Carvana slips into bigger-than-expected loss as demand for used cars declines
Nov 3 (Reuters) – Carvana Co
The used-car retailer said retail units sold in the quarter fell 8% to 102,570 and it expects a further decline in the current quarter.
The boom in demand for personal transportation caused by the pandemic is faltering as rising inflation strains people’s pockets, prompting them to rethink expensive purchases.
In a letter to shareholders, Carvana said the monthly payment for a customer buying a typical car jumped 22% in 2022 from a year ago, significantly outpacing the spike in the cost of living.
Meanwhile, the company also faces growing macroeconomic pressures, global supply constraints and higher operating costs.
Carvana, famous for its car vending machines, earlier this year laid off around 2,500 employees, or 12% of its workforce, in a bid to cut costs among its other measures. Read more
According to Refinitiv, it posted a net loss of $2.67 per Class A share for the July-September quarter, higher than analysts’ estimates of a loss of $1.94 per Class A share.
Revenue of $3.39 billion also beat expectations of $3.71 billion.
Reporting by Shivansh Tiwary in Bengaluru; Editing by Shinjini Ganguli
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