Carvana Co. (NYSE:CVNA) confirmed its once stellar growth has stalled as fourth-quarter revenues slumped while losses rose almost ten-fold.
Arizona-based Carvana pioneered online sales of used cars through its automated ‘car vending machines’, a market that boomed during Covid lockdowns when second-hand prices also soared due to semiconductor shortages hitting new car availability.
All that has changed, the company said, with losses in its latest quarter jumping to US$1.44bn from US$181mln a year ago while revenue fell 24% to US$2.84bn.
Carvana said it had significantly accelerated its stock reduction plan in the final three months of 2022, cutting its inventory by 27%, with more to come in the current quarter.
Ernie Garcia, chief executive, added that it had “undoubtedly been a challenging time” but the company aims to cut costs by US$1bn over the next six months.
Revenues for 2022 overall rose by 6% year-on-year to US$13.6bn, though cars sold dropped 3% to around 412,300.
Losses for the year were US$2.89bn (US$287mln).