Carvana released its first quarter financial results last week and they paint quite a picture for the automotive ecommerce platform. Carvana reported 46 percent year-over-year growth in retail units sold during Q1 2025, reaching an all-time high of 133,898 vehicles.
This milestone was paired with a 38 percent increase in total revenue, resulting in $4.2 billion for the quarter. The company’s success wasn’t limited to just sales volume either. Q1 also saw Carvana achieve record profitability metrics. Net income was $373 million, marking an 8.8 percent net income margin while adjusted EBITDA was $488 million, with an 11.5% adjusted EBITDA margin. GAAP operating income was $394 million, translating to a 9.3% operating margin. All of this comes just a year after the company posted its first ever profitable quarter.
“In Q1, Carvana set a new record for retail units while also driving record profitability and hitting our highest customer net promoter score in nearly three years,” said Ernie Garcia, Carvana founder and CEO. “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.”
A Roadmap for Continued Success
Carvana attributes much of this success to its ability to scale its operations while meeting the growing demand for its online platform. Since 2022, it has improved fulfillment speed, cutting average delivery time in half, while also improving the customer experience with self-service digital tools. Most importantly for profitability, operational spend per unit has been reduced by nearly 50 percent and total advertising spend is down 45 percent, all while sales continue to rise.
Looking ahead to Q2 2025, Carvana anticipates a sequential increase in retail units sold and adjusted EBITDA, projecting that both will reach all-time highs yet again. The company’s leadership remains confident in its long-term strategy, signaling not only sustainable growth but also its readiness to outperform industry expectations.
“As Carvana grows larger and more efficient, we look forward to making our offering even faster and more convenient,” said Garcia. “And sharing the value we create with our customers as we continue our mission of changing the way people buy and sell cars.”
Long-Term Objectives
Carvana’s leadership has now set its sights on achieving a new ambitious milestone over the next five to ten years. The company aims to sell 3 million retail units annually while attaining a 13.5 percent adjusted EBITDA margin. This long-term goal reflects Carvana’s confidence in its business model, but also its ability to attract a growing customer base that favors online transactions. The growth has been further supported by a market that is focused on pricing and increasingly looking at used cars as that affordable alternative. In Q1, used car sales were up 10 percent quarter over quarter according to Lotlinx.
In a letter to shareholders, Garcia emphasized Carvana’s focus to continue enhancing operational efficiency, reducing costs, and improving customer experiences. The company’s strategy involves leveraging its purpose-built infrastructure and proprietary technology to streamline transactions and deliver convenience on an even larger scale. With continued fleet expansion and improved logistics, Carvana hopes to position itself as a leader in automotive ecommerce.
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