February 23, 2023 – Carvana Co. (NYSE: CVNA), the leading e-commerce platform for buying and selling used cars online, today announced financial results for the quarter and full year ended December 31, 2022.
Carvana Co. (NYSE: CVNA) reported a Q4 net loss of $7.61 per share,Analysts polled by Capital IQ, had been expecting a $2.40 per share loss.
Summary of Q4 2022 and 2022 Results
Q4 2022 Financial Results:
Retail units sold totaled 86,977 a decrease of 23%.
Revenue totaled $2.837 billion, a decrease of 24%.
Total gross profit was $193 million, a decrease of 63%.
FY 2022 Financial Results:
Retail units sold totaled 412,296, a decrease of 3%.
Revenue totaled $13.604 billion, an increase of 6%.
Total gross profit was $1.246 billion, a decrease of 35%.
Total gross profit per unit was $3,022, a decrease of $1,515 , Non-GAAP Total GPU (defined above) was $3,337.
In FY 2022, we opened 5 markets, expanding our population coverage to 81.1%.
In Q4 2022, we opened our first inspection and reconditioning center (IRC) in California near Sacramento, bringing the total number of Carvana IRCs in operation to 17 at the end of 2022.
Our sequential retail unit reduction of 15% in Q4 was slightly larger than that of the used vehicle retail industry, which declined by 12% sequentially based on industry data sources.
The used vehicle industry is seasonal, with used vehicle demand typically highest from late Q1 through Q3 and lowest in Q4 and early Q1. The industry 12% sequential decline was in line with a normal Q4 seasonal range of 10% to 17% over the past ten years.
Inventory. We reduced our inventory by 27% in Q4, a significant acceleration compared to the 10% sequential reduction in Q3. We have continued to reduce inventory further in Q1 as we seek to normalize our inventory size in a high depreciation environment.
Q1 2023 Outlook
On retail units, we currently expect a sequential reduction in retail units sold in Q1 2023 compared to Q4 2022, as we continue to normalize our inventory size, optimize marketing spend, and make progress on our profitability initiatives.Through the first seven weeks of Q1, we have averaged ~5,600 retail units sold per week.
On GPU, we currently expect a sequential increase in Total GPU in Q1 2023 compared to Q4 2022.
On SG&A, we are currently targeting an aggregate ~$100 million reduction in quarterly Non-GAAP SG&A expense by Q2 2023, compared to Q4 2022.
For a complete list of our market opening history, estimated populations, and estimated total industry used vehicle sales by market, along with details on our IRCs, please see: https://investors.carvana.com/investor-resources/investor-materials
CARVANA CO. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS
About Carvana
Carvana (NYSE: CVNA) is an industry pioneer for buying and selling used vehicles online. As the fastest growing used automotive retailer in U.S. history, its proven, customer-first ecommerce model has positively impacted millions of people’s lives through more convenient, accessible and transparent experiences. Carvana.com allows someone to purchase a vehicle from the comfort of their home, completing the entire process online, benefiting from a 7-day money back guarantee, home delivery, nationwide inventory selection and more. Customers also have the option to sell or trade-in their vehicle across all Carvana locations, including its patented Car Vending Machines, in more than 300 U.S. markets. Carvana brings a continued focus on people-first values, industry-leading customer care, technology and innovation, and is the No. 2 automotive brand in the U.S., only behind Ford, on the Forbes 2022 Most Customer-Centric Companies List. Carvana is one of the four fastest companies to make the Fortune 500 and for more information, please visit www.carvana.com and follow us @Carvana.