The online used vehicle marketplace reported quarterly earnings Wednesday (Oct. 28) showing $8 billion in revenue, a 42% increase year over year.
“In the last two years, we have doubled the number of customers we serve while continuing to lead the industry in unit economics and giving value back to our customers by offering twice the selection, faster deliveries, and lower interest rates on their loans,” Carvana founder and CEO Ernie Garcia said in a news release. “We are just beginning to realize the potential of the machine we are building.”
Part of that machine runs on agentic artificial intelligence (AI), Garcia told analysts during the question and answer session of the company’s earnings call.
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For one thing, agentic AI “pushes more people in the direction of digital transactions,” while also bringing digital friction down to zero while leaving physical friction mostly unchanged.
Analyst Michael Baker of D.A. Davidson wanted to know what Carvana might need to invest in to take advantage of the technology, noting that when he asked an agent to find him a used car, Carvana’s competitors showed up in a number of results.
“We think we’ve got to make our cars readily available,” Garcia said. “We’ve got to make sure we’re pushing out data in all the ways that these different bots can see it. We’ve got to make sure that we continue to scale and get our information out there, and I think there’s lots of things that go into that. But I think the great news is that the bigger we get, the more often we’re going to show up in all those different places.”
Outside of raw unit growth, Chief Financial Officer Mark Jenkins and Garcia detailed several key drivers powering the top-line revenue expansion. Revenue growth outpaced unit growth in the quarter as Carvana intentionally expanded its inventory of higher-priced, late-model vehicles to meet rising demand among prime credit buyers.
PYMNTS wrote earlier this year about the increasing role of artificial intelligence within car dealerships, with 57% of dealership staff now report using AI tools in some aspect of their work.
While much of the early deployment is concentrated in communication-heavy processes the technology is also burrowing deeper into dealership management systems, pricing tools and service operations.
“As car buying increasingly begins online, dealers are adopting AI systems that help them respond faster to potential customers, prioritize the most promising leads and automate administrative tasks that once consumed hours of staff time,” that report said.
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