Carvana Co.

Good day and welcome to the Carvana third quarter 2021 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Mike Levin, Vice President of Investor Relations. Please go ahead.

Thank you, Matt. Good afternoon, ladies and gentlemen, and thank you for joining us on Carvana's third quarter 2021 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 on the 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 factor section of Carvan'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 Carvan assumes no obligation to update or revise them, whether as a result of new developments or otherwise. Unless otherwise noted on today's call, all comparisons are on a year-over-year basis. Our commentary today will include non-GAAP financial measures. Reconciliations between GAAP and non-GAAP metrics for our reporter results can be found in our shareholder letter issued today, a copy of which can be found on our investor relations website. And now, with that said, I'd like to turn the call over to Ernie Garcia. Ernie?

Thanks, Mike. Thanks, everyone, for joining the call. The third quarter was another great quarter for Carvana as we continued our march toward becoming the largest and most profitable automotive retailer. We sold over 110,000 cars to customers, recorded nearly $3.5 billion of revenue, grew total gross profit by 100%, and had our second consecutive quarter of positive EBITDA. Our team delivered these strong numbers despite entering the quarter with significant operational constraints, facing the Delta COVID wave that peaked late in the quarter, and despite making the choice to meter both retail and purchasing volume, which we implemented mid-quarter to ease pressure on the system while we operationally catch up to demand we're seeing. Since the onset of the pandemic, we found ourselves constrained in various parts of our operational chain. While those constraints have held us back relative to where we might have otherwise been, our team has done an exceptional job and has made tremendous progress throughout. In fact, in the third quarter, we bought and sold over three times as many cars as we did in the third quarter of 2019 prior to the pandemic, and roughly eight times as many as we did in the third quarter of 2018. This has all been possible because we have continued to focus on the long run. We've continued to invest in the people, technology, and infrastructure that are necessary to buy and sell millions of cars per year while delivering the exceptional customer experiences we've become known for. Given our opportunity, we believe this is clearly the right choice. To everyone across Carvana that's worked so hard to make our continual progress possible, thank you. We've also recently entered into two exciting partnerships with Root and with Hertz that we discuss in more detail in our shareholder letter. While the potential of these opportunities is significant, they're both at their very early stages, so we plan to share additional details on our product, financial, and scale ambitions with respect to these partnerships over time and will not be providing meaningful additional color at this time. These partnerships are each very exciting. Each has excellent underlying fundamentals and therefore excellent potential, but they're also exciting because of what they represent. As we continue building the Carvana platform to deliver exceptional customer experiences and to handle the constantly increasing scale, our horizontal and vertical opportunities continue to increase. As has been the case since our inception, to maximize our opportunity, we must thoughtfully assess and continually increase the capacity of the business to effectively manage our growth and to simultaneously explore these opportunities. And then we must appropriately balance our ambition for both scale and scope with the focus necessary to make constant forward progress. So far, we'd like to think our team has done a good job at building more capacity in the business to tackle these opportunities and at managing these tradeoffs given the capacity we have. To build Carvana into what it can be, we'll need to continue to spend energy getting this right in the future, and we plan to. Looking forward, we remain extremely excited. We've reached the scale of over 100,000 cars and 3.5 billion of revenue per quarter, yet we're still only approximately 1% of the overall market. Our focus today is the exact same as it was at the very beginning. It remains on our customers, on the experiences we give them, on maximizing the value we provide to them, on leveraging technology to minimize our costs, on building for scale, and on doing all of that with a long-term perspective so we can maximize our opportunity. The march continues. Mark?