Summary
Carvana Co. (CVNA) reported its financial results for the second quarter and first half of 2020. The company saw a significant increase in total net sales and operating revenues, driven by a 25.2% and 33.1% year-over-year increase in used vehicle unit sales for the three and six months ended June 30, 2020, respectively. This growth was attributed to expanded market reach and increased consumer acceptance of online car purchasing, partly accelerated by the COVID-19 pandemic and the company's "touchless delivery" process. Despite revenue growth, Carvana continued to incur net losses, with a net loss attributable to Carvana Co. of $40.8 million for the quarter and $100.7 million for the first half. The company's gross profit saw an increase, but total gross profit per unit decreased year-over-year, impacted by factors including increased average days to sale and a shift in vehicle mix. Selling, general, and administrative expenses also rose significantly, reflecting investments in market expansion and increased compensation. The company ended the period with a stronger liquidity position, including a substantial increase in cash and cash equivalents and significant availability under its revolving credit facilities, bolstered by a successful equity offering in the second quarter.
Financial Highlights
41 data points| Revenue | $1.12B |
| Cost of Revenue | $968.00M |
| Gross Profit | $150.00M |
| SG&A Expenses | $239.00M |
| Interest Expense | $20.00M |
| Net Income | -$41.00M |
| EPS (Basic) | $-0.62 |
| Shares Outstanding (Basic) | 66.33M |
Key Highlights
- 1Total net sales and operating revenues increased by 13.4% to $1.12 billion for Q2 2020 and 27.3% to $2.22 billion for the first six months of 2020, driven by higher used vehicle sales.
- 2Used vehicle unit sales grew by 25.2% in Q2 and 33.1% in the first six months of 2020 compared to the prior year, reaching 55,098 and 107,525 units respectively.
- 3Despite revenue growth, the company reported a net loss attributable to Carvana Co. of $40.8 million for Q2 2020 and $100.7 million for the first six months of 2020.
- 4Total gross profit increased by 9.0% in Q2 to $150.2 million and by 27.5% in the first six months to $288.6 million, however, total gross profit per unit decreased year-over-year.
- 5Selling, general, and administrative expenses increased significantly by 32.0% in Q2 and 52.6% in the first six months, driven by market expansion, increased compensation, and advertising.
- 6The company significantly strengthened its liquidity position, with cash and cash equivalents increasing to $246.3 million as of June 30, 2020, and substantial availability under its revolving credit facilities.
- 7Carvana expanded its market coverage, reaching 261 markets by June 30, 2020, up from 137 markets in the prior year, serving 73.2% of the U.S. population.