CVNA Q4 2023 Earnings

Call Details

• Call Title: Carvana Q4 2023 Earnings Call
• Date: February 22, 2024 at 10:30 PM UTC
• Management Team:
  • Ernie Garcia (Chief Executive Officer)
  • Mark Jenkins (Chief Financial Officer)
  • Meg Kehan (Investor Relations)

Call Summary

Financial Performance

• Total revenue in Q4 was $2.424 billion, a decrease of 13% sequentially.
• Retail units sold declined by 6% sequentially, which the company stated was in line with its outlook.
• Non-GAAP total GPU was $5,730 in Q4, a sequential decrease of $666 versus Q3.
• Non-GAAP retail GPU was $2,970 in Q4 versus $2,877 in Q3, marking a company record for retail GPU.
• Non-GAAP wholesale GPU was $881 in Q4 versus $951 in Q3, with sequential uplifts attributed to seasonality expectations in Q1.
• Non-GAAP SG&A expense was $376 million in Q4 versus $370 million in Q3, with the sequential change driven by the absence of a small non-recurring benefit in Q3 and small incremental expenses in Q4.
• Adjusted EBITDA was $60 million in Q4, a new fourth quarter company record, following a FY 2023 improvement in adjusted EBITDA of nearly $1.4 billion.

Guidance

• For Q1 2024, the company expects retail units sold to be slightly up year-over-year, assuming the environment remains stable.
• For Q1 2024, the company expects adjusted EBITDA to be significantly above $100 million, which the company equates to significantly above $1,200 per retail unit sold.
• The Q1 outlook explicitly does not anticipate any material one-time benefits or costs.
• For FY 2024, the company expects both retail units sold and adjusted EBITDA to grow compared to FY 2023.
• The company stated confidence in Q1 results driven by trends observed early in the quarter, while maintaining quarterly reporting cadence rather than providing multi-quarter numeric cadence beyond Q1.
• Guidance is repeatedly conditioned on a stable macro and industry environment, with multiple references to the phrase 'as long as the environment remains stable.'