Carvana's first-quarter results significantly surpassed Wall Street projections, driven by record sales figures. The online used vehicle retailer reported strong performance in the first three months of 2025, exceeding average analyst estimates compiled by LSEG.
The company reported earnings per share of $1.51, compared to the expected 67 cents. Revenue reached $4.23 billion, surpassing the $3.98 billion anticipated.
Revenue increased 38% year over year from $3.06 billion. Retail unit sales saw a 46% rise during the period, totaling nearly 134,000 units. The company also reported record net income of $373 million, adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, of $488 million, and operating income of $394 million.
Net income benefited from approximately $158 million tied to positive changes in the fair value of warrants to acquire common stock of Carvana partner Root auto insurance.
Carvana provided an update on its long-term objectives and quarterly guidance. The second quarter guidance projects a sequential increase in both retail units sold and adjusted EBITDA. A new management objective aims to sell 3 million retail units annually at an adjusted EBITDA margin of 13.5% within the next five to 10 years.
Shares of Carvana are up approximately 27% this year. The company has undergone a restructuring effort focused on lowering costs and increasing efficiency.
The company's earnings release and shareholder letter did not discuss potential impacts from automotive tariffs. Changes in new vehicle prices, production, and demand affect the used car market, even though tariffs do not directly impact used car sales.
During the company's fourth-quarter call in February, CEO Ernie Garcia declined specific comments on tariff impacts beyond an expectation that new car prices could rise. This could indirectly lead to "dampened price increase" in used vehicles.
A barometer for used vehicle pricing saw a rise last month to its highest level since October 2023, according to Cox Automotive. This occurred as consumers reportedly moved up purchases amid concerns over price increases potentially linked to auto tariffs.
"We are incredibly well positioned for the path ahead and have very clear visibility to even stronger financial performance, much larger scales, and even better customer experiences," Carvana CEO and cofounder Ernie Garcia said in a release.
