Carvana Co. (CVNA) Q3 2023 Earnings Call Transcript

For the period ending September 30, 2023

November 2, 2023 5:30 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day, and welcome to the Carvana, Third Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. Please note, this event is being recorded.

I would now like to turn the conference over to Meg Kehan, Investor Relations. Please go ahead.

Meg Kehan

Thank you, Varsh. Good afternoon, ladies and gentlemen, and thank you for joining us on Carvana's third quarter 2023 earnings conference call. Please note that this call will be simultaneously webcast on the Investor Relations section of the company's corporate website at investors.carvana.com.

The third quarter shareholder letter is also posted to the IR website. Additionally, we posted two sets of supplemental financial tables for Q3, which can be found on the Events and Presentations page of our IR website. Joining me on the call today are Ernie Garcia, Chief Executive Officer; and Mark Jenkins, Chief Financial Officer.

Before we start, I would like to remind you that the following discussion contains forward-looking statements within the meaning of the federal securities laws, including, but not limited to Carvana's market opportunities and future financial results that involve risks and uncertainties that may cause actual results to differ materially from those discussed here.

A detailed discussion of the material factors that cause actual results to differ from forward-looking statements can be found in the Risk Factors section of Carvana's most recent Form 10-K and Form 10-Q.

The forward-looking statements and risks in this conference call are based on current expectations as of today, and Carvana assumes no obligation to update or revise them whether as a result of new developments or otherwise.

Our commentary today will include non-GAAP financial metrics. Unless otherwise specified, all references to GPU and SG&A will be to the non-GAAP metrics and all references to EBITDA will be to adjusted EBITDA. Reconciliations between GAAP and non-GAAP metrics for our reported results can be found in our shareholder letter issued today, a copy of which can be found on our IR website.

With that said, I'd like to turn the call over to Ernie Garcia. Ernie?

Ernie Garcia

Thanks, Meg, and thanks everyone for joining the call. The third quarter was another great quarter for Carvana that continued the clear momentum we've had since we rolled out our plan 18 months ago. Over that period of time we have cut $1.2 billion in annualized SG&A expenses out of the business, which has dramatically improved our efficiency, while also reducing annualized inbound transport and reconditioning COGs expenses by about $250 million annualized, which has driven up our GPU.