Carvana announced a groundbreaking year in 2023, marked by record financial performance and improvements in efficiency and profitability.
“2023 was an exceptional year for Carvana, where our deliberate focus on efficiency and profitability drove fundamental business improvements that not only led to our best-ever financial results but also increased customer NPS throughout the year,” said Ernie Garcia, Carvana founder and CEO. “Carvana is stronger than ever. We are beginning to demonstrate the differentiated profitability, efficiency and customer experience benefits of our vertically integrated approach, and have a clear path toward our goals of becoming the largest and most profitable automotive retailer and buying and selling millions of cars.”
The company sold 312,847 retail units, generating a total revenue of $10.771 billion for the full year. Carvana reported a record Total Gross Profit per Unit (GPU) of $5,511, an increase of $2,489 year-over-year, and a record Non-GAAP Total GPU of $5,984, up by $2,647 from the previous year.
Additionally, Carvana achieved a record net income of $150 million, partly fueled by a gain on debt reduction, and a record Adjusted EBITDA of $339 million.
In the fourth quarter of 2023 alone, Carvana sold 76,090 retail units, with total revenue reaching $2.424 billion.
It wasn't long ago Carvana was in the news for poor financial performance. In May 2022, it was reported the company's sales had dropped 7% in the first quarter, and it had lost $3,255 for every vehicle sold over the same period, as increasing car prices simply priced out many potential buyers. Carvana also laid off 2,500 employees.
Looking ahead to the first quarter of 2024, Carvana expects a slight year-over-year increase in retail units sold and a significant rise in Adjusted EBITDA, projecting it to be above $100 million. This forecast is based on early Q1 results, suggesting consistent Retail GPU compared to Q4 2023, with potential for improvement, and anticipated sequential increases in Wholesale GPU and Other GPU. Additionally, Carvana aims for a sequential reduction in SG&A expense per retail unit sold.
For the full year 2024, Carvana is optimistic about growing both retail units sold and Adjusted EBITDA compared to 2023.
