DALY CITY, CA — Shares of Carvana rose as much as 14% in after-hours trading Wednesday after the company beat Wall Street expectations for the second quarter and forecast record adjusted earnings for 2024.
Second Quarter Performance Highlights
Carvana reported solid second-quarter results, significantly beating analysts’ forecasts as compiled by LSEG:
- Earnings per share (EPS): 14 cents versus an expected loss of 7 cents
- Income: $3.41 billion versus the expected $3.24 billion
This solid performance was fueled by a 32.5% year-over-year increase in retail sales, with more than 101,400 Carvana vehicles sold during the quarter.
Share Offering Announcement
Concurrent with the earnings report, Carvana announced an open market offering of approximately $1 billion in stock, equivalent to approximately 35 million shares.
Gross profit and future prospects
The company reported gross profit per unit (GPU) of $7,049, up $529 from the prior year. Based on these promising results, Carvana expects adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to reach between $1 billion and $1.2 billion in 2024, up from $339 million in 2023.
Carvana’s forecast calls for a positive second half of the year, with expectations for sequential growth in retail vehicle sales in the third quarter.
CEO Vision
In a joint letter to shareholders, CEO and co-founder Ernie Garcia, along with CFO Mark Jenkins, expressed optimism about the company’s future:
“Looking forward, our business still has a lot of untapped potential. And our team is still untapped. We see opportunities for significant improvement over time.”
Financial Milestones
Carvana’s net income for the second quarter was $48 million, with a net income margin of 1.4%. Adjusted EBITDA for the quarter was a record $355 million, with an adjusted EBITDA margin of 10.4%.
The impressive second-quarter results signal a continued turnaround for Carvana, which had faced concerns about potential insolvency in early 2022.
