Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 03, 2019 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | CARVANA CO. | |
Entity Central Index Key | 0001690820 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Class A Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 44,155,061 | |
Class B Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 101,475,865 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | |
Current assets: | |||
Cash and cash equivalents | $ 85,321 | $ 78,861 | |
Restricted cash | 21,734 | 9,848 | |
Accounts receivable, net | 38,179 | 33,120 | |
Finance receivables held for sale, net | 151,186 | 105,200 | |
Vehicle inventory | 525,694 | 412,243 | |
Beneficial interests in securitizations | 19,531 | 0 | |
Other current assets | 35,141 | 23,582 | |
Total current assets | 876,786 | 662,854 | |
Property and equipment, net | 353,486 | 296,839 | |
Operating Lease, Right-of-Use Asset | 77,754 | 0 | |
Intangible assets, net | 8,496 | 8,869 | |
Goodwill | 9,353 | 9,353 | |
Other Assets, Noncurrent | 12,526 | 13,098 | |
Total assets | 1,338,401 | 991,013 | |
Current liabilities: | |||
Accounts payable and accrued liabilities | 165,024 | 117,524 | |
Accounts payable due to related party | 5,739 | 3,891 | |
Floor plan facility | 434,777 | 196,963 | |
Current portion of other long-term debt | 15,331 | 11,133 | |
Other current liabilities, including $4,519 and $0, respectively from leases with related parties | 9,159 | 0 | |
Total current liabilities | 630,030 | 329,511 | |
Senior unsecured notes | [1] | 343,251 | 342,869 |
Other long-term debt, excluding current portion | 135,788 | 82,480 | |
Operating lease liabilities, including $41,030 and $0, respectively from leases with related parties, excluding current portion | 74,641 | 0 | |
Other liabilities | 1,844 | 8,725 | |
Liabilities, Total | 1,185,554 | 763,585 | |
Commitments and contingencies (Note 15) | |||
Stockholders' equity: | |||
Preferred stock, $0.01 par value - 50,000 shares authorized; none issued and outstanding as of March 31, 2019 and December 31, 2018 | 0 | 0 | |
Additional paid in capital | 157,830 | 147,916 | |
Accumulated deficit | (103,202) | (74,653) | |
Total stockholders' equity attributable to Carvana Co. | 54,773 | 73,408 | |
Non-controlling interests | 98,074 | 154,020 | |
Total stockholders' equity | 152,847 | 227,428 | |
Total liabilities & stockholders' equity | 1,338,401 | 991,013 | |
Class A Common Stock | |||
Stockholders' equity: | |||
Common stock | 43 | 41 | |
Class B Common Stock | |||
Stockholders' equity: | |||
Common stock | $ 102 | $ 104 | |
[1] | As of both March 31, 2019 and December 31, 2018, a related party held $15.0 million of the senior unsecured notes. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) - Parenthetical - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Operating lease, right-of-use asset, related party | $ 77,754 | $ 0 |
Other assets, due from related parties | 12,526 | 13,098 |
Other current liabilities, from related parties | 9,159 | 0 |
Operating lease liabilities, leases with related parties, excluding current portion | $ 74,641 | $ 0 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Senior unsecured notes, amount held by related party | $ 15,000 | $ 15,000 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 43,243,000 | 41,208,000 |
Common stock, shares outstanding (in shares) | 43,243,000 | 41,208,000 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 |
Common stock, shares issued (in shares) | 102,352,000 | 104,336,000 |
Common stock, shares outstanding (in shares) | 102,352,000 | 104,336,000 |
Related Party | ||
Operating lease, right-of-use asset, related party | $ 42,779 | $ 0 |
Other assets, due from related parties | 2,492 | 1,895 |
Other current liabilities, from related parties | 4,519 | 0 |
Operating lease liabilities, leases with related parties, excluding current portion | $ 41,030 | $ 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Sales and operating revenues: | |||
Used vehicle sales, net | $ 683,829 | $ 334,056 | |
Wholesale vehicle sales | 33,030 | 10,133 | |
Other sales and revenues, including $10,573 and $4,111, respectively, from related parties | 38,375 | 16,233 | |
Net sales and operating revenues | 755,234 | 360,422 | |
Cost of sales, including $1,273 and $1,047, respectively, to related parties | 666,702 | 326,188 | |
Gross profit | 88,532 | 34,234 | |
Selling, General and Administrative Expense | 155,241 | 83,186 | |
Interest expense, including $333 and $0, respectively, to related parties | 15,648 | 3,541 | |
Other expense, net | 239 | 179 | |
Net loss before income taxes | (82,596) | (52,672) | |
Income tax provision | 0 | 0 | |
Net loss | (82,596) | (52,672) | |
Net loss attributable to non-controlling interests | (54,047) | (45,629) | |
Net loss attributable to Carvana Co. | (28,549) | (7,043) | |
Dividends on Class A convertible preferred stock | 0 | (1,345) | |
Accretion of beneficial conversion feature on Class A convertible Preferred Stock | 0 | (1,380) | |
Net loss attributable to Class A common stockholders | $ (28,549) | $ (9,768) | |
Class A Common Stock | |||
Sales and operating revenues: | |||
Net loss per share of Class A common stock, basic and diluted (in dollars per share) | $ (0.69) | $ (0.53) | |
Weighted-average shares of Class A common stock, basic and diluted (in shares) | [1] | 41,352 | 18,346 |
[1] | Weighted-average shares of Class A common stock outstanding have been adjusted for unvested restricted stock awards. |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations (Unaudited) - Parenthetical - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cost of sales, to related parties | $ 666,702 | $ 326,188 |
Selling, general and administrative expense, to related parties | 155,241 | 83,186 |
Related Party | ||
Other sales and revenues, from related parties | 10,573 | 4,111 |
Cost of sales, to related parties | 1,273 | 1,047 |
Selling, general and administrative expense, to related parties | 2,735 | 1,819 |
Interest expense, to related parties | $ 333 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Restricted Stock Units | Carvana Group | Class A Convertible Preferred Stock | Class A Common StockRestricted Stock Units | Preferred StockClass A Convertible Preferred Stock | Common StockClass A Common Stock | Common StockClass A Common StockRestricted Stock Units | Common StockClass B Common Stock | Additional Paid-in Capital | Additional Paid-in CapitalCarvana Group | Additional Paid-in CapitalClass A Convertible Preferred Stock | Accumulated Deficit | Non-controlling Interests |
Stockholders' Equity, beginning of the period (in shares) at Dec. 31, 2017 | 100,000 | 18,096,000 | 114,664,000 | |||||||||||
Stockholders' Equity, beginning of the period at Dec. 31, 2017 | $ 279,544 | $ 97,127 | $ 18 | $ 115 | $ 41,375 | $ (12,899) | $ 153,808 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net loss | (52,672) | (7,043) | (45,629) | |||||||||||
Accretion of beneficial conversion feature on Class A convertible Preferred Stock | (1,380) | $ 1,400 | $ 1,380 | $ (1,380) | ||||||||||
Preferred dividends | (1,345) | (1,345) | ||||||||||||
Exchanges of LLC Units (in shares) | 1,436,000 | (1,341,000) | ||||||||||||
Exchanges of LLC Units | $ 2 | $ (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 (in shares) | (20,000) | |||||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes | (160) | (160) | ||||||||||||
Options exercised (in shares) | 4,000 | |||||||||||||
Options exercised | 63 | 63 | ||||||||||||
Equity-based compensation expense | 1,510 | 1,510 | ||||||||||||
Stockholders' Equity, end of the period (in shares) at Mar. 31, 2018 | 100,000 | 19,516,000 | 113,323,000 | |||||||||||
Stockholders' Equity, end of the period at Mar. 31, 2018 | 226,940 | $ 98,507 | $ 20 | $ 113 | 41,603 | (19,942) | 106,639 | |||||||
Stockholders' Equity, beginning of the period (in shares) at Dec. 31, 2018 | 0 | 41,208,000 | 104,336,000 | |||||||||||
Stockholders' Equity, beginning of the period at Dec. 31, 2018 | 227,428 | $ 0 | $ 41 | $ 104 | 147,916 | (74,653) | 154,020 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Net loss | (82,596) | (28,549) | (54,047) | |||||||||||
Accretion of beneficial conversion feature on Class A convertible Preferred Stock | 0 | |||||||||||||
Exchanges of LLC Units (in shares) | 2,020,000 | (1,984,000) | ||||||||||||
Exchanges of LLC Units | $ 2 | $ (2) | 1,899 | (1,899) | ||||||||||
Establishment of deferred tax assets related to increases in tax basis in Carvana Group | 25,582 | 25,582 | ||||||||||||
Establishment of valuation allowance related to deferred tax assets associated with increases in tax basis in Carvana Group | $ (25,582) | $ (25,582) | ||||||||||||
Contribution of Class A common stock from related party (in shares) | (72,000) | |||||||||||||
Issuance of Class A common stock to settle vested restricted stock units (in shares) | 100,000 | 100,000 | 74,000 | |||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes (in shares) | (14,000) | |||||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes | (433) | (433) | ||||||||||||
Options exercised (in shares) | 27,000 | |||||||||||||
Options exercised | 426 | 426 | ||||||||||||
Equity-based compensation expense | 8,022 | 8,022 | ||||||||||||
Stockholders' Equity, end of the period (in shares) at Mar. 31, 2019 | 0 | 43,243,000 | 102,352,000 | |||||||||||
Stockholders' Equity, end of the period at Mar. 31, 2019 | $ 152,847 | $ 0 | $ 43 | $ 102 | $ 157,830 | $ (103,202) | $ 98,074 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (82,596) | $ (52,672) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization expense | 7,943 | 4,605 |
Loss on disposal of property and equipment | 49 | 103 |
Provision for bad debt and valuation allowance | 1,385 | 597 |
Gain on loan sales | (19,200) | (9,891) |
Equity-based compensation expense | 7,711 | 1,510 |
Amortization and write-off of debt issuance costs | 979 | 323 |
Originations of finance receivables | (532,066) | (228,595) |
Principal payments received on finance receivables held for sale | 11,227 | 0 |
Proceeds from sale of finance receivables, net | 601,557 | 220,357 |
Purchase of finance receivables | (127,710) | 0 |
Changes in assets and liabilities: | ||
Accounts receivable | (5,435) | (6,969) |
Vehicle inventory | (112,536) | (72,030) |
Other current assets | (13,111) | (2,998) |
Other assets | 238 | 297 |
Operating lease right-of-use assets | (1,262) | |
Accounts payable and accrued liabilities | 46,784 | 12,957 |
Accounts payable to related party | 1,848 | 800 |
Operating lease liabilities | 68 | |
Other liabilities | (382) | 157 |
Net cash used in operating activities | (214,509) | (131,449) |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment, including $4,257 and $0 from related parties | (43,199) | (28,011) |
Net cash used in investing activities | (43,199) | (28,011) |
Cash Flows from Financing Activities: | ||
Proceeds from floor plan facility | 807,890 | 393,119 |
Payments on floor plan facility | (570,076) | (293,378) |
Proceeds from long-term debt | 41,817 | 15,608 |
Payments on long-term debt | (3,003) | (1,309) |
Payments of debt issuance costs | (567) | (141) |
Proceeds from exercise of stock options | 426 | 63 |
Tax withholdings related to restricted stock awards | (433) | (160) |
Dividends paid | 0 | (1,528) |
Net proceeds from issuance of Class A Convertible Preferred Stock | 0 | (163) |
Net cash provided by financing activities | 276,054 | 112,262 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 18,346 | (47,198) |
Cash, cash equivalents and restricted cash at beginning of period | 88,709 | 187,123 |
Cash, cash equivalents and restricted cash at end of period | 107,055 | 139,925 |
Class A Convertible Preferred Stock | ||
Cash Flows from Financing Activities: | ||
Dividends paid | (1,500) | |
Net proceeds from issuance of Class A Convertible Preferred Stock | $ 0 | $ (12) |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Purchases of property and equipment, from related parties | $ 43,199 | $ 28,011 |
Related Party | ||
Purchases of property and equipment, from related parties | $ 4,257 | $ 0 |
Business Organization
Business Organization | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Organization | NOTE 1 — BUSINESS ORGANIZATION Description of Business Carvana Co. and its wholly-owned subsidiary Carvana Co. Sub (collectively, "Carvana Co.") together with its consolidated subsidiaries (the “Company”) is a leading e-commerce platform for buying and selling used cars. The Company is transforming the used car sales experience by giving consumers what they want — a wide selection, great value and quality, transparent pricing and a simple, no pressure transaction. Using the website, customers can complete all phases of a used vehicle purchase transaction including financing their purchase, trading in their current vehicle and purchasing complementary products such as vehicle service contracts and GAP waiver coverage. Each element of the Company's business, from inventory procurement to fulfillment and overall ease of the online transaction, has been built for this singular purpose. Organization Carvana Co. is a holding company that was formed as a Delaware corporation on November 29, 2016 for the purpose of completing its initial public offering ("IPO") and related transactions in order to operate the business of Carvana Group, LLC and its subsidiaries (collectively, "Carvana Group"). Substantially all of the Company’s assets and liabilities represent the assets and liabilities of Carvana Group, except the Company's senior unsecured notes which were issued by Carvana Co. and guaranteed by its and Carvana Group's existing domestic restricted subsidiaries. In accordance with Carvana Group LLC's amended and restated limited liability company agreement (the "LLC Agreement"), Carvana Co. is the sole manager of Carvana Group, LLC and conducts, directs and exercises full control over the activities of Carvana Group. There are two classes of common ownership interests in Carvana Group, LLC, Class A common units ( the "Class A Units") and Class B common units (the "Class B Units"). As further discussed in Note 10 — Stockholders' Equity, the Class A Units and Class B Units (collectively, the "LLC Units") do not hold voting rights, which results in Carvana Group, LLC being considered a variable interest entity ("VIE"). Due to Carvana Co.'s power to control and its significant economic interest in Carvana Group, it is considered the primary beneficiary of the VIE and the Company consolidates the financial results of Carvana Group. As of March 31, 2019, Carvana Co. owned approximately 28.6% of Carvana Group and the LLC Unitholders owned the remaining 71.4%. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. All intercompany balances and transactions have been eliminated. Certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted. The Company believes the disclosures made are adequate to prevent the information presented from being misleading. However, the accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included within the Company's most recent Annual Report on Form 10-K. The accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal and recurring items) necessary to present fairly the Company’s financial position as of March 31, 2019, results of operations, cash flows, and changes in stockholder's equity for the three months ended March 31, 2019 and 2018. Interim results are not necessarily indicative of full year performance because of the impact of seasonal and short-term variations. As discussed in Note 1 — Business Organization, Carvana Group is considered a VIE and Carvana Co. consolidates its financial results due to the determination that it is the primary beneficiary. Liquidity The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared in conformity with U.S. GAAP, which contemplate continuation of the Company as a going concern. The Company has incurred losses from inception through March 31, 2019, and expects to incur additional losses in the future. As the Company continues to grow into new markets, build vending machines and inspection and reconditioning centers and enhance technology and software development efforts, it needs access to substantial capital. From inception, the Company has primarily funded operations through the issuance of equity instruments and the issuance of senior unsecured notes. The Company has historically funded vehicle inventory purchases through its Floor Plan Facility, and as of March 31, 2019 had approximately $215.2 million available under its $650.0 million Floor Plan Facility that matures in October 2020 to fund future vehicle inventory purchases, as described in further detail in Note 9 — Debt Instruments. The Company has also funded a portion of its capital expenditures through long-term financing with lenders and other investors as described in further detail in Note 9 — Debt Instruments and Note 15 — Leases. The Company has entered into securitization transactions and various agreements under which it sells the finance receivables it originates to financing partners, subject to each party's rights under the respective agreement, as further discussed in Note 7 — Finance Receivable Sale Agreements and Note 8 — Securitizations and Variable Interest Entities. Management believes that current working capital and expected continued inventory, capital expenditure, and receivables financing are sufficient to fund operations for at least one year from the financial statement issuance date. Use of Estimates The preparation of these unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. Certain accounting estimates involve significant judgments, assumptions and estimates by management that have a material impact on the carrying value of certain assets and liabilities, disclosures of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period, which management considers to be critical accounting estimates. The judgments, assumptions and estimates used by management are based on historical experience, management’s experience and other factors, which are believed to be reasonable under the circumstances. Because of the nature of the judgments and assumptions made by management, actual results could differ materially from these judgments and estimates, which could have a material impact on the carrying values of the Company’s assets and liabilities and the results of operations. Comprehensive Loss During the three months ended March 31, 2019 and 2018, the Company had no other components of comprehensive loss and, therefore, the net loss and comprehensive loss were the same for all periods presented. Restricted Cash As of March 31, 2019 and December 31, 2018, the restricted cash includes 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 9 — Debt Instruments. Leases As discussed below, the Company adopted ASC 842 on January 1, 2019. Under ASC 842, the Company determines if an arrangement is a lease at inception by evaluating if the asset is explicitly or implicitly identified or distinct, if the Company will receive substantially all of the economic benefit or if the lessor has an economic benefit and the ability to substitute the asset. Right-of-use ("ROU") assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. The Company assesses whether the lease is an operating or finance lease at its inception. Operating lease liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. To calculate the present value, the Company uses the implicit rate in the lease when readily determinable. However, most of the Company's leases do not provide an implicit rate and it uses its incremental borrowing rate. The incremental borrowing rate is based on collateralized borrowings of similar assets with terms that approximate the lease term when available and when collateralized rates are not available, it uses uncollateralized rates with similar terms adjusted for the fact that it is an unsecured rate. The operating lease ROU asset is the initial lease liability adjusted for any prepayments, initial indirect costs incurred by the Company, and lease incentives. The Company's operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities in its accompanying unaudited condensed consolidated balance sheets. The Company's finance leases are included in property and equipment, and other debt in its accompanying unaudited condensed consolidated balance sheets. Securitizations and Variable Interest Entities The Company reviews subsidiaries and affiliates, as well as other entities, to determine if they should be considered variable interest entities, and whether it should change the consolidation determinations based on changes in their characteristics. The Company considers an entity a VIE if its equity investors own an interest therein that lacks the characteristics of a controlling financial interest or if such investors do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or if the entity is structured with non-substantive voting interests. A VIE is consolidated by its primary beneficiary, the party that has both the power to direct the activities that most significantly impact the VIE’s economic performance and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. The Company evaluates whether it has variable interests in the VIE and if so, if it is the primary beneficiary of the VIE on an ongoing basis. The Company consolidates VIEs when it is deemed to be the primary beneficiary. The Company sponsors asset-backed securitization transactions. These transactions often result in the creation of securitization trusts, which are VIEs. To comply with Regulation RR of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Risk Retention Rules") the Company retains at least 5% interest in the credit risk of the underlying finance receivables, which it accomplishes by retaining at least a 5% interest in each security issued by the securitization trusts. Typically, this includes notes and certificates, which are presented as beneficial interests in securitizations in the accompanying unaudited condensed consolidated balance sheets. Fair Value Measurements The fair value of financial instruments is based on estimates using quoted market prices, discounted cash flows or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and the estimated timing and amount of future cash flows. Therefore, the estimates of fair value may differ substantially from amounts that ultimately may be realized or paid at settlement or maturity of the financial instruments, and those differences may be material. Accordingly, the aggregate fair value amounts presented may not represent the Company’s underlying institutional value. The Company uses the three-tier hierarchy established by U.S. GAAP, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value to determine the fair value of its financial instruments. This hierarchy indicates to what extent the inputs used in the Company’s calculations are observable in the market. The different levels of the hierarchy are defined as follows: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Other than quoted prices that are observable in the market for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the fill term of the assets or liabilities. Level 3: Inputs are unobservable and reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The Company has elected the fair value option for its beneficial interests in securitization trusts, which primarily include notes and certificates of the securitization trust. Electing the fair value option allows the Company to recognize changes in the fair value of these assets in the period the fair value changes. The changes in fair value are recorded within other expense, net and amounts attributable to interest income are reported in interest expense, net on the accompanying unaudited condensed consolidated statement of operations. See Note 17 — Fair Value of Financial Instruments for additional information. Segments Business segments are defined as components of an enterprise about which discrete financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing operating performance. Based on the way the Company manages its business, the Company has determined that it currently operates with one reportable segment. The chief operating decision maker focuses on consolidated results in assessing operating performance and allocating resources. Furthermore, the Company offers similar products and services and uses similar processes to sell those products and services to similar classes of customers throughout the United States (“U.S.”). Substantially all revenue is generated and all assets are held in the U.S. for all periods presented. Adoption of New Accounting Standards Beginning in February 2016, the FASB issued several accounting standards updates related to the new leasing model in ASC 842, Leases ("ASC 842"). ASC 842 introduced a model that requires leases to be presented on the balance sheet and eliminates the requirement for an entity to use bright-line tests in determining lease classification. Expense recognition under ASC 842 on the income statement remains similar to previous lease accounting guidance. The Company adopted ASC 842 on January 1, 2019 using the modified retrospective approach, the practical expedient package and the transition relief option, which allowed the Company to, among other things, avoid reassessing lease classification for existing leases, forego the balance sheet recognition requirements with respect to short-term leases and avoid restating comparative periods presented. The adoption of ASC 842 resulted in initial recognition of ROU assets and operating lease liabilities of approximately $80.3 million and $86.8 million, respectively, as of January 1, 2019, and did not have an impact on the beginning equity balances as of the implementation date. Adopting ASC 842 did not have a material impact on the Company's sale-leaseback transactions, which have typically been accounted for as financing transactions in prior periods and under ASC 842. The standard did not have a material impact on the Company's consolidated statements of operations or statements of cash flows. In June 2018, the FASB issued ASU 2018-07, Compensation — Stock Compensation (Topic 718) ("ASU 2018-07") related to the accounting for share-based payment transactions for acquiring goods and services from nonemployees. Under ASU 2018-07, the intent is to simplify and align most requirements for share-based payments to nonemployees with the requirements for share-based payments granted to employees under ASC 718, including measuring the equity instruments at the grant-date fair value. The Company adopted ASU 2018-07 on January 1, 2019 using the modified retrospective approach. The adoption of ASU 2018-07 did not have a material effect on the Company’s consolidated financial statements. Accounting Standards Issued But Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which amends the guidance on the impairment of financial instruments by requiring measurement and recognition of expected credit losses for financial assets held. ASU 2016-13 is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, and earlier adoption is permitted beginning in the first quarter of fiscal 2019. Debt securities available for sale are excluded from the scope of ASU 2016-13. The Company plans to adopt ASU 2016-13 for its fiscal year beginning January 1, 2020. Finance receivables originated in connection with the Company’s vehicle sales are held for sale and are subsequently sold. The Company does not presently hold any finance receivables until maturity. Therefore, the Company does not expect adoption of ASU 2016-13 to have a material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13") related to updated requirements over the disclosures of fair value measurements. Under ASU 2018-13, certain disclosure requirements for fair value measurements will be eliminated, modified or added to facilitate better communication around recurring and nonrecurring fair value measurements. ASU 2018-13 is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, with some amendments applied prospectively, some applied retrospectively and early adoption permitted. The Company plans to adopt ASU 2018-13 for its fiscal year beginning January 1, 2020 and is currently assessing the impact the guidance will have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). The intent of this pronouncement is to align the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software as defined in ASC 350-40. Under ASU 2018-15, the capitalized implementation costs related to a cloud computing arrangement will be amortized over the term of the arrangement and all capitalized implementation amounts will be required to be presented in the same line items of the financial statements as the related hosting fees. ASU 2018-15 is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company plans to adopt ASU 2018-15 for its fiscal year beginning January 1, 2020 and is currently assessing the impact, if any, the guidance will have on its consolidated financial statements. In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities ("ASU 2018-17"). ASU 2018-17 requires reporting entities to consider indirect interests held through related parties under common control on a proportional basis rather than as the equivalent of a direct interest in its entirety for determining whether a decision-making fee is a variable interest. The standard is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. Entities are required to apply the amendments in ASU 2018-17 retrospectively with a cumulative-effect adjustment to retained earnings at the beginning of the earliest period presented. The Company plans to adopt ASU 2018-15 for its fiscal year beginning January 1, 2020 and is currently assessing the impact, if any, the guidance will have on its consolidated financial statements. |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | NOTE 3 — PROPERTY AND EQUIPMENT, NET The following table summarizes property and equipment, net as of March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Land and site improvements $ 55,839 $ 45,702 Buildings and improvements 146,056 123,705 Transportation fleet 85,827 65,760 Software 39,902 36,452 Furniture, fixtures and equipment 24,903 20,675 Total property and equipment excluding construction in progress 352,527 292,294 Less: accumulated depreciation and amortization on property and equipment (52,505) (44,050) Property and equipment excluding construction in progress, net 300,022 248,244 Construction in progress 53,464 48,595 Property and equipment, net $ 353,486 $ 296,839 Depreciation and amortization expense on property and equipment was approximately $7.6 million and $4.6 million for the three months ended March 31, 2019 and 2018, respectively. These amounts primarily relate to selling, general and administrative activities and are included as a component of selling, general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations. |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Goodwill and Intangible Assets, Net | NOTE 4 — GOODWILL AND INTANGIBLE ASSETS, NET On April 12, 2018, the Company acquired Car360, Inc. ("Car360"), a provider of app-based photo capture technology, for approximately $16.7 million, net of cash acquired of approximately $0.4 million. The purchase price was comprised of approximately $6.7 million cash, net of cash acquired, and approximately 0.5 million Class A Units of Carvana Group, with a fair value of approximately $10.0 million. The purchase price was allocated to net tangible assets of approximately $0.2 million and intangible assets of approximately $9.9 million based on their fair values on the acquisition date and a related deferred tax liability of approximately $2.5 million. The deferred tax liability will amortize over 5 years to 7 years, and approximately $0.4 million and $0.0 million was amortized during the three months ended March 31, 2019 and 2018, respectively. The excess of the purchase price over the amounts allocated to assets acquired, liabilities assumed and the deferred tax liability was approximately $9.4 million, which has been recorded as goodwill. The historical results of operations for Car360 were not significant to the Company's consolidated results of operations for the periods presented. The following table summarizes intangible assets and goodwill related to the Car360 acquisition as of March 31, 2019 and December 31, 2018 (in thousands): Useful Life March 31, 2019 December 31, 2018 Intangible assets: Developed technology 7 years $ 8,642 $ 8,642 Customer relationships 5 years 523 523 Non-compete agreements 5 years 774 774 Intangible assets, acquired cost 9,939 9,939 Less: accumulated amortization (1,443) (1,070) Intangible assets, net $ 8,496 $ 8,869 Goodwill N/A $ 9,353 $ 9,353 Amortization expense during the three months ended March 31, 2019 and 2018 was approximately $0.4 million and $0.0 million, respectively. As of March 31, 2019, the remaining weighted-average amortization period for definite-lived intangible assets was approximately 5.8 years. The anticipated annual amortization expense to be recognized in future years as of March 31, 2019 is as follows (in thousands): Expected Future Amortization Remainder of 2019 $ 1,120 2020 1,494 2021 1,494 2022 1,494 2023 1,308 2024 1,235 Thereafter 351 Total $ 8,496 |
Accounts Payable and Other Accr
Accounts Payable and Other Accrued Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Other Accrued Liabilities | NOTE 5 — ACCOUNTS PAYABLE AND OTHER ACCRUED LIABILITIES The following table summarizes accounts payable and other accrued liabilities as of March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Accounts payable $ 44,106 $ 29,141 Sales taxes and vehicle licenses and fees 36,861 27,651 Accrued interest expense 20,469 9,206 Reserve for returns and cancellations 17,226 11,284 Accrued property and equipment 8,682 7,414 Accrued compensation and benefits 8,249 13,477 Accrued advertising costs 7,641 4,398 Other accrued liabilities 21,790 14,953 Total accounts payable and accrued liabilities $ 165,024 $ 117,524 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 6 — RELATED PARTY TRANSACTIONS Lease Agreements In November 2014, the Company and DriveTime entered into a lease agreement that governs the Company’s access to and utilization of temporary storage, reconditioning, offices and parking space at various DriveTime inspection and reconditioning centers and retail facilities (the "DriveTime Lease Agreement"). The DriveTime Lease Agreement was most recently amended in December 2018. Lease duration varies by location, with cancellable terms, provided 60 days' prior written notice is given, expiring between 2021 and 2024. Most of the retail facilities allow the Company to exercise up to two consecutive one In March 2017, the Company and DriveTime entered into a lease agreement that governs the Company's access to and utilization of office and parking space at various DriveTime retail facilities (the "DriveTime Hub Lease Agreement"). The DriveTime Hub Lease Agreement was most recently amended in December 2018. Lease expiration varies by location with most having cancellable terms, provided 60 days' prior written notice is given, expiring in 2021 and the Company having the right to exercise up to two consecutive one The DriveTime Lease Agreement and the DriveTime Hub Lease Agreement both have non-cancellable lease terms of less than twelve months with rights to terminate at the Company's election with 60 days prior written notice and extension options as described above. It is not reasonably certain that the Company will exercise its options to extend the leases or abstain from exercising its termination rights at the hub locations within these lease agreements to create a lease term greater than one year and therefore the Company accounts for them as short-term leases. The Company expects to extend the lease terms of the locations where it reconditions vehicles beyond twelve months, therefore those locations are not considered short-term leases. Under these lease agreements the Company makes variable monthly lease payments based on its pro rata utilization of space at each facility plus a pro rata share of each facility’s actual insurance costs and real estate taxes. The Company pays actual insurance costs and real estate taxes directly at locations where it occupies all of the space, including the Blue Mound and Delanco inspection and reconditioning centers. The Company is additionally responsible for paying for any tenant improvements it requires to conduct its operations and its share of estimated costs incurred by DriveTime related to preparing these sites for use. As it relates to locations where the Company reconditions vehicles, the Company’s share of facility and shared reconditioning supplies expenses are related to the actual costs for operating the inspection and reconditioning centers and the Company’s pro rata share of total reconditioned vehicles and parking spaces at such inspection and reconditioning centers in a given month. Management has determined that the costs allocated to the Company are based on a reasonable methodology. In December 2016, the Company entered into a lease agreement related to a vehicle inspection and reconditioning center in Tolleson, Arizona, with Verde Investments, Inc., an affiliate of DriveTime ("Verde"), with an initial term of approximately 15 years. In August 2018, the Company entered into an additional lease agreement with a coterminous initial term with Verde for contiguous space to that inspection and reconditioning center. The lease agreements require monthly rental payments and can each be extended for four additional five In February 2017, the Company entered into a lease agreement with DriveTime for sole occupancy of a fully operational inspection and reconditioning center in Winder, Georgia, where the Company previously maintained partial occupancy. The lease has an initial term of eight years, subject to the Company's ability to exercise three renewal options of five years each. In November 2018, the Company entered into a lease agreement with DriveTime for access to and utilization of a fully operational inspection and reconditioning center near Cleveland, Ohio. DriveTime vacated the facility in February 2019, at which point the Company became the sole occupant and purchased certain leasehold improvements and equipment at the facility from DriveTime for approximately $4.3 million and began leasing the full facility from DriveTime. The lease has an initial term of three years, subject to the Company's ability to exercise three renewal options of five years each. Before DriveTime vacated the facility, the Company paid a monthly rental fee related to its pro rata utilization of space at the facility plus a pro rata share of the facility’s actual insurance costs and real estate taxes. Before DriveTime vacated the facility, the Company’s share of facility and shared reconditioning supplies expenses were calculated based on the actual costs for operating the inspection and reconditioning center and the Company’s pro rata share of total reconditioned vehicles and parking spaces at the inspection and reconditioning center in a given month. Management has determined that the costs allocated to the Company are based on a reasonable methodology. Expenses related to these operating lease agreements are allocated based on usage to inventory and selling, general and administrative expenses in the accompanying unaudited condensed consolidated balance sheets and statements of operations. Costs allocated to inventory are recognized as cost of sales when the inventory is sold. During the three months ended March 31, 2019, total costs related to these operating lease agreements, including those noted above, were approximately $2.0 million with approximately $0.8 million and $1.2 million allocated to inventory and selling, general and administrative expenses, respectively. During the three months ended March 31, 2018, total costs related to these lease agreements were approximately $2.2 million with approximately $1.0 million and $1.2 million allocated to inventory and selling, general and administrative expenses, respectively. Corporate Office Leases In September 2016, the Company entered into a lease for the second floor of its corporate headquarters in Tempe, Arizona. DriveTime guarantees up to $0.5 million of the Company's rent payments under that lease through September 2019. In connection with that lease, the Company entered into a sublease with DriveTime for the use of the first floor of the same building. The lease and sublease each have a term of 83 months, subject to the right to exercise three five Lease Assumption from DriveTime In February 2019, the Company entered into an agreement to assume a lease of an inspection and reconditioning center near Nashville, Tennessee that DriveTime leased from an unrelated landlord. As part of the agreement, the Company purchased from DriveTime certain leasehold improvements and equipment at the facility for approximately $2.0 million when the Company became the sole occupant in April 2019. The lease expires in four years, subject to the ability to exercise three renewal options of five Master Dealer Agreement In December 2016, the Company entered into a master dealer agreement with DriveTime (the "Master Dealer Agreement"), pursuant to which the Company may sell vehicle service contracts ("VSCs") to customers purchasing a vehicle from the Company. The Company earns a commission on each VSC sold to its customers and DriveTime is obligated by and subsequently administers the VSCs. The Company collects the retail purchase price of the VSCs from its customers and remits the purchase price net of commission to DriveTime. During the three months ended March 31, 2019 and 2018, the Company recognized approximately $10.1 million and $4.1 million, respectively, of commissions earned on VSCs sold to its customers and administered by DriveTime, net of a reserve for estimated contract cancellations. The commission earned on the sale of these VSCs is included in other sales and revenues in the accompanying unaudited condensed consolidated statements of operations. In November 2018, the Company amended the Master Dealer Agreement to allow the Company to receive payments for excess reserves based on the performance of the VSCs versus the reserves held by the VSC administrator, once a required claims period for such VSCs has passed. During the three months ended March 31, 2019, the Company recognized approximately $0.5 million related to payments for excess reserves to which it expects to be entitled, which is included in other sales and revenues in the accompanying unaudited condensed consolidated statement of operations. Beginning in 2017, DriveTime also administers a portion of the Company's GAP waiver coverage and the limited warranty provided to all customers under the Master Dealer Agreement. The Company pays a per-contract fee to DriveTime to administer a portion of the GAP waiver coverage it sells to its customers and a per-vehicle fee to DriveTime to administer the limited warranty included with every purchase. During the three months ended March 31, 2019 and 2018, the Company incurred approximately $0.8 million and $0.3 million, respectively, related to the administration of GAP waiver coverage and limited warranty. GAP Waiver Insurance Policy In March 2019, the Company purchased an insurance policy from BlueShore Insurance Company ("BlueShore"), an affiliate of DriveTime, for approximately $1.0 million that reimburses the lienholder of finance receivables with GAP waiver coverage for any GAP waiver claims on a defined set of finance receivables that the Company sold in a securitization transaction. This insurance is transferred with the underlying finance receivable. Simultaneously, the Company entered into a retrospective profit sharing agreement with BlueShore under which the Company will share in the profits generated from the insurance policy by receiving a portion of the excess of the premium it paid to BlueShore, net of a fee, compared to the amount BlueShore pays out related to the GAP waiver claims. As of March 31, 2019, the Company held a receivable of approximately $0.1 million, which is included in other assets on the accompanying unaudited condensed consolidated balance sheets, related to this retrospective profit sharing agreement. Servicing and Administrative Fees DriveTime provides servicing and administrative functions associated with the Company's finance receivables. The Company incurred expenses of approximately $0.5 million, and $0.1 million for the three months ended March 31, 2019 and 2018, respectively, related to these services. Aircraft Time Sharing Agreement The Company entered into an agreement to share usage of two aircraft owned by Verde and operated by DriveTime on October 22, 2015, and the agreement was subsequently amended on May 15, 2017. Pursuant to the agreement, the Company agreed to reimburse DriveTime for actual expenses for each of its flights. The original agreement was for 12 months, with perpetual 12-month automatic renewals. Either the Company or DriveTime can terminate the agreement with 30 days’ prior written notice. During each of the three months ended March 31, 2019 and 2018, the Company reimbursed DriveTime approximately $0.1 million under this agreement. Senior Unsecured Notes Held by Verde As of March 31, 2019 and December 31, 2018, Verde held $15.0 million of principal of the Company's outstanding senior unsecured notes, which are described further in Note 9 — Debt Instruments. Accounts Payable Due to Related Party As of March 31, 2019 and December 31, 2018, approximately $5.7 million and $3.9 million, respectively, was due to related parties primarily related to the agreements mentioned above, and is included in accounts payable to related party in the accompanying unaudited condensed consolidated balance sheets. Contribution Agreements On September 10, 2018, the Company announced a commitment by its Chief Executive Officer, Ernest Garcia III, to contribute shares of the Company's Class A common stock, for each then-current employee from his personal shareholdings to the Company at no charge (the “Share Contributions”). His contributions are intended to fund equity awards of 165 restricted stock units to each of the Company's then-current employees upon their satisfying certain employment tenure requirements (the "100k Milestone Gift"). The Company entered into certain contribution agreements related to his commitment in order to effect the transfer of shares from Mr. Garcia to the Company. The Company does not expect Mr. Garcia to incur any tax obligations related to the Share Contributions, but pursuant to a series of contribution agreements, it has indemnified Mr. Garcia from any such obligations that may arise. See Note 10 — Stockholders' Equity and Note 12 — Equity-Based Compensation for further discussion. IP License Agreement In February 2017, the Company entered into a license agreement that governs the rights of certain intellectual property owned by the Company and the rights of certain intellectual property owned by DriveTime. The license agreement, which was amended and restated in April 2017, generally provides that each party grants to the other certain limited exclusive (other than with respect to the licensor party and its affiliates) and non-exclusive licenses to use certain of its intellectual property, and each party agrees to certain covenants not to sue the other party, its affiliates and certain of its service providers in connection with various patent claims. The exclusive license to DriveTime is limited to the business that is primarily of subprime used car sales to retail customers. However, upon a change of control of either party, both parties’ license rights as to certain future improvements to licensed intellectual property and all limited exclusivity rights are terminated. The agreement does not provide a license to any of the Company's patents, trademarks, logos, customers’ personally identifiable information or any intellectual property related to the Company's vending machines, automated vehicle photography or certain other elements of the Company's brand. |
Finance Receivable Sale Agreeme
Finance Receivable Sale Agreements | 3 Months Ended |
Mar. 31, 2019 | |
Transfers and Servicing [Abstract] | |
Finance Receivable Sale Agreements | NOTE 7 — FINANCE RECEIVABLE SALE AGREEMENTS In December 2016, the Company entered into a master purchase and sale agreement (the "Master Purchase and Sale Agreement" or "MPSA") and a master transfer agreement (the "2016 Master Transfer Agreement") pursuant to which it sells finance receivables meeting certain underwriting criteria to certain financing partners, including Ally Bank and Ally Financial (the "Ally Parties"). Through November 2017 under the MPSA and the 2016 Master Transfer Agreement, the Company could sell up to an aggregate of $375.0 million, and $292.2 million, respectively, in principal balances of finance receivables subject to adjustment as described in the respective agreements. On November 3, 2017, the Company amended its MPSA 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 2016 Master Transfer Agreement and replaced this facility by entering into a new master transfer agreement (the "2017 Master Transfer Agreement") with a purchaser trust under which the trust committed to purchase up to an aggregate of approximately $357.1 million in principal balances of finance receivables. On November 2, 2018, the Company amended the 2017 Master Transfer Agreement to, among other things and subject to the terms of the agreement, increase and extend the trust's commitment to purchase finance receivables from the Company. The trust's available financing following the November amendment permits up to $454.5 million in principal balances of finance receivables to be purchased, and the trust's purchase commitment contemplates it securing up to three times the currently available financing in the aggregate following the November amendment. Also on November 2, 2018, the Company amended the MPSA to, among other things and subject to the terms of the agreement, commit the purchaser to purchase up to a maximum of $1.25 billion of principal balances of finance receivables during the term of the agreement, which was extended to November 1, 2019. During the three months ended March 31, 2019 and 2018, the Company sold approximately $65.3 million and $125.6 million, respectively, in principal balances of finance receivables under the MPSA and had approximately $1.1 billion of unused capacity as of March 31, 2019. During the three months ended March 31, 2019 and 2018, the Company sold approximately $58.3 million and $85.5 million, respectively, in principal balances of finance receivables under the 2017 Master Transfer Agreement and had approximately $396.2 million of unused capacity as of March 31, 2019. During the three months ended March 31, 2019, the Company also purchased finance receivables that it previously sold to a purchaser trust under the 2017 Master Transfer Agreement for a total price of approximately $127.7 million and immediately resold such finance receivables into a securitization transaction, which is described further in Note 8 — Securitizations and Variable Interest Entities. Other than customary repurchase obligations, the Company is not obligated to, nor does it have a right to, purchase or sell finance receivables it has previously sold under the 2017 Master Transfer Agreement. This transaction was entered into in connection with the securitization transaction and was entered into independently from the terms of the 2017 Master Transfer Agreement. The total gain related to finance receivables sold to financing partners under the MPSA, the 2017 Master Transfer Agreement, and securitization transactions discussed in Note 8 — Securitizations and Variable Interest Entities was approximately $19.2 million and $9.9 million during the three months ended March 31, 2019 and 2018, respectively, which is included in other sales and revenues in the accompanying unaudited condensed consolidated statements of operations. |
Securitizations and Variable In
Securitizations and Variable Interest Entities | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Securitizations and Variable Interest Entities | NOTE 8 — SECURITIZATIONS AND VARIABLE INTEREST ENTITIES Beginning in 2019, the Company sponsors and establishes securitization trusts to purchase finance receivables from the Company. The securitization trusts issue asset-backed securities, some of which are collateralized by the finance receivables that the Company sells to the securitization trusts. Upon transfer of the finance receivables to the securitization trusts, the Company recognizes a gain or loss on sales of finance receivables. The net proceeds from the sales are the fair value of the assets obtained as part of the transactions and typically include cash and at least 5% of the beneficial interests issued by the securitization trusts to comply with Risk Retention Rules. The beneficial interests retained by the Company include but are not limited to rated notes and certificates of the securitization trusts. The holders of the certificates issued by the securitization trusts have rights to cash flows only after the holders of the notes issued by the securitization trusts have received their contractual cash flows. The securitization trusts have no direct recourse to the Company’s assets, and holders of the securities issued by the securitization trusts can look only to the assets of the securitization trusts that issued their securities for payment. The beneficial interests held by the Company are subject principally to the credit and prepayment risk stemming from the underlying finance receivables. As described in Note 2 — Summary of Significant Accounting Policies, the securitization trusts established in connection with asset-backed securitization transactions are VIEs. For each VIE that the Company establishes in its role as sponsor of securitization transactions, it performs an analysis to determine whether or not it is the primary beneficiary of the VIE. The Company’s continuing involvement with the VIEs consists of retaining a portion of the securities issued by the VIEs and performing ministerial duties as the trust administrator. As of March 31, 2019, the Company is not the primary beneficiary of these securitization trusts because its retained interests in the VIEs do not have exposures to losses or benefits that could potentially be significant to the VIEs. The Company does not consolidate the securitization trusts. The assets the Company retains in the unconsolidated VIEs are presented as beneficial interests in securitizations on the accompanying unaudited condensed consolidated balance sheets, which as of March 31, 2019 were approximately $19.5 million. The Company held no other assets or liabilities related to its involvement with unconsolidated VIEs as of March 31, 2019. The following table summarizes the carrying value and total exposure to losses of its assets related to unconsolidated VIEs with which the Company has continuing involvement, but is not the primary beneficiary at March 31, 2019. Total exposure represents the estimated loss the Company would incur under severe, hypothetical circumstances, such as if the value of the interests in the securitization trusts and any associated collateral declined to zero. The Company believes the possibility of this is remote. As such, the total exposure presented below is not an indication of the Company's expected losses. Carrying Value Total Exposure (in thousands) Rated notes $ 16,940 $ 16,940 Certificates and other assets 2,591 2,591 Total unconsolidated VIEs $ 19,531 $ 19,531 The beneficial interests in securitizations are considered securities available for sale subject to restrictions on transfer pursuant to the Company’s obligations as a sponsor under Risk Retention Rules. These securities are interests in securitization trusts, thus there are no contractual maturities. The amortized cost and fair value of securities available for sale as of March 31, 2019 were as follows (in thousands): Amortized Cost Fair Value Rated notes $ 16,940 $ 16,940 Certificates and other assets 2,591 2,591 Total securities available for sale $ 19,531 $ 19,531 |
Debt Instruments
Debt Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt Instruments | NOTE 9 — DEBT INSTRUMENTS Floor Plan Facility The Company has a floor plan facility with a lender to finance its used vehicle inventory, which is secured by substantially all of its assets, other than the Company's interests in real property (the "Floor Plan Facility"). The Company most recently amended the Floor Plan Facility in November 2018 to, among other things, extend the maturity date to October 31, 2020, increase the available capacity to $650.0 million from $350.0 million, and lower the annual interest rate to one-month LIBOR plus 3.40%, a decrease from the previous rate of one-month LIBOR plus 3.65%. The Floor Plan Facility requires monthly interest payments on borrowings under the Floor Plan Facility and that at least 5% of the total principal amount owed to the lender is held as restricted cash. Repayment in an amount equal to the amount of the advance or loan must be made within five fifteen one fifteen two As of March 31, 2019, the interest rate on the Floor Plan Facility was approximately 5.90%, the Company had an outstanding balance under this facility of approximately $434.8 million, unused capacity of approximately $215.2 million of which approximately $181.8 million was available based on the borrowing base, and held approximately $21.7 million in restricted cash related to this facility. As of December 31, 2018, the interest rate on the Floor Plan Facility was approximately 5.90%, the Company had an outstanding balance of approximately $197.0 million and held approximately $9.8 million in restricted cash related to this facility. Long-Term Debt Senior Unsecured Notes On September 21, 2018, the Company issued an aggregate of $350.0 million in senior unsecured notes due 2023 (the "Senior Notes") under an indenture entered into by and among the Company, each of the guarantors party thereto and U.S. Bank National Association, as trustee (the “Indenture”). The Senior Notes accrue interest at a rate of 8.875% per annum, which is payable semi-annually in arrears on April 1 and October 1 of each year beginning April 1, 2019. The Senior Notes mature on October 1, 2023, unless earlier repurchased or redeemed, and are guaranteed by the Company's existing domestic restricted subsidiaries (other than the subsidiaries formed solely for the purpose of facilitating the Company's sales of its finance receivables, if any). The Company may redeem some or all of the Senior Notes on or after September 1, 2020 at redemption prices set forth in the Indenture, plus any accrued and unpaid interest to the redemption date. Prior to September 1, 2020, the Company may redeem up to 35.0% of the aggregate principal amount of the Senior Notes at a redemption price equal to 108.875%, together with accrued and unpaid interest to, but not including, the date of redemption, with the net cash proceeds of certain equity offerings. In addition, the Company may, at its option, redeem some or all of the Senior Notes prior to October 1, 2020, by paying a make-whole premium plus any accrued and unpaid interest, to, but not including, the redemption date. If the Company experiences certain change of control events, it must make an offer to purchase all of the Senior Notes at 101.0% of the principal amount thereof, plus any accrued and unpaid interest, to the repurchase date. The Indenture governing the Senior Notes contains restrictive covenants that limit the ability of the Company to, among other things, incur additional debt or issue preferred stock, create liens, create restrictions on the Company’s ability to make intercompany payments, pay dividends and make other distributions in respect of the Company's capital stock, redeem or repurchase the Company’s capital stock or prepay subordinated indebtedness, make certain investments or certain other restricted payments, guarantee indebtedness, designate unrestricted subsidiaries, sell certain kinds of assets, enter into certain types of transactions with affiliates, and effect mergers or consolidations. Certain of these covenants will be suspended if the Senior Notes are assigned an investment grade rating from any two of Moody’s Investors Service, Inc., Standard & Poor’s Rating Services, and Fitch Ratings, Inc., and there is no continuing default. As of March 31, 2019, the Company was in compliance with all covenants. The outstanding principal of the Senior Notes, net of debt issuance costs, was approximately $343.3 million and $342.9 million as of March 31, 2019 and December 31, 2018, respectively, of which $15.0 million of principal was held by Verde, and is included as long-term debt in the accompanying unaudited condensed consolidated balance sheets. In connection with the issuance of these Senior Notes, Carvana Group amended its LLC agreement to create a class of non-convertible preferred units, which Carvana Co. purchased with its net proceeds from the issuance of these Senior Notes, as further discussed in Note 10 — Stockholders' Equity. Notes Payable The Company has entered into promissory note and disbursement agreements to finance certain equipment for its transportation fleet and building improvements. The assets financed with the proceeds from these notes serve as the collateral for each note and certain security agreements related to these assets have cross collateralization and cross default provisions with respect to one another. Each note has a fixed annual interest rate, a two five Other Real Estate Financing Transactions The Company finances certain purchases and construction of its property and equipment through various sale and leaseback transactions. As of March 31, 2019, none of these transactions have qualified for sale accounting due to meeting the criteria for finance leases, or forms of continuing involvement, such as repurchase options or renewal periods that extend the lease for substantially all of the asset's remaining useful life, and are therefore accounted for as financing transactions. These arrangements require monthly payments and have initial terms that expire in fifteen twenty twenty In November 2017, the Company entered into a master sale-leaseback agreement (the "Master Sale-Leaseback Agreement" or "MSLA"), which was amended in November 2018, pursuant to which it may sell and lease back certain of its owned or leased properties and construction improvements. Under the MSLA, at any time the Company may elect to, and beginning in November 2020 or until a property owner of a leased site consents to the sale-leaseback, the purchaser has the right to demand that the Company repurchase one or more of the properties sold and leased back pursuant to the MSLA for an amount equal to the repurchase price. Repurchase prices are defined in each of the applicable leases and are generally the original purchase prices plus any accrued and unpaid rent. Under the MSLA, the total sales price of properties the Company has sold and is leasing back at any point in time is limited to $75.0 million. By December 31, 2018, the Company repurchased all properties it |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 10 — STOCKHOLDERS' EQUITY Immediately prior to the IPO, Carvana Co. amended and restated its certificate of incorporation to, among other things authorize (i) 50.0 million shares of Preferred Stock, par value $0.01 per share, (ii) 500.0 million shares of Class A common stock, par value $0.001 per share, and (iii) 125.0 million shares of Class B common stock, par value $0.001 per share. On December 5, 2017, Carvana Co. amended and restated its certificate of incorporation to authorize 100,000 shares of Convertible Preferred Stock, with an initial stated value of $1,000 per share and a par value of $0.01 per share. Each share of Class A common stock generally entitles its holder to one vote on all matters to be voted on by stockholders. Each share of Class B common stock held by the Garcia Parties generally entitles its holder to ten votes on all matters to be voted on by stockholders, for so long as the Garcia Parties maintain direct or indirect beneficial ownership of at least 25% of the outstanding shares of Carvana Co.'s Class A common stock determined on an as-exchanged basis assuming that all of the Class A Units and Class B Units were exchanged for Class A common stock. All other shares of Class B common stock generally entitle their holders to one vote per share on all matters to be voted on by stockholders. Holders of Class B common stock are not entitled to receive dividends and would not be entitled to receive any distributions upon the liquidation, dissolution or winding down of the Company. Holders of Class A and Class B common stock vote together as a single class on all matters presented to stockholders for their vote or approval, except as otherwise required by applicable law. Carvana Group's amended and restated LLC Agreement provides for two classes of common ownership interests in Carvana Group. Carvana Group’s two classes of common ownership interests are Class A Units and Class B Units (the "LLC Units"). Carvana Co. is required to, at all times, maintain (i) a four-to-five ratio between the number of shares of Class A common stock issued and outstanding by Carvana Co. and the number of Class A Units owned by Carvana Co. (subject to certain exceptions for treasury shares and shares underlying certain convertible or exchangeable securities and subject to adjustment as set forth in the exchange agreement (the "Exchange Agreement") further discussed below, and taking into account Carvana Sub’s 0.1% ownership interest in Carvana, LLC) and (ii) a four-to-five ratio between the number of shares of Class B common stock owned by the original holders of LLC units prior to the IPO (the "Original LLC Unitholders") and the number of Class A Units owned by the Original LLC Unitholders. The Company may issue shares of Class B common stock only to the extent necessary to maintain these ratios. Shares of Class B common stock are transferable only together with an equal number of LLC Units if Carvana Co., at the election of an Original LLC Unitholder, exchanges LLC Units for shares of Class A common stock. As of March 31, 2019, there were approximately 182.4 million and 5.8 million Class A Units and Class B Units (as adjusted for the participation thresholds), respectively, issued and outstanding. As discussed in Note 12 — Equity-Based Compensation, Class B Units were issued under the Company’s LLC Equity Incentive Plan (the “LLC Equity Incentive Plan”) and are subject to a participation threshold and are earned over the requisite service period. Exchange Agreement Carvana Co. and the LLC Unitholders entered into an Exchange Agreement under which each LLC Unitholder (and certain permitted transferees thereof) may receive shares of the Company's Class A common stock in exchange for their LLC Units on a four-to-five conversion ratio, or cash at the option of the Company, subject to conversion ratio adjustments for stock splits, stock dividends, reclassifications and similar transactions and subject to vesting for certain Class A Units and subject to vesting and the respective participation threshold for Class B Units. To the extent such owners also hold Class B common stock, they will be required to deliver to Carvana Co. a number of shares of Class B common stock equal to the number of shares of Class A common stock being exchanged for. Any shares of Class B common stock so delivered will be canceled. The number of exchangeable Class B Units is determined based on the value of Carvana Co.'s Class A common stock and the applicable participation threshold. During the three months ended March 31, 2019, certain LLC Unitholders exchanged 2.5 million LLC Units and 2.0 million shares of Class B common stock for 2.0 million newly-issued shares of Class A common stock. Simultaneously, and in connection with these exchanges, Carvana Co. received approximately 2.5 million LLC Units, increasing its total ownership interest in Carvana Group, and canceled the exchanged shares of Class B common stock. Convertible Preferred Stock On December 5, 2017, Carvana Co. sold 100,000 shares of Convertible Preferred Stock for a purchase price of $100.0 million and net proceeds of approximately $98.5 million, which it used to purchase 100,000 Convertible Preferred Units of Carvana Group at a price per unit equal to the initial stated value of the Convertible Preferred Stock less issuance costs. The Convertible Preferred Stock has a par value of $0.01 per share and a liquidation value of $1,000 per share. At the holder's request beginning on January 29, 2018, any or all shares of the Convertible Preferred Stock were convertible into shares of Class A common stock at an initial conversion rate of 50.78 shares of Class A common stock per share of Convertible Preferred Stock. On or after December 5, 2018, the Company had the option to cause all shares of Convertible Preferred Stock to be converted into shares of Class A common stock or cash, at the Company's election, if the 10-day volume-weighted average price equaled or exceeded 150% of the conversion price as set forth in the agreement. In the event Carvana Co. issued any shares of Class A common stock upon conversion of any shares of Convertible Preferred Stock or in connection with any change of control repurchase of shares of Convertible Preferred Stock, a corresponding number of Convertible Preferred Units would be canceled and cease to be outstanding, and Carvana Group would issue Class A Units to Carvana Co. on a four-to-five ratio between the number of shares of Class A common stock issued by Carvana Co. to the holders of the Convertible Preferred Stock and the number of Class A Units issued. The initial conversion price was $19.6945, which was calculated based on a 20.0% premium to the volume weighted average price for Class A common stock during the 5 trading days immediately preceding December 4, 2017. Following announcement of the transaction, the share price of Class A common stock increased and exceeded the conversion price on the commitment date and resulted in a beneficial conversion feature ("BCF") of approximately $2.6 million. The BCF was originally recorded as a reduction of the Convertible Preferred Stock with an offset to additional paid-in capital. The BCF accreted as a deemed dividend through January 29, 2018, the first available conversion date, increasing the carrying value of the Convertible Preferred Stock with an offsetting charge to additional paid-in capital. During the three months ended March 31, 2018, the Company recorded $1.4 million in accretion related to the BCF. During the three months ended March 31, 2018, the Company paid approximately $1.5 million of dividends to the holders of the Convertible Preferred Stock and Carvana Group distributed approximately $1.5 million to Carvana Co. with respect to the Convertible Preferred Units. During the year ended December 31, 2018, at the holder's request 75,000 shares of Convertible Preferred Stock, and at the Company's election 25,000 shares of Convertible Preferred Stock, were converted into a total of approximately 5.1 million shares of Class A common stock. Simultaneously with each conversion, an equal number of Convertible Preferred Units were canceled and Carvana Group issued approximately 6.3 million Class A Units to Carvana Co. As of March 31, 2019 and December 31, 2018, there were no outstanding shares of Convertible Preferred Stock and no related accrued dividends. Class A Non-Convertible Preferred Units On October 2, 2018, Carvana Group amended its LLC Agreement to create a class of non-convertible preferred units (the "Class A Non-Convertible Preferred Units"), effective September 21, 2018. The Class A Non-Convertible Preferred Units were created in connection with Carvana Co.'s issuance of the Senior Notes, as discussed further in Note 9 — Debt Instruments. Carvana Co. used its net proceeds from the Senior Notes to purchase 350,000 Class A Non-Convertible Preferred Units. In the event Carvana Co. makes payments on the Senior Notes, Carvana Group will make an equal cash distribution to the Class A Non-Convertible Preferred Units. For each $1,000 principal amount of Senior Notes that Carvana Co. repays or otherwise retires one Class A Non-Convertible Preferred Unit shall be canceled and retired. Contribution of Class A Common Shares From Ernest Garcia III |
Non-controlling Interests
Non-controlling Interests | 3 Months Ended |
Mar. 31, 2019 | |
Noncontrolling Interest [Abstract] | |
Non-controlling Interests | NOTE 11 — NON-CONTROLLING INTERESTS As discussed in Note 1 — Business Organization, Carvana Co. consolidates the financial results of Carvana Group and reports a non-controlling interest related to the portion of Carvana Group owned by the LLC Unitholders. Changes in the ownership interest in Carvana Group while Carvana Co. retains its controlling interest will be accounted for as equity transactions. Exchanges of LLC Units result in a change in ownership and reduce the amount recorded as non-controlling interests and increase additional paid-in capital. Upon the issuance of shares of Class A common stock by Carvana Co. related to the Company’s equity compensation plans such as the exercise of options, issuance of restricted or non-restricted stock, payment of bonuses in stock or settlement of stock appreciation rights in stock, Carvana Group is required to issue to Carvana Co. a number of Class A Units equal to 1.25 times the number of shares of Class A common stock being issued in connection with the exercise of such options or issuance of other types of equity compensation, subject to adjustment for stock splits, stock dividends, reclassifications and similar transactions. Activity related to the Company's equity compensation plans may result in a change in ownership which will impact the amount recorded as non-controlling interest and additional paid-in capital. The non-controlling interest related to the Class B Units is determined based on the respective participation thresholds and the share price of Class A common stock on an as-converted basis. To the extent that the number of as-converted Class B Units change or Class B Units are forfeited, the resulting difference in ownership will be accounted for as equity transactions adjusting the non-controlling interest and additional paid-in capital. During the three months ended March 31, 2019 and 2018, the total adjustments related to exchanges of LLC Units were a decrease in non-controlling interests and a corresponding increase in additional paid-in capital of approximately $1.9 million and $1.5 million, respectively, which have been included in exchanges of LLC Units in the accompanying unaudited condensed consolidated statements of stockholders' equity. As of March 31, 2019, Carvana Co. owned approximately 28.6% of Carvana Group with the LLC Unitholders owning the remaining 71.4%. The net loss attributable to the non-controlling interests on the accompanying unaudited condensed consolidated statements of operations represents the portion of the net loss attributable to the economic interest in Carvana Group held by the non-controlling LLC Unitholders calculated based on the weighted average non-controlling interests' ownership during the periods presented. |
Equity-Based Compensation
Equity-Based Compensation | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Equity-Based Compensation | NOTE 12 — EQUITY-BASED COMPENSATION Equity-based compensation expense is recognized based on amortizing the grant-date fair value on a straight-line basis over the requisite service period, which is generally the vesting period of the award, less actual forfeitures. A summary of equity-based compensation expense recognized during the three months ended March 31, 2019 and 2018 is as follows (in thousands): Three Months Ended March 31, 2019 2018 Class B Units $ 578 $ 435 Restricted Stock Units and Awards excluding those granted in relation to Mr. Garcia's 100k Milestone Gift contributions 2,467 667 Restricted Stock Units granted in relation to Mr. Garcia's 100k Milestone Gift contributions 3,124 — Options 1,207 408 Class A Units 646 — Total equity-based compensation expense $ 8,022 $ 1,510 Equity-based compensation capitalized to property and equipment (311) — Equity-based compensation capitalized to inventory (877) — Equity-based compensation, net of capitalized amounts $ 6,834 $ 1,510 As of March 31, 2019, the total unrecognized compensation expense related to outstanding equity awards was approximately $52.8 million, which the Company expects to recognize over a weighted-average period of approximately 3.0 years. Total unrecognized equity-based compensation expense will be adjusted for actual forfeitures. 2017 Omnibus Incentive Plan In connection with the IPO, the Company adopted the 2017 Omnibus Incentive Plan (the "2017 Incentive Plan"). Under the 2017 Incentive Plan, 14.0 million shares of Class A common stock are available for issuance, which the Company may grant as stock options, stock appreciation rights, restricted stock, restricted stock units ("RSUs") and other stock-based awards to employees, directors, officers and consultants. As discussed in Note 10 — Stockholders' Equity, during the three months ended March 31, 2019, the Company granted approximately 0.1 million RSUs with a vesting period of one two five Class A Units During 2018, the Company granted certain employees Class A Units with service-based vesting over two four Class B Units |
Loss Per Share
Loss Per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Loss Per Share | NOTE 13 — LOSS PER SHARE Basic and diluted net loss per share is computed by dividing the net loss attributable to Class A common stockholders by the weighted-average shares of Class A common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potentially dilutive shares. For all periods presented, potentially dilutive shares are excluded from diluted net loss per share because they have an anti-dilutive impact. Therefore, basic and diluted net loss per share attributable to Class A common stockholders are the same for all periods presented. The following table presents the calculation of basic and diluted net loss per share during the three months ended March 31, 2019 and 2018 (in thousands, except per share data): Three Months Ended March 31, 2019 2018 Numerator: Net loss $ (82,596) $ (52,672) Net loss attributable to non-controlling interests 54,047 45,629 Dividends on Class A convertible preferred stock — (1,345) Accretion of beneficial conversion feature on Class A convertible preferred stock — (1,380) Net loss attributable to Carvana Co. Class A common stockholders, basic and diluted $ (28,549) $ (9,768) Denominator: Weighted-average shares of Class A common stock outstanding 41,632 18,725 Nonvested weighted-average restricted stock awards (280) (379) Weighted-average shares of Class A common stock to compute basic and diluted net loss per Class A common share 41,352 18,346 Net loss per share of Class A common stock, basic and diluted $ (0.69) $ (0.53) Shares of Class B common stock do not share in the losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted net loss per share of Class B common stock under the two-class method has not been presented. LLC Units (adjusted for the Exchange Ratio and participation thresholds) are considered potentially dilutive shares of Class A common stock because they are exchangeable into shares of Class A common stock. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 14 — INCOME TAXES As described in Note 1 — Business Organization, as a result of the IPO, Carvana Co. began consolidating the financial results of Carvana Group. Carvana Group is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, Carvana Group is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Carvana Group is passed through to and included in the taxable income or loss of its members, including Carvana Co., based on its economic interest held in Carvana Group. Carvana Co. was formed on November 29, 2016 and did not engage in any operations prior to the IPO. Carvana Co. is taxed as a corporation and is subject to U.S. federal, state and local income taxes with respect to its allocable share of any taxable income or loss of Carvana Group, as well as any stand-alone income or loss generated by Carvana Co. As described in Note 10 — Stockholders' Equity, the Company acquired approximately 2.5 million LLC Units during the three months ended March 31, 2019 in connection with exchanges with Existing LLC Unitholders. During the three months ended March 31, 2019, the Company recorded a gross deferred tax asset of approximately $25.6 million associated with the basis difference in its investment in Carvana Group related to the acquisition of these LLC Units which is reflected as an increase to additional paid-in capital in the accompanying unaudited condensed consolidated statement of stockholders' equity. As described in Note 4 — Goodwill and Intangible Assets, Net, Carvana Group acquired Car360 on April 12, 2018. The acquisition included various intangible assets, and as a result the Company recognized a deferred tax liability of approximately $2.5 million which is reflected within other liabilities in the accompanying unaudited condensed consolidated balance sheet. The deferred tax liability will be amortized over five seven During the three months ended March 31, 2019, management performed an assessment of the recoverability of deferred tax assets. Management determined, based on the accounting standards applicable to such assessment, that there was sufficient negative evidence as a result of the Company’s cumulative losses to conclude it was more likely than not that its deferred tax assets would not be realized and has recorded a full valuation allowance against its deferred tax assets. In the event that management was to determine that the Company would be able to realize its deferred tax assets in the future in excess of their net recorded amount, an adjustment to the valuation allowance would be made which would reduce the provision for income taxes. The Company recognizes uncertain income tax positions when it is more-likely-than-not the position will be sustained upon examination. As of March 31, 2019 and December 31, 2018, the Company has not identified any uncertain tax positions and has not recognized any related reserves. Tax Receivable Agreement Carvana Co. expects to obtain an increase in its share of the tax basis in the net assets of Carvana Group when LLC Units are exchanged by the Existing LLC Unitholders and other qualifying transactions. As described in Note 10 — Stockholders' Equity, each change in outstanding shares of Class A common stock results in a corresponding increase or decrease in Carvana Co.'s ownership of LLC Units. The Company intends to treat any exchanges of LLC Units as direct purchases of LLC interests for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that Carvana Co. would otherwise pay in the future to various taxing authorities. They may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. In connection with the IPO, the Company entered into a Tax Receivable Agreement (“TRA”). Under the TRA, the Company generally will be required to pay to the Original LLC Unitholders 85% of the amount of cash savings, if any, in U.S. federal, state or local tax that the Company actually realizes directly or indirectly (or are deemed to realize in certain circumstances) as a result of (i) certain tax attributes created as a result of any sales or exchanges (as determined for U.S. federal income tax purposes) to or with the Company of their interests in Carvana Group for shares of Carvana Co.'s Class A common stock or cash, including any basis adjustment relating to the assets of Carvana Group and (ii) tax benefits attributable to payments made under the TRA (including imputed interest). The Company expects to benefit from the remaining 15% of any tax benefits that it may actually realize. To the extent that the Company is unable to timely make payments under the TRA for any reason, such payments generally will be deferred and will accrue interest until paid. If the Internal Revenue Service or a state or local taxing authority challenges the tax basis adjustments that give rise to payments under the TRA and the tax basis adjustments are subsequently disallowed, the recipients of payments under the agreement will not reimburse the Company for any payments the Company previously made to them. Any such disallowance would be taken into account in determining future payments under the TRA and would, therefore, reduce the amount of any such future payments. Nevertheless, if the claimed tax benefits from the tax basis adjustments are disallowed, the Company’s payments under the TRA could exceed its actual tax savings, and the Company may not be able to recoup payments under the TRA that were calculated on the assumption that the disallowed tax savings were available. The TRA provides that if (i) certain mergers, asset sales, other forms of business combinations, or other changes of control were to occur, (ii) there is a material breach of any material obligations under the TRA; or (iii) the Company elects an early termination of the TRA, then the TRA will terminate and the Company's obligations, or the Company's successor’s obligations, under the TRA will accelerate and become due and payable, based on certain assumptions, including an assumption that the Company would have sufficient taxable income to fully utilize all potential future tax benefits that are subject to the TRA and that any LLC Units that have not been exchanged are deemed exchanged for the fair market value of the Company's Class A common stock at the time of termination. As of March 31, 2019, the Company has concluded based on applicable accounting standards, that it was more likely than not that its deferred tax assets subject to the TRA would not be realized; therefore, the Company has not recorded a liability related to the tax savings it may realize from utilization of such deferred tax assets. As of March 31, 2019, the total unrecorded TRA liability is approximately $140.1 million. If utilization of the deferred tax assets subject to the TRA becomes more likely than not in the future, the Company will record a liability related to the TRA which will be recognized as expense within its consolidated statements of operations. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | NOTE 15 — LEASES The Company is party to various lease agreements for real estate and transportation equipment. For each lease agreement, the Company determines its lease term as the non-cancellable period of the lease and includes options to extend or terminate the lease when it is reasonably certain that it will exercise that option. The Company also assesses whether each lease is an operating or finance lease at the lease commencement date. Rent expense of operating leases is recognized on a straight-line basis over the lease term and includes scheduled rent increases as well as amortization of tenant improvement allowances. Operating Leases As of March 31, 2019, the Company is a tenant under various operating leases related to certain of its hubs, vending machines and corporate offices. The initial terms expire at various dates between 2019 and 2029. Many of the leases include one or more renewal options ranging from one twenty Refer to Note 6 — Related Party Transactions for further discussion of operating leases with related parties. Finance Leases The Company has finance leases for certain equipment in its transportation fleet. The leases have initial terms of two five four Lease Costs and Activity The Company's lease costs and activity during the three months ended March 31, 2019 were as follows (in thousands): Lease costs: Finance leases: Amortization of finance lease assets $ 1,267 Interest on obligations under finance leases 331 Total finance lease costs $ 1,598 Operating leases: Fixed lease costs $ 2,328 Fixed lease costs to related parties 1,806 Variable short-term lease costs to related parties 454 Total operating lease costs $ 4,588 Cash payments related to lease liabilities included in operating cash flows: Operating lease liabilities to third parties $ 1,817 Operating lease liabilities to related parties $ 2,137 Interest payments on finance lease liabilities $ 331 Cash payments related to lease liabilities included in financing cash flows: Principal payments on finance lease liabilities $ 1,208 Maturity Analysis of Lease Liabilities The following table summarizes maturities of lease liabilities as of March 31, 2019 (in thousands): Operating Leases (1) Finance Leases Related Party ( 2 ) Non-Related Party Total Operating Total Remainder of 2019 $ 6,676 $ 6,231 $ 5,937 $ 12,168 $ 18,844 2020 8,227 7,692 8,078 15,770 23,997 2021 7,953 7,154 7,354 14,508 22,461 2022 7,628 7,179 6,655 13,834 21,462 2023 7,061 7,212 5,430 12,642 19,703 Thereafter 1,224 31,660 32,730 64,390 65,614 Total minimum lease payments 38,769 67,128 66,184 133,312 172,081 Less: amount representing interest (4,608) (21,579) (27,933) (49,512) (54,120) Total lease liabilities $ 34,161 $ 45,549 $ 38,251 $ 83,800 $ 117,961 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are variable lease payments contingent upon the Company's utilization of the leased assets. As described in Note 2 — Summary of Significant Accounting Policies, the Company adopted ASC 842 using the modified retrospective approach and various practical expedients and relief packages, which permitted the Company to refrain from restating comparative periods. Therefore, the following future minimum lease payments as of December 31, 2018 prepared under previous lease accounting guidance has been included from the Company's 2018 Annual Report on Form 10-K filed on February 27, 2019 (in thousands): Operating Leases (1) Capital Leases Other Real Estate Financing Transactions (3) Related Party (2) Non-Related Party Total 2019 $ 3,779 $ 3,566 $ 6,461 $ 8,306 $ 14,767 2020 3,779 3,575 6,716 8,202 14,918 2021 3,779 3,583 6,869 7,387 14,256 2022 3,779 3,609 7,020 6,580 13,600 2023 3,275 3,837 7,140 5,330 12,470 Thereafter — 62,081 36,770 38,402 75,172 Total minimum lease payments $ 18,391 $ 80,251 $ 70,976 $ 74,207 $ 145,183 Less amounts representing interest (2,237) $ 16,154 (1) Leases that are on a month-to-month basis and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are contingent upon the Company's utilization of the leased assets. (3) These were previously presented as finance leases and represent the Company's sale and leaseback transactions that are accounted for as other real estate financing transactions, as further discussed in Note 9 — Debt Instruments. As of March 31, 2019, none of the Company's lease agreements contain material residual value guarantees or material restrictive covenants. Lease Terms and Discount Rates The weighted-average remaining lease terms and discount rates as of March 31, 2019 were as follows, excluding short-term operating leases: Weighted-average remaining lease terms (years) Operating leases 10.9 Finance leases 4.9 Weighted-average discount rate Operating leases 9.0 % Finance leases 5.6 % |
Leases | NOTE 15 — LEASES The Company is party to various lease agreements for real estate and transportation equipment. For each lease agreement, the Company determines its lease term as the non-cancellable period of the lease and includes options to extend or terminate the lease when it is reasonably certain that it will exercise that option. The Company also assesses whether each lease is an operating or finance lease at the lease commencement date. Rent expense of operating leases is recognized on a straight-line basis over the lease term and includes scheduled rent increases as well as amortization of tenant improvement allowances. Operating Leases As of March 31, 2019, the Company is a tenant under various operating leases related to certain of its hubs, vending machines and corporate offices. The initial terms expire at various dates between 2019 and 2029. Many of the leases include one or more renewal options ranging from one twenty Refer to Note 6 — Related Party Transactions for further discussion of operating leases with related parties. Finance Leases The Company has finance leases for certain equipment in its transportation fleet. The leases have initial terms of two five four Lease Costs and Activity The Company's lease costs and activity during the three months ended March 31, 2019 were as follows (in thousands): Lease costs: Finance leases: Amortization of finance lease assets $ 1,267 Interest on obligations under finance leases 331 Total finance lease costs $ 1,598 Operating leases: Fixed lease costs $ 2,328 Fixed lease costs to related parties 1,806 Variable short-term lease costs to related parties 454 Total operating lease costs $ 4,588 Cash payments related to lease liabilities included in operating cash flows: Operating lease liabilities to third parties $ 1,817 Operating lease liabilities to related parties $ 2,137 Interest payments on finance lease liabilities $ 331 Cash payments related to lease liabilities included in financing cash flows: Principal payments on finance lease liabilities $ 1,208 Maturity Analysis of Lease Liabilities The following table summarizes maturities of lease liabilities as of March 31, 2019 (in thousands): Operating Leases (1) Finance Leases Related Party ( 2 ) Non-Related Party Total Operating Total Remainder of 2019 $ 6,676 $ 6,231 $ 5,937 $ 12,168 $ 18,844 2020 8,227 7,692 8,078 15,770 23,997 2021 7,953 7,154 7,354 14,508 22,461 2022 7,628 7,179 6,655 13,834 21,462 2023 7,061 7,212 5,430 12,642 19,703 Thereafter 1,224 31,660 32,730 64,390 65,614 Total minimum lease payments 38,769 67,128 66,184 133,312 172,081 Less: amount representing interest (4,608) (21,579) (27,933) (49,512) (54,120) Total lease liabilities $ 34,161 $ 45,549 $ 38,251 $ 83,800 $ 117,961 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are variable lease payments contingent upon the Company's utilization of the leased assets. As described in Note 2 — Summary of Significant Accounting Policies, the Company adopted ASC 842 using the modified retrospective approach and various practical expedients and relief packages, which permitted the Company to refrain from restating comparative periods. Therefore, the following future minimum lease payments as of December 31, 2018 prepared under previous lease accounting guidance has been included from the Company's 2018 Annual Report on Form 10-K filed on February 27, 2019 (in thousands): Operating Leases (1) Capital Leases Other Real Estate Financing Transactions (3) Related Party (2) Non-Related Party Total 2019 $ 3,779 $ 3,566 $ 6,461 $ 8,306 $ 14,767 2020 3,779 3,575 6,716 8,202 14,918 2021 3,779 3,583 6,869 7,387 14,256 2022 3,779 3,609 7,020 6,580 13,600 2023 3,275 3,837 7,140 5,330 12,470 Thereafter — 62,081 36,770 38,402 75,172 Total minimum lease payments $ 18,391 $ 80,251 $ 70,976 $ 74,207 $ 145,183 Less amounts representing interest (2,237) $ 16,154 (1) Leases that are on a month-to-month basis and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are contingent upon the Company's utilization of the leased assets. (3) These were previously presented as finance leases and represent the Company's sale and leaseback transactions that are accounted for as other real estate financing transactions, as further discussed in Note 9 — Debt Instruments. As of March 31, 2019, none of the Company's lease agreements contain material residual value guarantees or material restrictive covenants. Lease Terms and Discount Rates The weighted-average remaining lease terms and discount rates as of March 31, 2019 were as follows, excluding short-term operating leases: Weighted-average remaining lease terms (years) Operating leases 10.9 Finance leases 4.9 Weighted-average discount rate Operating leases 9.0 % Finance leases 5.6 % |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 16 — COMMITMENTS AND CONTINGENCIES Accrued Limited Warranty As part of its retail strategy, the Company provides a 100-day or 4,189-mile limited warranty to customers to repair certain broken or defective components of each used vehicle sold. As such, the Company accrues for such repairs based on actual claims incurred to-date and repair reserves based on historical trends. The liability was approximately $2.0 million and $1.4 million as of March 31, 2019 and December 31, 2018, respectively, and is included in accounts payable and other accrued liabilities in the accompanying unaudited condensed consolidated balance sheets. Legal Matters From time to time, the Company is involved in various claims and legal actions that arise in the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, as of March 31, 2019 the Company does not believe that the ultimate resolution of any legal actions, either individually or in the aggregate, will have a material adverse effect on its financial position, results of operations, liquidity and capital resources. Future litigation may be necessary to defend the Company and its partners by determining the scope, enforceability and validity of third party proprietary rights or to establish its own proprietary rights. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 17 — FAIR VALUE OF FINANCIAL INSTRUMENTS A description of the fair value hierarchy and the Company's methodologies are included in Note 2 — Summary of Significant Accounting Policies. As of March 31, 2019 and December 31, 2018, the Company held certain assets that were required to be measured at fair value on a recurring basis and as of March 31, 2019, the Company held beneficial interests in securitizations for which it elected the fair value option. The following tables are a summary of fair value measurements and hierarchy level at March 31, 2019 and December 31, 2018 (in thousands): As of March 31, 2019: Carrying Value Level 1 Level 2 Level 3 Assets: Money market funds (1) $ 19,810 $ 19,810 $ — $ — Beneficial interests in securitizations 19,531 — 19,531 — As of December 31, 2018: Carrying Value Level 1 Level 2 Level 3 Assets: Money market funds (1) $ 63,713 $ 63,713 $ — $ — _________________________ (1) 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. Beneficial Interests in Securitizations The Company acquired its beneficial interests in securitizations as a portion of its proceeds from the securitization transaction completed on March 29, 2019. The securitization trust issued the same securities to investors as those the Company received as proceeds to satisfy the Risk Retention Regulations. As of March 31, 2019, the Company determined the fair value of its beneficial interests in securitizations based on the observed prices paid by investors when the transaction closed on March 29, 2019. Given both the proximity to the end of the reporting period and lack of observable changes in economic inputs, the Company concluded the fair value at March 29, 2019 represents the fair value at March 31, 2019. Fair Value of Financial Instruments The carrying amounts of restricted cash, accounts receivable, accounts payable and accrued liabilities and accounts payable to related parties 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 and sale leasebacks were determined to approximate fair value as each of the transactions were entered into at prevailing interest rates during each respective period and they have not materially changed as of or during the periods ended March 31, 2019 and December 31, 2018. The fair value of the Senior Notes, which are not carried at fair value on the accompanying unaudited condensed consolidated balance sheets, was determined using Level 2 inputs based on quoted market prices for the identical liability. The fair value of the Senior Notes as of March 31, 2019 and December 31, 2018 was as follows (in thousands): March 31, 2019 December 31, 2018 Carrying value, net of unamortized debt issuance costs $ 343,251 $ 342,869 Fair value 352,690 319,375 The fair value of finance receivables, which are not carried at fair value on the accompanying unaudited condensed consolidated balance sheets, was determined 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, 2019 and December 31, 2018 were as follows (in thousands): March 31, 2019 December 31, 2018 Carrying value $ 151,186 $ 105,200 Fair value 157,778 109,703 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | NOTE 18 — SUPPLEMENTAL CASH FLOW INFORMATION The following table summarizes supplemental cash flow information for the three months ended March 31, 2019 and 2018 (in thousands): Three Months Ended March 31, 2019 2018 Supplemental cash flow information: Cash payments for interest $ 3,917 $ 1,884 Non-cash investing and financing activities: Capital expenditures included in accounts payable and accrued liabilities $ 11,246 $ 8,035 Property and equipment acquired under finance leases $ 11,395 $ — Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 4,940 $ — Capital expenditures financed through long-term debt $ — $ 5,164 Equity-based compensation expense capitalized to property and equipment $ 311 $ — Fair value of beneficial interests received in securitization transactions $ 19,531 $ — Costs related to issuance of equity included in accrued liabilities $ — $ 163 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, 2019 December 31, 2018 March 31, 2018 December 31, 2017 Cash and cash equivalents $ 85,321 $ 78,861 $ 121,497 $ 172,680 Restricted cash (1) 21,734 9,848 18,428 14,443 Total cash, cash equivalents and restricted cash $ 107,055 $ 88,709 $ 139,925 $ 187,123 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 19 — SUBSEQUENT EVENTS Master Purchase and Sale Agreement Amendment On April 19, 2019, the Company amended the Master Purchase and Sale Agreement (the "MPSA") to, among other things, and subject to the terms of the agreement, extend the scheduled commitment termination date until April 17, 2020 and amend the purchaser’s commitment to purchase up to a maximum of $1.0 billion of principal balances of automotive finance receivables following the amendment. Loan and Security Agreement On April 19, 2019, the Company and a financing partner entered into a Loan and Security Agreement pursuant to which the financing partner agreed to provide a $300.0 million revolving credit facility to a purchaser trust to fund certain automotive finance receivables and related assets originated by the Company. This loan and security agreement resembles other financing arrangements that the financing party provides in connection with the Company’s master transfer agreements. Amended and Restated Loan and Security Agreement On May 7, 2019, the Company purchased the certificate of the trust to which the Company has historically sold automotive finance receivables on a forward-flow basis pursuant to the 2017 Master Transfer Agreement. In connection with the certificate purchase, the Company and a financing partner entered into an Amended and Restated Loan and Security Agreement pursuant to which the financing partner agreed to provide a $350.0 million revolving credit facility to a purchaser trust to fund certain automotive finance receivables and related assets originated by the Company. This loan and security agreement resembles other financing arrangements that the financing partner provides in connection with the Company’s master transfer agreements. Contribution Agreement In connection with an ongoing commitment from the Company's Chief Executive Officer, Ernest Garcia III, related to the previously announced 100k Milestone Gift program, the Company and Mr. Garcia entered into a contribution agreement on May 7, 2019 under which Mr. Garcia will contribute to the Company 43,230 shares of Class A common stock that he individually owns, at no charge (the "Contribution Agreement"). The contribution will take place on May 10, 2019 and is intended to fund restricted stock unit awards to certain employees of Carvana, LLC upon their satisfying applicable employment tenure requirements. Although the Company does not expect Mr. Garcia to incur any tax obligations related to the contribution, the Company has indemnified Mr. Garcia from any such obligations that may arise. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. All intercompany balances and transactions have been eliminated. Certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted. The Company believes the disclosures made are adequate to prevent the information presented from being misleading. However, the accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included within the Company's most recent Annual Report on Form 10-K. The accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting only of normal and recurring items) necessary to present fairly the Company’s financial position as of March 31, 2019, results of operations, cash flows, and changes in stockholder's equity for the three months ended March 31, 2019 and 2018. Interim results are not necessarily indicative of full year performance because of the impact of seasonal and short-term variations. |
Liquidity | Liquidity The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared in conformity with U.S. GAAP, which contemplate continuation of the Company as a going concern. The Company has incurred losses from inception through March 31, 2019, and expects to incur additional losses in the future. As the Company continues |
Use of Estimates | Use of EstimatesThe preparation of these unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. Certain accounting estimates involve significant judgments, assumptions and estimates by management that have a material impact on the carrying value of certain assets and liabilities, disclosures of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period, which management considers to be critical accounting estimates. The judgments, assumptions and estimates used by management are based on historical experience, management’s experience and other factors, which are believed to be reasonable under the circumstances. Because of the nature of the judgments and assumptions made by management, actual results could differ materially from these judgments and estimates, which could have a material impact on the carrying values of the Company’s assets and liabilities and the results of operations. |
Comprehensive Loss | Comprehensive Loss During the three months ended March 31, 2019 and 2018, the Company had no other components of comprehensive loss and, therefore, the net loss and comprehensive loss were the same for all periods presented. |
Restricted Cash | Restricted CashAs of March 31, 2019 and December 31, 2018, the restricted cash includes 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 9 — Debt Instruments. |
Leases | Leases As discussed below, the Company adopted ASC 842 on January 1, 2019. Under ASC 842, the Company determines if an arrangement is a lease at inception by evaluating if the asset is explicitly or implicitly identified or distinct, if the Company will receive substantially all of the economic benefit or if the lessor has an economic benefit and the ability to substitute the asset. Right-of-use ("ROU") assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. The Company assesses whether the lease is an operating or finance lease at its inception. Operating lease liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. To calculate the present value, the Company uses the implicit rate in the lease when readily determinable. However, most of the Company's leases do not provide an implicit rate and it uses its incremental borrowing rate. The incremental borrowing rate is based on collateralized borrowings of similar assets with terms that approximate the lease term when available and when collateralized rates are not available, it uses uncollateralized rates with similar terms adjusted for the fact that it is an unsecured rate. The operating lease ROU asset is the initial lease liability adjusted for any prepayments, initial indirect costs incurred by the Company, and lease incentives. The Company's operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities in its accompanying unaudited condensed consolidated balance sheets. The Company's finance leases are included in property and equipment, and other debt in its accompanying unaudited condensed consolidated balance sheets. |
Securitizations and Variable Interest Entities | Securitizations and Variable Interest Entities The Company reviews subsidiaries and affiliates, as well as other entities, to determine if they should be considered variable interest entities, and whether it should change the consolidation determinations based on changes in their characteristics. The Company considers an entity a VIE if its equity investors own an interest therein that lacks the characteristics of a controlling financial interest or if such investors do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or if the entity is structured with non-substantive voting interests. A VIE is consolidated by its primary beneficiary, the party that has both the power to direct the activities that most significantly impact the VIE’s economic performance and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. The Company evaluates whether it has variable interests in the VIE and if so, if it is the primary beneficiary of the VIE on an ongoing basis. The Company consolidates VIEs when it is deemed to be the primary beneficiary. |
Fair Value Measurements | Fair Value Measurements The fair value of financial instruments is based on estimates using quoted market prices, discounted cash flows or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and the estimated timing and amount of future cash flows. Therefore, the estimates of fair value may differ substantially from amounts that ultimately may be realized or paid at settlement or maturity of the financial instruments, and those differences may be material. Accordingly, the aggregate fair value amounts presented may not represent the Company’s underlying institutional value. The Company uses the three-tier hierarchy established by U.S. GAAP, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value to determine the fair value of its financial instruments. This hierarchy indicates to what extent the inputs used in the Company’s calculations are observable in the market. The different levels of the hierarchy are defined as follows: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Other than quoted prices that are observable in the market for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the fill term of the assets or liabilities. Level 3: Inputs are unobservable and reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. |
Segments | Segments Business segments are defined as components of an enterprise about which discrete financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing operating performance. Based on the way the Company manages its business, the Company has determined that it currently operates with one reportable segment. The chief operating decision maker focuses on consolidated results in assessing operating performance and allocating resources. Furthermore, the Company offers similar products and services and uses similar processes to sell those products and services to similar classes of customers throughout the United States (“U.S.”). Substantially all revenue is generated and all assets are held in the U.S. for all periods presented. |
Adoption of New Accounting Standards and Accounting Standards Issued But Not Yet Adopted | Adoption of New Accounting Standards Beginning in February 2016, the FASB issued several accounting standards updates related to the new leasing model in ASC 842, Leases ("ASC 842"). ASC 842 introduced a model that requires leases to be presented on the balance sheet and eliminates the requirement for an entity to use bright-line tests in determining lease classification. Expense recognition under ASC 842 on the income statement remains similar to previous lease accounting guidance. The Company adopted ASC 842 on January 1, 2019 using the modified retrospective approach, the practical expedient package and the transition relief option, which allowed the Company to, among other things, avoid reassessing lease classification for existing leases, forego the balance sheet recognition requirements with respect to short-term leases and avoid restating comparative periods presented. The adoption of ASC 842 resulted in initial recognition of ROU assets and operating lease liabilities of approximately $80.3 million and $86.8 million, respectively, as of January 1, 2019, and did not have an impact on the beginning equity balances as of the implementation date. Adopting ASC 842 did not have a material impact on the Company's sale-leaseback transactions, which have typically been accounted for as financing transactions in prior periods and under ASC 842. The standard did not have a material impact on the Company's consolidated statements of operations or statements of cash flows. In June 2018, the FASB issued ASU 2018-07, Compensation — Stock Compensation (Topic 718) ("ASU 2018-07") related to the accounting for share-based payment transactions for acquiring goods and services from nonemployees. Under ASU 2018-07, the intent is to simplify and align most requirements for share-based payments to nonemployees with the requirements for share-based payments granted to employees under ASC 718, including measuring the equity instruments at the grant-date fair value. The Company adopted ASU 2018-07 on January 1, 2019 using the modified retrospective approach. The adoption of ASU 2018-07 did not have a material effect on the Company’s consolidated financial statements. Accounting Standards Issued But Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which amends the guidance on the impairment of financial instruments by requiring measurement and recognition of expected credit losses for financial assets held. ASU 2016-13 is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, and earlier adoption is permitted beginning in the first quarter of fiscal 2019. Debt securities available for sale are excluded from the scope of ASU 2016-13. The Company plans to adopt ASU 2016-13 for its fiscal year beginning January 1, 2020. Finance receivables originated in connection with the Company’s vehicle sales are held for sale and are subsequently sold. The Company does not presently hold any finance receivables until maturity. Therefore, the Company does not expect adoption of ASU 2016-13 to have a material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13") related to updated requirements over the disclosures of fair value measurements. Under ASU 2018-13, certain disclosure requirements for fair value measurements will be eliminated, modified or added to facilitate better communication around recurring and nonrecurring fair value measurements. ASU 2018-13 is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, with some amendments applied prospectively, some applied retrospectively and early adoption permitted. The Company plans to adopt ASU 2018-13 for its fiscal year beginning January 1, 2020 and is currently assessing the impact the guidance will have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). The intent of this pronouncement is to align the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software as defined in ASC 350-40. Under ASU 2018-15, the capitalized implementation costs related to a cloud computing arrangement will be amortized over the term of the arrangement and all capitalized implementation amounts will be required to be presented in the same line items of the financial statements as the related hosting fees. ASU 2018-15 is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company plans to adopt ASU 2018-15 for its fiscal year beginning January 1, 2020 and is currently assessing the impact, if any, the guidance will have on its consolidated financial statements. In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities ("ASU 2018-17"). ASU 2018-17 requires reporting entities to consider indirect interests held through related parties under common control on a proportional basis rather than as the equivalent of a direct interest in its entirety for determining whether a decision-making fee is a variable interest. The standard is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. Entities are required to apply the amendments in ASU 2018-17 retrospectively with a cumulative-effect adjustment to retained earnings at the beginning of the earliest period presented. The Company plans to adopt ASU 2018-15 for its fiscal year beginning January 1, 2020 and is currently assessing the impact, if any, the guidance will have on its consolidated financial statements. |
Loss Per Share | Basic and diluted net loss per share is computed by dividing the net loss attributable to Class A common stockholders by the weighted-average shares of Class A common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potentially dilutive shares. For all periods presented, potentially dilutive shares are excluded from diluted net loss per share because they have an anti-dilutive impact. Therefore, basic and diluted net loss per share attributable to Class A common stockholders are the same for all periods presented. |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | The following table summarizes property and equipment, net as of March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Land and site improvements $ 55,839 $ 45,702 Buildings and improvements 146,056 123,705 Transportation fleet 85,827 65,760 Software 39,902 36,452 Furniture, fixtures and equipment 24,903 20,675 Total property and equipment excluding construction in progress 352,527 292,294 Less: accumulated depreciation and amortization on property and equipment (52,505) (44,050) Property and equipment excluding construction in progress, net 300,022 248,244 Construction in progress 53,464 48,595 Property and equipment, net $ 353,486 $ 296,839 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of Intangible Assets and Goodwill | The following table summarizes intangible assets and goodwill related to the Car360 acquisition as of March 31, 2019 and December 31, 2018 (in thousands): Useful Life March 31, 2019 December 31, 2018 Intangible assets: Developed technology 7 years $ 8,642 $ 8,642 Customer relationships 5 years 523 523 Non-compete agreements 5 years 774 774 Intangible assets, acquired cost 9,939 9,939 Less: accumulated amortization (1,443) (1,070) Intangible assets, net $ 8,496 $ 8,869 Goodwill N/A $ 9,353 $ 9,353 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The anticipated annual amortization expense to be recognized in future years as of March 31, 2019 is as follows (in thousands): Expected Future Amortization Remainder of 2019 $ 1,120 2020 1,494 2021 1,494 2022 1,494 2023 1,308 2024 1,235 Thereafter 351 Total $ 8,496 |
Accounts Payable and Other Ac_2
Accounts Payable and Other Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | The following table summarizes accounts payable and other accrued liabilities as of March 31, 2019 and December 31, 2018 (in thousands): March 31, 2019 December 31, 2018 Accounts payable $ 44,106 $ 29,141 Sales taxes and vehicle licenses and fees 36,861 27,651 Accrued interest expense 20,469 9,206 Reserve for returns and cancellations 17,226 11,284 Accrued property and equipment 8,682 7,414 Accrued compensation and benefits 8,249 13,477 Accrued advertising costs 7,641 4,398 Other accrued liabilities 21,790 14,953 Total accounts payable and accrued liabilities $ 165,024 $ 117,524 |
Securitizations and Variable _2
Securitizations and Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities Expected Losses | As such, the total exposure presented below is not an indication of the Company's expected losses. Carrying Value Total Exposure (in thousands) Rated notes $ 16,940 $ 16,940 Certificates and other assets 2,591 2,591 Total unconsolidated VIEs $ 19,531 $ 19,531 The beneficial interests in securitizations are considered securities available for sale subject to restrictions on transfer pursuant to the Company’s obligations as a sponsor under Risk Retention Rules. These securities are interests in securitization trusts, thus there are no contractual maturities. The amortized cost and fair value of securities available for sale as of March 31, 2019 were as follows (in thousands): Amortized Cost Fair Value Rated notes $ 16,940 $ 16,940 Certificates and other assets 2,591 2,591 Total securities available for sale $ 19,531 $ 19,531 |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Equity-Based Compensation Expense | A summary of equity-based compensation expense recognized during the three months ended March 31, 2019 and 2018 is as follows (in thousands): Three Months Ended March 31, 2019 2018 Class B Units $ 578 $ 435 Restricted Stock Units and Awards excluding those granted in relation to Mr. Garcia's 100k Milestone Gift contributions 2,467 667 Restricted Stock Units granted in relation to Mr. Garcia's 100k Milestone Gift contributions 3,124 — Options 1,207 408 Class A Units 646 — Total equity-based compensation expense $ 8,022 $ 1,510 Equity-based compensation capitalized to property and equipment (311) — Equity-based compensation capitalized to inventory (877) — Equity-based compensation, net of capitalized amounts $ 6,834 $ 1,510 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Summary of the Calculation of Basic and Diluted Net Loss Per Share | The following table presents the calculation of basic and diluted net loss per share during the three months ended March 31, 2019 and 2018 (in thousands, except per share data): Three Months Ended March 31, 2019 2018 Numerator: Net loss $ (82,596) $ (52,672) Net loss attributable to non-controlling interests 54,047 45,629 Dividends on Class A convertible preferred stock — (1,345) Accretion of beneficial conversion feature on Class A convertible preferred stock — (1,380) Net loss attributable to Carvana Co. Class A common stockholders, basic and diluted $ (28,549) $ (9,768) Denominator: Weighted-average shares of Class A common stock outstanding 41,632 18,725 Nonvested weighted-average restricted stock awards (280) (379) Weighted-average shares of Class A common stock to compute basic and diluted net loss per Class A common share 41,352 18,346 Net loss per share of Class A common stock, basic and diluted $ (0.69) $ (0.53) |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Schedule of Lease Cost and Activity | The Company's lease costs and activity during the three months ended March 31, 2019 were as follows (in thousands): Lease costs: Finance leases: Amortization of finance lease assets $ 1,267 Interest on obligations under finance leases 331 Total finance lease costs $ 1,598 Operating leases: Fixed lease costs $ 2,328 Fixed lease costs to related parties 1,806 Variable short-term lease costs to related parties 454 Total operating lease costs $ 4,588 Cash payments related to lease liabilities included in operating cash flows: Operating lease liabilities to third parties $ 1,817 Operating lease liabilities to related parties $ 2,137 Interest payments on finance lease liabilities $ 331 Cash payments related to lease liabilities included in financing cash flows: Principal payments on finance lease liabilities $ 1,208 |
Schedule of Finance Lease, Maturity, After Adopting 842 | The following table summarizes maturities of lease liabilities as of March 31, 2019 (in thousands): Operating Leases (1) Finance Leases Related Party ( 2 ) Non-Related Party Total Operating Total Remainder of 2019 $ 6,676 $ 6,231 $ 5,937 $ 12,168 $ 18,844 2020 8,227 7,692 8,078 15,770 23,997 2021 7,953 7,154 7,354 14,508 22,461 2022 7,628 7,179 6,655 13,834 21,462 2023 7,061 7,212 5,430 12,642 19,703 Thereafter 1,224 31,660 32,730 64,390 65,614 Total minimum lease payments 38,769 67,128 66,184 133,312 172,081 Less: amount representing interest (4,608) (21,579) (27,933) (49,512) (54,120) Total lease liabilities $ 34,161 $ 45,549 $ 38,251 $ 83,800 $ 117,961 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are variable lease payments contingent upon the Company's utilization of the leased assets. |
Schedule of Operating Lease, Maturity, After Adopting 842 | The following table summarizes maturities of lease liabilities as of March 31, 2019 (in thousands): Operating Leases (1) Finance Leases Related Party ( 2 ) Non-Related Party Total Operating Total Remainder of 2019 $ 6,676 $ 6,231 $ 5,937 $ 12,168 $ 18,844 2020 8,227 7,692 8,078 15,770 23,997 2021 7,953 7,154 7,354 14,508 22,461 2022 7,628 7,179 6,655 13,834 21,462 2023 7,061 7,212 5,430 12,642 19,703 Thereafter 1,224 31,660 32,730 64,390 65,614 Total minimum lease payments 38,769 67,128 66,184 133,312 172,081 Less: amount representing interest (4,608) (21,579) (27,933) (49,512) (54,120) Total lease liabilities $ 34,161 $ 45,549 $ 38,251 $ 83,800 $ 117,961 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are variable lease payments contingent upon the Company's utilization of the leased assets. |
Schedule of Operating Lease Maturity, Before Adopting 842 | Therefore, the following future minimum lease payments as of December 31, 2018 prepared under previous lease accounting guidance has been included from the Company's 2018 Annual Report on Form 10-K filed on February 27, 2019 (in thousands): Operating Leases (1) Capital Leases Other Real Estate Financing Transactions (3) Related Party (2) Non-Related Party Total 2019 $ 3,779 $ 3,566 $ 6,461 $ 8,306 $ 14,767 2020 3,779 3,575 6,716 8,202 14,918 2021 3,779 3,583 6,869 7,387 14,256 2022 3,779 3,609 7,020 6,580 13,600 2023 3,275 3,837 7,140 5,330 12,470 Thereafter — 62,081 36,770 38,402 75,172 Total minimum lease payments $ 18,391 $ 80,251 $ 70,976 $ 74,207 $ 145,183 Less amounts representing interest (2,237) $ 16,154 (1) Leases that are on a month-to-month basis and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are contingent upon the Company's utilization of the leased assets. (3) These were previously presented as finance leases and represent the Company's sale and leaseback transactions that are accounted for as other real estate financing transactions, as further discussed in Note 9 — Debt Instruments. |
Schedule of Capital and Finance Lease Maturity, Before Adopting 842 | Therefore, the following future minimum lease payments as of December 31, 2018 prepared under previous lease accounting guidance has been included from the Company's 2018 Annual Report on Form 10-K filed on February 27, 2019 (in thousands): Operating Leases (1) Capital Leases Other Real Estate Financing Transactions (3) Related Party (2) Non-Related Party Total 2019 $ 3,779 $ 3,566 $ 6,461 $ 8,306 $ 14,767 2020 3,779 3,575 6,716 8,202 14,918 2021 3,779 3,583 6,869 7,387 14,256 2022 3,779 3,609 7,020 6,580 13,600 2023 3,275 3,837 7,140 5,330 12,470 Thereafter — 62,081 36,770 38,402 75,172 Total minimum lease payments $ 18,391 $ 80,251 $ 70,976 $ 74,207 $ 145,183 Less amounts representing interest (2,237) $ 16,154 (1) Leases that are on a month-to-month basis and lease extensions that the Company does not expect to take are not included. (2) Related party lease payments exclude rent payments due under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement for locations where the Company shares space with DriveTime, as those are contingent upon the Company's utilization of the leased assets. (3) These were previously presented as finance leases and represent the Company's sale and leaseback transactions that are accounted for as other real estate financing transactions, as further discussed in Note 9 — Debt Instruments. |
Schedule of Weighted-Average Remaining Lease Terms and Discount Rates | The weighted-average remaining lease terms and discount rates as of March 31, 2019 were as follows, excluding short-term operating leases: Weighted-average remaining lease terms (years) Operating leases 10.9 Finance leases 4.9 Weighted-average discount rate Operating leases 9.0 % Finance leases 5.6 % |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Assets Measured on Recurring Basis | The following tables are a summary of fair value measurements and hierarchy level at March 31, 2019 and December 31, 2018 (in thousands): As of March 31, 2019: Carrying Value Level 1 Level 2 Level 3 Assets: Money market funds (1) $ 19,810 $ 19,810 $ — $ — Beneficial interests in securitizations 19,531 — 19,531 — As of December 31, 2018: Carrying Value Level 1 Level 2 Level 3 Assets: Money market funds (1) $ 63,713 $ 63,713 $ — $ — _________________________ (1) 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. |
Fair Value of Senior Notes and Fair Value of Carrying Value and Fair Value of Finance Receivables | The fair value of the Senior Notes as of March 31, 2019 and December 31, 2018 was as follows (in thousands): March 31, 2019 December 31, 2018 Carrying value, net of unamortized debt issuance costs $ 343,251 $ 342,869 Fair value 352,690 319,375 The fair value of finance receivables, which are not carried at fair value on the accompanying unaudited condensed consolidated balance sheets, was determined 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, 2019 and December 31, 2018 were as follows (in thousands): March 31, 2019 December 31, 2018 Carrying value $ 151,186 $ 105,200 Fair value 157,778 109,703 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow Information | The following table summarizes supplemental cash flow information for the three months ended March 31, 2019 and 2018 (in thousands): Three Months Ended March 31, 2019 2018 Supplemental cash flow information: Cash payments for interest $ 3,917 $ 1,884 Non-cash investing and financing activities: Capital expenditures included in accounts payable and accrued liabilities $ 11,246 $ 8,035 Property and equipment acquired under finance leases $ 11,395 $ — Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 4,940 $ — Capital expenditures financed through long-term debt $ — $ 5,164 Equity-based compensation expense capitalized to property and equipment $ 311 $ — Fair value of beneficial interests received in securitization transactions $ 19,531 $ — Costs related to issuance of equity included in accrued liabilities $ — $ 163 |
Schedule of Cash, Cash Equivalents and Restricted Cash | 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, 2019 December 31, 2018 March 31, 2018 December 31, 2017 Cash and cash equivalents $ 85,321 $ 78,861 $ 121,497 $ 172,680 Restricted cash (1) 21,734 9,848 18,428 14,443 Total cash, cash equivalents and restricted cash $ 107,055 $ 88,709 $ 139,925 $ 187,123 |
Business Organization - Narrati
Business Organization - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2019class | Mar. 31, 2019vote | |
Subsidiary, Sale of Stock [Line Items] | ||
Number of classes of common ownership interests | 2 | 2 |
Carvana Co. | Carvana Group | ||
Subsidiary, Sale of Stock [Line Items] | ||
Ownership percentage by Carvana Co. | 28.60% | 28.60% |
Carvana Group | ||
Subsidiary, Sale of Stock [Line Items] | ||
Ownership percentage by existing unitholders | 71.40% | 71.40% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Liquidity (Details) - Floor Plan Facility - Line of Credit - USD ($) | Mar. 31, 2019 | Nov. 30, 2018 | Oct. 31, 2018 |
Debt Instrument [Line Items] | |||
Line of credit facility, remaining borrowing capacity | $ 215,200,000 | ||
Line of credit facility, maximum borrowing capacity | $ 650,000,000 | $ 350,000,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Comprehensive Loss (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Accounting Policies [Abstract] | ||
Other comprehensive loss | $ 0 | $ 0 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Restricted Cash (Details) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Floor Plan Facility | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Deposit required under floor plan facility, percentage of principal balance | 5.00% | 5.00% | 5.00% | 5.00% |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Segments (Details) | 3 Months Ended |
Mar. 31, 2019segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 1 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Adoption of New Accounting Standards (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Accounting Policies [Abstract] | |||
Operating Lease, Right-of-Use Asset | $ 77,754 | $ 80,300 | $ 0 |
Lease liabilities | $ 83,800 | $ 86,800 |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation and amortization on property and equipment | $ (52,505) | $ (44,050) |
Property and equipment, net | 353,486 | 296,839 |
Land and site improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 55,839 | 45,702 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 146,056 | 123,705 |
Transportation fleet | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 85,827 | 65,760 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 39,902 | 36,452 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 24,903 | 20,675 |
Total property and equipment excluding construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 352,527 | 292,294 |
Property and equipment, net | 300,022 | 248,244 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 53,464 | $ 48,595 |
Property and Equipment, Net - N
Property and Equipment, Net - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization expense | $ 7,943 | $ 4,605 |
Property, Plant and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization expense | $ 7,600 | $ 4,600 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Narrative (Details) - USD ($) $ in Thousands, shares in Millions | Apr. 12, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 9,353 | $ 9,353 | ||
Amortization expense | 400 | $ 0 | ||
Class A Common Units | ||||
Business Acquisition [Line Items] | ||||
Number of shares issued to former stockholders (in shares) | 0.5 | |||
Car360 | ||||
Business Acquisition [Line Items] | ||||
Payments to acquire business, net of cash acquired | $ 16,700 | |||
Cash acquired | 400 | |||
Payments to acquire businesses, net | 6,700 | |||
Fair value, equity interested issued | 10,000 | |||
Acquired net working capital | 200 | |||
Fair value, intangible assets | 9,900 | |||
Deferred tax liability | 2,500 | 2,500 | ||
Deferred tax liability, amortization expense | 400 | $ 0 | ||
Goodwill | $ 9,400 | $ 9,353 | $ 9,353 | |
Weighted average amortization period, definite-lived intangible assets | 5 years 9 months 18 days | |||
Car360 | Minimum | ||||
Business Acquisition [Line Items] | ||||
Deferred tax liability, amortization period | 5 years | |||
Car360 | Maximum | ||||
Business Acquisition [Line Items] | ||||
Deferred tax liability, amortization period | 7 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Summary of Fair Value of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2018 | Apr. 12, 2018 | |
Intangible assets: | |||
Total | $ 8,496 | $ 8,869 | |
Goodwill | 9,353 | 9,353 | |
Car360 | |||
Intangible assets: | |||
Intangible assets, acquired cost | 9,939 | 9,939 | |
Less: accumulated amortization | (1,443) | (1,070) | |
Total | 8,496 | 8,869 | |
Goodwill | $ 9,353 | 9,353 | $ 9,400 |
Car360 | Developed technology | |||
Intangible assets: | |||
Useful Life | 7 years | ||
Intangible assets, acquired cost | $ 8,642 | 8,642 | |
Car360 | Customer relationships | |||
Intangible assets: | |||
Useful Life | 5 years | ||
Intangible assets, acquired cost | $ 523 | 523 | |
Car360 | Non-compete agreements | |||
Intangible assets: | |||
Useful Life | 5 years | ||
Intangible assets, acquired cost | $ 774 | $ 774 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net Goodwill and Intangible Assets, Net - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Business Combinations [Abstract] | ||
Remainder of 2019 | $ 1,120 | |
2020 | 1,494 | |
2021 | 1,494 | |
2022 | 1,494 | |
2023 | 1,308 | |
2024 | 1,235 | |
Thereafter | 351 | |
Total | $ 8,496 | $ 8,869 |
Accounts Payable and Other Ac_3
Accounts Payable and Other Accrued Liabilities - Summary of Accounts Payable and Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 44,106 | $ 29,141 |
Sales taxes and vehicle licenses and fees | 36,861 | 27,651 |
Accrued interest expense | 20,469 | 9,206 |
Reserve for returns and cancellations | 17,226 | 11,284 |
Accrued property and equipment | 8,682 | 7,414 |
Accrued compensation and benefits | 8,249 | 13,477 |
Accrued advertising costs | 7,641 | 4,398 |
Other accrued liabilities | 21,790 | 14,953 |
Total accounts payable and accrued liabilities | $ 165,024 | $ 117,524 |
Related Party Transactions - Le
Related Party Transactions - Lease Agreements (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||||
Feb. 28, 2019USD ($) | Nov. 30, 2018renewal_option | Mar. 31, 2017renewal_optionlocation | Feb. 28, 2017renewal_option | Dec. 31, 2016vote | Nov. 30, 2014renewal_optionlocation | Mar. 31, 2019USD ($)renewal_option | Mar. 31, 2018USD ($) | |
Related Party Transaction [Line Items] | ||||||||
Operating lease, number of renewal options | renewal_option | 1 | |||||||
Purchase of certain leasehold improvements and equipment | $ 43,199 | $ 28,011 | ||||||
Related Party | DriveTime Automotive Group, Inc. | Related Party Lease Agreements | Building | ||||||||
Related Party Transaction [Line Items] | ||||||||
Operating lease, number of renewal options | renewal_option | 2 | 2 | ||||||
Operating leases, renewal term | 1 year | 1 year | ||||||
Renewal options, number of locations | location | 10 | 10 | ||||||
Termination rights, prior written notice period | 60 days | |||||||
Related Party | DriveTime Automotive Group, Inc. | Related Party Lease Agreements | Building | Cleveland, Ohio | ||||||||
Related Party Transaction [Line Items] | ||||||||
Operating lease, number of renewal options | renewal_option | 3 | |||||||
Operating leases, renewal term | 5 years | |||||||
Related Party | DriveTime Automotive Group, Inc. | Lease Agreement for Fully-Operational Inspection and Reconditioning Center | Building | Winder, Georgia | ||||||||
Related Party Transaction [Line Items] | ||||||||
Operating lease, number of renewal options | renewal_option | 3 | |||||||
Operating leases, renewal term | 5 years | |||||||
Operating lease term | 8 years | |||||||
Related Party | DriveTime Automotive Group, Inc. | Lease Agreement for Fully-Operational Inspection and Reconditioning Center | Building | Cleveland, Ohio | ||||||||
Related Party Transaction [Line Items] | ||||||||
Operating lease term | 3 years | |||||||
Related Party | DriveTime Automotive Group, Inc. | Lease Agreement for Fully-Operational Inspection and Reconditioning Center | Leasehold Improvements and Equipment | Cleveland, Ohio | ||||||||
Related Party Transaction [Line Items] | ||||||||
Purchase of certain leasehold improvements and equipment | $ 4,300 | |||||||
Related Party | Verde Investments, Inc. | Lease Agreement Related to Vehicle Inspection and Reconditioning Center | Building | Tolleson, Arizona | ||||||||
Related Party Transaction [Line Items] | ||||||||
Operating lease, number of renewal options | vote | 4 | |||||||
Operating leases, renewal term | 5 years | |||||||
Operating lease term | 15 years | |||||||
Related Party | Verde Investments, Inc. and DriveTime Automotive Group Inc. | Related Party Lease Agreements | ||||||||
Related Party Transaction [Line Items] | ||||||||
Expenses from transactions with related party | 2,000 | 2,200 | ||||||
Related Party | Verde Investments, Inc. and DriveTime Automotive Group Inc. | Related Party Lease Agreements | Cost of Sales | ||||||||
Related Party Transaction [Line Items] | ||||||||
Expenses from transactions with related party | 800 | 1,000 | ||||||
Related Party | Verde Investments, Inc. and DriveTime Automotive Group Inc. | Related Party Lease Agreements | Selling, general and administrative | ||||||||
Related Party Transaction [Line Items] | ||||||||
Expenses from transactions with related party | $ 1,200 | $ 1,200 |
Related Party Transactions - Co
Related Party Transactions - Corporate Office Leases (Details) | 1 Months Ended | 3 Months Ended | |
Sep. 30, 2016USD ($)renewal_option | Mar. 31, 2019USD ($)renewal_option | Mar. 31, 2018USD ($) | |
Related Party Transaction [Line Items] | |||
Operating lease, number of renewal options | renewal_option | 1 | ||
Related Party | DriveTime Automotive Group, Inc. | Corporate Headquarters, Office Lease | |||
Related Party Transaction [Line Items] | |||
Guarantor obligations, maximum exposure (up to) | $ | $ 500,000 | ||
Related Party | DriveTime Automotive Group, Inc. | Corporate Headquarters, Office Lease And Subleased Office Space, First Floor | |||
Related Party Transaction [Line Items] | |||
Operating lease term | 83 months | ||
Operating lease, number of renewal options | renewal_option | 3 | ||
Operating leases, renewal term | 5 years | ||
Related Party | DriveTime Automotive Group, Inc. | Subleased Office Space, First Floor | |||
Related Party Transaction [Line Items] | |||
Expenses from transactions with related party | $ | $ 200,000 | $ 200,000 |
Related Party Transactions - _2
Related Party Transactions - Lease Assumption from DriveTime (Details) $ in Millions | 1 Months Ended | 3 Months Ended |
Feb. 28, 2019USD ($)renewal_option | Mar. 31, 2019renewal_option | |
Related Party Transaction [Line Items] | ||
Operating lease, number of renewal options | 1 | |
DriveTime Automotive Group, Inc. | Leasehold Improvements and Equipment | Lease Agreement for Inspection and Reconditioning Center | Related Party | Nashville, TN | ||
Related Party Transaction [Line Items] | ||
Agreement to purchase certain leasehold improvements and equipment | $ | $ 2 | |
Operating lease term | 4 years | |
Operating lease, number of renewal options | 3 | |
Operating leases, renewal term | 5 years |
Related Party Transactions - Ma
Related Party Transactions - Master Dealer Agreement (Details) - DriveTime Automotive Group, Inc. - Related Party - Master Dealer Agreement - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Revenue from related parties | $ 10.1 | $ 4.1 |
Revenue related to excess cash reserves on contracts | 0.5 | |
Expenses related to administration of GAP waiver coverage | $ 0.8 | $ 0.3 |
Related Party Transactions - GA
Related Party Transactions - GAP Waiver Insurance Policy (Details) - USD ($) $ in Thousands | 1 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Other assets, due from related parties | $ 12,526 | $ 13,098 |
Related Party | BlueShore | ||
Related Party Transaction [Line Items] | ||
Payments to acquire GAP waiver insurance policy | 1,000 | |
Other assets, due from related parties | $ 100 |
Related Party Transactions - Se
Related Party Transactions - Servicing and Administrative Fees (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
DriveTime Automotive Group, Inc. | Servicing and Administrative Fees | Related Party | ||
Related Party Transaction [Line Items] | ||
Expenses from transactions with related party | $ 0.5 | $ 0.1 |
Related Party Transactions - Ai
Related Party Transactions - Aircraft Time Sharing Agreement (Details) - Related Party - Aircraft Time Sharing Agreement - Air Transportation Equipment $ in Millions | Oct. 22, 2015aircraft | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) |
DriveTime Automotive Group, Inc. | |||
Related Party Transaction [Line Items] | |||
Number of aircrafts | aircraft | 2 | ||
Contractual agreement term | 12 months | ||
Number of allowable days prior to contract termination with written notice | 30 days | ||
Expenses from transactions with related party | $ | $ 0.1 | $ 0.1 | |
Verde Investments, Inc. | |||
Related Party Transaction [Line Items] | |||
Contractual agreement, perpetual automatic renewal | 12 months |
Related Party Transactions - _3
Related Party Transactions - Senior Unsecured Notes Held by Verde (Details) - Senior Unsecured Notes Effective September 2018 - Senior Notes - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Long-term debt | $ 343.3 | $ 342.9 |
Related Party | Verde Investments, Inc. | ||
Related Party Transaction [Line Items] | ||
Long-term debt | $ 15 | $ 15 |
Related Party Transactions - Ac
Related Party Transactions - Accounts Payable Due to Related Party (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Accounts payable due to related party | $ 5,739 | $ 3,891 |
Related Party | ||
Related Party Transaction [Line Items] | ||
Accounts payable due to related party | $ 5,700 | $ 3,900 |
Related Party Transactions - _4
Related Party Transactions - Contribution Agreement (Details) - Restricted Stock Units - Chief Executive Officer - Contribution Agreement | Sep. 10, 2018USD ($)shares |
Related Party Transaction [Line Items] | |
Contribution of Class A common stock from related party, fee charged | $ | $ 0 |
Stock contribution commitment, shares per employee (in shares) | shares | 165 |
Finance Receivable Sale Agree_2
Finance Receivable Sale Agreements - Narrative (Details) | 3 Months Ended | |||||
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Nov. 02, 2018USD ($)multiplier | Nov. 03, 2017USD ($) | Nov. 02, 2017USD ($) | Dec. 31, 2016USD ($) | |
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | ||||||
Purchase of finance receivables | $ 127,710,000 | $ 0 | ||||
Consumer Loan | Master Transfer Agreement | ||||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | ||||||
Transfer of financial assets, accounted for as sales, maximum amount eligible to be sold | $ 357,100,000 | $ 292,200,000 | ||||
Consumer Loan | MPSA | ||||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | ||||||
Transfer of financial assets, accounted for as sales, maximum amount eligible to be sold | $ 1,500,000,000 | $ 375,000,000 | $ 375,000,000 | |||
Receivable purchase agreement, remaining unused capacity | 1,100,000,000 | |||||
Commitment of purchaser, current availability financing, principal balances of finance receivables (up to) | $ 1,250,000,000 | |||||
Transfer of financial assets accounted for as sales, amount derecognized | 65,300,000 | 125,600,000 | ||||
Consumer Loan | Master Transfer Agreement 2017 | ||||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | ||||||
Receivable purchase agreement, remaining unused capacity | 396,200,000 | $ 454,500,000 | ||||
Purchase commitment multiplier | multiplier | 3 | |||||
Transfer of financial assets accounted for as sales, amount derecognized | 58,300,000 | 85,500,000 | ||||
Consumer Loan | Master Purchase And Sale Agreement And 2017 Master Transfer Agreement | ||||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | ||||||
Gain on loan sales | $ 19,200,000 | $ 9,900,000 |
Securitizations and Variable _3
Securitizations and Variable Interest Entities - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Beneficial interests in securitizations | $ 19,531 | $ 0 |
Securitizations and Variable _4
Securitizations and Variable Interest Entities - Schedule of Expected Losses (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Variable Interest Entity [Line Items] | ||
Carrying Value | $ 19,531 | $ 0 |
Variable Interest Entity, Not Primary Beneficiary, Aggregated Disclosure | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 19,531 | |
Total Exposure | 19,531 | |
Variable Interest Entity, Not Primary Beneficiary, Aggregated Disclosure | Rated notes | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 16,940 | |
Total Exposure | 16,940 | |
Variable Interest Entity, Not Primary Beneficiary, Aggregated Disclosure | Certificates and other assets | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 2,591 | |
Total Exposure | $ 2,591 |
Securitizations and Variable _5
Securitizations and Variable Interest Entities - Schedule of Cost and Fair Value of Securities (Details) - Variable Interest Entity, Not Primary Beneficiary, Aggregated Disclosure $ in Thousands | Mar. 31, 2019USD ($) |
Variable Interest Entity [Line Items] | |
Amortized Cost | $ 19,531 |
Fair Value | 19,531 |
Rated notes | |
Variable Interest Entity [Line Items] | |
Amortized Cost | 16,940 |
Fair Value | 16,940 |
Certificates and other assets | |
Variable Interest Entity [Line Items] | |
Amortized Cost | 2,591 |
Fair Value | $ 2,591 |
Debt Instruments - Floor Plan F
Debt Instruments - Floor Plan Facility (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 10 Months Ended | ||||
Nov. 30, 2018 | Nov. 30, 2017 | Mar. 31, 2019 | Oct. 31, 2018 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | |
Line of Credit Facility [Line Items] | |||||||
Line of credit, outstanding | $ 434,777,000 | $ 196,963,000 | |||||
Restricted cash | $ 21,734,000 | $ 9,848,000 | $ 18,428,000 | $ 14,443,000 | |||
Floor Plan Facility | Line of Credit | |||||||
Line of Credit Facility [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 650,000,000 | $ 350,000,000 | |||||
Deposit required under floor plan facility, percentage of principal balance | 5.00% | 5.00% | 5.00% | 5.00% | |||
Term of principal payments | 5 days | ||||||
Principal repayment, term threshold after sale of used vehicle | 15 days | 15 days | |||||
Principal repayment, term threshold after sale of related finance receivable | 2 days | 1 day | |||||
Outstanding balance, days held in inventory threshold | 180 days | ||||||
Outstanding balance, held in inventory, percentage of original principal amount due | 10.00% | ||||||
Outstanding balance, held in inventory, original principal amount, threshold | 50.00% | ||||||
Outstanding balance, held in inventory, wholesale value, threshold | 50.00% | ||||||
Interest rate | 5.90% | 5.90% | |||||
Line of credit, outstanding | $ 434,800,000 | $ 197,000,000 | |||||
Line of credit facility, remaining borrowing capacity | 215,200,000 | ||||||
Current borrowing capacity | 181,800,000 | ||||||
Restricted cash | $ 21,700,000 | $ 9,800,000 | |||||
Floor Plan Facility | Line of Credit | London Interbank Offered Rate (LIBOR) | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 3.40% | 3.65% |
Debt Instruments - Long-Term De
Debt Instruments - Long-Term Debt (Details) | Sep. 21, 2018USD ($) | Nov. 30, 2017USD ($)property | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | ||||
Notes payable, current portion | $ 15,331,000 | $ 11,133,000 | ||
Sale leaseback transaction, amount due under financing arrangement | 84,100,000 | |||
Master Sale-Leaseback Agreement | ||||
Debt Instrument [Line Items] | ||||
Sale leaseback transaction, number of properties sold and leased back at amount equal to the repurchase price (or more) | property | 1 | |||
Sale leaseback transaction, maximum sales price of properties sold and leasing back | $ 75,000,000 | |||
Sale leaseback, repurchase price | 28,800,000 | |||
Sale leaseback transaction, additional amount company may sell and lease back | $ 75,000,000 | 75,000,000 | ||
Minimum | ||||
Debt Instrument [Line Items] | ||||
Sale leaseback transaction, expiration period | 15 years | |||
Maximum | ||||
Debt Instrument [Line Items] | ||||
Sale leaseback transaction, expiration period | 20 years | |||
Sale leaseback transaction, renewal period (up to) | 20 years | |||
Senior Notes | Senior Unsecured Notes Effective September 2018 | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 350,000,000 | |||
Interest rate | 8.875% | |||
Long-term debt | $ 343,300,000 | 342,900,000 | ||
Senior Notes | Senior Unsecured Notes Effective September 2018 | Verde Investments, Inc. | Affiliated Entity | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 15,000,000 | $ 15,000,000 | ||
Senior Notes | Senior Unsecured Notes Effective September 2018 | Debt Instrument, Redemption, Period One | ||||
Debt Instrument [Line Items] | ||||
Redemption price, percentage of principal amount redeemed | 35.00% | |||
Redemption price, percentage | 108.875% | |||
Senior Notes | Senior Unsecured Notes Effective September 2018 | Debt Instrument, Redemption, Period Two | ||||
Debt Instrument [Line Items] | ||||
Redemption price, percentage | 101.00% | |||
Notes Payable, Other Payables | Promissory Note | ||||
Debt Instrument [Line Items] | ||||
Weighted average interest rate | 6.10% | |||
Notes payable | $ 32,900,000 | |||
Notes payable, current portion | $ 8,200,000 | |||
Notes Payable, Other Payables | Promissory Note | Minimum | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, term | 2 years | |||
Notes Payable, Other Payables | Promissory Note | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, term | 5 years |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) | Dec. 05, 2017$ / sharesshares | May 03, 2017vote$ / sharesshares | May 02, 2017 | Mar. 31, 2019$ / sharesshares | Mar. 31, 2019class$ / sharesshares | Mar. 31, 2019vote$ / sharesshares | Dec. 31, 2018$ / sharesshares |
Limited Partners' Capital Account [Line Items] | |||||||
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||
Number of classes of common ownership interests | 2 | 2 | |||||
Conversion ratio | 1.25 | ||||||
Class A Common Units | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Conversion ratio | 0.80 | ||||||
Class A Common Units | Carvana Group | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Common unit, outstanding (in shares) | 182,400,000 | 182,400,000 | 182,400,000 | ||||
Class B Common Units | Carvana Group | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Common unit, outstanding (in shares) | 5,800,000 | 5,800,000 | 5,800,000 | ||||
Garcia Parties | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Ownership percentage of outstanding shares, minimum requirement | 25.00% | ||||||
Carvana Sub | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Percentage of voting power | 0.10% | ||||||
Class A Common Stock | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 | 500,000,000 | 500,000,000 | 500,000,000 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||
Number of votes | vote | 1 | ||||||
Required ratio between shares issued and shares owned of subsidiary | 0.8 | ||||||
Required ratio between shares outstanding and shares owned of subsidiary | 0.8 | ||||||
Class B Common Stock | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 | 125,000,000 | 125,000,000 | 125,000,000 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||
Number of votes | vote | 1 | ||||||
Conversion ratio | 0.8 | ||||||
Class B Common Stock | Garcia Parties | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Number of votes | vote | 10 | ||||||
Convertible Preferred Stock | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Preferred stock, shares authorized (in shares) | 100,000 | ||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||
Preferred stock initial value per share (in dollars per share) | $ / shares | $ 1,000 | ||||||
Conversion ratio | 0.8 |
Stockholders' Equity - Exchange
Stockholders' Equity - Exchange Agreement (Details) shares in Millions | May 03, 2017 | Mar. 31, 2019shares |
Limited Partners' Capital Account [Line Items] | ||
Conversion ratio | 1.25 | |
Class B Common Stock | ||
Limited Partners' Capital Account [Line Items] | ||
Conversion ratio | 0.8 | |
Exchange Agreement | ||
Limited Partners' Capital Account [Line Items] | ||
Conversion of stock, converted (in shares) | 2.5 | |
LLC units received (in shares) | 2.5 | |
Exchange Agreement | Class B Common Stock | ||
Limited Partners' Capital Account [Line Items] | ||
Conversion of stock, converted (in shares) | 2 | |
Exchange Agreement | Class A Common Stock | ||
Limited Partners' Capital Account [Line Items] | ||
Conversion ratio | 0.8 | |
Conversion of stock, issued (in shares) | 2 |
Stockholders' Equity - Converti
Stockholders' Equity - Convertible Preferred Stock (Details) $ / shares in Units, $ in Thousands | Dec. 11, 2017 | Dec. 05, 2017USD ($)$ / sharesshares | Mar. 31, 2019USD ($)$ / sharesshares | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($)$ / sharesshares | Jan. 29, 2018$ / shares | May 03, 2017$ / shares |
Limited Partners' Capital Account [Line Items] | |||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Conversion ratio | 1.25 | ||||||
Accretion of beneficial conversion feature on Class A convertible preferred stock | $ 0 | $ (1,380) | |||||
Dividends paid | $ 0 | 1,528 | |||||
Preferred stock, shares outstanding (in shares) | shares | 0 | 0 | |||||
Class A Common Units | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Conversion ratio | 0.80 | ||||||
Carvana Group | Class A Common Units | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Conversions of Class A Convertible Preferred Stock (in shares) | shares | 6,300,000 | ||||||
Convertible Preferred Stock | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Issuance of stock (in shares) | shares | 100,000 | ||||||
Gross issuance of stock | $ 100,000 | ||||||
Stock sold during period, net proceeds | $ 98,500 | ||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||
Preferred stock initial value per share (in dollars per share) | $ / shares | 1,000 | ||||||
Conversion rate (in dollars per share) | $ / shares | $ 19.6945 | $ 50.78 | |||||
Percent of stock price for company option to convert preferred stock to common | 150.00% | ||||||
Conversion ratio | 0.8 | ||||||
Redemption price, calculation premium to volume weighted average stock price | 20.00% | ||||||
Beneficial conversion feature of Class A convertible preferred stock | $ 2,600 | ||||||
Redemption price, trading days used In calculation | 5 days | ||||||
Accretion of beneficial conversion feature on Class A convertible preferred stock | 1,400 | ||||||
Dividends paid | 1,500 | ||||||
Preferred stock, shares outstanding (in shares) | shares | 0 | 0 | |||||
Accrued dividends | $ 0 | $ 0 | |||||
Convertible Preferred Stock | Shareholder | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Conversions of Class A Convertible Preferred Stock (in shares) | shares | 75,000 | ||||||
Convertible Preferred Stock | Carvana Group | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 100,000 | ||||||
Dividends paid | $ 1,500 | ||||||
Conversions of Class A Convertible Preferred Stock (in shares) | shares | 25,000 | ||||||
Class A Common Stock | |||||||
Limited Partners' Capital Account [Line Items] | |||||||
Conversions of Class A Convertible Preferred Stock (in shares) | shares | 5,100,000 |
Stockholders' Equity - Class A
Stockholders' Equity - Class A Non-Convertible Preferred Units (Details) | Oct. 02, 2018USD ($)shares |
Senior Notes | Senior Unsecured Notes Effective September 2018 | |
Limited Partners' Capital Account [Line Items] | |
Repayment or retirement of debt, equity cancellation and retirement criteria | $ | $ 1,000 |
Carvana Group | Class A Non-Convertible Preferred Units | |
Limited Partners' Capital Account [Line Items] | |
Issuance of stock (in shares) | 350,000 |
Repayment of debt, number of shares canceled and retired (in shares) | 1 |
Stockholders' Equity - Contribu
Stockholders' Equity - Contribution of Class A Common Shares (Details) - USD ($) shares in Millions | Sep. 10, 2018 | Mar. 31, 2019 |
Restricted Stock Units | ||
Limited Partners' Capital Account [Line Items] | ||
Issuance of stock (in shares) | 0.1 | |
Class A Common Stock | Restricted Stock Units | ||
Limited Partners' Capital Account [Line Items] | ||
Issuance of stock (in shares) | 0.1 | |
Chief Executive Officer | Contribution Agreement | Restricted Stock Units | ||
Limited Partners' Capital Account [Line Items] | ||
Contribution of Class A common stock from related party, fee charged | $ 0 | |
Chief Executive Officer | Class A Common Stock | Contribution Agreement | ||
Limited Partners' Capital Account [Line Items] | ||
Contribution of Class A common stock (in shares) | 0.1 | |
Contribution of Class A common stock from related party, fee charged | $ 0 |
Non-controlling Interests - Nar
Non-controlling Interests - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | |
Noncontrolling Interest [Line Items] | ||
Conversion ratio | 1.25 | |
Carvana Co. | Carvana Group | ||
Noncontrolling Interest [Line Items] | ||
Ownership percentage by Carvana Co. | 28.60% | |
Carvana Group | ||
Noncontrolling Interest [Line Items] | ||
Ownership percentage by existing unitholders | 71.40% | |
Non-controlling Interests | ||
Noncontrolling Interest [Line Items] | ||
Adjustments to non-controlling interests | $ (1,899) | $ (1,540) |
Additional Paid-in Capital | ||
Noncontrolling Interest [Line Items] | ||
Adjustments to non-controlling interests | $ 1,899 | $ 1,540 |
Equity-Based Compensation - Equ
Equity-Based Compensation - Equity-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense | $ 8,022 | $ 1,510 |
Equity-based compensation, net of capitalized amounts | 6,834 | 1,510 |
Unrecognized compensation expense | $ 52,800 | |
Unrecognized compensation expense, period for recognition | 3 years | |
Property, Plant and Equipment | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense capitalized | $ (311) | 0 |
Inventories | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense capitalized | (877) | 0 |
Class B Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense | 578 | 435 |
Restricted Stock Units and Awards excluding those granted in relation to Mr. Garcia's 100k Milestone Gift contributions | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense | 2,467 | 667 |
Restricted Stock Units granted in relation to Mr. Garcia's 100k Milestone Gift contributions | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense | 3,124 | 0 |
Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense | 1,207 | 408 |
Class A Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity-based compensation expense | $ 646 | $ 0 |
Equity-Based Compensation - 201
Equity-Based Compensation - 2017 Omnibus Incentive Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Equity-based compensation expense | $ 7,711 | $ 1,510 |
Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Service-based vesting period | 1 day | |
Issuance of stock (in shares) | 100,000 | |
Equity-based compensation expense | $ 3,100 | |
Class A Common Stock | Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Issuance of stock (in shares) | 100,000 | |
2017 Omnibus Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Maximum number of awards authorized for grant (in shares) | 14,000,000 | |
2017 Omnibus Incentive Plan | Class A Common Stock | Class A Common Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Number of shares available for grant (in shares) | 11,100,000 | |
2017 Omnibus Incentive Plan | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Service-based vesting period | 2 years | |
2017 Omnibus Incentive Plan | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Service-based vesting period | 5 years |
Equity-Based Compensation - Cla
Equity-Based Compensation - Class A Units (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Conversion ratio | 1.25 | |
Class A Common Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of units granted in the period (in dollars per share) | $ 18.58 | |
Conversion ratio | 0.80 | |
Minimum | Class A Common Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Service-based vesting period | 2 years | |
Maximum | Class A Common Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Service-based vesting period | 4 years |
Equity-Based Compensation - C_2
Equity-Based Compensation - Class B Units (Details) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Class B Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of units issued in the period (in shares) | 0 | 0 |
Loss Per Share - Calculation of
Loss Per Share - Calculation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Numerator: | |||
Net loss | $ (82,596) | $ (52,672) | |
Net loss attributable to non-controlling interests | 54,047 | 45,629 | |
Dividends on Class A convertible preferred stock | 0 | (1,345) | |
Accretion of beneficial conversion feature on Class A convertible preferred stock | 0 | (1,380) | |
Net loss attributable to Carvana Co. Class A common stockholders, basic and diluted | $ (28,549) | $ (9,768) | |
Class A Common Stock | |||
Denominator: | |||
Weighted-average shares of Class A common stock to compute basic and diluted net loss per Class A common share (in shares) | [1] | 41,352 | 18,346 |
Net loss per share of Class A common stock, basic and diluted (in dollars per share) | $ (0.69) | $ (0.53) | |
Restricted Awards | |||
Denominator: | |||
Nonvested weighted-average restricted stock awards (in shares) | (280) | (379) | |
Class A Common Units | |||
Denominator: | |||
Weighted-average shares of Class A common stock outstanding (in shares) | 41,632 | 18,725 | |
[1] | Weighted-average shares of Class A common stock outstanding have been adjusted for unvested restricted stock awards. |
Loss Per Share - Narrative (Det
Loss Per Share - Narrative (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Preferred Class A | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 5.1 | |
Class B Common Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 104.4 | 114.1 |
Class B Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 6.3 | 7.2 |
Restricted Awards And Restricted Stock Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0.7 | 0.4 |
Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1.3 | 0.8 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) shares in Millions | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Apr. 12, 2018 | |
Income Tax Contingency [Line Items] | ||||
Uncertain tax positions | $ 0 | $ 0 | ||
Related reserves | 0 | $ 0 | ||
Car360 | ||||
Income Tax Contingency [Line Items] | ||||
Deferred tax liability | 2,500,000 | $ 2,500,000 | ||
Deferred tax liability, amortization expense | $ 400,000 | $ 0 | ||
Car360 | Minimum | ||||
Income Tax Contingency [Line Items] | ||||
Deferred tax liability, amortization period | 5 years | |||
Car360 | Maximum | ||||
Income Tax Contingency [Line Items] | ||||
Deferred tax liability, amortization period | 7 years | |||
Carvana Group | ||||
Income Tax Contingency [Line Items] | ||||
Gross deferred tax asset | $ 25,600,000 | |||
Exchange Agreement | ||||
Income Tax Contingency [Line Items] | ||||
LLC units received (in shares) | 2.5 |
Income Taxes - Tax Receivable A
Income Taxes - Tax Receivable Agreement (Details) $ in Millions | Mar. 31, 2019USD ($) |
Income Tax Disclosure [Abstract] | |
Deferred tax liability, unrecorded, Tax Receivable Agreement | $ 140.1 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)renewal_option | Mar. 31, 2018USD ($) | |
Lessee, Lease, Description [Line Items] | ||
Operating lease, number of renewal options | renewal_option | 1 | |
Operating leases, rent expense | $ 1,800 | |
Finance lease, extension term | 4 years | |
Outstanding finance lease | $ 34,161 | |
Outstanding finance lease, due next twelve months | $ 7,100 | |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease, renewal term | 1 year | |
Finance lease, term of contract | 2 years | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease, renewal term | 20 years | |
Finance lease, term of contract | 5 years |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost and Activity (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Finance leases: | |
Amortization of finance lease assets | $ 1,267 |
Interest on obligations under finance leases | 331 |
Total finance lease costs | 1,598 |
Operating leases: | |
Fixed lease costs | 2,328 |
Total operating lease costs | 4,588 |
Cash payments related to lease liabilities included in operating cash flows: | |
Interest payments on finance lease liabilities | 331 |
Cash payments related to lease liabilities included in financing cash flows: | |
Principal payments on finance lease liabilities | 1,208 |
Related Party | |
Operating leases: | |
Fixed lease costs | 1,806 |
Variable short-term lease costs to related parties | 454 |
Cash payments related to lease liabilities included in operating cash flows: | |
Operating lease liabilities | 2,137 |
Third Party | |
Cash payments related to lease liabilities included in operating cash flows: | |
Operating lease liabilities | $ 1,817 |
Leases - Schedule of Operating
Leases - Schedule of Operating and Finance Lease Maturities, After Adopting 842 (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 |
Finance Leases | ||
Remainder of 2019 | $ 6,676 | |
2020 | 8,227 | |
2021 | 7,953 | |
2022 | 7,628 | |
2023 | 7,061 | |
Thereafter | 1,224 | |
Total minimum lease payments | 38,769 | |
Less: amount representing interest | (4,608) | |
Total lease liabilities | 34,161 | |
Operating Leases | ||
Remainder of 2019 | 12,168 | |
2020 | 15,770 | |
2021 | 14,508 | |
2022 | 13,834 | |
2023 | 12,642 | |
Thereafter | 64,390 | |
Total minimum lease payments | 133,312 | |
Less: amount representing interest | (49,512) | |
Total lease liabilities | 83,800 | $ 86,800 |
Total | ||
Remainder of 2019 | 18,844 | |
2020 | 23,997 | |
2021 | 22,461 | |
2022 | 21,462 | |
2023 | 19,703 | |
Thereafter | 65,614 | |
Total minimum lease payments | 172,081 | |
Less: amount representing interest | (54,120) | |
Total lease liabilities | 117,961 | |
Related Party | ||
Operating Leases | ||
Remainder of 2019 | 6,231 | |
2020 | 7,692 | |
2021 | 7,154 | |
2022 | 7,179 | |
2023 | 7,212 | |
Thereafter | 31,660 | |
Total minimum lease payments | 67,128 | |
Less: amount representing interest | (21,579) | |
Total lease liabilities | 45,549 | |
Non-Related Party | ||
Operating Leases | ||
Remainder of 2019 | 5,937 | |
2020 | 8,078 | |
2021 | 7,354 | |
2022 | 6,655 | |
2023 | 5,430 | |
Thereafter | 32,730 | |
Total minimum lease payments | 66,184 | |
Less: amount representing interest | (27,933) | |
Total lease liabilities | $ 38,251 |
Leases - Schedule of Operatin_2
Leases - Schedule of Operating and Finance Lease Maturities, Before Adopting 842 (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Capital Leases | |
2019 | $ 3,779 |
2020 | 3,779 |
2021 | 3,779 |
2022 | 3,779 |
2023 | 3,275 |
Thereafter | 0 |
Total minimum lease payments | 18,391 |
Less amounts representing interest | (2,237) |
Total | 16,154 |
Other Real Estate Financing Transactions | |
2019 | 3,566 |
2020 | 3,575 |
2021 | 3,583 |
2022 | 3,609 |
2023 | 3,837 |
Thereafter | 62,081 |
Total minimum lease payments | 80,251 |
Operating Leases | |
2019 | 14,767 |
2020 | 14,918 |
2021 | 14,256 |
2022 | 13,600 |
2023 | 12,470 |
Thereafter | 75,172 |
Total minimum lease payments | 145,183 |
Related Party | |
Operating Leases | |
2019 | 6,461 |
2020 | 6,716 |
2021 | 6,869 |
2022 | 7,020 |
2023 | 7,140 |
Thereafter | 36,770 |
Total minimum lease payments | 70,976 |
Non-Related Party | |
Operating Leases | |
2019 | 8,306 |
2020 | 8,202 |
2021 | 7,387 |
2022 | 6,580 |
2023 | 5,330 |
Thereafter | 38,402 |
Total minimum lease payments | $ 74,207 |
Leases - Schedule of Lease Term
Leases - Schedule of Lease Terms and Discount Rates (Details) | 3 Months Ended |
Mar. 31, 2019 | |
Weighted-average remaining lease terms (years) | |
Operating leases | 10 years 10 months 24 days |
Finance leases | 4 years 10 months 24 days |
Weighted-average discount rate | |
Operating leases | 9.00% |
Finance leases | 5.60% |
Commitments and Contingencies -
Commitments and Contingencies - Accrued Limited Warranty (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2019USD ($)mi | Dec. 31, 2018USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | ||
Limited warranty, period | 100 days | |
Limited warranty, miles | mi | 4,189 | |
Accrued limited warranty | $ | $ 2 | $ 1.4 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Fair Value Assets Measured on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Assets: | ||
Beneficial interests in securitizations | $ 19,531 | |
Money market funds | ||
Assets: | ||
Money market funds | 19,810 | $ 63,713 |
Level 1 | ||
Assets: | ||
Beneficial interests in securitizations | 0 | |
Level 1 | Money market funds | ||
Assets: | ||
Money market funds | 19,810 | 63,713 |
Level 2 | ||
Assets: | ||
Beneficial interests in securitizations | 19,531 | |
Level 2 | Money market funds | ||
Assets: | ||
Money market funds | 0 | 0 |
Level 3 | ||
Assets: | ||
Beneficial interests in securitizations | 0 | |
Level 3 | Money market funds | ||
Assets: | ||
Money market funds | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Carrying Value and Fair Value, Senior Notes and Finance Receivables (Details) - Level 2 - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Finance receivables | $ 151,186 | $ 105,200 |
Carrying value | Senior Unsecured Notes Effective September 2018 | Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes | 343,251 | 342,869 |
Fair value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Finance receivables | 157,778 | 109,703 |
Fair value | Senior Unsecured Notes Effective September 2018 | Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes | $ 352,690 | $ 319,375 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Supplemental cash flow information: | ||
Cash payments for interest | $ 3,917 | $ 1,884 |
Non-cash investing and financing activities: | ||
Capital expenditures included in accounts payable and accrued liabilities | 11,246 | 8,035 |
Property and equipment acquired under finance leases | 11,395 | 0 |
Operating lease right-of-use assets obtained in exchange for operating lease liabilities | 4,940 | |
Capital expenditures financed through long-term debt | 0 | 5,164 |
Equity-based compensation expense capitalized to property and equipment | 311 | 0 |
Fair value of beneficial interests received in securitization transactions | 19,531 | 0 |
Costs related to issuance of equity included in accrued liabilities | $ 0 | $ 163 |
Supplemental Cash Flow Inform_4
Supplemental Cash Flow Information - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 85,321 | $ 78,861 | $ 121,497 | $ 172,680 |
Restricted cash | 21,734 | 9,848 | 18,428 | 14,443 |
Total cash, cash equivalents and restricted cash | $ 107,055 | $ 88,709 | $ 139,925 | $ 187,123 |
Supplemental Cash Flow Inform_5
Supplemental Cash Flow Information - Narrative (Details) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Floor Plan Facility | Line of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Deposit required under floor plan facility, percentage of principal balance | 5.00% | 5.00% | 5.00% | 5.00% |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) - Subsequent Event - USD ($) | May 07, 2019 | Apr. 19, 2019 |
Class A Common Stock | Contribution Agreement | Chief Executive Officer | ||
Subsequent Event [Line Items] | ||
Stock contribution commitment (in shares) | 43,230 | |
Contribution of Class A common stock from related party, fee charged | $ 0 | |
Loan And Security Agreement | Revolving Credit Facility | Line of Credit | Financing Partner | ||
Subsequent Event [Line Items] | ||
Agreement to provide revolving credit facility | $ 300,000,000 | |
Amended and Restated Loan And Security Agreement | Revolving Credit Facility | Line of Credit | Financing Partner | ||
Subsequent Event [Line Items] | ||
Agreement to provide revolving credit facility | $ 350,000,000 | |
Consumer Loan | MPSA | ||
Subsequent Event [Line Items] | ||
Commitment of purchaser, current availability financing, principal balances of finance receivables (up to) | $ 1,000,000,000 |