Transportation

Carvana reports Q4, FY 2022 losses as car sales suffer

Image provided by Carvana.

February 24, 2023

Carvana, an e-commerce platform for buying and selling used cars online that offers a car vending machine, reported Q4 2022 sales and earnings declines while full year 2022 results were mixed, according to a shareholders letter.

Highlights include:

• Net sales fell 24%, from $3.75 billion in Q4 2021 to $2.83 billion in the three months ending Dec. 31, 2022.
• Net loss increased from $182 million to $1.44 billion in the comparative quarters.
• Net loss per share rose from $1.02 to $7.61 in the comparative quarters.
• Retail units sold decreased 23%, from 113,016 to 86,977 in the comparative quarters.
• Full year sales rose 6.2%, from $12.8 billion in 2021 to $13.6 billion in 2022.
• Retail unit sales fell 3% from 425,237 to 412,297 in the comparative years.
• Loss extended from $287 million to $2.9 million in the comparative years.
• Net loss per share rose from $1.63 to $15.73 in the comparative years.

Shares traded at $10.08 Thursday against a 52-week range of $3.55-$145.58.

The approximate $2.84 billion in quarterly revenue missed analyst expectations by $210 million while the non-GAAP EPS of a $7.61 loss missed expectations by $5.21, according to Seeking Alpha.

"It has undoubtedly been a challenging time, but like the challenges we have faced before, we are up to the task," Ernie Garcia, founder and CEO of Carvana, said in a press release. "Over the next six months, we will work to complete an estimated $1 billion in annual cost reduction and we will do it while not only maintaining, but actually improving our customer experiences.

"For Q1 2023, 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."