NEW YORK, May 15, 2018 (GLOBE NEWSWIRE) -- DropCar Inc. (NASDAQ:DCAR), the provider of app-based mobility services and logistics for automotive consumers and enterprises, today announced its results for the quarter ended March 31, 2018.
DropCar B2B
DropCar's enterprise (B2B) segment grew its revenues 139% year-over-year in Q1, driven by organic growth of existing enterprise customers and the onboarding of new top-tier automotive partners, particularly in the car sharing segment.
Mercedes Benz, the first of DropCar's four Tier-One corporate customers, increased its volume by 46% YoY during the first quarter of 2018. Meanwhile, during the second half of Q1, DropCar began generating revenues from its third and fourth Tier-One corporate B2B customers.
DropCar also added a number of automotive clients during the first quarter, including the largest global dealer of an undisclosed Top-5 car brand (based on calendar Q1 2018 unit sales according to Focus2Move.com's Global Auto Database). Along these lines, the ramps of multiple automotive clients over the last few quarters drove ~240% YoY growth in B2B job volumes.
Looking forward, B2B is expected to be a prominent source of growth, both in terms of scale and scope. The Company's Tier-One enterprise partners are anchoring DropCar's expansion into new big cities, where consumer services will subsequently be layered on, so that performance equilibrium (i.e., the optimal balance between consumer and B2B) can be achieved.
In addition, management expects B2B will drive growth beyond car movements and client engagement services. As an example, DropCar believes that it has an opportunity to monetize its big data analytics, mined from its more than approximately 220,000 transactions (consumer and B2B) since inception.
DropCar's Consumer Segments
Q1 was strategically successful for DropCar's consumer segments (WILL and STEVE), in terms of positioning, market testing, and price discovery. In early January 2018, DropCar increased its base STEVE subscription rate from $349 to $379 per month.
While STEVE experienced an initial churn increase (due to price sensitivity at the margins), subscriber retention rates normalized by the end of Q1, and new subscriber growth has since resumed. Along these lines, STEVE's Q1 revenues grew 140%+ YoY (versus Q1-2017) and 10%+ sequentially (versus Q4-2017).
Looking forward, management expects STEVE will experience seasonal growth from Memorial Day through Labor Day. Moreover, as DropCar's software and data-analytics teams increasingly identify and deploy new efficiency initiatives (with enhancements such as dynamic pre-assignment and weather-enhanced demand forecasting), management expects to see improvements in efficiency (e.g. volume-per-valet) and performance metrics.
In addition, DropCar expects to roll out expanded car-care features (such as car washing, fueling, dent repair, and oil changes), which are less time-sensitive and can be fulfilled during periods of lower demand intensity, to further improve valet utilization levels.
B2B Opportunities in the Real Estate Sector
The success of shared workspaces (e.g. WeWork) and expanding commercial business district (CBD) density trends (e.g., employees per square foot), are straining fixed parking supplies in major CBD markets beyond New York.
While driving is not the primary nor pragmatic commuting option in New York City, it is far more important in major CBDs such as Chicago, Los Angeles, Boston, Philadelphia, Washington DC, San Francisco, and Dallas. As a result, employee parking is increasingly becoming a key differentiator when it comes to signing commercial tenants in major CBDs.
Accordingly, DropCar is experiencing growing inbound interest for our virtual garage and car care services, from commercial real estate landlords who are scrambling to deal with these parking challenges in major CBDs beyond New York.
Abbreviated First Quarter Financial Results
Please note Q1 was abbreviated for the WPCS contracting segment, in light of DropCar's reverse-merger that was completed on January 30, 2018. Moreover, Q1 financial results included a number of non-recurring items relating to the merger and the subsequent $6 million private placement in early March.
For interested individuals unable to join the live event, a replay will be available until 8/15/18 (17:00PM EDT). To access the recording, dial toll-free (domestic) 877-481-4010 or (internationally) 919-882-2331. The replay passcode is 32991.
Investor Relations Contact
Daniel Gelbtuch, VP of Corporate Finance for DropCar
[email protected] (917) 509-9582
Media Contact
John Williams, Scoville PR for DropCar
[email protected] (206) 625-0075
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