On Thursday, TrueCar not only reported that it suffered a $14.7 million loss during the second quarter, but the company also said its founder, chief executive officer and chairman Scott Painter will step down as CEO later this year.
The company indicated Painter will retire when his successor takes office, which is expected to occur by year-end. TrueCar also mentioned Painter will continue to serve as chairman of TrueCar’s board of directors.
“After a decade of building TrueCar from an idea into a public company, I have come to the conclusion reached by many founders and entrepreneurs in my position: It is time for a change,” Painter said in a release that included details of the soft second-quarter performance that company officials alerted the investment community was coming.
“On behalf of the board of directors, I want to thank Scott for the creativity and vision he has demonstrated during the last decade in founding the company and leading it through its public offering,” said Todd Bradley, a member of TrueCar’s board of directors.
“We are grateful to Scott for the leadership demonstrated by making this difficult decision,” Bradley continued.
The news of Painter’s departure comes amid of flurry of activity regarding TrueCar and large dealer groups. Not only did TrueCar and AutoNation part ways at the end of the July, the company also settled a trademark dispute with Sonic Automotive.
And along with Painter’s move, TrueCar announced that Christopher Claus, former president of USAA Financial Advice & Solutions Group and a current director of TrueCar, has been named lead independent director. The company explained Claus will focus on the board’s search committee to find a new CEO as well as building deeper ties with USAA.
“I am honored to begin serving as the lead independent director and look forward to working closely with the leadership team to build upon and execute the vision that Scott has created, as well as maintain a strong partnership with the company’s largest affinity partner, USAA,” Claus said.
TrueCar’s leadership will have to steer the company through some difficult times. The company’s Q2 financial statement included nearly a $15 million net loss.
That said, the company reported an increase to $65.3 million in revenue, up from $50.5 million during Q2 of 2014.
“It was a tough quarter in relation to our initial guidance,” TrueCar chief financial officer Mike Guthrie said. “Notwithstanding that, we achieved notable successes.
“Traffic grew by 42 percent to 6 million unique visitors, and TrueCar Certified Dealers transacted a total of 190,358 vehicles on the platform, a quarterly record,” Guthrie continued. “New-car transactions represented 4 percent of total U.S. retail sales in the quarter.”
Editor’s note: Look for more coverage of developments at TrueCar coming in future editions of Auto Remarketing Today.