Carvana Co (NYSE:CVNA) stock fell 14.48% (As on February 20, 11:18:01 AM UTC-4, Source: Google Finance) after the company reported lower gross profit per vehicle and shrinking wholesale volumes for the latest quarter. The Tempe, Arizona-based company made $359 million in adjusted earnings before interest, taxes, depreciation and amortization in the three months ended Dec. 31, above both analysts’ expectations for $330 million and the $60 million it earned a year ago. Revenue came to $3.55 billion (+46% YoY), surpassing consensus estimates for $3.3 billion. Carvana posted earnings per share of 56 cents for the latest quarter, above analysts consensus forecast for adjusted EPS of 32 cents and unadjusted of 31 cents.

Moreover, in 2024, Carvana sold 416,348 retail units (+33% YoY) for record total annual revenue of $13.67 billion (+27% YoY). In Q4, Carvana sold 114,379 retail units (+50% YoY). For 2024, its adjusted EBITDA came in at $1.38 billion and net income at $404 million. The company has delivered substantial cost efficiency improvements as it reduced full year GAAP SG&A and Non-GAAP SG&A expense per unit by $1,240 and $1,014 year-over-year, respectively, delivered record low full year Advertising expense per unit of $550, a 25% decrease year-over-year and reduced Carvana Operations expense per unit by over $300 year-over-year in Q4 ○ Reduced Overhead expense per unit by over $550 year-over-year in Q4. Further, the company has deepened the integration between Carvana and ADESA as it integrated Carvana IRC operations at 6 of 56 ADESA locations and leveraged Carvana technology and analytical tools to launch new digital offerings for wholesale customers. The company has reduced average delivery time ~20% year-over-year in Q4.

While Carvana projected stronger sales volumes and adjusted earnings for this year, it showed signs of weakness at both the retail and wholesale levels that could presage lower-margin growth. Revenue per vehicle fell by $1,000 a car to just over $22,000 in the latest quarter, pushing down retail gross profit per unit by $270 to $3,226. At the wholesale level, gross profit per vehicle came to $674 — missing analysts’ forecast for $714 and below the previous quarter’s $930. Wholesale volumes undershot the consensus outlook by 3,248 vehicles. Total Gross profit was $763 million, an increase of 90%.

Looking ahead, the company said it is positioned “well for a strong 2025.” The company added that it sees “significant growth” in both retail units sold and adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, in full year 2025.