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- Carvana crushes Q1 with 46% sales surge
Driving the news: Carvana $CVNA ( ▲ 6.66% ) shattered Q1 forecasts, posting $4.23 billion in revenue (versus $3.98 billion expected) and $1.51 earnings per share (more than double the $0.67 forecast).
The company set multiple financial records, including $373 million in net income, $488 million in adjusted EBITDA, and $394 million in operating income.
The only retailer also delivered nearly 134,000 vehicles, a 46% jump from last year.
Why it matters: Carvana's impressive performance comes as the used vehicle market experiences significant pricing pressure. Cox Automotive reported used vehicle values jumped to their highest level since October 2023 as dealers and consumers rushed purchases amid fears of tariff-related price hikes.
But between the lines: CEO Ernie Garcia downplayed potential impacts of automotive tariffs on the business, noting only "little gyrations" of demand that have since stabilized. He suggested price increases could potentially benefit used car sales, despite concerns in the broader market.
Big picture: After previously facing bankruptcy a few years ago, Carvana has undergone massive restructuring to lower costs and increase efficiency. Now the company is setting ambitious long-term goals, aiming to sell 3 million retail units annually at a 13.5% adjusted EBITDA margin within 5-10 years.
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