Summary
Carvana Co. (CVNA) reported significant year-over-year growth in its first quarter of 2018, demonstrating strong momentum in the online used car market. The company saw a substantial increase in total net sales and operating revenues, growing by 126.6% to $360.4 million, primarily driven by a 125.1% surge in used vehicle sales. This growth was fueled by a 121.6% increase in retail unit sales, reaching 18,464 vehicles, and an expansion of its market footprint to 56 from 23 in the prior year. Despite the impressive revenue and unit sales growth, Carvana continued to operate at a net loss. The company's net loss widened to $52.7 million from $38.4 million in the prior year's first quarter, reflecting aggressive investments in growth initiatives, including expanded advertising, increased headcount, and new market openings. The increase in selling, general, and administrative (SG&A) expenses was substantial, supporting the company's ambitious expansion strategy. Investors should monitor the company's ability to scale its operations efficiently and improve profitability amidst this rapid expansion.
Financial Highlights
40 data pointsKey Highlights
- 1Total net sales and operating revenues surged by 126.6% to $360.4 million compared to the prior year's first quarter.
- 2Retail unit sales more than doubled, increasing by 121.6% to 18,464 vehicles, indicating strong customer adoption of the online car buying model.
- 3The company significantly expanded its market presence, growing from 23 markets at the end of Q1 2017 to 56 markets by the end of Q1 2018.
- 4Total gross profit increased by 251.3% to $34.2 million, with used vehicle gross profit showing a strong 259.8% increase, and total gross profit per unit rising to $1,854 from $1,169.
- 5Selling, General, and Administrative (SG&A) expenses rose by 80.9% to $83.2 million, reflecting significant investments in advertising, personnel, and infrastructure to support rapid growth.
- 6The company reported a net loss of $52.7 million for the quarter, an increase from $38.4 million in the same period last year, highlighting ongoing investment in growth over profitability.
- 7Carvana completed a follow-on public offering on April 30, 2018, raising approximately $173.3 million to fund general corporate purposes and support business expansion.