Debt-heavy Carvana Co. said Thursday it expects to achieve an adjusted profit above $50 million in its second quarter, an announcement that sent its share price soaring.
The online used-vehicle retailer — which has in the last several months scaled back its growth endeavors, trimmed inventory and worked to reduce its cash burn to focus on improving profitability in a more volatile sales environment — also said it expects to take in adjusted total gross profit per vehicle of more than $6,000 in the second quarter.
Carvana shares surged 56 percent to $24.27 at the Thursday market close. A year earlier, the stock traded at about $25 a share after peaking above $360 in 2021.
Share prices of online used-vehicle retailers Vroom Inc. and Shift Technologies Inc. also rose following Carvana's announcement. Vroom shares closed Thursday at $1.15, up 21 percent; and Shift Technologies shares closed at $1.90, up 11 percent.
Carvana's estimated adjusted earnings before interest, taxes, depreciation and amortization of more than $50 million in the second quarter would be a swing from the adjusted EBITDA loss of $239 million it reported in the same period a year earlier. The company recorded a net loss of $439 million in the second quarter of 2022 and a net loss of $2.89 billion for the full year.
