Carvana Co. (NYSE:CVNA) shares raced ahead on Thursday as anticipation grew before its latest earnings report, and investors were not disappointed.
The prominent online used car dealer said its third-quarter 2023 financial results set new records for key performance indicators as a strong focus on profitability paid off with impressive results.
That offset any disappointment surrounding Carvana’s revenue decline, with the company reporting $2.8 billion for 3Q compared to $3.4 billion in the same year-ago quarter as the number of retail vehicle units dropped to around 81,000.
Shares of Carvana, which rose over 15% on Wednesday, added another 4% after the bell.
During the three-month period to end September 2023, Carvana posted a record third quarter total Gross Profit Per Unit (GPU) of $5,952, marking a 70% year-over-year increase.
Additionally, the company reached a record 3Q non-GAAP total GPU of $6,396, representing a 65% year-over-year growth.
Adjusted EBITDA came in at $148 million, marking the second consecutive quarter in which Carvana achieved more than $100 million in Adjusted EBITDA.
"We have always believed Carvana will be the largest and most profitable automotive retailer, and our focus on unit economics over the past several quarters led to Q3 results that clearly validate the differentiation and profitability potential of our business model,” Ernie Garcia, CEO of Carvana said in a statement.
Looking ahead to 4Q 2023, Carvana said it anticipates a sequential decline in retail units sold, influenced by industry and seasonal patterns. That said, it is forecasting Non-GAAP Total GPU of more than $5,000 for the third consecutive quarter and positive Adjusted EBITDA for the third consecutive quarter.