The vehicle will be on display at the Calvana Dealer in Austin, Texas on February 20, 2023.
Brandon Bell | Getty Images
Detroit – Carbana The first quarter results easily smashed Wall Street expectations as businesses reported record sales due to industry demand exceeded expectations amid concerns over price increases due to car tariffs.
Here’s how the company performed in the first quarter compared to the average estimate compiled by LSEG:
- Earnings per share: Expected $1.51 vs 67 cents
- Revenue: Expected to be $4.23 billion vs. $3.98 billion
Online used car retailers reported an increase of around 134,000 units, up 46% year-on-year for the first three months of the year. Carvana also reported a record of net profit of $373 million. Revenue adjusted prior to $488 million in interest, tax, depreciation, amortization, or EBITDA. Operating profit of $394 million.
The company said its net income benefited from approximately $158 million related to a positive change in the fair value of the warrant to acquire common stock of Calvana Partners. root Auto insurance.
Revenues of $4.23 billion increased 38% year-on-year from $3.06 billion.
Carvana, which normally does not offer detailed annual targets, also updated its long-term goals and quarterly guidance on Wednesday.
The second quarter guidance includes “continuous increases in both sales and adjusted EBITDA retail units,” with the new “management goal” being to sell 3 million retail units per year with an adjusted EBITDA margin of 13.5% within five to ten years.
Carvana vs. Other Auto Retailer Stocks
“We are positioned incredibly well for the path ahead, and we are very clear about stronger financial performance, much larger scale and even better customer experiences,” Carvana CEO and co-founder Ernie Garcia said in the release.
Carvana’s shares have grown about 27% this year. This is because they benefited from years of restructuring to reduce costs and increase efficiency.
Calvana did not discuss the potential impact of tariffs on shareholder letters or announcements of revenue. Investors monitor comments about the company’s quarterly revenue calls.
The 25% tariff on new imported vehicles and many parts does not directly affect the sales of used cars, but changes in new vehicle prices, production and demand will affect the used car market.
Garcia declined to comment on the potential impact other than the possibility of new car prices rising.
“The general issue is that we run our business with the idea of running like in other years,” Garcia said at the time. “And we think that’s the smartest thing, because there’s exactly a lot of uncertainty about how this will unfold.”
Cox Automotive reported that its meticulous barometer of used car pricing jumped to its highest level last month since October 2023 and October 2023 as consumers rushed to buy amid fears of rising prices due to car rates.
