Carvana’s record quarterly results top Wall Street expectations

Carvana’s record quarterly results top Wall Street expectations


Vehicles are seen on display at a Carvana dealership in Austin, Texas, on Feb. 20, 2023.

Brandon Bell | Getty Images

DETROIT — Carvana’s first-quarter results easily topped Wall Street’s expectations as the company reported record sales driven by higher-than-expected industry demand amid fears of price increases due to automotive tariffs.

Carvana CEO and co-founder Ernie Garcia loosely addressed potential impacts of tariffs on the business, saying the company experienced “little gyrations” of demand that have since leveled off. He downplayed the idea that the levies would have any material impact on its business that the company can’t handle.

“I don’t think we have too much interesting there,” Garcia said Wednesday during the company’s quarterly call, adding that pricing may increase and could potentially be beneficial for used car sales.

While the tariffs of 25% on new imported vehicles and many parts do not directly impact used car sales, changes in new vehicle prices, production and demand affect the used car market.

A closely watched barometer for used vehicle pricing jumped last month to its highest level since October 2023 as dealers and consumers rushed purchases amid fears of price hikes due to auto tariffs, Cox Automotive reported earlier Wednesday.

Here’s how the company performed in the first quarter, compared with average estimates compiled by LSEG:

  • Earnings per share: $1.51 vs. 67 cents expected
  • Revenue: $4.23 billion vs. $3.98 billion expected

The online used vehicle retailer reported a 46% increase in year-over-year sales during the first three months of the year to nearly 134,000 units. Carvana also reported records of net income of $373 million; adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, of $488 million; and operating income of $394 million.

The company said its net income benefitted from roughly from $158 million associated with positive changes in the fair value of its warrants to acquire common stock of Carvana partner Root auto insurance.

Revenue of $4.23 billion was up 38% year over year from $3.06 billion.

Stock Chart IconStock chart icon

hide content

Carvana vs. other auto retailer shares

Carvana, which doesn’t typically provide detailed annual targets, on Wednesday also updated its long-term objectives and quarterly guidance.

Its second-quarter guidance includes a “sequential increase in both retail units sold and adjusted EBITDA,” while the new “management objective” is to sell 3 million retail units per year at an adjusted EBITDA margin of 13.5% within five to 10 years.

“We are incredibly well positioned for the path ahead and have very clear visibility to even stronger financial performance, much larger scales, and even better customer experiences,” Garcia said in a release.

Garcia told investors the goal is “very exciting and very achievable,” while noting that the company will prioritize “growth over margin within reasonable margin ranges.”

The company’s return to growth comes several years after concerns that Carvana was close to bankruptcy as it focused on growth and mismanaged inventories during the coronavirus pandemic in 2021 to 2022.

Since then, the company has benefitted from a years-long restructuring to lower costs and increase efficiency, including shares of the company increasing roughly 27% this year.



Source

High Noon recalls some 12-packs, saying they may contain Celsius energy drink cans filled with vodka seltzer
Business

High Noon recalls some 12-packs, saying they may contain Celsius energy drink cans filled with vodka seltzer

High Noon vodka seltzer and Celsius energy drinks. Kevin Carter | David Paul Morris | Bloomberg | Getty Images High Noon has issued a nationwide recall of one of its popular vodka seltzer drinks, saying some packages may contain Celsius energy drink cans filled with the alcoholic beverage. The cans, labeled as Celsius Astro Vibe […]

Read More
Apartment rents drop in July as vacancies move to multiyear high
Business

Apartment rents drop in July as vacancies move to multiyear high

A sign on the side of a building in Hell’s Kitchen, New York City, advertising an apartment is available for rent through a real estate broker.  Deb Cohn-Orbach | UCG | Universal Images Group | Getty Images The massive surge of new apartment supply in the last few years is still being absorbed, and that […]

Read More
Ford Motor is set to report earnings after the bell. Here’s what Wall Street expects
Business

Ford Motor is set to report earnings after the bell. Here’s what Wall Street expects

The Ford display is seen at the New York International Auto Show on April 16, 2025. Danielle DeVries | CNBC Ford Motor is set to report its second-quarter earnings after the markets close Wednesday as investors watch for any changes to its full-year guidance, which the automaker suspended in May due to President Donald Trump’s […]

Read More