(1) Amounts for periods prior to the initial public offering have been retrospectively adjusted to give effect to 15.0 million shares of Class A common stock issued in the initial public offering and the Organizational Transactions described in Note 1.

(2) Weighted-average shares of Class A common stock outstanding have been adjusted for unvested restricted stock awards.

to fund growth into new markets, fund construction of vending machines and enhance technology and software development efforts, it needs access to substantial capital. From inception, the Company has funded operations through the sale of Class A Units, the sale of Class C Redeemable Preferred Units, capital contributions from DriveTime, its IPO completed on May 3, 2017 for net proceeds of approximately ~~$205.9~~$205.8 million, ~~the sale~~its issuance of Class ~~C Redeemable~~A Convertible Preferred ~~Units, capital contributions from DriveTime~~Stock on December 5, 2017 for net proceeds of approximately $98.5 million, and short-term funding from the Company’s majority owner. Additionally, the Company completed an offering of its Class A common stock on April 30, 2018 for net proceeds of approximately $173.3 million after deducting underwriting discounts and commissions but before deducting estimated offering expenses. The Company has historically funded vehicle inventory purchases through its Floor Plan Facility, described in further detail in Note 7 — Debt Instruments, and ~~has~~had approximately ~~$79.9~~$1.5 million available under the Floor Plan Facility to fund future vehicle inventory purchases as of ~~September 30, 2017.~~March 31, 2018. The Company plans to increase the amount and extend the maturity date of financing available to purchase vehicle inventory by amending its existing Floor Plan Facility or by entering into a new agreement prior to the maturity date of the Floor Plan Facility. The Company has also funded ~~some~~certain of its capital expenditures through long-term financing with third parties as described in further detail in Note 7 —

who trade-in their existing vehicles that do not meet the Company’s quality standards to list and sell through its website. The Company satisfies its performance obligation for wholesale vehicle sales when the wholesale purchaser obtains control of the underlying vehicle, which is upon delivery when the transfer of title, risks and rewards of ownership and control pass to the customer. The Company recognizes revenue at the amount it expects to receive for the used vehicle, which is the fixed price determined at the auction. The purchase price of the wholesale vehicle is typically due and collected within 30 days of delivery of the wholesale vehicle.

NOTE 4 — ACCOUNTS PAYABLE AND OTHER ACCRUED LIABILITIES

NOTE 6 — FINANCE RECEIVABLE SALE AGREEMENTS

$1.5 billion. Also on November 3, 2017, the Company terminated the remaining capacity under the 2016 Master Transfer Agreement and replaced this facility by entering into a new master transfer agreement (the "2017 Master Transfer Agreement") with a third party under which the third party has committed to purchase up to an aggregate of approximately $357.1 million in principal balances of finance receivables.

NOTE 8 — STOCKHOLDERS' EQUITY

NOTE 9 — NON-CONTROLLING INTERESTS

~~CARVANA CO. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)~~

~~(Unaudited)~~

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Numerator:
Net loss $ (39,769 ) $ (21,985 ) $ (117,078 ) $ (57,418 )
Less: Net loss attributable to non-controlling interests (35,389 ) (19,589 ) (104,232 ) (51,159 )
Net loss attributable to Carvana Co., basic and diluted $ (4,380 ) $ (2,396 ) $ (12,846 ) $ (6,259 )
Denominator:
Weighted-average shares of Class A common stock outstanding 15,520
15,000
15,254
15,000
Less: unvested weighted-average restricted stock awards 475
—
230
—
Weighted-average shares of Class A common stock to compute basic and diluted net loss per Class A common share 15,045
15,000
15,024
15,000
Net loss per share of Class A common stock, basic and diluted $ (0.29 ) $ (0.16 ) $ (0.86 ) $ (0.42 )

~~CARVANA CO. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)~~

~~(Unaudited)~~

institution was approximately $1.0 million and $2.0 ~~million.~~million, respectively. This balance is classified as restricted cash in the accompanying unaudited condensed consolidated balance sheets.

As of December 31, ~~2016:~~2017:



	Carrying Value		Level 1		Level 2		Level 3
Assets:
Money market funds ⁽¹⁾	$	171,859	$	171,859	$	—	$	—

Carrying Value Level 1 Level 2 Level 3
Assets:
Money market funds ⁽¹⁾
$ 20,088
$ 20,088
$ —
$ —

~~___________________________~~_________________________

(1) ~~Classified~~Consists of highly liquid investments with original maturities of three months or less and classified in cash and cash equivalents in the accompanying unaudited condensed consolidated balance sheets.

~~(2) Classified as other assets in the accompanying unaudited condensed consolidated balance sheet and as a component~~

Fair Value of ~~other sales and revenues in the accompanying unaudited condensed consolidated statements of operations.~~Financial Instruments

The fair value of the purchase price adjustment receivable is determined based on the extent to which the Company’s estimated performance of the underlying finance receivables exceeds the purchaser’s estimated performance of the underlying finance receivables as of measurement dates specified in the Master Purchase and Sale Agreement. The Company develops its estimate of future cumulative losses based on the historical performance of finance receivables it originated with similar characteristics as well as general macro-economic trends. The Company then utilizes a discounted cash flow model to calculate the present value of the expected future payment amounts. Such fair value measurement is considered Level 3 under the fair value hierarchy.

The carrying amounts of restricted cash, accounts receivable, accounts payable and accrued liabilities and accounts payable to related party approximate fair value because their respective maturities are less than three months. The carrying value of the Floor Plan Facility was determined to approximate fair value due to its short-term duration and variable interest rate that approximates prevailing interest rates as of each reporting period. The carrying value of notes payable was determined to approximate fair value as each of the notes has prevailing interest rates, which have not materially changed as of ~~September 30, 2017.~~March 31, 2018. The carrying value of finance leases was determined to approximate fair value as each of the transactions was entered into at prevailing interest rates during each respective period. The fair value of finance receivables, ~~net~~which are not carried at fair value on the accompanying unaudited condensed consolidated balance sheets, was determined ~~to be approximately $39.1 million and $25.6 million as of September 30, 2017 and December 31, 2016, respectively,~~ utilizing the estimated sales price based on the historical experience of the Company. Such fair value measurement of the finance receivables, net is considered Level 2 under the fair value hierarchy. The carrying value and fair value of the finance receivables as of March 31, 2018 and December 31, 2017 were as follows (in thousands):



	March 31, 2018		December 31, 2017
Carrying value	$	62,490	$	45,564
Fair value	65,233		47,514

~~NOTE 15 — SUBSEQUENT EVENTS~~

~~LLC Unit Exchanges~~

Subsequent to September 30, 2017, certain LLC Unitholders have collectively exchanged approximately 0.5 million LLC Units of Carvana Group together with approximately 0.4 million shares of Carvana Co.'s Class B common stock for approximately 0.4 million shares of Carvana Co.'s Class A common stock under the Exchange Agreement.

~~Floor Plan Facility~~

On November 2, 2017, the Company entered into a letter agreement with Ally Bank and Ally Financial (the "Ally Parties") to extend repayment of amounts due under the Floor Plan Facility for sales involving financing originated by the Company that are not sold to or financed by the Ally Parties. With respect to such vehicles, the Ally Parties agree to extend repayment of the advance or the loan for such vehicle to the earlier of fifteen business days after the sale of the vehicle or two business

CARVANA CO. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(Unaudited)

~~days~~NOTE 15 — SUPPLEMENTAL CASH FLOW INFORMATION

The following table summarizes supplemental cash flow information for the three months ended March 31, 2018 and 2017 (in thousands):



	Three Months Ended March 31,
	2018		2017
Supplemental cash flow information:
Cash payments for interest	$	1,884	$	1,885
Non-cash investing and financing activities:
Capital expenditures included in accounts payable and accrued liabilities	$	8,035	$	6,220
Capital expenditures financed through long-term debt	$	5,164	$	1,622
Costs related to issuances of equity included in accrued liabilities	$	163	$	1,424
Accrual of return on Class C redeemable preferred units	$	—	$	7,261

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the accompanying unaudited condensed consolidated balance sheets that sum to the total of the same amounts shown in the accompanying unaudited condensed consolidated statements of cash flows for all periods presented (in thousands):



	March 31, 2018		December 31, 2017		March 31, 2017		December 31, 2016
Cash and cash equivalents	$	121,497	$	172,680	$	8,307	$	39,184
Restricted cash ⁽¹⁾	18,428		14,443		11,488		10,266
Total cash, cash equivalents and restricted cash	$	139,925	$	187,123	$	19,795	$	49,450

(1) Amounts included in restricted cash represent the deposit required under the Company's Floor Plan Facility, which is 5% of the outstanding Floor Plan Facility principal balance, as explained in Note 7 — Debt Instruments and amounts held as restricted cash as required under letter of credit agreements, as explained in Note 13 — Commitments and Contingencies. Both amounts are classified as restricted cash in the accompanying unaudited condensed consolidated balance sheets.

NOTE 16 — SUBSEQUENT EVENTS

Business Acquisition

On April 12, 2018, Carvana Group acquired Car360, Inc., a provider of app-based photo capture technology. Carvana Group paid approximately $6.7 million in cash, subject to certain post-closing adjustments based on expenses and working capital, and issued 930,047 new Class A Units to the former stockholders of Car360, which are exchangeable for 744,037 shares of Class A common stock.

Follow-On Public Offering

On April 30, 2018, the Company completed a follow-on public offering of 6.6 million shares of its Class A common stock at a public offering price of $27.50 per share and received net proceeds from the offering of approximately $173.3 million after underwriting discounts and commissions but before estimated offering expenses. The Company used the net proceeds to purchase approximately 8.3 million newly-issued LLC Units in Carvana Group.

A holder of Class A common stock (the "Selling Stockholder") and certain LLC Unitholders (the "Selling LLC Unitholders") sold a total of 4.4 million shares of Class A common stock as part of the offering. The Selling LLC Unitholders exchanged approximately 4.9 million LLC Units for approximately 3.9 million shares of Class A common stock to be sold in the offering, and to the extent such Selling LLC Unitholder held Class B common stock, the corresponding shares of Class B common stock were immediately retired by the Company. The Company did not receive any proceeds from the sale ~~or funding~~ of the ~~retail installment contract.~~4.4 million shares of Class A common stock by the Selling Stockholder and the Selling LLC Unitholders.

~~Finance Receivable Sale Agreements~~

On November 3, 2017, the Company amended its Purchase and Sale Agreement to increase the aggregate amount of principal balances of finance receivables it can sell from $375.0 million to $1.5 billion. Also on November 3, 2017, the Company terminated the remaining capacity under the Master Transfer Agreement and replaced this facility by entering into a new master transfer agreement with an unrelated third party under which the third party has committed to purchase up to an aggregate of $357.1 million in principal balances of finance receivables.

~~Master Sale-Leaseback Agreement~~

On November 3, 2017, the Company entered into a Master Sale-Leaseback Agreement pursuant to which it may sell and lease back up to $75.0 million of its real property interests, including costs for construction improvements. At any time the Company may elect to, and beginning November 2, 2019, the purchaser has the right to demand that, the Company repurchase one or more sold real property interests for an amount equal to the repurchase price provided in the applicable lease and any amounts due and owing under such lease. The Company expects to sell and lease back many of its real estate holdings and improvements pursuant to this agreement.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Unless the context requires otherwise, references in this report to "Carvana," the “Company,” “we,” “us” and “our” refer to Carvana ~~Group, LLC and its consolidated subsidiaries prior to the initial public offering described in this report and to Carvana~~ Co. and its consolidated ~~subsidiaries following the Organizational Transactions and the initial public offering.~~subsidiaries. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided as a supplement to, and should be read in conjunction with, our audited consolidated financial statements, the accompanying notes and the MD&A included in our ~~prospectus~~most recent Annual Report filed ~~with the SEC~~ on ~~April 28, 2017,~~Form 10-K, as well as our consolidated financial statements and the accompanying notes included in Item 1 of this Form 10-Q.

Overview

Carvana is a leading ~~eCommerce~~e-commerce platform for buying used cars. We are transforming the used car buying experience by giving consumers what they want — a wide selection, great value and quality, transparent pricing and a simple, no pressure transaction. Each element of our business, from inventory procurement to fulfillment and overall ease of the online transaction, has been built for this singular purpose.

On May 3, 2017, we completed our IPO of 15.0 million shares of Class A common stock at a public offering price of $15.00 per share. We received $205.9 million in proceeds, net of underwriting discounts and commissions and offering expenses. We used a portion of the net proceeds to repay the $35.0 million of outstanding borrowings plus accrued interest under the Verde Credit Facility, and will use the remainder for general working corporate purposes. We expect these general corporate purposes to include funding working capital, operating expenses and the selective pursuit of business development opportunities, including to expand our current business through acquisitions of, or investments in, other businesses, products or technologies.

Since the launch of our first market in January 2013 through September 30, 2017, we have purchased, reconditioned, sold and delivered approximately 58,300 vehicles to customers through our website, generating $1.1 billion in revenue.

Our business combines a comprehensive online sales experience with a vertically-integrated supply chain that allows us to sell high quality vehicles to our customers transparently and efficiently at a low price. Using our website, customers can complete all phases of a used vehicle purchase transaction. Specifically, our online sales experience allows customers to:

•

Purchase a used vehicle. As of March 31, 2018, we listed approximately 11,400 vehicles for sale on our website, where customers can select and purchase a vehicle, including arranging financing and signing contracts, directly from their desktop or mobile device. Selling used vehicles to retail customers is the primary driver of our business. Selling used vehicles generates revenue equal to the selling price of the vehicle, less an allowance for returns, and also enables multiple additional revenue streams, including vehicle service contracts (“VSCs”), GAP waiver coverage, and trade-ins.

•

Finance their purchase. Customers can pay for their Carvana vehicle using cash, our proprietary loan origination platform or financing from third parties such as banks or credit unions. Customers who choose to apply for our in-house financing fill out a short application form, select from a range of financing terms we provide, and, if approved, apply the financing to their purchase in our online checkout process. We generally seek to sell the automotive finance receivables we originate to third party financing partners and earn a premium on each sale.

~~Purchase a used vehicle.~~ As of September 30, 2017, we listed approximately 6,700 vehicles for sale on our website, where customers can select and purchase a vehicle, including arranging financing and signing contracts, directly from their desktop or mobile device. Selling used vehicles to retail customers is the primary driver of our business. Selling used vehicles generates revenue equal to the selling price of the vehicle, less an allowance for returns, and also enables multiple additional revenue streams, including vehicle service contracts (“VSCs”), GAP waiver coverage, and trade-ins.

•

Protect their purchase. Customers have the option to protect their vehicle with a CarvanaCare-branded VSC as part of our online checkout process. VSCs provide customers with insurance against certain mechanical repairs after the expiration of their vehicle’s original manufacturer warranty. We earn a fee for selling VSCs on behalf of an affiliate of DriveTime and, prior to December 2016, third parties, who are the obligors under these VSCs. We generally have no contractual liability to customers for claims under these agreements. We also offer GAP waiver coverage to customers in most states. This product contractually obligates us to cancel the remaining principal outstanding after insurance proceeds in a total loss event.

•

Sell us their car. We allow our customers to trade-in a vehicle and apply the trade-in value to their purchase, or to sell us a vehicle independent of a purchase. Using our digital appraisal tool, customers can complete a short appraisal form and receive an offer for their vehicle nearly instantaneously. We generate vehicle offers using a proprietary valuation algorithm supported by extensive used vehicle market and customer behavior data. When customers accept our offer, we take their vehicles into inventory and sell them either at auction as a wholesale sale or through our website as a retail sale. Vehicles sold at auction typically do not meet the quality or condition standards required to be included in retail inventory displayed for sale on our website.

~~Finance their purchase.~~ Customers can pay for their Carvana vehicle using cash, our proprietary loan origination platform or financing from third parties such as banks or credit unions. Customers who choose to apply for our in-house financing fill out a short application form, select from a range of financing terms we provide, and, if approved, apply the financing to their purchase in our online checkout process. We generally seek to sell the automotive finance receivables we originate to third party financing partners and earn a premium on each sale.

~~Protect their purchase.~~ Customers have the option to protect their vehicle with a CarvanaCare-branded VSC as part of our online checkout process. VSCs provide customers with insurance against certain mechanical repairs after the expiration of their vehicle’s original manufacturer warranty. We earn a fee for selling VSCs on behalf of an affiliate of DriveTime and, prior to December 2016, third parties, who are the obligors under these VSCs. We generally have no contractual liability to customers for claims under these agreements. We also recently began offering GAP waiver coverage to customers in most states. This product contractually obligates us to cancel the remaining principal outstanding after insurance proceeds in a total loss event.

~~Sell us their car.~~ We allow our customers to trade-in a vehicle and apply the trade-in value to their purchase, or to sell us a vehicle independent of a purchase. Using our digital appraisal tool, customers can complete a short appraisal

form and receive an offer for their trade-in nearly instantaneously. We generate trade-in offers using a proprietary valuation algorithm supported by extensive used vehicle market and customer behavior data. When customers accept our offer, we take their vehicles into inventory and sell them either at auction as a wholesale sale or through our website as a retail sale. Vehicles sold at auction typically do not meet the quality or condition standards required to be included in retail inventory displayed for sale on our website.

To enable a seamless customer experience, we have built a vertically-integrated used vehicle supply chain, supported by proprietary software systems and data.


•	Vehicle sourcing and acquisition. We acquire the majority of our used vehicle inventory from wholesale auctions. We also, to a lesser extent, acquire vehicles from consumers and directly from used vehicle suppliers, including franchise and independent dealers, leasing companies, and car rental companies. Using proprietary machine learning

~~Vehicle sourcing and acquisition.~~ We acquire the majority of our used vehicle inventory from wholesale auctions. We also, to a lesser extent, acquire vehicles from consumers and directly from used vehicle suppliers, including franchise and independent dealers, leasing companies, and car rental companies. Using proprietary machine learning algorithms and data from a variety of internal and external sources, we evaluate tens of thousands of vehicles daily to determine their fit with consumer demand, internal profitability targets, and our existing inventory mix.

~~Inspection and reconditioning.~~

•

Inspection and reconditioning. After acquiring a vehicle, we transport it to one of our inspection and reconditioning centers (“IRCs”), where it undergoes a 150-point inspection and is reconditioned to meet “Carvana Certified” standards. This process is supported by a custom used vehicle inventory management system, which tracks vehicles through each stage of the process and is seamlessly integrated with auto parts suppliers to facilitate the procurement of required parts.

•

Photography and merchandising. We photograph vehicles using our proprietary photo booths located at each of our IRCs. This allows us to display interactive, 360-degree images of each vehicle on our website. We also annotate each vehicle image with a list of features and imperfections to assist our customers in their evaluation of each vehicle for purchase. Our 360-degree photo and annotation processes are enabled by proprietary imaging technology and integrations with various vehicle data providers for vehicle feature and option information.

•

Logistics and fulfillment. We transport vehicles purchased by our customers to their local market for home delivery or pick-up. In markets where we have launched operations, delivery to the customer is completed by a Carvana employee in a branded delivery truck. In a subset of these markets, customers have the option of picking up their car at one of our vending machines. These vending machines are multi-story glass towers where our customers deposit a token into a coin slot and an automated platform delivers the purchased vehicle to a garage bay where the customer is waiting. Our vending machines provide an attractive and unique customer pick-up experience, developing brand awareness while lowering our variable vehicle delivery expense. Our logistics and fulfillment operations are supported by our proprietary vehicle transportation management system, which optimizes the scheduling of transport routes and delivery slots.

On April 30, 2018, we completed a follow-on public offering of 6.6 million shares of Class A common stock at a public offering price of $27.50 per share and received approximately $173.3 million in proceeds after underwriting discounts and commissions but before estimated offering expenses. We will use the net proceeds from this transaction to purchase Class A Units of Carvana Group, which will use the net proceeds from the sale of the ~~process~~Class A Units primarily for general working corporate purposes. These general corporate purposes include funding working capital, operating expenses and ~~is seamlessly integrated with auto parts suppliers~~the selective pursuit of business development opportunities, including to ~~facilitate the procurement~~expand our current business through acquisitions of, ~~required parts.~~

~~Photography and merchandising.~~ We photograph vehicles using our proprietary photo booths located at each of our IRCs. This allows us to display interactive, 360-degree images of each vehicle on our website. We also annotate each vehicle image with a list of features and imperfections to assist our customersor investments in, their evaluation of each vehicle for purchase. Our 360-degree photo and annotation processes are enabled by proprietary imaging technology and integrations with various vehicle data providers for vehicle feature and option information.

~~Logistics and fulfillment.~~ ~~We transport vehicles purchased by our customers to their local market for home delivery~~other businesses, products or pick-up. In markets where we have launched operations, delivery to the customer is completed by a Carvana employee in a branded delivery truck. In a subset of these markets, customers have the option of picking up their car at one of our vending machines. These vending machines are multi-story glass towers where our customers deposit a token into a coin slot and an automated platform delivers the purchased vehicle to a garage bay where the customer is waiting. Our vending machines provide an attractive and unique customer pick-up experience, developing brand awareness while lowering our variable vehicle delivery expense. Our logistics and fulfillment operations are supported by our proprietary vehicle transportation management system, which optimizes the scheduling of transport routes and delivery slots.

technologies.

Unit Sales

Since launching to customers in Atlanta, Georgia in January 2013, we have experienced rapid growth in sales through our website. During the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2018, the number of vehicles we sold to retail customers grew by ~~133.5%~~121.6% to ~~30,735,~~18,464, compared to ~~13,161~~8,334 in the ~~nine~~three months ended ~~September 30, 2016.~~March 31, 2017.

We view the number of vehicles we sell to retail customers as the most important measure of our growth, and we expect to continue to focus on building a scalable platform to increase our retail units sold. This focus on retail units sold is motivated by several factors:

Retail units sold enable multiple revenue streams, including the sale of the vehicle itself, the sale of automotive finance receivables originated to finance the vehicle, the sale of VSCs, the sale of GAP waiver coverage and the sale of vehicles acquired from customers as trade-ins.

Retail units sold are the primary driver of customer referrals and repeat sales. Each time we sell a vehicle to a new customer, that customer becomes a candidate to refer future customers and can become a repeat buyer in the future.

Retail units sold is an important driver of the average number of days between vehicle acquisition by us and the sale to a customer. Reducing average days to sale impacts gross profit on our vehicles because used cars depreciate over time.

Retail unit sales allow us to benefit from economies of scale due to our centralized online sales model. We believe our model provides meaningful operating leverage in acquisition, reconditioning, transport, customer service and delivery.

We plan to invest in technology and infrastructure to support growth in unit sales. This includes continued investment in our acquisition, reconditioning and logistics network, as well as continued investment in product development and engineering to deliver customers a best-in-class experience.

Markets

Our growth in retail units sold is driven by ~~expansion into new markets and~~ increased penetration in our existing markets and expansion into new markets. We define a market as a metropolitan area in which we have commenced local advertising and offer free home delivery to customers with a Carvana employee and branded delivery truck. Opening a new market involves hiring a ~~market operations manager and a~~ team of customer advocates, connecting the market to our existing logistics network and initiating local advertising. Each new market has typically required approximately $0.5 million in capital expenditures, primarily related to the acquisition of 1one to 2two branded delivery trucks, a multi-car hauler to connect the market to our logistics network and furniture, fixtures and equipment in a local office space. As a market scales, we may elect to build a vending machine in the market to ~~improve fulfillment and~~ further increase customer ~~awareness.~~awareness and improve fulfillment. Each new vending machine has required on average approximately $5.0 million of capital expenditures, depending on the number of stories in the vending machine tower and local market conditions.

Our capital- and headcount-light expansion model has enabled us to increase our rate of market openings in each of the past ~~four~~five years. After opening Atlanta, Georgia in 2013, we opened two markets in 2014, six in 2015, ~~twelve~~12 in 2016, 23 in 2017 and 1812 in the first three ~~quarters~~months of ~~2017,~~2018, bringing our total number of markets to 3956 as of ~~September 30, 2017.~~March 31, 2018. Over this period, we have continually improved our market expansion playbook, which we believe ~~provides us with the capability~~improves our ability to ~~accelerate this rate of market openings in the future.~~execute our growth plan.

When we open a market, we commence local advertising using a blend of brand and direct advertising channels. Our local advertising spend in each market is approximately proportionate to each market’s population, subject to adjustments based on specific characteristics of the market, market age, used vehicle market seasonality and special events such as vending machine openings. This historically has led to increased market penetration over time following the market opening. Beginning in the second quarter of 2017, we increased national television advertising spend. With our growth into new markets, national television advertising ~~is becoming~~has become more economically efficient compared to purchasing several local television advertising campaigns.

Revenue and Gross Profit

Our increased penetration in existing markets and expansion into new markets ~~and increased penetration in existing ones~~ has led to growth in retail unit sales. We generate revenue on retail units sold from four primary sources: the sale of the ~~vehicle,~~vehicles, gains on the sales of loans originated to finance the ~~vehicle,~~vehicles, wholesale sales of vehicles we acquire from customers ~~as trade-ins,~~ and sales of ancillary products such as VSCs and GAP waiver coverage.

Our largest source of revenue, used vehicle sales, totaled ~~$208.1~~$334.1 million and ~~$550.4~~$148.4 million during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2018 and 2017, respectively. As we continue to ~~expand to new markets and~~ increase penetration in existing markets and expand to new ones, we expect used vehicle sales to increase as we increase retail units sold. We generate gross profit on used vehicle sales from the difference between the retail selling price of the vehicle and our cost of sales associated with acquiring the vehicle and preparing it for sale.

Wholesale sales includes sales of trade-ins and other vehicles acquired from customers as well as sales of certain retail units listed on our website and totaled ~~$7.5~~$10.1 million and ~~$21.0~~$5.7 million during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2018 and 2017, respectively. We expect wholesale sales to increase with retail units sold and as we expand our suite of product offerings to customers who may wish to trade-in or to sell us a car independent of a retail sale. We generate gross profit on wholesale vehicle sales from the difference between the wholesale selling price of the vehicle and our cost of sales associated with acquiring the vehicle and preparing it for sale.

Other sales and revenues, which includes gains on the sales of loans we originate, sales of GAP waiver coverage and sales commissions on VSCs ~~and GAP waiver coverage~~ totaled ~~$9.8~~$16.2 million and ~~$22.4~~$5.0 million during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2018 and 2017, respectively. We expect other sales and revenues to increase with retail units sold and as we improve our ability to offer

attractive financing solutions and ancillary products to our customers. Other sales and revenues are 100% gross margin products for which gross profit equals revenue.

During our growth phase, our highest priority will continue to be ~~generating demand~~providing exceptional customer experiences, increasing our brand awareness and building an infrastructure to support growth in retail units sold. Secondarily, we plan to pursue several strategies designed to increase our total gross profit per unit. These strategies include the following:

•

Reduce average days to sale. Our goal is to increase both our number of markets and our sales growth at a faster rate than we increase our inventory size, which we believe would decrease average days to sale due to a relative increase in demand versus supply. Reductions in average days to sale lead to fewer vehicle price reductions, and therefore higher average selling prices, other factors being equal. Higher average selling prices in turn lead to higher gross profit per unit sold, all other factors being equal.


•	Leverage existing IRC infrastructure. Aswe scale, we intend to more fully utilize the capacity in our four existing IRCs, which collectively have capacity to inspect and recondition approximately 200,000 vehicles per year.

~~Reduce average days to sale.~~ Our goal is to increase both our number of markets and our sales growth at a faster rate than we increase our inventory size, which we believe would decrease average days to sale due to a relative increase in demand versus supply. Reductions in average days to sale lead to fewer vehicle price reductions, and therefore higher average selling prices, other things being equal. Higher average selling prices in turn lead to higher gross profit per unit sold, all other factors being equal.


•	Increase utilization on logistics network. As we scale, we intend to more fully utilize our in-house logistics network to transport cars to our IRCs after acquisition from wholesale auctions or customers.


•	Increase conversion on existing products. We plan to continue to improve our website to highlight the benefits of our complementary product offerings, including financing, VSCs, GAP waiver coverage and trade-ins.


•	Add new products and services. We plan to utilize our online sales platform to offer additional complementary products and services to our customers.

~~Leverage existing IRC infrastructure.~~ As~~we scale, we intend to more fully utilize the capacity in our existing IRCs, which collectively have capacity to inspect and recondition approximately 200,000 vehicles per year.~~

~~Increase utilization on logistics network.~~ ~~As we scale, we intend to more fully utilize our in-house logistics network to transport cars to our IRCs after acquisition from wholesale auctions or customers.~~

~~Increase conversion on existing products.~~ ~~We plan to continue to improve our website to highlight the benefits of our complementary product offerings, including financing, VSCs, GAP waiver coverage and trade-ins.~~

~~Add new products and services.~~ ~~We plan to utilize our online sales platform to offer additional complementary products and services to our customers.~~

~~Optimize pricing.We regularly test different pricing of our products, including vehicle sticker prices, trade-in offers and ancillary product prices and believe we can improve by further optimizing prices over time.~~

•

Optimize purchasing and pricing.We are constantly improving the ways in which we predict customer demand, value vehicles sight unseen and optimize what we pay to acquire those vehicles. We also regularly test different pricing of our products, including vehicle sticker prices, trade-in and independent vehicle offers and ancillary product prices and believe we can improve by further optimizing prices over time.

Seasonality

Used vehicle sales exhibit seasonality with sales peaking late in the first calendar quarter and diminishing through the rest of the year, with the lowest relative level of vehicle sales expected to occur in the fourth calendar quarter. However, as the timing of income tax refunds is delayed, we believe that the second quarter is likely to show stronger seasonality than in the past. Due to our rapid growth, our overall sales patterns to date have not reflected the general seasonality of the used vehicle industry, but we expect this to change once our business and markets mature. Used vehicle prices also exhibit seasonality, with used vehicles depreciating at a faster rate in the last two quarters of each year and a slower rate in the first two quarters of each year. ~~Historically, this has led our gross profit per unit to be higher on average in the first half of the year than in the second half of the year.~~ We may experience seasonal and other fluctuations in our quarterly operating results, which may not fully reflect the underlying performance of our business.

Investment in Growth

We have aggressively invested in the growth of our business and we expect this investment to continue. We anticipate that our operating expenses will increase substantially as we continue to open new markets, expand our logistics network and increase our advertising spending, including increases in television advertising expenditures. There is no guarantee that we will be able to realize the return on our investments.

Relationship with ~~DriveTime~~Related Parties

We were founded as a subsidiary of DriveTime in 2012 and subsequently spun out of DriveTime as a standalone entity in November 2014. DriveTime consolidated our financial results in its financial statements through July 2015. DriveTime is controlled by our controlling shareholder, who is also the father of Ernie Garcia, III, our Chief Executive Officer.

For ~~further~~ discussion about our relationship with ~~DriveTime and other~~ related parties, refer to Note 5 — Related Party Transactions of our unaudited condensed consolidated financial statements included in Part I, Item 1, ~~Unaudited Condensed and Consolidated~~ Financial Statements of this Quarterly Report on Form 10-Q.

Key Operating Metrics

We regularly review a number of metrics, including the following key metrics, to evaluate our business, measure our progress and make strategic decisions. Our key operating metrics reflect the key drivers of our growth, including increasing brand awareness, opening new markets, ~~increasing brand awareness~~ and enhancing the selection of vehicles we make available to our customers. Our key

operating metrics also demonstrate our ability to translate these drivers into retail sales and to monetize these retail sales through a variety of product offerings.


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2017		2016		2017		2016		2018		2017
Retail units sold	11,719		5,023		30,735		13,161		18,464		8,334
Number of markets	39		16		39		16		56		23
Average monthly unique visitors	1,168,693		388,673		941,162		350,983		1,632,569		698,796
Inventory units available on website	6,689		4,565		6,689		4,565		11,366		7,746
Average days to sale	97		92		99		90		70		93
Total gross profit per unit	$	1,742	$	1,347	$	1,503	$	1,273	$	1,854	$	1,169

Retail Units Sold

We define retail units sold as the number of vehicles sold to customers in a given period, net of returns under our seven-day return policy. We view retail units sold as a key measure of our growth for several reasons. First, retail units sold is the primary driver of our revenues and, indirectly, gross profit, since retail unit sales enable multiple complementary revenue streams, including financing, VSCs, GAP waiver coverage and trade-ins. Second, growth in retail units sold increases the base of available customers for referrals and repeat sales. Third, growth in retail units sold is an indicator of our ability to successfully scale our logistics, fulfillment and customer service operations.

Number of Markets

We define a market as a metropolitan area in which we have commenced local advertising and offer free home delivery to customers with a Carvana employee and branded delivery truck. We view the number of markets we serve as a key driver of our growth. As we increase our number of markets, the population of consumers who have access to our fully-integrated customer experience increases, which in turn helps to increase the number of vehicles we sell.

Average Monthly Unique Visitors

We define a monthly unique visitor as an individual who has visited our website within a calendar month, based on data provided by Google Analytics. We calculate average monthly unique visitors as the sum of monthly unique visitors in a given period, divided by the number of months in that period. We view average monthly unique visitors as a key indicator of the strength of our brand, the effectiveness of our advertising and merchandising campaigns and consumer awareness.

Inventory Units Available

We define inventory units available as the number of vehicles listed for sale on our website on the last day of a given reporting period. Until we reach an optimal pooled inventory level, we view inventory units available as a key measure of our growth. Growth in inventory units available increases the selection of vehicles available to consumers in all of our markets simultaneously, which we believe will allow us to increase the number of vehicles we sell. Moreover, growth in inventory units available is an indicator of our ability to scale our vehicle purchasing, inspection and reconditioning operations.

Average Days to Sale

We define average days to sale as the average number of days between vehicle acquisition by us and delivery to a customer for all retail units sold in a period. However, this metric does not include any retail units that remain unsold at period end. We view average days to sale as a useful metric due to its impact on used vehicle average selling price.

Total Gross Profit per Unit

We define total gross profit per unit as the aggregate gross profit in a given period divided by retail units sold in that period. Total gross profit per unit is driven by sales of used vehicles, each of which generates additional revenue sources including: wholesale sales of vehicles we acquire from customers as trade-ins, gains on the sales of loans originated to finance

the vehicle, revenue from GAP waiver coverage and commissions on sales of VSCs. We believe total gross profit per unit is a key measure of our growth and long-term profitability.

Components of Results of Operations

Used Vehicle Sales

Used vehicle sales represent the aggregate sales of used vehicles to customers through our website. Revenue from used vehicles sales is recognized upon delivery or pick-up of the vehicle by the customer and reported net of a reserve for expected returns. Factors affecting used vehicle sales revenue include the number of retail units sold and the average selling price of these vehicles. ~~At our current stage of growth, changes~~Changes in retail units sold are a much larger driver of changes in revenue than are changes in average selling price.

The number of used vehicles we sell depends on ~~the number of markets we serve,~~ our volume of website traffic in the markets we serve, the number of these markets, our inventory selection, the effectiveness of our branding and marketing efforts, the quality of our customer sales experience, our volume of referrals and repeat customers, the competitiveness of our pricing, competition from other used car dealerships and general economic conditions. On a quarterly basis, the number of used vehicles we sell is also affected by seasonality, with demand for used vehicles reaching a seasonal high point in the first half of each year, commensurate with the timing of tax refunds, and diminishing through the rest of the year, with the lowest relative level of used vehicle sales expected to occur in the fourth calendar quarter.

Our retail average selling price depends on the mix of vehicles we acquire and hold in inventory, retail market prices in our markets, our average days to sale and our pricing strategy. We may ~~opportunistically~~ choose to shift our inventory mix to on average higher or lower cost vehicles, or to ~~opportunistically~~ raise or lower our prices relative to market to take advantage of supply or demand imbalances, which could temporarily lead to average selling prices increasing or decreasing. We anticipate that our average days to sale will decline over time as we continue to launch new markets, which we believe will ~~have a positive impact on~~increase our retail average selling price, other ~~things~~factors being equal.

Wholesale Vehicle Sales

Wholesale vehicle sales is equal to the aggregate proceeds we receive on vehicles sold to wholesalers. The vehicles we sell to wholesalers are primarily acquired from our customers who trade-in their existing vehicles when making a purchase from us, and to a lesser extent, vehicles we acquire from customers who do not purchase another vehicle from us. In addition, we occasionally sell certain used vehicles previously listed for sale to customers through our website to wholesalers. Factors affecting wholesale vehicle sales include the number of wholesale units sold and the average wholesale selling price of these vehicles. The average selling price of our wholesale units is primarily driven by the mix of vehicles we sell to wholesalers, as well as general supply and demand conditions in the applicable wholesale vehicle market.

Other Sales and Revenues

We generate other sales and revenues primarily through the sales of automotive finance receivables we originate and sell, ~~to third parties and~~ commissions we receive on ~~VSCs.~~VSCs and sales of GAP waiver coverage on vehicles customers buy and finance with us. Prior to December 9, 2016, the VSCs were sold and administered by third parties. On December 9, 2016, we entered into a master dealer agreement with DriveTime, pursuant to which we sell VSCs that DriveTime administers. The commission revenues we recognize on VSCs depends on the number of retail units we sell, the conversion rate of VSCs on these sales, commission rates we receive, VSC early cancellation frequency and product features. The GAP waiver coverage revenue we recognize depends on the number of retail units we sell, the number of customers that choose to finance their purchases with us and the conversion rate of GAP waiver coverage on those sales.

We generally seek to sell the automotive finance receivables we generate under committed forward flow arrangements with third parties who acquire these receivables at premium prices without recourse to us for their post-sale performance. Factors affecting revenue from these sales include the number of automotive finance receivables we originate, the average principal balance of these receivables, the credit quality of the portfolio and the price at which we are able to sell them to third parties.

The number of receivables we originate is driven by the number of used vehicles sold and the percentage of our sales for which we provide financing, which is influenced by the financing terms we offer our customers relative to alternatives available

to the customer. The average principal balance is driven primarily by the mix of vehicles we sell, since higher average selling prices typically mean higher average receivable balances. The price at which we resell these automotive finance receivables is driven by the terms of our forward flow arrangements, ~~and~~ applicable interest ~~rates.~~rates and whether or not the finance receivable includes GAP waiver coverage.

Cost of Sales

Cost of sales includes the cost to acquire vehicles and the reconditioning and transportation costs associated with preparing the vehicles for resale. Vehicle acquisition costs are driven by the mix of vehicles we acquire, the source of those vehicles and supply and demand dynamics in the wholesale vehicle market. Reconditioning costs consist of direct costs, including parts, labor and third party repair expenses directly attributable to specific vehicles, as well as indirect costs, such as IRC overhead. Transportation costs consist of costs incurred to transport the vehicles from the point of acquisition to the IRC. Cost of sales also includes any necessary adjustments to reflect vehicle inventory at the lower of cost or net realizable value.

Used Vehicle Gross Profit

Used vehicle gross profit equals the vehicle sales price minus our costs of sales associated with vehicles that we list and sell on our website. Used vehicle gross profit per unit equals our aggregate used vehicle gross profit in any measurement period divided by the number of retail units sold in such period.

Wholesale Vehicle Gross Profit

Wholesale vehicle gross profit equals the vehicle sales price minus our cost of sales associated with vehicles we sell to wholesalers. Factors affecting wholesale gross profit include the number of wholesale units sold, the average wholesale selling price of these vehicles, the acquisition price we offer to the customer and, in the case of vehicles formerly listed on our website, the total costs described above associated with that vehicle.

Other Gross Profit

Other sales and revenues consist of 100% gross margin products for which gross profit equals revenue. Therefore, changes in gross profit and the associated drivers are identical to changes in revenues from these products and the associated drivers.

Selling, General and Administrative Expenses

Selling, general and administrative (“SG&A”) expenses include expenses associated with advertising to customers, operating our ~~logistics hubs,~~ fulfillment centers and vending machines, operating our logistics and fulfillment network and other corporate overhead expenses, including expenses associated with ~~IT,~~information technology, product development, engineering, legal, accounting, finance and business development. We anticipate that these expenses will increase as we grow. SG&A expenses exclude the costs of transporting vehicles from the point of acquisition to the IRC, and inspecting and reconditioning vehicles, which are included in cost of sales.

Interest Expense

Interest expense includes interest incurred on our Floor Plan Facility (as defined in "Liquidity and Capital Resources"), notes payable and other long-term debt, which are used to fund inventory, our transportation fleet and certain of our property and ~~equipment, respectively.~~equipment. During 2017, interest expense also includes interest incurred and the commitment fee related to the Verde Credit Facility (as defined in "Liquidity and Capital Resources"), which was used as needed to fund working capital prior to its termination in connection with our IPO. Interest expense excludes the interest incurred during various construction projects to build, upgrade or remodel certain facilities, which is capitalized to property and equipment and depreciated over the estimated useful lives of the related assets.

Results of Operations


	Three Months Ended September 30,						Nine Months Ended September 30,							Three Months Ended March 31,
	2017		2016		Change		2017		2016		Change			2018		2017		Change

	(dollars in thousands, except per unit amounts)						(dollars in thousands, except per unit amounts)							(dollars in thousands, except per unit amounts)
Net sales and operating revenues:
Used vehicle sales, net	$	208,113	$	92,115	125.9	%	$	550,442	$	241,098	128.3	%		$	334,056	$	148,382	125.1	%
Wholesale vehicle sales	7,459		2,870		159.9	%	21,003		6,904		204.2	%		10,133		5,726		77.0	%
Other sales and revenues ⁽¹⁾	9,807		3,859		154.1	%	22,372		10,319		116.8	%		16,233		4,965		226.9	%
Total net sales and operating revenues	$	225,379	$	98,844	128.0	%	$	593,817	$	258,321	129.9	%		$	360,422	$	159,073	126.6	%
Gross profit:
Used vehicle gross profit	$	9,859	$	2,849	246.1	%	$	22,657	$	6,290	260.2	%		$	16,646	$	4,626	259.8	%
Wholesale vehicle gross profit	751		58		1,194.8	%	1,173		151		676.8	%		1,355		155		774.2	%
Other gross profit ⁽¹⁾	9,806		3,859		154.1	%	22,371		10,319		116.8	%		16,233		4,965		226.9	%
Total gross profit	$	20,416	$	6,766	201.7	%	$	46,201	$	16,760	175.7	%		$	34,234	$	9,746	251.3	%
Market information:
Markets, beginning of period	30		14		114.3	%	21		9		133.3	%		44		21		109.5	%
Market launches	9		2		350.0	%	18		7		157.1	%		12		2		500.0	%
Markets, end of period	39		16		143.8	%	39		16		143.8	%		56		23		143.5	%
Unit sales information:
Used vehicle unit sales	11,719		5,023		133.3	%	30,735		13,161		133.5	%		18,464		8,334		121.6	%
Wholesale vehicle unit sales	1,797		787		128.3	%	4,665		1,920		143.0	%		2,342		1,288		81.8	%
Per unit selling prices:
Used vehicles	$	17,759	$	18,339	(3.2	)%	$	17,909	$	18,319	(2.2	)%		$	18,092	$	17,804	1.6	%
Wholesale vehicles	$	4,151	$	3,647	13.8	%	$	4,502	$	3,596	25.2	%		$	4,327	$	4,446	(2.7	)%
Per unit gross profit: ⁽²⁾
Used vehicle gross profit	$	841	$	567	48.3	%	$	737	$	478	54.2	%		$	902	$	555	62.5	%
Wholesale vehicle gross profit	$	418	$	74	464.9	%	$	251	$	79	217.7	%		$	579	$	120	382.5	%
Other gross profit	$	837	$	768	9.0	%	$	728	$	784	(7.1	)%		$	879	$	596	47.5	%
Total gross profit	$	1,742	$	1,347	29.3	%	$	1,503	$	1,273	18.1	%		$	1,854	$	1,169	58.6	%

(1) Includes $2,414 and $6,070 of other sales and revenues from related parties for the three and nine months ended September 30, 2017, respectively.
(1) Includes $4,111 and $1,758 of other sales and revenues from related parties for the three months ended March 31, 2018 and 2017, respectively.													(1) Includes $4,111 and $1,758 of other sales and revenues from related parties for the three months ended March 31, 2018 and 2017, respectively.
(2) All gross profit per unit amounts are per used vehicle sold, except wholesale vehicle gross profit, which is per wholesale vehicle sold.

Used Vehicle Sales

Three Months Ended ~~September 30, 2017~~March 31, 2018 Versus ~~2016.~~2017. Used vehicle sales increased by ~~$116.0~~$185.7 million to ~~$208.1~~$334.1 million during the three months ended ~~September 30, 2017~~March 31, 2018 compared to ~~$92.1~~$148.4 million during the three months ended ~~September 30, 2016.~~March 31, 2017. The increase in revenue was primarily due to an increase in the number of used vehicles sold to ~~11,719~~18,464 from ~~5,023~~8,334 during the three months ended ~~September 30, 2016~~March 31, 2018 and 2017, respectively. The increase in ~~unit sales~~units sold was driven in part ~~by growth to 39 markets as of September 30, 2017 from 16 markets as of September 30, 2016. The increase in units sold was also driven~~ by growth in existing markets due to expanded inventory selection, enhanced marketing efforts, increased brand awareness and customer referrals. The increase in unit sales was also driven by growth to 56 markets as of March 31, 2018 from 23 markets as of March 31, 2017. We anticipate that unit sales will continue to grow as we ~~launch new markets and~~ increase penetration in existing markets. The average selling price of our retail units sold decreased to $17,759 in the three months ended September 30, 2017 from $18,339 in the same quarter in the prior year, primarily due to a shift in inventory mix.

~~Nine Months Ended September 30, 2017 Versus 2016.~~ Used vehicle sales increased by $309.3 million to $550.4 million during the nine months ended September 30, 2017 compared to $241.1 million during the nine months ended September 30, 2016. The increase in revenue was primarily due to an increase in the number of used vehicles sold to 30,735 from 13,161 during the nine months ended September 30, 2016markets and 2017, respectively. The increase in unit sales was driven in part by growth to 39 markets as of September 30, 2017 from 16 markets as of September 30, 2016. The increase in units sold was also driven by growth in existing markets due to expanded inventory selection, enhanced marketing efforts, increased brand awareness, and customer referrals. We anticipate that unit sales will continue to grow as we launch new ~~markets and increase penetration in existing~~ markets. The average selling price of our retail units sold decreased to $17,909 in the nine months ended September 30, 2017 from $18,319 in the same year-to-date period in the prior year. We believe average selling prices declined primarily due to our shift in inventory mix and partially due to an increase in average days to sale to 99 days in the nine months ended September 30, 2017 from 90 days in the comparable prior year period, leading to additional sticker price reductions and therefore lower average selling prices.

Wholesale Vehicle Sales

Three Months Ended ~~September 30, 2017~~March 31, 2018 Versus ~~2016.~~ 2017. Wholesale vehicle sales increased by ~~$4.6~~$4.4 million to ~~$7.5~~$10.1 million during the three months ended ~~September 30, 2017,~~March 31, 2018, compared to ~~$2.9~~$5.7 million during the three months ended ~~September 30, 2016.~~March 31, 2017. We primarily obtain our wholesale inventory from customer trade-ins. As our retail unit sales have increased, so have the trade-ins we receive. Therefore, we have had more units available for sale to wholesalers over time and our revenues attributed to wholesale vehicle sales have increased.

~~Nine Months Ended September 30, 2017 Versus 2016.~~ Wholesale vehicle sales increased by $14.1 million to $21.0 million during the nine months ended September 30, 2017, compared to $6.9 million during the nine months ended September 30, 2016. We primarily obtain our wholesale inventory from customer trade-ins. As our retail unit sales have increased, so have the trade-ins we receive. Therefore, we have had more units available for sale to wholesalers over time and our revenues attributed to wholesale vehicle sales have increased.

Other Sales and Revenues

Three Months Ended ~~September 30, 2017~~March 31, 2018 Versus ~~2016.~~ 2017. Other sales and revenues primarily consist of gains on the sales of loans we originate, commissions we receive on sales of VSCs and sales of GAP waiver coverage. Other sales and revenues increased by ~~$5.9~~$11.3 million to ~~$9.8~~$16.2 million during the three months ended ~~September 30, 2017,~~March 31, 2018, compared to ~~$3.9~~$5.0 million during the three months ended ~~September 30, 2016.~~March 31, 2017. This increase was primarily driven by the increase in retail units sold which led to an increase in loans originated and sold, as well as an increase in VSC sales and GAP waiver coverage sales. During the three months ended September 30, 2016, VSC revenues were generated from third party sales whereas during the three months ended September 30, 2017, all VSC sales were administered through DriveTime.

~~Nine Months Ended September 30, 2017 Versus 2016.~~ Other sales and revenues increased by $12.1 million to $22.4 million during the nine months ended September 30, 2017, compared to $10.3 million during the nine months ended September 30, 2016. This increase was primarily driven by the increase in retail units sold, which led to an increase in loans originated and sold, as well as an increase in VSC sales and GAP waiver coverage sales. During the nine months ended September 30, 2016, VSC revenues were generated from third party sales whereas during the nine months ended September 30, 2017, all VSC sales were administered through DriveTime.

Used Vehicle Gross Profit

Three Months Ended ~~September 30, 2017~~March 31, 2018 Versus ~~2016.~~ 2017. Used vehicle gross profit increased by ~~$7.0~~$12.0 million to ~~$9.9~~$16.6 million during the three months ended ~~September 30, 2017,~~March 31, 2018, compared to ~~$2.8~~$4.6 million during the three months ended ~~September 30, 2016.~~March 31, 2017. This increase was driven primarily by an increase in retail units sold, as well as an increase in used vehicle gross profit per unit to ~~$841~~$902 for the three months ended ~~September 30, 2017~~March 31, 2018 compared to ~~$567~~$555 for the three months ended ~~September 30, 2016. Despite higher~~March 31, 2017. The increase was primarily driven by a decrease in average days to sale ~~as described above, vehicle gross profit per unit increased. The increase was driven by enhancements~~to 70 days in ~~our proprietary vehicle purchasing~~the three months ended March 31, 2018 from 93 days in the three months ended March 31, 2017 and ~~pricing technology, as well as by~~ cost efficiencies in the reconditioning of our vehicles.

~~Nine Months Ended September 30, 2017 Versus 2016.~~ Used vehicle gross profit increased by $16.4 million to $22.7 million during the nine months ended September 30, 2017, compared to $6.3 million during the nine months ended September 30, 2016. This increase was driven primarily by an increase in retail units sold, as well as an increase in used vehicle gross profit per unit to $737 for the nine months ended September 30, 2017 compared to $478 for the nine months ended September 30, 2016. The increase was driven by enhancements in our proprietary vehicle purchasing and pricing technology, as well as by cost efficiencies in the transportation and reconditioning of our vehicles.

Wholesale Vehicle Gross Profit

Three Months Ended ~~September 30, 2017~~March 31, 2018 Versus ~~2016.~~ 2017. Wholesale vehicle gross profit increased by ~~$0.7~~$1.2 million to ~~$0.8~~$1.4 million during the three months ended ~~September 30, 2017,~~March 31, 2018, compared to ~~$0.1~~$0.2 million during the three months ended ~~September 30, 2016.~~March 31, 2017. This increase was driven primarily by an increase in wholesale units sold to ~~1,797~~2,342 from ~~787~~1,288 and an increase in wholesale vehicle gross profit per wholesale unit to ~~$418~~$579 from ~~$74.~~$120.

~~Nine Months Ended September 30, 2017 Versus 2016.~~ Wholesale vehicle gross profit increased by $1.0 million to $1.2 million during the nine months ended September 30, 2017, compared to $0.2 million during the nine months ended September 30, 2016. This increase was driven primarily by an increase in wholesale units sold to 4,665 from 1,920 and an increase in gross profit per wholesale unit to $251 from $79.

Other Gross Profit

Other sales and revenues consist of 100% gross margin products for which gross profit equals revenue. Therefore, changes in other gross profit and the associated drivers are identical to changes in other sales and revenues and the associated drivers.

Components of SG&A


	Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
	2017		2016		2017		2016			2018		2017

	(in thousands)				(in thousands)					(in thousands)
Compensation and benefits⁽¹⁾	$	19,404	$	9,868	$	54,496	$	24,390		$	24,987	$	16,303
Advertising expense	15,475		6,677		39,299		17,928			25,009		11,439
Market occupancy costs⁽²⁾	1,734		346		4,141		1,199			2,510		983
Logistics⁽³⁾	3,905		2,252		9,829		5,515			6,318		2,808
Other overhead costs ⁽⁴⁾	18,158		8,852		48,830		22,939
Other costs ⁽⁴⁾										24,362		14,375
Total	$	58,676	$	27,995	$	156,595	$	71,971		$	83,186	$	45,908

(1) Compensation and benefits includes all payroll and related costs, including benefits, payroll taxes, and unit-based compensation, except those related to reconditioning vehicles, which are included in cost of sales.
(2) Market occupancy costs includes rent, utilities, security, repairs and maintenance, and depreciation of buildings and improvements, including vending machines and fulfillment centers, excluding the portion related to reconditioning vehicles which is included in cost of sales, and excluding the portion related to our corporate office which is included in other overhead costs.
(3) Logistics includes fuel, maintenance, and depreciation related to owning and operating our own transportation fleet, and third party transportation fees, except the portion related to inbound transportation, which are included in cost of sales.
(4) Other overhead costs include all other overhead and depreciation expenses such as IT expenses, limited warranty, travel, insurance, bad debt, title and registration, and other administrative expenses.
(1) Compensation and benefits includes all payroll and related costs, including benefits, payroll taxes and equity-based compensation, except those related to preparing vehicles for sale, which are included in cost of sales.									(1) Compensation and benefits includes all payroll and related costs, including benefits, payroll taxes and equity-based compensation, except those related to preparing vehicles for sale, which are included in cost of sales.
(2) Market occupancy costs includes rent, utilities, security, repairs and maintenance and depreciation of buildings and improvements, including vending machines and fulfillment centers, excluding the portion related to reconditioning vehicles, which is included in cost of sales, and excluding the portion related to corporate occupancy.									(2) Market occupancy costs includes rent, utilities, security, repairs and maintenance and depreciation of buildings and improvements, including vending machines and fulfillment centers, excluding the portion related to reconditioning vehicles, which is included in cost of sales, and excluding the portion related to corporate occupancy.
(3) Logistics includes fuel, maintenance and depreciation related to operating our own transportation fleet and third party transportation fees, except the portion related to inbound transportation, which is included in cost of sales.									(3) Logistics includes fuel, maintenance and depreciation related to operating our own transportation fleet and third party transportation fees, except the portion related to inbound transportation, which is included in cost of sales.
(4) Other costs include all other selling, general and administrative expenses such as IT expenses, corporate occupancy, professional services and insurance, limited warranty and title and registration.									(4) Other costs include all other selling, general and administrative expenses such as IT expenses, corporate occupancy, professional services and insurance, limited warranty and title and registration.

net loss before interest expense, income tax expense and depreciation and amortization expense. EBITDA Margin is EBITDA as a percentage of total revenues. We use EBITDA to measure the operating performance of our business ~~excluding specifically identified~~and EBITDA Margin to measure our operating performance relative to our total revenues. We believe that EBITDA and EBITDA Margin are useful measures to us and to our investors because they exclude certain financial and capital structure items that we do not believe directly reflect our core operations and may not be indicative of our recurring operations, in part because they may vary widely across time and within our industry independent of the performance of our core operations. We ~~use EBITDA Margin~~believe that excluding these items enables us to ~~measure~~more effectively evaluate our ~~operating~~ performance period-over-period and relative to our ~~total revenues.~~competitors. EBITDA and EBITDA Margin may not be comparable to similarly titled measures provided by other companies due to potential differences in methods of calculations. A reconciliation of EBITDA to net loss, the most directly comparable GAAP measure, and calculation of EBITDA Margin is as follows (in thousands):

(1) Amounts for periods prior to the initial public offering have been retrospectively adjusted to give effect to 15.0 million shares of Class A common stock issued in the initial public offering.

(2) ~~Assumes~~Amounts for periods prior to the initial public offering have been retrospectively adjusted to include all LLC units outstanding at the initial public offering, including conversion of the Class C Redeemable Preferred Units into Class A Units on a one-for-one basis. Also assumes exchange of all outstanding LLC Units for shares of Class A common stock during each period ~~presented, including retrospectively applying exchanges of LLC units outstanding at the initial public offering to all periods prior to the initial public offering.~~presented.

(3) Excludes approximately ~~0.5~~0.4 million ~~unvested~~nonvested restricted stock awards and ~~0.6~~units and 0.8 million vested and ~~unvested~~nonvested stock options outstanding at ~~September 30, 2017,~~March 31, 2018, because they were determined to be anti-dilutive.

capital obligations for at least the next 12 months. However, our future capital requirements will depend on many factors, including our rate of revenue growth, our expansion into new markets, construction of vending machines and inspection and reconditioning centers and the timing and extent of our spending to support our technology and software development efforts. To the extent that existing cash and cash from operations are insufficient to fund our future activities, we may need to raise additional funds through public or private equity or debt financing. Additional funds may not be available on terms favorable to us or at all.

If any of the foregoing occurs, we may have to stop using certain of our technologies or processes or may be unable to commercialize one or more of our products, all of which could have a material adverse effect on our business, results of operations and financial condition.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Delaware		81-4549921
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1930 W. Rio Salado Parkway, Tempe, Arizona		85281
(Address of principal executive offices)		(Zip Code)



Large accelerated filer ¨	Accelerated filer ¨
Non-accelerated filer ý (Do not check if a smaller reporting company)	Smaller reporting company ¨
Emerging growth company ý
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ý



		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Unaudited Condensed Consolidated Balance Sheets as of ~~September 30, 2017~~March 31, 2018 and December 31, ~~2016~~2017	3
	Unaudited Condensed Consolidated Statements of Operations for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2018 and 2017 ~~and 2016~~	4
	Unaudited Condensed Consolidated Statements of Stockholders' Equity / Members' Deficit for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2018 and 2017	5
	Unaudited Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2018 and 2017 ~~and 2016~~	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2625
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	4443
Item 4.	Controls and Procedures	4544

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	4645
Item 1A.	Risk Factors	4645
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	4647
Item 4.	Mine Safety Disclosures	4647
Item 5.	Other Information	4647
Item 6.	Exhibits	4748


	September 30, 2017			December 31, 2016			March 31, 2018			December 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	103,454		$	39,184		$	121,497		$	172,680
Restricted cash	11,755			10,266			18,428			14,443
Accounts receivable, net	11,639			5,692			20,969			14,105
Finance receivables held for sale, net	37,519			24,771			62,490			45,564
Vehicle inventory	192,242			185,506			299,780			227,446
Other current assets	9,598			9,822			18,159			15,480
Total current assets	366,207			275,241			541,323			489,718
Property and equipment, net	125,996			60,592			176,259			148,681
Other assets	2,969			—			3,152			2,738
Total assets	$	495,172		$	335,833		$	720,734		$	641,137
LIABILITIES, TEMPORARY EQUITY & STOCKHOLDERS' EQUITY / MEMBERS’ DEFICIT
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	43,813		$	28,164		$	62,483		$	50,306
Accounts payable due to related party	2,142			1,884			2,602			1,802
Floor plan facility	195,083			165,313			348,533			248,792
Current portion of long-term debt	3,375			1,057			6,138			5,131
Total current liabilities	244,413			196,418			419,756			306,031
Long-term debt, excluding current portion	16,363			4,404			66,788			48,469
Other liabilities	6,920			—			7,250			7,093
Total liabilities	267,696			200,822			493,794			361,593
Commitments and contingencies (Note 13)
Temporary equity - Class C redeemable preferred units - 0 and 43,089 units authorized and outstanding as of September 30, 2017 and December 31, 2016, respectively	—			250,972
Stockholders' equity / members' deficit:
Members' deficit	—			(115,961		)
Preferred stock, $.01 par value - 50,000 shares authorized, none issued and outstanding as of September 30, 2017	—			—
Class A common stock, $0.001 par value - 500,000 shares authorized, 15,513 shares issued and outstanding as of September 30, 2017	16			—
Class B common stock, $0.001 par value - 125,000 shares authorized, 117,236 shares issued and outstanding as of September 30, 2017	117			—
Stockholders' equity:
Class A Convertible Preferred Stock, $0.01 par value, $1,000 liquidation value per share - 100 shares authorized, issued and outstanding as of March 31, 2018 and December 31, 2017							98,507			97,127
Preferred stock, $0.01 par value - 50,000 shares authorized; none issued and outstanding as of March 31, 2018 and December 31, 2017							—			—
Class A common stock, $0.001 par value - 500,000 shares authorized; 19,516 and 18,096 shares issued and outstanding as of March 31, 2018 and December 31, 2017, respectively							20			18
Class B common stock, $0.001 par value - 125,000 shares authorized; 113,323 and 114,664 shares issued and outstanding as of March 31, 2018 and December 31, 2017, respectively							113			115
Additional paid in capital	35,447			—			41,603			41,375
Accumulated deficit	(7,419		)	—			(19,942		)	(12,899		)
Total stockholders' equity / members' deficit attributable to Carvana Co.	28,161			(115,961		)
Total stockholders' equity attributable to Carvana Co.							120,301			125,736
Non-controlling interests	199,315			—			106,639			153,808
Total stockholders' equity / members’ deficit	227,476			(115,961		)
Total liabilities, temporary equity & stockholders' equity / members’ deficit	$	495,172		$	335,833
Total stockholders' equity							226,940			279,544
Total liabilities & stockholders' equity							$	720,734		$	641,137


	Nine Months Ended September 30,						Three Months Ended March 31,
	2017			2016			2018			2017
Cash Flows from Operating Activities:
Net loss	$	(117,078	)	$	(57,418	)	$	(52,672	)	$	(38,439	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	7,746			3,020			4,605			2,061
Loss on disposal of property and equipment	882			—			103			200
Provision for bad debt and valuation allowance	805			1,299
Provision for bad debt and finance receivable allowance							597			285
Gain on loan sales	(14,982		)	(6,169		)	(9,891		)	(2,942		)
Equity-based compensation expense	3,989			421			1,510			158
Amortization and write-off of debt issuance costs	1,407			—			323			181
Originations of finance receivables	(361,265		)	(160,713		)	(228,595		)	(96,528		)
Proceeds from sale of finance receivables	361,659			228,480			220,357			99,144
Proceeds from sale of finance receivables to related party	—			1,531
Purchase of finance receivables from related party	—			(74,589		)
Changes in assets and liabilities:
Accounts receivable	(6,159		)	(1,509		)	(6,969		)	(2,470		)
Prepayment to related parties	—			(1,404		)
Vehicle inventory	(5,962		)	(62,335		)	(72,030		)	(14,044		)
Other current assets	(1,206		)	(3,449		)	(2,998		)	292
Other assets	(1,722		)	—			297			(2,856		)
Accounts payable and accrued liabilities	8,694			9,493			12,957			(2,690		)
Accounts payable to related party	258			(21,436		)	800			2,508
Other liabilities	6,920			—			157			2,254
Net cash used in operating activities	(116,014		)	(144,778		)	(131,449		)	(52,886		)
Cash Flows from Investing Activities:
Purchases of property and equipment	(59,408		)	(21,021		)	(28,011		)	(18,556		)
Change in restricted cash	(1,489		)	(2,299		)
Net cash used in investing activities	(60,897		)	(23,320		)	(28,011		)	(18,556		)
Cash Flows from Financing Activities:
Proceeds from floor plan facility	674,411			246,880			393,119			147,390
Payments on floor plan facility	(644,641		)	(200,870		)	(293,378		)	(122,967		)
Proceeds from Verde Credit Facility	35,000			—			—			20,000
Payments on Verde Credit Facility	(35,000		)	—
Proceeds from long-term debt	7,596			—			15,608			—
Payments on long-term debt	(1,137		)	(107		)	(1,309		)	(260		)
Payments of debt issuance costs, including $1,000 and $0 to related parties, respectively	(1,000		)	(228		)
Payments of debt issuance costs, including $0 and $1,000 to related parties, respectively							(141		)	(1,000		)
Proceeds from exercise of stock options	28			—			63			—
Tax withholdings related to restricted stock awards	(399		)	—			(160		)	—
Proceeds from issuance of Class C redeemable preferred units	—			159,725
Class C redeemable preferred units issuance costs	—			(82		)
Net proceeds from initial public offering	206,323			—
Dividends paid							(1,528		)	—
Payments of costs related to issuance of Class A Convertible Preferred Stock							(12		)	—
Payments of costs related to initial public offering							—			(1,376		)
Net cash provided by financing activities	241,181			205,318			112,262			41,787
Net increase in cash and cash equivalents	64,270			37,220
Cash and cash equivalents at beginning of period	39,184			43,134
Cash and cash equivalents at end of period	$	103,454		$	80,354

Supplemental cash flow information:
Cash payments for interest to third parties	$	4,668		$	1,844
Cash payments for interest to related parties	$	382		$	30
Non-cash investing and financing activities:
Capital expenditures included in accounts payable and accrued liabilities	$	11,006		$	3,284
Capital expenditures financed through long-term debt	$	7,988		$	2,328
Accrual of return on Class C redeemable preferred units	$	9,439		$	13,224
Conversion of Class C redeemable preferred units to Class A units	$	260,411		$	—
Net decrease in cash, cash equivalents and restricted cash							(47,198		)	(29,655		)
Cash, cash equivalents and restricted cash at beginning of period							187,123			49,450
Cash, cash equivalents and restricted cash at end of period							$	139,925		$	19,795



				Class A				Class B
	Members' Deficit			Shares		Amount		Shares	Amount		Additional Paid-in Capital			Accumulated Deficit			Non-controlling Interests			Total Stockholders' Equity
Balance, December 31, 2016	$	(115,961	)	—		$	—	—	$	—	$	—		$	—		$	—		$	—
Equity-based compensation expense prior to Organizational Transactions	158			—		—		—	—		—			—			—			—
Accrued return on Class C Redeemable Preferred Units prior to Organizational Transactions	(9,439		)	—		—		—	—		—			—			—			—
Net loss prior to Organizational Transactions	(49,942		)	—		—		—	—		—			—			—			—
Conversion of Class C Redeemable Preferred Units for Class A Units	260,411			—		—		—	—		—			—			—			—
Effect of Organizational Transactions	(85,227		)	—		—		117,236	117		(174,255		)	—			259,365			85,227
Issuance of Class A common stock sold in initial public offering, net of underwriters' discounts and commissions and offering expenses	—			15,000		15		—	—		205,910			—			—			205,925
Net loss subsequent to Organizational Transactions	—			—		—		—	—		—			(7,419		)	(59,717		)	(67,136		)
Adjustments to non-controlling interests	—			—		—		—	—		333			—			(333		)	—
Issuance of restricted stock awards, net of forfeitures	—			538		1		—	—		(1		)	—			—			—
Restricted stock surrendered in lieu of withholding taxes	—			(27	)	—		—	—		(399		)	—			—			(399		)
Options exercised				2							28									28
Equity-based compensation expense recognized subsequent to Organizational Transactions	—			—		—		—	—		3,831			—			—			3,831
Balance, September 30, 2017	$	—		15,513		$	16	117,236	$	117	$	35,447		$	(7,419	)	$	199,315		$	227,476



				Convertible Preferred Stock			Class A				Class B
	Members' Deficit			Shares	Amount		Shares		Amount		Shares		Amount			Additional Paid-in Capital			Accumulated Deficit			Non-controlling Interests			Total Stockholders' Equity
Balance, December 31, 2016	$	(115,961	)	—	$	—	—		$	—	—		$	—		$	—		$	—		$	—		$	—
Equity-based compensation expense	158			—	—		—		—		—		—			—			—			—			—
Accrued return on Class C Redeemable Preferred Units	(7,261		)	—	—		—		—		—		—			—			—			—			—
Net loss	(38,439		)	—	—		—		—		—		—			—			—			—			—
Balance, March 31, 2017	$	(161,503	)	—	$	—	—		$	—	—		$	—		$	—		$	—		$	—		$	—

Balance, December 31, 2017	$	—		100	$	97,127	18,096		$	18	114,664		$	115		$	41,375		$	(12,899	)	$	153,808		$	279,544
Net loss	—			—	—		—		—		—		—			—			(7,043		)	(45,629		)	(52,672		)
Accretion of beneficial conversion feature on Class A Convertible Preferred Stock	—			—	1,380		—		—		—		—			(1,380		)	—			—			—
Preferred dividends	—			—	—		—		—		—		—			(1,345		)	—			—			(1,345		)
Exchanges of LLC Units	—			—	—		1,436		2		(1,341	)	(2		)	1,540			—			(1,540		)	—
Establishment of deferred tax assets related to increases in tax basis in Carvana Group	—			—	—		—		—		—		—			7,484			—			—			7,484
Establishment of valuation allowance related to deferred tax assets associated with increases in tax basis in Carvana Group	—			—	—		—		—		—		—			(7,484		)	—			—			(7,484		)
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes	—			—	—		(20	)	—		—		—			(160		)	—			—			(160		)
Options exercised	—			—	—		4		—		—		—			63			—			—			63
Equity-based compensation expense	—			—	—		—		—		—		—			1,510			—			—			1,510
Balance, March 31, 2018	$	—		100	$	98,507	19,516		$	20	113,323		$	113		$	41,603		$	(19,942	)	$	106,639		$	226,940



	September 30, 2017			December 31, 2016
Land and site improvements	$	11,474		$	9,355
Buildings and improvements	52,458			14,750
Transportation fleet	29,262			16,520
Software	15,673			10,065
Furniture, fixtures and equipment	10,728			3,704
Total property and equipment excluding construction in progress	119,595			54,394
Less: accumulated depreciation and amortization	(16,391		)	(9,752		)
Property and equipment excluding construction in progress, net	103,204			44,642
Construction in progress	22,792			15,950
Property and equipment, net	$	125,996		$	60,592



	March 31, 2018		December 31, 2017
Accounts payable	$	15,866	$	10,546
Sales taxes and vehicle licenses and fees	13,615		9,034
Accrued property and equipment	6,325		8,325
Accrued compensation and benefits	4,193		5,054
Accrued advertising costs	3,539		4,265
Other accrued liabilities	18,945		13,082
Total accounts payable and other accrued liabilities	$	62,483	$	50,306



	Three Months Ended September 30, 2017			Nine Months Ended September 30, 2017
Transfers (to) from non-controlling interests:
Decrease in additional paid-in capital as a result of the Organizational Transactions	$	—		$	(174,255	)
(Decrease) increase in additional paid-in capital as a result of adjustments to the non-controlling interests	(513		)	333
Total transfers to non-controlling interests	$	(513	)	$	(173,922	)



	Three Months Ended September 30, 2017		Nine Months Ended September 30, 2017
Expected volatility⁽¹⁾	63.0	%	63.0	%
Expected dividend yield	—	%	—	%
Expected term (in years)⁽²⁾	6.25		6.26
Risk-free interest rate	1.9	%	1.9	%



Exhibit No.	Description
~~10.1~~31.1	~~Second Amendment to the Carvana Co. 2017 Omnibus Incentive Plan, filed herewith.~~
~~10.2~~	~~Letter Agreement re Notice of Change in Release Period, filed herewith.~~
~~10.3~~	~~Second Amendment to the Amended and Restated Master Purchase and Sale Agreement, filed herewith.~~
~~10.4~~ *	~~Master Transfer Agreement, filed herewith.~~
~~10.5~~ *	~~Master Sale-Leaseback Agreement, filed herewith.~~
~~31.1~~	Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a), filed herewith.
31.2	Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a), filed herewith.
32.1	Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, filed herewith.
32.2	Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, filed herewith.
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema Document.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.




Date:	~~November 7, 2017~~May 9, 2018		Carvana Co.
			(Registrant)

		By:	/s/ Mark Jenkins
			Mark Jenkins
			Chief Financial Officer
			(On behalf of the Registrant and as Principal Financial Officer)