Carvana Co. · NYSE:CVNA
Carvana — J.P. Morgan Automotive Conference 2023
20 slides from Carvana's conference presentation, Aug 9, 2023
Slide 1: J.P. Morgan Automotive Conference
J.P. Morgan Automotive Conference August 9, 2023 August 2023 ©2023 Carvana, LLC
Slide 2: Safe Harbor
Safe Harbor Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Carvana’s current expectations and projections with respect to, among other things, our fi
Slide 3: History of Carvana
History of Carvana 1 2013 - 2021: The Growth Phase 2 2022: Challenges 3 2023: Profitability Focus ● Disrupted a $1T highly fragmented industry by ● Unforeseen macroeconomic and ● Cut ~$1.1B of annualized SG&A expense offering a simple and seamless car buying industry dynamics including resulting in
Slide 4: 2023: Getting Back on Trend
2023: Getting Back on Trend Continued focus on more profitable transactions, operational efficiencies, and cost reductions drove improvements in our Q2 2023 financial results. ©2023 Carvana, LLC Confidential Document 4
Slide 5: Part 1: Fundamental Gains in Retail GPU
Part 1: Fundamental Gains in Retail GPU
Slide 6: #1: Normalizing retail inventory size
#1: Normalizing retail inventory size • Over the last three quarters, we have made significant gains normalizing our inventory size and selling through aged inventory, leading to a ~40 day sequential reduction in average days to sale (ADTS) on retail units sold in Q2 and an expected further reductio
Slide 7: #2: Significant and sustainable cost improvements
#2: Significant and sustainable cost improvements • Retail reconditioning and inbound transport cost reductions vs. FY 2021 have been driven by several fundamental improvements, including: • (1) in-sourcing third-party services, • (2) staffing normalization, • (3) process standardization, • (4) prop
Slide 8: #3: Expanding buying cars from customers
#3: Expanding buying cars from customers Our seamless online and mobile appraisal offering and efficient local delivery network has led to significant gains in retail customer-sourcing over the past several years. • Since FY 2021, in addition to growing our customer-sourced ratio, we have also made
Slide 9: #4: Enabling additional revenue streams from value-added services
#4: Enabling additional revenue streams from value-added services Our first-party logistics network makes industry-leading selection available to our customers, while also enabling additional revenue streams from long-distance shipping and delivery services. 1 1 Local market inventory sourced from C
Slide 10: Retail GPU Fundamental Gains Summary
Retail GPU Fundamental Gains Summary Since FY 2021, we have made significant fundamental gains that positively impact Retail GPU, and we see further opportunities from here. ©2023 Carvana, LLC Confidential Document 10
Slide 11: Part 2: Fundamental Gains in Wholesale GPU
Part 2: Fundamental Gains in Wholesale GPU
Slide 12: #1: Leveraging our wholesale platform
#1: Leveraging our wholesale platform The ADESA wholesale marketplace platform has grown since our acquisition, and our teams are making significant progress leveraging the ADESA footprint to drive efficiencies in Carvana’s wholesale vehicle sales. ADESA Acquisition FY21 avg. In order to clearly dem
Slide 13: #2: Significant customer-sourced wholesale vehicle volume and GPU opportunity
#2: Significant customer-sourced wholesale vehicle volume and GPU opportunity We currently source and sell ~30% as many wholesale units as the largest U.S. dealer wholesaler, up from less than 10% in 2019. We see a significant opportunity to expand our wholesale offering to serve more individual and
Slide 14: #3: Large volume and profit opportunity at ADESA
#3: Large volume and profit opportunity at ADESA The wholesale used vehicle auction industry is beginning to rebound from lows so far in 2023. A return to pre-pandemic volume would mean +50% industry unit growth from 2022 levels. This plus opportunities to gain market share yield significant opportu
Slide 15: Updated Q3 2023 Outlook
Updated Q3 2023 Outlook We are seeing positive operating and loan sales trends early in the quarter and as a result are updating our third quarter outlook: Initial Q3 2023 Outlook Updated Q3 2023 Outlook Retail Units Similar to Q2 2023 No change from initial outlook Non-GAAP Total GPU Above $5,000 A
Slide 16: Non-GAAP Financial Measures
Non-GAAP Financial Measures As appropriate, we supplement our results of operations determined in accordance with U.S. generally accepted accounting principles (“GAAP”) with and discuss forward looking guidance with certain non-GAAP financial measurements that are used by management, and which we be
Slide 17: Non-GAAP Financial Measures
Non-GAAP Financial Measures ©2023 Carvana, LLC Confidential Document 17
Slide 18: Non-GAAP Financial Measures
Non-GAAP Financial Measures ©2023 Carvana, LLC Confidential Document 18
Slide 19: Non-GAAP Financial Measures
Non-GAAP Financial Measures ©2023 Carvana, LLC Confidential Document 19
Slide 20: Non-GAAP Financial Measures
Non-GAAP Financial Measures ©2023 Carvana, LLC Confidential Document 20