Auto Trader Group PLC (LSE:AUTO) shares fell almost 10% after it posted full-year results that showed slower growth in retail sales and car stock in the second half of its financial year.
The automotive sales platform reported a 5% increase in group revenue to £601.1 million for the year to 31 March 2025.
Revenue from the core Auto Trader business rose 7% to £564.8 million, with retailer revenue growing 7%, the number of retailer forecourts increasing 2% and average revenue per retailer (ARPR) up 5% to £2,854 per month.
ARPR rose 6.3% in the first half of the year but the outlook at the time was not strong.
Live car stock was up 1% to 449,000 vehicles, down from the 2% increase in the first half.
Operating profit rose 8% to £376.8 million, slowing from the 14% growth in the first half. Losses at Autorama narrowed to £4.3 million as revenue fell 12% to £36.3 million.
The impact of the UK's Digital Services Tax was recognised for the first time with a £10.2 million charge to operating expenses in the year.
Auto Trader launched Co-Driver, a new suite of AI-powered features aimed at improving the advertising process for retailers and enhancing the experience for car buyers.
Chief executive Nathan Coe said: "We remain confident in the outlook for the business given our strong market position, the value we deliver for customers, and our unique data and technology capabilities."
For the new financial year, he expects retailer revenue growth to improve between 5% and 7%, supported by pricing, product enhancements and stabilising stock levels. Growth is anticipated to be stronger in the second half of the year, benefiting the start of FY27.
The shares fell 88p to 812p in early trading on Thursday, wiping out most of the 13% gain since the start of the year.
** Update: Adds share price detail **