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Why Is Carvana (CVNA) Up 20.6% Since Last Earnings Report?
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It has been about a month since the last earnings report for Carvana (CVNA - Free Report) . Shares have added about 20.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Carvana due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Carvana Co. before we dive into how investors and analysts have reacted as of late.
Carvana Q2 Earnings Match Estimates
Carvana reported earnings of 42 cents per share for the second quarter of 2026, in line with the Zacks Consensus Estimate. Earnings rose 61.5% year over year. Revenues of $7.37 billion increased 52.4% year over year and topped the consensus mark of $6.99 billion by 5.5%. The top-line beat reflected record retail volume and strong vehicle pricing.
Retail Volume Reaches a Record
Retail vehicle sales increased 61.7% to $5.5 billion, supported by a 17.4% rise in revenue per retail unit to $27,908. Retail units sold advanced 37.7% to 197,325. Retail volumes have nearly doubled over the past two years and continued to outpace an industry that declined year over year. Wholesale sales and revenues grew 31.2% to $1.34 billion, while wholesale unit sales climbed 44.4% to 105,052.
Gross Profit Rises, GPU Declines
Total gross profit increased 30.1% to $1.38 billion. Retail vehicle gross profit rose 34.4% to $700 million, wholesale gross profit advanced 19.7% to $158 million and other gross profit grew 28.0% to $526 million.
However, total gross profit per unit fell $412 to $7,014, and non-GAAP GPU declined $455 to $7,125. On a sequential basis, total gross profit and non-GAAP GPU improved by $231 and $214, respectively.
Margins Reflect Growth Investments
Operating income increased to $680 million from $511 million, but adjusted EBITDA margin contracted to 10.4% from 12.4%. Adjusted EBITDA rose to $769 million from $601 million, showing strong dollar profit growth even as the margin narrowed.
Net income advanced 66.6% to $513 million. Selling, general and administrative expenses increased to $704 million from $551 million as advertising, logistics and other costs rose.
Carvana Expands Production Capacity
Inventory selection remains central to the company’s growth plan. Carvana integrated retail production capabilities at three additional ADESA sites during the quarter, bringing the total to 19, and began construction on its first full buildout at an ADESA location.
The current footprint provides fully built-out annual capacity for about 1.5 million retail units, with additional real estate available for expansion. The new full buildout is expected to begin producing vehicles in early 2027.
Cash and Liquidity
Cash and cash equivalents totaled $2.63 billion as of June 30, 2026, up from $2.32 billion at year-end 2025. Committed liquidity resources were $4.67 billion, while total liquidity resources increased to $7 billion from $6.74 billion. For the first six months of 2026, net cash provided by operating activities rose to $345 million from $261 million.
Full-Year EBITDA Outlook
For the third quarter, management expects retail units sold to increase sequentially from the second quarter. For full-year 2026, Carvana projects adjusted EBITDA of $2.7-$3 billion, compared with $2.24 billion in 2025. It also reiterated its long-term path toward selling 3 million vehicles annually and achieving a 13.5% adjusted EBITDA margin between 2030 and 2035.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a flat trend in estimates revision.
The consensus estimate has shifted 7.89% due to these changes.
VGM Scores
At this time, Carvana has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock has a grade of F on the value side, putting it in the fifth quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Carvana has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
View the Zacks #1 Rank List
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Why Is Carvana (CVNA) Up 20.6% Since Last Earnings Report?
It has been about a month since the last earnings report for Carvana (CVNA - Free Report) . Shares have added about 20.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Carvana due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Carvana Co. before we dive into how investors and analysts have reacted as of late.
Carvana Q2 Earnings Match Estimates
Carvana reported earnings of 42 cents per share for the second quarter of 2026, in line with the Zacks Consensus Estimate. Earnings rose 61.5% year over year. Revenues of $7.37 billion increased 52.4% year over year and topped the consensus mark of $6.99 billion by 5.5%. The top-line beat reflected record retail volume and strong vehicle pricing.
Retail Volume Reaches a Record
Retail vehicle sales increased 61.7% to $5.5 billion, supported by a 17.4% rise in revenue per retail unit to $27,908. Retail units sold advanced 37.7% to 197,325. Retail volumes have nearly doubled over the past two years and continued to outpace an industry that declined year over year. Wholesale sales and revenues grew 31.2% to $1.34 billion, while wholesale unit sales climbed 44.4% to 105,052.
Gross Profit Rises, GPU Declines
Total gross profit increased 30.1% to $1.38 billion. Retail vehicle gross profit rose 34.4% to $700 million, wholesale gross profit advanced 19.7% to $158 million and other gross profit grew 28.0% to $526 million.
However, total gross profit per unit fell $412 to $7,014, and non-GAAP GPU declined $455 to $7,125. On a sequential basis, total gross profit and non-GAAP GPU improved by $231 and $214, respectively.
Margins Reflect Growth Investments
Operating income increased to $680 million from $511 million, but adjusted EBITDA margin contracted to 10.4% from 12.4%. Adjusted EBITDA rose to $769 million from $601 million, showing strong dollar profit growth even as the margin narrowed.
Net income advanced 66.6% to $513 million. Selling, general and administrative expenses increased to $704 million from $551 million as advertising, logistics and other costs rose.
Carvana Expands Production Capacity
Inventory selection remains central to the company’s growth plan. Carvana integrated retail production capabilities at three additional ADESA sites during the quarter, bringing the total to 19, and began construction on its first full buildout at an ADESA location.
The current footprint provides fully built-out annual capacity for about 1.5 million retail units, with additional real estate available for expansion. The new full buildout is expected to begin producing vehicles in early 2027.
Cash and Liquidity
Cash and cash equivalents totaled $2.63 billion as of June 30, 2026, up from $2.32 billion at year-end 2025. Committed liquidity resources were $4.67 billion, while total liquidity resources increased to $7 billion from $6.74 billion. For the first six months of 2026, net cash provided by operating activities rose to $345 million from $261 million.
Full-Year EBITDA Outlook
For the third quarter, management expects retail units sold to increase sequentially from the second quarter. For full-year 2026, Carvana projects adjusted EBITDA of $2.7-$3 billion, compared with $2.24 billion in 2025. It also reiterated its long-term path toward selling 3 million vehicles annually and achieving a 13.5% adjusted EBITDA margin between 2030 and 2035.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a flat trend in estimates revision.
The consensus estimate has shifted 7.89% due to these changes.
VGM Scores
At this time, Carvana has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock has a grade of F on the value side, putting it in the fifth quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Carvana has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.