Online used-vehicle retailer Carvana reported its first quarterly profit since going public in April 2017.
The company posted net income of $45 million in the second quarter, a turnaround from a loss of $106 million in the year-earlier period.
Carvana has boosted unit sales and revenue by triple digits in several quarters over the last several years while aggressively expanding. Critics have in the past noted that the company was not profitable, but investors have so far bet that it would achieve profitability once it reached scale.
In the second quarter, Carvana sold 107,815 retail units, nearly double what it sold in the same period last year. Revenue nearly tripled to $3.3 billion. It marked the first quarter that retail unit sales topped 100,000 and that revenue exceeded $3 billion.
In a letter to shareholders, the company said it would have sold more vehicles if it had had more cars and trucks to market, reflecting low inventories that have dogged most auto retailers in the U.S.
Carvana said that scaling vehicle production, or reconditioning used vehicles, as quickly as possible remains a priority for the company. It opened its 13th inspection and reconditioning center during the second quarter, in Cleveland, and plans to open eight more such facilities by the end of 2022.
Carvana’s total gross profit per unit was $5,120 in the second quarter, compared with $2,726 in the year-earlier period and $3,656 in the first quarter of 2021. Retail gross profit per unit was $2,022, vs. $1,190 in the year-earlier period and $1,211 in the first quarter of this year, and was driven in part by a higher customer-sourced ratio, higher used-vehicle prices and operational efficiency.
Carvana added 27 new markets during the quarter and said it covered 79.4 percent of the U.S. population at the end of the period. It’s since opened two more markets, giving it a total of 301.
Shares of Carvana jumped 11 percent in after-hours trading to $375.
Carvana, of Tempe, Ariz., ranks No. 2 on Automotive News’ list of the top 100 retailers ranked by used-vehicle sales, retailing 244,111 used vehicles in 2020.