CarGurus Inc. has reported a significant decline in net income and revenue for the second quarter. The company’s net income dropped 23 percent to $13.8 million, and overall revenue decreased by 53 percent to $239.7 million. CEO Jason Trevisan stated that efforts to stabilize the digital wholesale segment have shown some improvement, although digital wholesale revenue still plummeted by 80 percent to $68.8 million.

CarOffer, CarGurus’ wholesale digital trading platform, played a major role in the decline of the digital wholesale segment. The segment suffered a second-quarter operating loss of $6.3 million, doubling the loss from the previous year.

However, the company’s U.S. marketplace business reported a 3.7 percent growth in revenue, reaching $158.4 million. Trevisan attributed this growth to increased sales and price adjustments targeting both new and existing dealers. The operating income for this segment was $24.6 million, down 13 percent from the same period last year.

Despite the decline in net income and revenue, CarGurus’ stock has rebounded after initially dropping over 15 percent following the delayed release of its second-quarter earnings. The company has made efforts to improve its digital wholesale segment by reducing volumes and enhancing operational aspects to better handle price fluctuations.

As of June 30, CarGurus had 31,097 paying dealers, with 24,220 dealers in the U.S. and 6,877 internationally. The average revenue per subscribing dealer in the U.S. increased by 6 percent to $6,110 compared to the previous year. However, the number of transactions decreased by 68 percent in the second quarter, totaling 20,793.

Q2 revenue: $239.7 million, down 53 percent from a year earlier

Q2 consolidated net income: $13.8 million, down 23 percent from a year earlier

Q2 adjusted EBITDA: $45.2 million, down 26 percent from a year earlier

Guidance: For the third quarter, the company expects revenue of $201 million to $221 million, product revenue of $15 million to $25 million, and non-GAAP consolidated adjusted earnings before interest, taxes, depreciation, and amortization of $36 million to $44 million.