PHOENIX - Carvana Co. (NYSE: NYSE:CVNA), a leader in the online used car retail space, has reached a significant milestone with over 2 million cars sold and an equal number purchased from customers since its inception in 2013. The company, known for its online car buying and selling platform, has become synonymous with the shift toward e-commerce in the automotive retail industry.
The company sold its one-millionth vehicle in Q4 2021 and achieved the two-millionth sale in Q3 2024, showcasing a rapid adoption rate among consumers. Carvana's buying service has also seen accelerated growth, purchasing its one-millionth car from a customer in Q1 2022 and its two-millionth in Q2 2024.
Carvana's customer base spans across demographics, with individuals aged 18 to over 90 and budgets ranging from $6,000 to $175,000. The company has facilitated vehicle deliveries or pickups in nearly every zip code with more than 5,000 residents in the contiguous United States.
Despite its rapid growth and having sold and bought 4 million cars in just over 11 years, Carvana's market share stands at approximately 1%. This points to a significant growth opportunity, as e-commerce penetration in the used car market is also around 1%, compared to double-digit percentages in other consumer sectors.
Carvana's founder and CEO, Ernie Garcia, remarked on the achievement, stating the company's commitment to providing a seamless e-commerce experience for automotive retail and its pursuit of becoming the leading and most profitable automotive retailer.
The company's vertically integrated business model and technology-driven approach have contributed to its success, distinguishing it as a Fortune 500 company and earning recognition from Forbes as one of America's Best Employers.
Carvana's progress is indicative of a broader trend towards online vehicle transactions, with the company poised to capitalize on the expanding market. This news is based on a press release statement from Carvana.
In other recent news, Carvana's third-quarter unit sales projections have been raised to 107.8 thousand units, marking an increase of 33% year-over-year, according to Citi's research. The company's operational efficiencies have been cited as key contributors to this growth. However, Citi maintains a neutral stance on Carvana, despite the positive adjustments. In related developments, Evercore ISI has kept its In-Line rating for Carvana, noting industry trends such as CarMax (NYSE:KMX)'s earnings release and a decline in consumer confidence. BNP Paribas (OTC:BNPQY) Exane also maintained a neutral stance on Carvana's shares, highlighting its significant relationship with Ally Financial (NYSE:ALLY). On the other hand, BofA Securities reinstated coverage on Carvana with a Buy rating, citing potential for long-term growth in the used car market. Carvana's management has projected a year-over-year growth rate of over 25% for third-quarter unit sales and EBITDA for 2024 between $1 billion and $1.2 billion, surpassing the consensus estimate of $890 million. These recent developments highlight the ongoing financial assessments and expectations surrounding Carvana.
InvestingPro Insights
Carvana's remarkable growth trajectory, as evidenced by its recent milestone of 2 million cars sold and purchased, is reflected in its financial performance. According to InvestingPro data, the company's revenue for the last twelve months as of Q2 2024 stood at $11.67 billion, with a quarterly revenue growth of 14.89% in Q2 2024. This aligns with the company's rapid expansion and increasing market penetration described in the article.
The company's improving profitability is noteworthy, with an operating income margin of 3.48% for the last twelve months as of Q2 2024. This improvement is particularly significant given Carvana's historical focus on growth over profitability. An InvestingPro Tip highlights that analysts predict the company will be profitable this year, which could mark a turning point in Carvana's financial narrative.
Investors have taken notice of Carvana's progress, with the stock showing a strong return of 363.1% over the past year. This performance aligns with the company's operational achievements mentioned in the article. Another relevant InvestingPro Tip indicates that Carvana is trading near its 52-week high, reflecting market optimism about its business model and growth prospects.
For readers interested in a deeper analysis, InvestingPro offers 19 additional tips for Carvana, providing a comprehensive view of the company's financial health and market position.
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