CarParts.com said Wednesday (March 5) that it has engaged a financial advisor and legal counsel to support its exploration of strategic alternatives, including a possible sale of the company.
The eCommerce seller of automotive parts and accessories began this process after receiving inbound strategic inquiries, it said in a Wednesday press release.
CarParts.com said in the release that it has not set a timeline for completion of the process, that there is no certainty that the process will result in any strategic change, and that it does not intend to provide updates on the process unless and until it enters into definitive agreements or otherwise determines that further disclosure is required by law.
“Over the last five years, we have made significant investments in building a vertically integrated supply chain with a nationwide fulfillment network to support our best-in-class eCommerce experience, mobile app, as well as our marketplace business,” CarParts.com CEO David Meniane said in the release. “Our future as an independent company is bright. At the same time, we are committed to evaluating a range of strategic alternatives to maximize value for our shareholders.”
When reporting its third quarter financial results in October, CarParts.com said its net sales declined 13% compared to the same quarter the previous year, dropping to $144.8 million, and had a net loss of $10 million.
The company said in an Oct. 29 press release that the sales decrease was driven by deliberate price increases to focus on higher value customers, support gross margin expansion, and deal with a continued challenging consumer environment in the industry and one-time impacts from the CrowdStrike issue and hurricanes Helene and Milton.
Despite these challenges, the number of cumulative downloads of the company’s mobile app more than doubled at the start of the year to surpass 550,000.
Meniane said during an Oct. 29 earnings call that the company had been working on re-platforming CarParts.com to increase performance and shorten its development cycles.
“We expect to emerge from this transition period, positioned to capture the growing opportunity in front of us within a fragmented and underserved $400 billion auto parts market,” Meniane said during the call. “Customers value our offering, and our business model is highly differentiated, scalable and difficult to replicate.”
CarParts.com will report its fourth quarter 2024 financial results March 25.
