Carvana showcased a strong performance in Q1, surpassing Wall Street expectations with record sales amid rising demand despite concerns about tariffs. CEO Arnie Garcia noted a minor shift in demand due to potential tariffs but downplayed their impact on the business. The 25% tariff on new imported vehicles doesn’t directly affect used car sales but influences the market dynamics.
Cox Automotive reported a surge in used car prices as consumers rushed to buy amid price fears. Carvana’s Q1 results included an earnings per share of $1.51, compared to the expected 67 cents, and revenue of $4.23 billion, up 38% year-on-year. The company also noted a net profit of $373 million, with significant contributions from fair value changes related to stock warrants.
Garcia outlined ambitious long-term goals, targeting the sale of 3 million retail units annually with a 13.5% adjusted EBITDA margin within 5-10 years. Following a challenging period marked by restructuring and concerns over bankruptcy, Carvana aims for sustainable growth while balancing margins. The company’s shares have risen about 27% this year.
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