Auto Trader, the UK’s largest digital automotive marketplace, has released its full year results and announced that total group revenue and average revenue per retailer both grew by 5%.
Operating profit increased 8% and basic earnings per share increased 12% and Auto Trader expects a slight improvement in revenue growth in the coming year.
Charlie Huggins, Manager of the Quality Shares Portfolio at Wealth Club said, “Auto Trader’s revenue growth slowed to 5% in fiscal year 25, held back by a reduction in the number of retailer paid stock units.
This, ironically, was a result of a buoyant used car market, meaning demand significantly outstripped supply. As a result, cars are selling like hot cakes, reducing the need for retailers to buy advertising slots from Auto Trader.
These dynamics have continued into the new year, meaning Auto Trader expects retailer revenue growth of 5-7% in FY26. This is below analysts’ expectations.
Overall, Auto Trader maintains an incredibly strong market position and the used car market remains in good shape. At some point, demand for used cars will moderate and supply constraints will ease, which should feed through to stronger revenue growth for Auto Trader.
For now though, market conditions aren’t overly favourable. This means investors will likely need to moderate their growth expectations for the coming year.”
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