Shares of Carvana (NYSE) surged in after-hours trading as the company posted yet another industry-leading quarter. Carvana’s Q3 adjusted EBITDA once again set a record high. It achieved an impressive adjusted EBITDA margin of 11.7%, the highest among public automotive retailers. This margin has more than doubled from a year ago and exceeded analyst expectations.
Carvana founder and CEO, Ernie Garcia, stated that the company’s strong results reinforce its status as the fastest-growing and most profitable automotive retailer. He added that Q3’s achievements highlight the strength of Carvana’s vertically integrated business model. Garcia also noted that the results begin to show the potential of Carvana’s unique infrastructure, including the ADESA network.
In the third quarter, Carvana reported a 34% increase in vehicles sold. This growth drove total revenue up by 32%, reaching $3.655 billion. Earnings per share (EPS) rose to $0.64, well above Wall Street’s estimate of $0.23. Gross profit per vehicle also climbed by $1,289 to $7,427, exceeding the $6,505 consensus estimate.
Looking ahead to Q4, Carvana anticipates vehicle sales growth to exceed the 34% gain seen in Q3. Additionally, the company expects full-year 2024 adjusted EBITDA to be significantly above the high end of its projected $1.0 billion to $1.2 billion range.
Carvana shares raced higher, last trading up by 22%, which also lifted shares of competitors like CarMax (KMX) and Penske Automotive (PAG).
