CarGurus, Inc. Stock Compensation Disclosure

11. Stock‑based Compensation

CarGurus, Inc. 2017 Equity Incentive Plan

In October 2017 the Board adopted, and the Company’s stockholders approved, the Company’s Omnibus Incentive Compensation Plan (the “2017 Plan”) for the purpose of granting incentive stock options, non-qualified stock options, stock awards, stock units, other share-based awards, and cash awards to employees, advisors, and consultants to the Company and its subsidiaries and non-employee members of the Board. The 2017 Plan authorizes the issuance or transfer of the sum of: (i) 7,800,000 shares of Class A common stock, plus (ii) the number of shares of Class A common stock (up to 4,500,000 shares) equal to the sum of (x) the number of shares of Class A common stock and Class B common stock of the Company subject to outstanding awards under the Company’s 2015 Equity Incentive Plan, as amended (the “2015 Plan”), as of October 10, 2017, that terminate, expire, or are canceled, forfeited, exchanged, or surrendered on or after October 10, 2017, without having been exercised, vested, or paid prior to October 10, 2017, including shares tendered or withheld to satisfy tax withholding obligations with respect to outstanding grants under the 2015 Plan, plus (y) the number of shares of Class A common stock reserved for issuance under the 2015 Plan that remained available for grant under the 2015 Plan as of October 10, 2017. The aggregate number of shares of Class A common stock that may be issued or transferred under the 2017 Plan pursuant to incentive stock options will not exceed 12,300,000 shares of Class A common stock. Any shares withheld to satisfy tax withholding obligations return to the authorized, but unissued, pool under the 2017 Plan and can be reissued by the Company. In conjunction with the adoption of the 2017 Plan, options and RSUs that were outstanding at that time under the 2015 Plan remained outstanding but no additional grants may be made from the 2015 Plan.

Unless determined otherwise by the Compensation Committee of the Board, as of the first trading day of January of each calendar year during the term of the 2017 Plan (excluding any extensions), beginning with calendar year 2019, an additional number of shares of Class A common stock will be added to the number of shares of Class A common stock authorized to be issued or transferred under the 2017 Plan and the number of shares authorized to be issued or transferred pursuant to incentive stock options, equal to 4% of the total number of shares of Class A common stock outstanding on the last trading day in December of the immediately preceding calendar year, or 6,000,000 shares, whichever is less, or such lesser amount as determined by the Board (the “Evergreen Increase”). The Compensation Committee of the Board determined to not effectuate the Evergreen Increase that was otherwise scheduled to have occurred on each of January 2, 2019, January 2, 2020, January 4, 2021, January 2, 2025, and January 2, 2026. On January 3, 2022, January 3, 2023, and January 2, 2024, an additional 4,070,921, 4,065,466, and 3,687,010 shares of Class A Common Stock, respectively, was authorized to be issued or transferred under the 2017 Plan pursuant to the Evergreen Increase.

As of December 31, 2025, 7,955,891 shares of Class A common stock were available for issuance under the 2017 Plan.

CarGurus, Inc. 2015 Equity Incentive Plan

The 2015 Plan provided for the issuance of stock-based incentives to employees, consultants, and non-employee directors. The 2015 Plan authorized the issuance of up to an aggregate of (i) 3,181,740 shares of Class A common stock and (ii) 5,161,644 shares of Class B common stock. The Company has not made any awards pursuant to the 2015 Plan since the Company’s stockholders approved the 2017 Plan.

Stock Options

During the years ended December 31, 2024 and 2023, there were no options granted.

During the years ended December 31, 2024 and 2023, the aggregate intrinsic value for options exercised was $5.9 million and $0.2 million, respectively.

As of December 31, 2025, there was immaterial unrecognized stock-based compensation expense related to unvested stock options that is expected to be recognized over a weighted-average period of 0.1 years.

Restricted Stock Units

During the years ended December 31, 2024 and 2023, the weighted-average grant-date fair value of RSUs granted was $23.98 and $17.47 per share, respectively.

During the years ended December 31, 2024 and 2023, RSUs that vested and settled totaled 2,793,920 and 2,440,510, respectively.

During both the years ended December 31, 2024 and 2023, the total fair value of RSUs vested was $65.5 million.

As of December 31, 2025, there was $97.3 million of unrecognized stock-based compensation expense related to unvested RSUs that is expected to be recognized over a weighted-average period of 2.6 years.

Stock-based Compensation Expense

For the years ended December 31, 2025, 2024, and 2023, stock-based compensation expense by where the stock-based compensation expense was recognized in the Company’s consolidated income statements was as follows:

For the years ended December 31, 2025, 2024, and 2023, consolidated stock-based compensation expense excluded $6.7 million, $6.5 million, and $5.5 million, respectively, of capitalized website development costs, capitalized internal-use software costs, and capitalized hosting arrangements. For the years ended December 31, 2025, 2024, and 2023, stock-based compensation expense from continuing operations excluded $6.5 million, $6.2 million, and $5.4 million, respectively, of capitalized website development costs, capitalized internal-use software costs, and capitalized hosting arrangements.

For the year ended December 31, 2025, the income tax benefit related to consolidated stock-based compensation was $3.5 million, partially recognized in the provision for income taxes and partially in net loss from discontinued operations, net of tax benefits on the consolidated income statements. For the years ended December 31, 2024 and 2023, the income tax expense related to consolidated stock-based compensation was $1.1 million and $5.5 million, respectively, partially recognized in the provision for income taxes and partially in net loss from discontinued operations, net of tax benefits on the consolidated income statements.

For the year ended December 31, 2025, the income tax benefit related to stock-based compensation from continuing operations was $3.5 million, recognized in the provision for income taxes on the consolidated income statements. For the years ended December 31, 2024 and 2023, the income tax expense related to stock-based compensation from continuing operations was $0.9 million and $5.6 million, respectively, recognized in the provision for income taxes on the consolidated income statements.

2023 CarOffer Transaction

In connection with the 2023 CarOffer Transaction, the Company redeemed all remaining holders of noncontrolling interests (“Noncontrolling Interest Units”), certain of which were employee owned. For the year ended December 31, 2023, the Company paid $29.0 million for the Noncontrolling Interest Units that were employee owned and accounted for this portion of the 2023 CarOffer Transaction as stock-based compensation in its income statements from discontinued operations. For all other Noncontrolling Interest Units, the Company reduced the remaining redeemable noncontrolling interest to zero and recorded excess cash paid to these unit holders as a deemed dividend of $5.8 million for the year ended December 31, 2023.

As part of the 2023 CarOffer Transaction, all unvested incentive units of CarOffer (“CO Incentive Units”) and unvested Class CO CarOffer units (the “Subject Units”) were modified such that any remaining unvested units received accelerated vesting. The Company purchased all outstanding CO Incentive and Subject Units and recognized approximately $20.7 million of stock-based compensation in its income statements from discontinued operations for the year ended December 31, 2023.

Common Stock Reserved for Future Issuance

Common Stock Share Repurchase Programs

In November 2024 the Company announced that the Board authorized a program to purchase up to $200.0 million of its Class A common stock (the “Original 2025 Share Repurchase Program”). In August 2025 the Company announced that the Board amended the Original 2025 Share Repurchase Program to increase the authorization by an additional $150.0 million, for a total authorization to purchase up to $350.0 million of its Class A common stock, and extended the expiration of the Original 2025 Share Repurchase Program from December 31, 2025 to July 31, 2026 (as amended, the “2025 Share Repurchase Program”). The 2025 Share Repurchase Program was completed in November 2025. All repurchased shares under the 2025 Share Repurchase Program were retired. The Company funded share repurchases under the 2025 Share Repurchase Program through cash on hand and cash generated from operations.

In November 2023 the Company announced that the Board authorized a program to purchase up to $250.0 million of its Class A common stock, which expired on December 31, 2024 (the “2024 Share Repurchase Program”).

In December 2022 the Company announced that the Board authorized a program to purchase up to $250.0 million of its Class A common stock, which expired on December 31, 2023 (the “2022 Share Repurchase Program”).

During the year ended December 31, 2025, the Company repurchased and retired 10,723,839 shares for $350.0 million, exclusive of commissions and excise tax, at an average cost of $32.65 per share, under the 2025 Share Repurchase Program.

During the year ended December 31, 2024, the Company repurchased and retired 6,357,302 shares for $146.1 million, exclusive of commissions and excise tax, at an average cost of $22.98 per share, under the 2024 Share Repurchase Program.

During the year ended December 31, 2023, the Company repurchased and retired 11,076,755 shares for $204.1 million, exclusive of commissions and excise tax, at an average cost of $18.43 per share, under the 2022 Share Repurchase Program.