By Maria Armental
KAR Auction Services Inc. has withdrawn its financial projections for the year, citing a chip shortage and related lack of visibility into used vehicle volumes in its marketplaces.
The company said it expects $95 million to $100 million in third-quarter adjusted earnings before interest, taxes, depreciation, and amortization, or adjusted Ebitda, and about 2.6 million vehicles sold in 2021.
KAR, which is slated to hold its analyst day on Tuesday, said it expects to see a cyclical recovery in commercial volumes.
Long term, it said it expects to sell 4.25 million vehicles in 2025 and revenue of $3.4 billion to $3.5 billion in 2025, along with $750 million to $800 million in adjusted Ebitda for 2025.
“Although the current operating environment is challenged due to semiconductor shortage related impacts on used vehicle volumes in our marketplaces, we are excited for future opportunities once our markets recover,” Chief Executive Peter Kelly said in a statement.
Write to Maria Armental at maria.armental@wsj.com
