Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 16, 2024 | Jun. 30, 2023 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38073 | ||
Entity Registrant Name | CARVANA CO. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 81-4549921 | ||
Entity Address, Address Line One | 300 E. Rio Salado Parkway | ||
Entity Address, City or Town | Tempe | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85281 | ||
City Area Code | 602 | ||
Local Phone Number | 922-9866 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2.5 | ||
Documents Incorporated by Reference | Portions of the registrant's Definitive Proxy Statement for its 2024 Annual Meeting of Shareholders are incorporated by reference into Part III of this Form 10-K. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001690820 | ||
Common Stock | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Class A Common Stock, Par Value $0.001 Per Share | ||
Trading Symbol | CVNA | ||
Security Exchange Name | NYSE | ||
Preferred Stock Purchase Rights | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Preferred Stock Purchase Rights | ||
Security Exchange Name | NYSE | ||
Class A | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding (in shares) | 116,279,730 | ||
Class B | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding (in shares) | 85,619,471 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Firm ID | 248 |
Auditor Name | GRANT THORNTON LLP |
Auditor Location | Southfield, Michigan |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 530 | $ 434 |
Restricted cash | 64 | 194 |
Accounts receivable, net | 266 | 253 |
Finance receivables held for sale, net | 807 | 1,334 |
Vehicle inventory | 1,150 | 1,876 |
Beneficial interests in securitizations | 366 | 321 |
Other current assets, including $3 and $6, respectively, due from related parties | 138 | 182 |
Total current assets | 3,321 | 4,594 |
Property and equipment, net | 2,982 | 3,244 |
Operating lease right-of-use assets, including $10 and $14, respectively, from leases with related parties | 455 | 536 |
Intangible assets, net | 52 | 70 |
Other assets, including $0 and $1, respectively, due from related parties | 261 | 254 |
Total assets | 7,071 | 8,698 |
Current liabilities: | ||
Accounts payable and accrued liabilities, including $7 and $16, respectively, due to related parties | 596 | 777 |
Short-term revolving facilities | 668 | 1,534 |
Current portion of long-term debt | 189 | 201 |
Other current liabilities, including $3 and $4, respectively, from leases with related parties | 83 | 80 |
Total current liabilities | 1,536 | 2,592 |
Long-term debt, excluding current portion | 5,416 | 6,574 |
Operating lease liabilities, excluding current portion, including $7 and $9, respectively, from leases with related parties | 433 | 507 |
Other liabilities, including $11 and $0, respectively, due to related parties | 70 | 78 |
Total liabilities | 7,455 | 9,751 |
Commitments and contingencies (Note 17) | ||
Stockholders' deficit: | ||
Preferred stock, $0.01 par value - 50,000 shares authorized; none issued and outstanding as of December 31, 2023 and 2022 | 0 | 0 |
Additional paid in capital | 1,869 | 1,558 |
Accumulated deficit | (1,626) | (2,076) |
Total stockholders' equity (deficit) attributable to Carvana Co. | 243 | (518) |
Non-controlling interests | (627) | (535) |
Total stockholders' deficit | (384) | (1,053) |
Total liabilities & stockholders' deficit | 7,071 | 8,698 |
Class A | ||
Stockholders' deficit: | ||
Common stock | 0 | 0 |
Class B | ||
Stockholders' deficit: | ||
Common stock | $ 0 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Other current assets, due from related parties | $ 138 | $ 182 |
Operating lease, right-of-use asset, from leases with related parties | 455 | 536 |
Other assets, due from related parties | 261 | 254 |
Accounts payable and accrued liabilities, due to related parties | 596 | 777 |
Other current liabilities, from leases with related parties | 83 | 80 |
Operating lease liabilities, excluding current portion, from leases with related parties | 433 | 507 |
Other liabilities, including $11 and $0, respectively, due to related parties | $ 70 | $ 78 |
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 |
Class A | ||
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) | 114,239,000 | 106,037,000 |
Common stock, shares outstanding (in shares) | 114,239,000 | 106,037,000 |
Class B | ||
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) | 85,619,000 | 82,900,000 |
Common stock, shares outstanding (in shares) | 85,619,000 | 82,900,000 |
Related Party | ||
Other current assets, due from related parties | $ 3 | $ 6 |
Operating lease, right-of-use asset, from leases with related parties | 10 | 14 |
Other assets, due from related parties | 0 | 1 |
Accounts payable and accrued liabilities, due to related parties | 7 | 16 |
Other current liabilities, from leases with related parties | 3 | 4 |
Operating lease liabilities, excluding current portion, from leases with related parties | 7 | 9 |
Other liabilities, including $11 and $0, respectively, due to related parties | $ 11 | $ 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Sales and operating revenues: | ||||
Net sales and operating revenues | $ 10,771 | $ 13,604 | $ 12,814 | |
Cost of sales, including $4, $22, and $65, respectively, to related parties | 9,047 | 12,358 | 10,885 | |
Gross profit | 1,724 | 1,246 | 1,929 | |
Selling, general and administrative expenses, including $33, $33, and $27, respectively, to related parties | 1,796 | 2,736 | 2,033 | |
Goodwill impairment | 0 | 847 | 0 | |
Interest expense | 632 | 486 | 176 | |
Gain on debt extinguishment | (878) | 0 | 0 | |
Other (income) expense, net | (1) | 70 | 6 | |
Net income (loss) before income taxes | 175 | (2,893) | (286) | |
Income tax provision | 25 | 1 | 1 | |
Net income (loss) | 150 | (2,894) | (287) | |
Net loss attributable to non-controlling interests | (300) | (1,307) | (152) | |
Net income (loss) attributable to Carvana Co. | 450 | (1,587) | (135) | |
Net loss attributable to Class A common stockholders, basic | 450 | (1,587) | (135) | |
Net loss attributable to Class A common stockholders, diluted | $ 450 | $ (1,587) | $ (135) | |
Net earnings (loss) per share of Class A common stock, basic (in dollars per share) | $ 4.12 | $ (15.74) | $ (1.63) | |
Net earnings (loss) per share of Class A common stock, diluted (in dollars per share) | $ 0.75 | $ (15.74) | $ (1.63) | |
Weighted-average shares of Class A common stock, basic (in shares) | 109,323 | 100,828 | 82,805 | |
Weighted-average shares of Class A common stock, diluted (in shares) | 200,578 | 100,828 | 82,805 | |
Related Party | ||||
Sales and operating revenues: | ||||
Cost of sales, including $4, $22, and $65, respectively, to related parties | $ 4 | $ 22 | $ 65 | |
Selling, general and administrative expenses, including $33, $33, and $27, respectively, to related parties | $ 33 | $ 33 | $ 27 | |
Class A | ||||
Sales and operating revenues: | ||||
Net earnings (loss) per share of Class A common stock, basic (in dollars per share) | $ 4.12 | $ (15.74) | $ (1.63) | |
Net earnings (loss) per share of Class A common stock, diluted (in dollars per share) | $ 0.75 | $ (15.74) | $ (1.63) | |
Weighted-average shares of Class A common stock, basic (in shares) | [1] | 109,323 | 100,828 | 82,805 |
Weighted-average shares of Class A common stock, diluted (in shares) | 200,578 | 100,828 | 82,805 | |
Retail vehicle sales, net | ||||
Sales and operating revenues: | ||||
Net sales and operating revenues | $ 7,514 | $ 10,254 | $ 9,851 | |
Wholesale sales and revenues | ||||
Sales and operating revenues: | ||||
Net sales and operating revenues | 2,504 | 2,609 | 1,920 | |
Wholesale sales and revenues | Related Party | ||||
Sales and operating revenues: | ||||
Net sales and operating revenues | 19 | 32 | 54 | |
Other sales and revenues | ||||
Sales and operating revenues: | ||||
Net sales and operating revenues | 753 | 741 | 1,043 | |
Other sales and revenues | Related Party | ||||
Sales and operating revenues: | ||||
Net sales and operating revenues | $ 145 | $ 176 | $ 208 | |
[1]Weighted-average shares of Class A common stock outstanding - basic have been adjusted for unvested restricted stock awards. |
Consolidated Statements of Op_2
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Sales and revenues, from related parties | $ 10,771 | $ 13,604 | $ 12,814 |
Cost of sales, to related parties | 9,047 | 12,358 | 10,885 |
Selling, general and administrative expenses, to related parties | 1,796 | 2,736 | 2,033 |
Wholesale sales and revenues | |||
Sales and revenues, from related parties | 2,504 | 2,609 | 1,920 |
Other sales and revenues | |||
Sales and revenues, from related parties | 753 | 741 | 1,043 |
Related Party | |||
Cost of sales, to related parties | 4 | 22 | 65 |
Selling, general and administrative expenses, to related parties | 33 | 33 | 27 |
Related Party | Wholesale sales and revenues | |||
Sales and revenues, from related parties | 19 | 32 | 54 |
Related Party | Other sales and revenues | |||
Sales and revenues, from related parties | $ 145 | $ 176 | $ 208 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Carvana Group | Follow-On Public Offering | Class A Common Stock Restricted Stock Units (RSUs) | Class B Common Stock & LLC Units | Common Stock Class A Common Stock | Common Stock Class A Common Stock Restricted Stock Units (RSUs) | Common Stock Class A Common Stock Follow-On Public Offering | Common Stock Class B Common Stock | Common Stock Class B Common Stock & LLC Units | Additional Paid-in Capital | Additional Paid-in Capital Carvana Group | Additional Paid-in Capital Follow-On Public Offering | Accumulated Deficit | Non-controlling Interests | Non-controlling Interests Follow-On Public Offering | Non-controlling Interests Class B Common Stock & LLC Units |
Stockholders' equity, beginning of period (in shares) at Dec. 31, 2020 | 76,512,000 | 95,592,000 | |||||||||||||||
Stockholders' equity, beginning of the period at Dec. 31, 2020 | $ 802,000 | $ 0 | $ 0 | $ 742,000 | $ (354,000) | $ 414,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Net loss | (287,000) | (135,000) | (152,000) | ||||||||||||||
Exchanges of LLC Units (in shares) | 13,145,000 | 12,692,000 | |||||||||||||||
Adjustments to non-controlling interests related to equity offering / Exchanges of LLC Units | 0 | 43,000 | (43,000) | ||||||||||||||
Establishment of deferred tax assets related to increases in tax basis in Carvana Group | $ 908,000 | $ 908,000 | |||||||||||||||
Establishment of valuation allowance related to deferred tax assets associated with increases in tax basis of Carvana Group | (908,000) | (908,000) | |||||||||||||||
Issuance of Class A common stock to settle vested restricted stock units (in shares) | 218,000 | ||||||||||||||||
Issuance of Class A common stock to settle vested restricted stock units | $ 0 | ||||||||||||||||
Issuance of Class A common stock under ESPP (in shares) | 2,000 | ||||||||||||||||
Issuance of Class A common stock under ESPP | 1,000 | 1,000 | |||||||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes (in shares) | (22,000) | ||||||||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes | (39,000) | (39,000) | |||||||||||||||
Options exercised (in shares) | 75,000 | ||||||||||||||||
Options exercised | 1,000 | 1,000 | |||||||||||||||
Equity-based compensation | 47,000 | 47,000 | |||||||||||||||
Stockholders' equity, end of the period (in shares) at Dec. 31, 2021 | 89,930,000 | 82,900,000 | |||||||||||||||
Stockholders' equity, end of the period at Dec. 31, 2021 | 525,000 | $ 0 | $ 0 | 795,000 | (489,000) | 219,000 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Net loss | (2,894,000) | (1,587,000) | (1,307,000) | ||||||||||||||
Issuance of Class A common stock, net of underwriters' discounts and commissions and offering expenses (in shares) | 15,625,000 | ||||||||||||||||
Issuance of Class A common stock, net of underwriters' discounts and commissions and offering expenses | $ 1,227,000 | $ 1,227,000 | |||||||||||||||
Exchanges of LLC Units (in shares) | 46,000 | ||||||||||||||||
Adjustments to non-controlling interests related to equity offering / Exchanges of LLC Units | 0 | 1,000 | (554,000) | (1,000) | $ 554,000 | ||||||||||||
Establishment of deferred tax assets related to increases in tax basis in Carvana Group | 22,000 | 22,000 | |||||||||||||||
Establishment of valuation allowance related to deferred tax assets associated with increases in tax basis of Carvana Group | (22,000) | (22,000) | |||||||||||||||
Contributions of Class A common stock from related party (in shares) | (128,000) | ||||||||||||||||
Contribution of Class A common stock from related party | 0 | ||||||||||||||||
Issuance of Class A common stock to settle vested restricted stock units (in shares) | 390,000 | ||||||||||||||||
Issuance of Class A common stock to settle vested restricted stock units | 0 | ||||||||||||||||
Issuance of Class A common stock under ESPP (in shares) | 86,000 | ||||||||||||||||
Issuance of Class A common stock under ESPP | 1,000 | $ 1,000 | |||||||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes | (8,000) | (8,000) | |||||||||||||||
Options exercised (in shares) | 88,000 | ||||||||||||||||
Options exercised | 3,000 | 3,000 | |||||||||||||||
Equity-based compensation | 93,000 | 93,000 | |||||||||||||||
Stockholders' equity, end of the period (in shares) at Dec. 31, 2022 | 106,037,000 | 82,900,000 | |||||||||||||||
Stockholders' equity, end of the period at Dec. 31, 2022 | (1,053,000) | $ 0 | $ 0 | 1,558,000 | (2,076,000) | (535,000) | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Net loss | 150,000 | 450,000 | (300,000) | ||||||||||||||
Issuance of Class A common stock, net of underwriters' discounts and commissions and offering expenses (in shares) | 7,157,000 | 2,721,000 | |||||||||||||||
Issuance of Class A common stock, net of underwriters' discounts and commissions and offering expenses | $ 327,000 | $ 126,000 | 327,000 | $ 126,000 | |||||||||||||
Exchanges of LLC Units (in shares) | 31,000 | (2,000) | |||||||||||||||
Adjustments to non-controlling interests related to equity offering / Exchanges of LLC Units | 0 | 1,000 | $ (83,000) | (1,000) | $ 83,000 | ||||||||||||
Contributions of Class A common stock from related party (in shares) | (63,000) | ||||||||||||||||
Contribution of Class A common stock from related party | 0 | ||||||||||||||||
Issuance of Class A common stock to settle vested restricted stock units (in shares) | 1,057,000 | ||||||||||||||||
Issuance of Class A common stock to settle vested restricted stock units | $ 0 | ||||||||||||||||
Issuance of Class A common stock under ESPP (in shares) | 33,000 | ||||||||||||||||
Issuance of Class A common stock under ESPP | $ 0 | ||||||||||||||||
Forfeitures of restricted stock and restricted stock surrendered in lieu of withholding taxes | (15,000) | (15,000) | |||||||||||||||
Options exercised (in shares) | 17,000 | ||||||||||||||||
Options exercised | 0 | ||||||||||||||||
Equity-based compensation | 81,000 | 81,000 | |||||||||||||||
Stockholders' equity, end of the period (in shares) at Dec. 31, 2023 | 114,239,000 | 85,619,000 | |||||||||||||||
Stockholders' equity, end of the period at Dec. 31, 2023 | $ (384,000) | $ 0 | $ 0 | $ 1,869,000 | $ (1,626,000) | $ (627,000) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash Flows from Operating Activities: | |||
Net loss | $ 150 | $ (2,894) | $ (287) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and amortization expense | 352 | 261 | 105 |
Goodwill impairment | 0 | 847 | 0 |
Equity-based compensation expense | 73 | 69 | 39 |
Loss on disposal of property and equipment | 8 | 14 | 1 |
Gain on debt extinguishment | (878) | 0 | 0 |
Payment-in-kind interest expense | 184 | 0 | 0 |
Provision for bad debt and valuation allowance | 38 | 23 | 28 |
Amortization and write-off of debt issuance costs | 24 | 27 | 11 |
Unrealized (gain) loss on warrants to acquire Root Class A common stock | (3) | 80 | 24 |
Unrealized gain on beneficial interests in securitizations | (14) | (6) | (7) |
Changes in finance receivable related assets: | |||
Originations of finance receivables | (6,041) | (7,214) | (7,306) |
Proceeds from sale of finance receivables, net | 6,594 | 6,297 | 7,391 |
Gain on loan sales | (434) | (411) | (717) |
Principal payments received on finance receivables held for sale | 186 | 190 | 206 |
Other changes in assets and liabilities: | |||
Vehicle inventory | 711 | 1,354 | (2,086) |
Accounts receivable | (22) | 145 | (148) |
Other assets | 39 | (83) | (105) |
Accounts payable and accrued liabilities | (166) | (46) | 247 |
Operating lease right-of-use assets | 81 | 21 | (213) |
Operating lease liabilities | (71) | 15 | 223 |
Other liabilities | (8) | (13) | 0 |
Net cash provided by (used in) operating activities | 803 | (1,324) | (2,594) |
Cash Flows from Investing Activities: | |||
Purchases of property and equipment | (87) | (512) | (557) |
Proceeds from disposal of property and equipment | 72 | 44 | 0 |
Payments for acquisitions, net of cash acquired | (7) | (2,196) | 0 |
Purchases of investments | 0 | 0 | (126) |
Principal payments received on and proceeds from sale of beneficial interests | 53 | 81 | 56 |
Net cash provided by (used in) investing activities | 31 | (2,583) | (627) |
Cash Flows from Financing Activities: | |||
Proceeds from short-term revolving facilities | 6,709 | 12,982 | 14,600 |
Payments on short-term revolving facilities | (7,575) | (13,501) | (12,587) |
Proceeds from issuance of long-term debt | 132 | 3,435 | 1,650 |
Payments on long-term debt | (503) | (165) | (73) |
Payments of debt issuance costs | (69) | (75) | (24) |
Net proceeds from issuance of Class A common stock and LLC Units | 453 | 1,227 | 0 |
Proceeds from equity-based compensation plans | 0 | 4 | 2 |
Tax withholdings related to restricted stock units and awards | (15) | (8) | (40) |
Net cash (used in) provided by financing activities | (868) | 3,899 | 3,528 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (34) | (8) | 307 |
Cash, cash equivalents, and restricted cash at beginning of period | 628 | 636 | 329 |
Cash, cash equivalents, and restricted cash at end of period | $ 594 | $ 628 | $ 636 |
Business Organization
Business Organization | 12 Months Ended |
Dec. 31, 2023 | |
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 LLC (collectively, "Carvana Co.", and together with its consolidated subsidiaries, the "Company"), is the 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 transaction, including financing their purchase, trading in their current vehicle, and purchasing complementary products such as vehicle service contracts ("VSC"), auto insurance, 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 Secured Notes and Senior Unsecured Notes (each as defined in Note 10 — Debt Instruments) which were issued by Carvana Co. and guaranteed by its and Carvana Group's existing domestic restricted subsidiaries, excluding, in the case of the Senior Unsecured Notes, ADESA US Auction, LLC ("ADESA"), and its 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 and conducts, directs and exercises full control over the activities of Carvana Group. There are two classes of common ownership interests in Carvana Group, Class A common units (the "Class A Units") and Class B common units (the "Class B Units"). As further discussed in Note 11 — Stockholders' Equity (Deficit), the Class A Units and Class B Units (collectively, the "LLC Units") do not hold voting rights, which results in Carvana Group 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 December 31, 2023, Carvana Co. owned approximately 56.6% of Carvana Group and the LLC Unitholders (as defined in Note 11 — Stockholders' Equity (Deficit)) owned the remaining 43.4%. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). 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. All intercompany balances and transactions have been eliminated. Liquidity The Company has incurred losses in prior periods and expects to incur additional losses in the future as it continues to shift priorities to focus on driving profitability through operating efficiency and reducing expenses. Historically, the Company's capital and liquidity needs were primarily satisfied through its debt and equity financings, operating cash flows, and short-term revolving facilities. During the year ended December 31, 2023, the Company (i) received net cash proceeds of $327 million from its "at-the-market offering" program and $126 million from its private placement of Class A Units and Class B common stock to the Garcia Parties; (ii) launched and closed an offer to exchange its Senior Unsecured Notes for new Senior Secured Notes that significantly reduced near-term cash interest expense and total debt outstanding; (iii) amended certain revolving credit facilities primarily to extend maturities; and (iv) on November 1, 2023, the Company resized the Floor Plan Facility to $1.5 billion and extended its maturity date to April 30, 2025. Management believes that current working capital, cash flows from operations, and expected continued or new financing arrangements will be sufficient to fund operations for at least one year from the financial statement issuance date. Use of Estimates The preparation of these consolidated financial statements in conformity with 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 Income (Loss) During the years ended December 31, 2023, 2022, and 2021, the Company did not have any other comprehensive income (loss) and, therefore, the net income (loss) and comprehensive income (loss) were the same for all periods presented. Cash and Cash Equivalents The Company has cash deposits and cash equivalents deposited in or managed by major financial institutions. Cash equivalents include highly liquid investment instruments with original maturities of three months or less, and consist primarily of money market funds. At times the related amounts are in excess of the amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses with these financial institutions and does not believe it represents significant credit risk. Restricted Cash Amounts included in restricted cash primarily represent the deposits required under the Company's short-term revolving facilities and any undistributed amounts collected on the finance receivables pledged under the Company's finance receivable facilities as explained in Note 10 — Debt Instruments. As of December 31, 2023 and 2022, restricted cash also includes certain cash held for corporate insurance purposes. Accounts Receivable, Net Accounts receivable, net of an allowance for doubtful accounts, includes certain amounts due from customers and their finance providers. The allowance for doubtful accounts is estimated based upon historical experience, current economic conditions, and other factors and is evaluated periodically. The allowance for doubtful accounts was $9 million and $12 million as of December 31, 2023 and 2022, respectively. Finance Receivables Held for Sale, Net Finance receivables include installment contracts the Company originates to its customers to facilitate vehicle sales. The Company classifies these receivables as held for sale, as it does not intend to hold the finance receivables it originates to maturity. The Company typically sells the finance receivables it originates, as explained in Note 8 — Finance Receivable Sale Agreements and Note 9 — Securitizations and Variable Interest Entities. The Company records a valuation allowance to report finance receivables at the lower of unpaid principal balance or fair value. To determine the fair value of finance receivables the Company utilizes industry-standard modeling, such as discounted cash flow analysis, factoring in the Company’s historical experience, the credit quality of the underlying receivables, loss trends and recovery rates, as well as the overall economic environment. For purposes of determining the valuation allowance, finance receivables are evaluated collectively to determine the allowance as they represent a large group of smaller-balance homogeneous loans. The allowance was $59 million and $36 million as of December 31, 2023 and 2022, respectively. Principal balances of finance receivables are charged-off when the Company is unable to sell the finance receivable and the related vehicle has been repossessed and liquidated or the receivable has otherwise been deemed uncollectible. Interest income on finance receivables held for sale is recognized when earned based on contractual loan terms and is included in other sales and revenues. Loan origination costs are capitalized and recognized as a reduction to the gain on loan sale when the loans are sold. Vehicle Inventory Vehicle inventory consists of used vehicles, primarily acquired directly from customers and at auction. Direct and indirect vehicle reconditioning costs including parts and labor, inbound transportation costs and other incremental overhead costs are capitalized as a component of inventory. Inventory is stated at the lower of cost or net realizable value. Vehicle inventory cost is determined by specific identification. Net realizable value is the estimated selling price less costs to complete, dispose and transport the vehicles. Selling prices are derived from historical data and trends, such as sales price and inventory turn times of similar vehicles, as well as independent market resources. Each reporting period the Company recognizes any necessary adjustments to reflect vehicle inventory at the lower of cost or net realizable value through cost of sales in the accompanying consolidated statements of operations. Property and Equipment Property and equipment consists of land, buildings and improvements, transportation fleet equipment, software, and furniture, fixtures and equipment and is stated at cost less accumulated depreciation and amortization. Repairs and maintenance costs that extend the life or utility of an asset are also capitalized. Ordinary repairs and maintenance are charged to expense as incurred. Costs incurred during construction are capitalized as construction in progress and reclassified to the appropriate fixed asset categories when the project is completed. In addition, interest on borrowings during the active construction period of construction projects is capitalized and depreciated over the estimated useful lives of the related assets. Costs incurred during the preliminary project planning phase are charged to expense as incurred. The Company capitalizes direct costs of materials and services consumed in developing or obtaining internal-use software. The Company also capitalizes payroll and payroll-related costs for employees who are directly associated with and who devote time to the development of software products for internal use, to the extent of the time spent directly on the project. Capitalization of costs begins during the application development stage and ends when the software is available for general use. Costs incurred during the preliminary project and post-implementation stages are charged to expense as incurred. Depreciation and amortization are computed using the straight-line method over the lesser of the remaining lease term or the following estimated useful lives: Buildings and improvements 15-30 years Transportation fleet equipment 5-6 years Software 3 years Furniture, fixtures and equipment 3-5 years Management reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. The Company compares the sum of estimated undiscounted future cash flows expected to result from the use of the asset to the carrying value of the asset. When the carrying value of the asset exceeds its estimated undiscounted future cash flows, the Company recognizes an impairment charge for the amount by the which the carrying value of the asset exceeds the fair value of the asset. The Company periodically reassesses the useful lives of its long-lived assets when events or circumstances indicate that useful lives have significantly changed from the previous estimate. The Company recorded no impairment charges during the years ended December 31, 2023, 2022, and 2021. See Note 4 — Property and Equipment, Net for additional information on property and equipment. Goodwill and Intangible Assets Intangible assets are recognized and recorded at their acquisition date fair values. Definite-lived intangible assets consist of developed technology, customer relationships, and non-compete agreements and are generally amortized on a straight-line basis over their estimated useful lives. The Company determined the useful lives of its definite-lived intangible assets based on multiple factors including technological obsolescence, the make-up of the acquired customer base and expected attrition, and the period over which expected cash flows are used to measure the fair value of the intangible asset at acquisition. The Company periodically reassesses the useful lives of its definite-lived intangible assets when events or circumstances indicate that useful lives have significantly changed from the previous estimate. No impairment charges related to intangible assets were recognized during the years ended December 31, 2023, 2022, or 2021. Goodwill represents the excess purchase price over the fair value of the net assets acquired. Goodwill is not amortized but is tested annually or more frequently when events or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company has one operating segment, which is its reporting unit; therefore, management analyzes goodwill associated with all of its operations when analyzing for potential impairment. When conducting annual or interim impairment assessments, if applicable, a two-step process is used. First, an optional qualitative evaluation is performed as to whether it is more likely than not that the fair value of the Company's sole reporting unit is less than its carrying value, using an assessment of relevant events and circumstances. In performing this assessment, the Company is required to make assumptions and judgments including, but not limited to, an evaluation of macroeconomic conditions as they relate to the business, industry and market trends, as well as the overall future financial performance of the reporting unit. If it is determined that it is not more likely than not that the fair value of the reporting unit is less than its carrying value, no additional tests are performed. However, if the Company concludes otherwise or elects not to perform the qualitative assessment, the Company performs a second step consisting of a quantitative assessment of goodwill impairment. This assessment requires the Company to compare the fair value of its reporting unit with its carrying value. If the carrying amount exceeds the fair value, an impairment charge will be recognized. In performing this assessment, the Company is required to make assumptions and judgments including, but not limited to, financial projections, discount rate, and future market conditions. During the year ended December 31, 2022, the Company performed a quantitative goodwill impairment test for the Company's reporting unit and as a result recorded a non-cash goodwill impairment charge of $847 million, which is reflected as Goodwill impairment in the accompanying consolidated statements of operations. Leases 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, the Company's leases generally 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 on the accompanying consolidated balance sheets. The Company's finance leases are included in property and equipment and long-term debt on the accompanying 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 VIEs, 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 a 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 on the accompanying consolidated balance sheets. Other Assets Other current assets consist of various items, including, among other items, software licenses and subscriptions, prepaid expenses, the estimated reserve for vehicle inventory returns, the current portion of the purchase price adjustment receivables based on the performance of the Company's finance receivables, the current portion of the receivable related to the excess cash reserves over realized claims of vehicle service contracts ("VSCs"), and deposits. Other assets consist of various items, including, among other items, investment in equity instruments (as further discussed in Note 18 — Fair Value of Financial Instruments), the purchase price adjustment receivables based on the performance of the Company's finance receivables, the receivable related to the excess cash reserves over realized claims of VSCs, collateral for insurance, and debt issuance costs on revolving debt instruments. Accrued Liabilities Accrued liabilities consist of various items payable within one year, including, among other items, accruals for sales tax, compensation and benefits, vehicle licenses and fees, interest expense on the Senior Unsecured Notes, reserves for returns and cancellations, and advertising expenses. Other Liabilities As of December 31, 2023 and 2022, other current liabilities primarily consist of the current portion of operating lease liabilities. Other liabilities consist of various items to be recognized beyond one year, including the deferred revenue associated with Root Warrants (as further discussed in Note 18 — Fair Value of Financial Instruments) and tax receivable agreement ("TRA") liability (as further discussed in Note 15 — Income Taxes). Revenue Recognition The Company recognizes revenue in accordance with the five-step model prescribed by ASC 606 that includes: (1) identify the contract; (2) identify the performance obligations; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) performance obligations are satisfied. Retail Vehicle Sales The Company sells retail vehicles directly to its customers through its website. The prices of retail vehicles are set forth in the customer contracts at stand-alone selling prices which are agreed upon prior to delivery. The Company satisfies its performance obligation for retail vehicle sales upon delivery when the risks and rewards of ownership and control pass to the customer. The Company recognizes revenue at the agreed upon purchase price stated in the contract, including any delivery charges, less an estimate for returns. Estimates for returns are based on an analysis of historical experience, trends and sales data. Changes in these estimates are reflected as an adjustment to revenue in the period identified. The amount of consideration received for retail vehicle sales includes noncash consideration representing the value of trade-in vehicles, if applicable, as stated in the contract. Prior to the delivery of the vehicle, the payment is received or financing has been arranged. Payments from customers that finance their purchases with third parties are typically due and collected within 30 days of delivery of the retail vehicle. Revenue excludes any sales taxes, title and registration fees, and other government fees that are collected from customers. Wholesale Sales and Revenues The Company sells vehicles to wholesalers. These vehicles sold to wholesalers are primarily acquired from customers and do not meet the Company’s quality standards to list and sell through its website. The Company satisfies its performance obligation for wholesale sales and revenues when the wholesale purchaser obtains control of the underlying vehicle, which is upon delivery or pick up at an auction when the transfer of title, risks and rewards of ownership, and control pass to the wholesale purchaser. The Company recognizes revenue at the amount it expects to receive for the used wholesale vehicle, which is the fixed price determined at the auction, or for wholesale marketplace transactions, at the amount it expects to receive for auction fees charged in facilitating the transaction. The purchase price of the wholesale vehicle is typically due and collected within 30 days of delivery of the wholesale vehicle and auction fees are typically due within two days of a completed sale. Other Sales and Revenues Other sales and revenues include gains on the sales of finance receivables, commissions on VSCs, GAP waiver coverage, and customer insurance and interest income received on finance receivables prior to selling them to investors. Customers purchasing retail vehicles from the Company may enter into contracts for VSCs and, if they finance with the Company, GAP waiver coverage. The prices of VSCs and GAP waiver coverage are set forth in each contract. The Company sells and receives a commission on VSCs under a master dealer agreement with DriveTime, pursuant to which the Company sells VSCs that DriveTime administers and is the obligor. The Company receives a commission on GAP waiver coverage contracts where the administrator of the contract is obligated to reimburse the holder of the underlying finance receivable for a balance that is in excess of the value of the financed vehicle in the event of a total loss. The Company recognizes commission revenue at the time of sale, net of a reserve for estimated contract cancellations. GAP waiver coverage contracts obligate whoever holds the underlying finance receivable to not attempt collection of a balance that is in excess of the value of the financed vehicle in the event of a total loss. GAP waiver coverage is recognized as the performance obligation is satisfied over the period of coverage, generally on a straight-line basis over the expected period the outstanding balance of the related finance receivable will exceed the value of the financed vehicle, less a reserve for cancellations. Upon selling the corresponding finance receivable, the Company recognizes any remaining deferred revenue. The reserve for cancellations of VSCs and GAP waiver coverage contracts is estimated based upon historical experience and recent trends and is reflected as a reduction of other sales and revenues. Changes in these estimates are reflected as an adjustment to other sales and revenues in the period identified. Under the master dealer agreement with DriveTime, the Company is also contractually entitled to receive profit-sharing revenues based on the performance of the VSCs once a required claims period has passed. This is a form of variable consideration the Company recognizes as revenue to the extent that it is probable that it will not result in a significant revenue reversal. The Company applies the expected value method, utilizing expected VSC performance based on historical claims and cancellation data from its customers, as well as other qualitative assumptions to estimate the amount it expects to receive. The Company reassesses the estimate each reporting period with any changes reflected as an adjustment to other sales and revenues in the period identified. Profit-sharing payments will begin when the underlying VSCs reach a specified level of claims history. As of December 31, 2023 and 2022, the Company had ending receivables of less than $1 million and $8 million, respectively, related to cumulative profit-sharing payments recognized as revenue to which it expects to be entitled. The receivables are included in other current assets and other assets on the accompanying consolidated balance sheets. The Company accounts for sales of finance receivables in accordance with ASC Topic 860, Transfers and Servicing ("ASC 860"). ASC 860 states that a transfer of an entire financial asset, a group of entire financial assets, or a participating interest in an entire financial asset in which the transferor surrenders control over those financial assets is accounted for as a sale only if all of the following conditions are met: • The transferred financial assets have been isolated from the transferor - put presumptively beyond the reach of the transferor and its creditors, even in bankruptcy or other receivership. • Each transferee has the right to pledge or exchange the assets (or beneficial interests) it received, and no condition both constrains the transferee (or third-party holder of its beneficial interests) from taking advantage of its right to pledge or exchange the asset and provides more than a trivial benefit to the transferor. • The transferor, its consolidated affiliates included in the financial statements being presented or its agents do not maintain effective control over the transferred financial assets or third-party beneficial interests related to those transferred assets. For the years ended December 31, 2023, 2022, and 2021, all transfers of finance receivables met the requirements for sale treatment. The Company records the gain on the sale of a finance receivable upon receipt of proceeds, in an amount equal to the fair value of the net proceeds received less the carrying amount of the finance receivable. The Company has made customary representations related to the sales of finance receivables. Any significant estimated post-sale obligations or contingent obligations to the purchaser of the receivables would be accrued if probable and estimable in accordance with ASC 450, Contingencies . Any such obligations are considered in the Company's determination of the accounting for the transfers of the finance receivables under ASC 860 . Cost of Sales Cost of sales includes the cost to acquire used vehicles and direct and indirect vehicle reconditioning costs associated with preparing the vehicles for resale. Vehicle reconditioning costs include parts, labor, inbound transportation costs, and other incremental overhead costs, which are allocated to inventory via specific identification and standard costing. Occupancy and labor costs not related to vehicle acquisition or reconditioning, including those incurred in connection with expanding production capacity, are expensed as incurred as a component of selling, general and administrative expense. Cost of sales also includes any necessary adjustments to reflect vehicle inventory at the lower of cost or net realizable value. Selling, General, and Administrative Expenses Selling, general, and administrative ("SG&A") expenses primarily include compensation and benefits, advertising, depreciation expense, facilities costs, technology expenses, logistics and fulfillment expenses, and other administrative expenses. SG&A expenses exclude the costs related to reconditioning vehicles and inbound transportation, which are included in cost of sales, and payroll costs of employees related to the development of software products for internal use, which are capitalized to software and depreciated over the estimated useful lives of the related assets. Advertising Costs Advertising production costs are expensed the first time the advertising takes place. All other advertising costs are expensed as incurred. Advertising expenses are included in SG&A expenses on the accompanying consolidated statements of operations. Advertising expenses were $228 million, $490 million, and $479 million during the years ended December 31, 2023, 2022, and 2021, respectively. Equity-Based Compensation The Company classifies equity-based awards granted in exchange for services as either equity awards or liability awards. The classification of an award as either an equity award or a liability award is generally based upon cash settlement options. Equity awards are measured based on the fair value of the award at the grant date. Liability awards are re-measured to fair value each reporting period. The Company recognizes equity-based compensation on a straight-line basis over the award’s requisite service period, which is generally the vesting period of the award, less actual forfeitures. No compensation expense is recognized for awards for which participants do not render the requisite services. For equity and liability awards earned based on performance or upon occurrence of a contingent event, when and if the awards will be earned is estimated. If an award is not considered probable of being earned, no amount of equity-based compensation is recognized. If the award is deemed probable of being earned, related compensation expense is recorded over the estimated service period. To the extent the estimate of awards considered probable of being earned changes, the amount of equity-based compensation recognized will also change. See Note 13 — Equity-Based Compensation for additional information on equity-based compensation. Shipping and Handling The Company's logistics costs related to transporting its used vehicle inventory include fuel, maintenance, and depreciation related to operating its own transportation fleet, and third-party transportation fees. The portion of these costs related to inbound transportation from the point of acquisition to the inspection and reconditioning center are capitalized to inventory and then included in cost of sales when the related used vehicle is sold. Logistics costs not included in cost of sales are included in selling, general and administrative expenses in the accompanying consolidated statements of operations and were $119 million, $235 million, and $148 million during the years ended December 31, 2023, 2022, and 2021, respectively, excluding compensation and benefits. Defined Contribution Plan The Company sponsors a qualified 401(k) retirement plan (defined contribution plan) for its employees. The plan covers substantially all employees who have attained the age of 18. Participants may voluntarily contribute to the plan up to the maximum limits established by Internal Revenue Service regulations. The Company provides matching contributions of 40% up to the first 6% of an employee’s compensation, which vests evenly over the employee’s initial five-year service period. On January 1, 2022, the plan was amended whereby prospective participants' employer matching contributions vest evenly over the employee's initial four-year service period. Employer contributions to the plan, net of forfeitures, were $8 million, $8 million, and $5 million for the years ended December 31, 2023, 2022, and 2021, respectively. Employer contributions are included in selling, general, and administrative expenses in the accompanying consolidated statements of operations. Derivative Instruments and Hedging Activities The Company from time to time enters into primarily short-term derivative instruments to manage risks arising from its business operations and economic conditions, primarily cash flow variability that may arise from interest rate changes between the time the Company originates finance receivables and the time it sells them through securitizations. The Company does not designate these derivative instruments as hedges under ASC 815, Derivatives and Hedging for hedge accounting treatment and as a result they are accounted for as economic hedges. Gains and losses related to the derivative instruments are included within other sales and revenues to follow the presentation of the hedged item within the accompanying consolidated statements of operations and any derivative instruments outstanding as of the end of the period are reported at fair value on the accompanying 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. T |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | NOTE 3 — BUSINESS COMBINATIONS Acquisition of ADESA U.S. Physical Auction Busines s On May 9, 2022, the Company completed its acquisition of 100% of the equity interests in the U.S. physical auction business of ADESA from Openlane, Inc., fka KAR Auction Services, Inc. for approximately $2.2 billion in cash (the "ADESA Acquisition"). Proceeds from the issuance and sale of the 2030 Senior Unsecured Notes (as defined below) were used to fund the acquisition. The acquisition included 56 auction sites throughout the U.S. with 6.5 million square feet of buildings on more than 4,000 acres of land, significantly expanding the Company's infrastructure and enhancing its customer offering by facilitating a broader selection of vehicles and faster delivery times. The following table summarizes the allocation of the purchase price consideration to identifiable assets acquired and liabilities assumed as of December 31, 2022: Purchase Price Allocation (in millions) Assets Acquired Current assets $ 208 Property and equipment 1,281 Operating lease right-of-use assets 188 Intangible assets 79 Other assets 1 Total Assets Acquired 1,757 Liabilities Assumed Current liabilities 233 Operating lease liabilities 167 Total Liabilities Assumed 400 Net Assets Acquired 1,357 Purchase price consideration 2,195 Goodwill $ 838 Identifiable intangible assets acquired consist of the following (in millions): Fair Value Useful Life Customer relationships $ 50 10 years Developed technology $ 29 3 years Customer relationships were valued using the multi-period excess earnings method of the income approach. Developed technology was valued using the replacement cost method of the cost approach. Significant assumptions used in the valuations were forecasted revenues and attrition rate and are classified as Level 3 due to the lack of observable market data. No residual values were assigned to the customer relationships and developed technology intangible assets and they are amortized on an economic useful life basis commensurate with future anticipated cash flows and straight line, respectively. As of December 31, 2023, the remaining weighted-average amortization period for the intangible assets acquired was 5.6 years. Real property was valued using market comparable transactions of the market approach, for which the key assumption is the similarity of the acquired property to market comparable transactions. Personal property was valued using the replacement cost method of the cost approach, for which the key assumptions are the costs of similar personal property in new condition and economic obsolescence rates. The acquisition resulted in the recognition of $838 million of goodwill, which is deductible for tax purposes and represents the future economic benefits expected to arise from anticipated synergies and intangible assets that do not qualify for separate recognition, including an assembled workforce, non-contractual relationships and other agreements. For the years ended December 31, 2023 and 2022, the Company recognized $856 million and $490 million, respectively, of wholesale sales and revenues, $770 million and $472 million, respectively, of cost of sales, and a net loss of $83 million and $101 million, respectively, from ADESA operations, which includes $122 million and $83 million, respectively, of depreciation and amortization, including acquired intangible assets amortization expense of $15 million for each year. The following unaudited pro forma combined results of operations information for the years ended December 31, 2022 and 2021 have been prepared as if the ADESA Acquisition occurred on January 1, 2021: Unaudited Year ended December 31, 2022 2021 (in millions) Revenues $ 13,903 $ 13,675 Net loss (3,024) (571) Net loss attributable to non-controlling interests (1,343) (276) Net loss attributable to Carvana Co. $ (1,681) $ (295) Net loss per share of Class A common stock - basic and diluted $ (15.89) $ (3.00) Weighted-average shares of Class A common stock - basic and diluted 105,808 98,459 The unaudited pro forma combined results of operations information reflect the following pro forma adjustments: Unaudited Year ended December 31, 2022 2021 (in millions) Interest expense $ 123 $ 345 Lease expense $ 5 $ (16) Depreciation and amortization expense $ 13 $ (6) Intercompany revenues and cost of sales $ (7) $ (20) The unaudited pro forma combined results of operations information is provided for informational purposes only and is not necessarily intended to represent the results that would have been achieved had the ADESA Acquisition been consummated on January 1, 2021 or indicative of the results that may be achieved in the future. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | NOTE 4 — PROPERTY AND EQUIPMENT, NET The following table summarizes property and equipment, net, as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Land and site improvements $ 1,331 $ 1,331 Buildings and improvements 1,344 1,267 Transportation fleet 570 673 Software 296 245 Furniture, fixtures, and equipment 144 158 Total property and equipment excluding construction in progress 3,685 3,674 Less: accumulated depreciation and amortization on property and equipment (775) (564) Property and equipment excluding construction in progress, net 2,910 3,110 Construction in progress 72 134 Property and equipment, net $ 2,982 $ 3,244 Depreciation and amortization expense on property and equipment was $386 million, $346 million, and $153 million for the years ended December 31, 2023, 2022, and 2021, respectively, of which $166 million, $183 million, and $103 million was recorded to selling, general, and administrative expense, respectively, $51 million, $49 million, and $26 million was capitalized to vehicle inventory, respectively, and $169 million, $114 million, and $24 million were recorded to cost of sales, respectively, including $66 million, $52 million, and $24 million previously capitalized to vehicle inventory, respectively. The Company capitalized internal use software costs totaling $56 million, $85 million, and $59 million during the years ended December 31, 2023, 2022, and 2021, respectively, which is included in software and construction in progress in the table above. The Company capitalized $42 million, $68 million, and $45 million during the years ended December 31, 2023, 2022, and 2021, respectively, of payroll and payroll-related costs, excluding equity-based compensation capitalized to property and equipment, for employees who are directly associated with and who devote time to the development of software products for internal use. The Company capitalizes interest in connection with various construction projects to build, upgrade, or remodel certain of its facilities. During the years ended December 31, 2023, 2022, and 2021, the Company incurred total interest costs, net of interest income, of $637 million, $503 million, and $185 million, respectively, of which $5 million, $17 million, and $9 million, respectively, were capitalized. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | NOTE 5 — INTANGIBLE ASSETS The following table summarizes intangible assets, net as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Customer relationships $ 50 $ 50 Developed technology 41 41 Non-compete agreements — 1 Intangible assets, acquired cost 91 92 Less: accumulated amortization (39) (22) Intangible assets, net $ 52 $ 70 Amortization expense was $17 million, $16 million and $2 million during the years ended December 31, 2023, 2022, and 2021, respectively. As of December 31, 2023, the remaining weighted-average amortization period for definite-lived intangible assets was 5.0 years. The anticipated annual amortization expense to be recognized in future years as of December 31, 2023 is as follows: Expected Future Amortization (in millions) 2024 $ 18 2025 14 2026 7 2027 5 2028 3 Thereafter 5 Total $ 52 |
Accounts Payable and Other Accr
Accounts Payable and Other Accrued Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Other Accrued Liabilities | NOTE 6 — ACCOUNTS PAYABLE AND OTHER ACCRUED LIABILITIES The following table summarizes accounts payable and other accrued liabilities as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Accounts payable, including $7 and $16, respectively, due to related parties $ 231 $ 232 Sales taxes and vehicle licenses and fees 77 76 Reserve for returns and cancellations 57 60 Accrued compensation and benefits 41 65 Customer deposits 30 23 Accrued interest expense (1) 7 99 Accrued advertising costs 4 7 Income tax liability 3 — Accrued property and equipment 1 10 Other accrued liabilities 145 205 Total accounts payable and other accrued liabilities $ 596 $ 777 (1) As discussed in Note 10 — Debt Instruments, accrued payment-in-kind ("PIK") interest is included in long-term debt within the accompanying consolidated balance sheets. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 7 — RELATED PARTY TRANSACTIONS Lease Agreements In November 2014, the Company and DriveTime Automotive Group, Inc. (together with its consolidated affiliates, collectively, "DriveTime"), a related party of the Company due to Ernest Garcia II, Ernest Garcia III, and entities controlled by one or both of them (collectively the "Garcia Parties") controlling and owning substantially all of the interests in DriveTime, entered into a lease agreement (the "DriveTime Lease Agreement") that governs the Company’s access to and utilization of temporary storage, reconditioning, offices and parking space at various DriveTime facilities, including hubs and inspection and reconditioning centers. The DriveTime Lease Agreement was most recently amended in December 2018. The last hub facility lease remaining under the DriveTime Lease Agreement expired in April 2023, and the leases for the inspection and reconditioning centers expire between 2024 and 2026, subject to renewal options. 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 facilities (the "DriveTime Hub Lease Agreement"). The DriveTime Hub Lease Agreement was most recently amended in July 2021. The last facility remaining under the DriveTime Hub Lease Agreement expired in April 2023 and was not renewed. Prior to expiration, the hub locations under the DriveTime Lease Agreement and the DriveTime Hub Lease Agreement both had cancellable lease terms of less than twelve months with rights to terminate at the Company's election with 60 days' prior written notice and certain one-year renewal options provided. At non-reconditioning locations, because it was not reasonably certain that the Company would exercise its options to extend the leases or abstain from exercising its termination rights within these lease agreements to create a lease term greater than one year, the Company accounted for them as short-term leases. For these locations, the Company made 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. Management had determined that the costs allocated to the Company were based on a reasonable methodology. The DriveTime Lease Agreement also includes the Blue Mound and Delanco inspection and reconditioning centers. At both of these locations, the Company expects the lease to continue beyond twelve months, therefore those locations are not considered short-term leases. The Company occupies all of the space at these inspection and reconditioning centers and makes monthly lease payments based on DriveTime's actual rent expense. In addition, the Company is responsible for the actual insurance costs, tenant improvements required to conduct operations, and real estate taxes at these inspection and reconditioning center locations. 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. The lease has an initial term of eight years, subject to the Company's ability to exercise three renewal options of five years each. Expenses related to these operating lease agreements are allocated based on usage to inventory and selling, general and administrative expenses in the accompanying consolidated balance sheets and statements of operations. Costs allocated to inventory are recognized as cost of sales when the inventory is sold. Total costs related to these operating lease agreements, including those noted above, were $3 million, $4 million, and $5 million, for the years ended December 31, 2023, 2022, and 2021, respectively, allocated between inventory and selling, general, and administrative expenses. Office Leases In September 2016, the Company entered into a lease for office space in Tempe, Arizona. In connection with that lease, the Company entered into a sublease with DriveTime for the use of another floor in the same building. The lease and sublease each have a term of 83 months, subject to the right to exercise three five-year extension options. Pursuant to the sublease, the Company pays the rent equal to the amounts due under DriveTime's master lease directly to DriveTime's landlord. The rent expense incurred related to this first floor sublease was $1 million during each of the years ended December 31, 2023, 2022, and 2021. The lease and sublease expire in February 2024. In December 2019, Verde Investments, Inc., an affiliate of DriveTime ("Verde"), purchased an office building in Tempe, Arizona that the Company leased from an unrelated landlord prior to Verde's purchase. In connection with the purchase, Verde assumed that lease. The lease has an initial term of ten years, subject to the right to exercise two five-year extension options. The rent expense incurred under the lease with Verde was $1 million during each of the years ended December 31, 2023, 2022, and 2021. Wholesale Sales and Revenues DriveTime purchases wholesale vehicles from, and sells wholesale vehicles to, both the Company and unrelated third parties through both competitive online auctions that are managed by unrelated third parties and the Company's wholesale marketplace platform. Additionally, beginning in September 2023, the Company provided DriveTime with reconditioning services through its wholesale marketplace platform. The Company recognized $19 million, $32 million, and $54 million of wholesale sales and revenues from DriveTime during the years ended December 31, 2023, 2022, and 2021, respectively. Retail Vehicle Acquisitions and Reconditioning During the second quarter of 2021, the Company began acquiring reconditioned retail vehicles from DriveTime. The purchase price of each vehicle was equal to the wholesale price of the vehicle plus a fee for transportation and reconditioning services. In addition, DriveTime performs reconditioning services for the Company at DriveTime reconditioning centers. As of December 31, 2023, and 2022, less than $1 million and $1 million, respectively, related to vehicles and reconditioning services were included in vehicle inventory in the accompanying consolidated balance sheets. The Company also recognized $4 million, $22 million, and $62 million of cost of goods sold during the years ended December 31, 2023, 2022, and 2021 respectively. 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 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. 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. In August 2020 and April 2021, the Company and DriveTime further amended the Master Dealer Agreement to adjust excess reserve payment calculations and timing and the scope of DriveTime's after-sale administration services, respectively. During the years ended December 31, 2023, 2022, and 2021, the Company recognized $138 million, $176 million, and $186 million, respectively, of commissions earned on VSCs sold to its customers and administered by DriveTime, net of a reserve for estimated contract cancellations, and payments for excess reserves to which it expects to be entitled. The commission earned on the sale of VSCs and expected payments for excess reserves is included in other sales and revenues in the accompanying consolidated statements of operations. Beginning in 2017, DriveTime also administers the Company's limited warranty provided to all customers and administered a portion of the Company's GAP waiver coverage under the Master Dealer Agreement. Since the first quarter of 2020, the Company's GAP waiver coverage sales have been administered by an unrelated third party. The Company pays a per-vehicle fee to DriveTime to administer the limited warranty included with every purchase and prior to the first quarter of 2020 paid a per-contract fee to DriveTime to administer a portion of the GAP waiver coverage it sells to its customers. The Company incurred $17 million, $18 million, and $15 million during the years ended December 31, 2023, 2022, and 2021, respectively, related to the administration of limited warranty. Profit Sharing Agreement In June 2018, the Company entered into an agreement with an unaffiliated third party, pursuant to which the Company would sell certain Road Hazard ("RH") and Pre-Paid Maintenance ("PPM") contracts. Under this agreement, third parties would administer the RH and PPM contracts, including providing customer and administrative services, and pay a profit sharing component to the Company. In 2022, the Company began selling equivalent offerings from DriveTime, pursuant to the Master Dealer Agreement discussed above, and all rights and obligations in connection with existing RH and PPM contracts were transferred to DriveTime (the "Transferred Contracts"). Finally, in December 2022, the Company entered into a profit sharing agreement with DriveTime with regard to the Transferred Contracts (the "Profit Sharing Agreement"). The Company recognized $7 million and $3 million in revenue during the years ended December 31, 2023 and 2022, respectively, under the 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 $13 million, $10 million, and $6 million for the years ended December 31, 2023, 2022, and 2021, 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 in 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. The Company reimbursed DriveTime less than $1 million under this agreement during each of the years ended December 31, 2023, 2022, and 2021. Shared Services Agreement with DriveTime In November 2014, the Company and DriveTime entered into a shared services agreement whereby DriveTime provided certain accounting and tax, legal and compliance, information technology, telecommunications, benefits, insurance, real estate, equipment, corporate communications, software and production, and other services primarily to facilitate the transition of these services to the Company on a standalone basis (the "Shared Services Agreement"). The Shared Services Agreement was most recently amended and restated in February 2021 and operates on a year-to-year basis, with the Company having the right to terminate any or all services with 30 days' prior written notice and DriveTime having the right to terminate any or all services with 90 days' prior written notice. Charges allocated to the Company are based on the Company’s actual use of the specific services detailed in the Shared Services Agreement. The Company incurred less than $1 million in expenses related to the Shared Services Agreement during each of the years ended December 31, 2023, 2022, and 2021. Accounts Payable Due to Related Party As of December 31, 2023 and 2022, $7 million and $16 million, respectively, was due to related parties primarily related to the agreements mentioned above, and is included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets. Contributions of Class A Common Stock From Ernest Garcia III On January 5, 2022, in recognition of the Company selling its 1 millionth vehicle in the fourth quarter of 2021, the Company's CEO, Ernest Garcia III ("Mr. Garcia"), committed to giving then-current employees 23 shares of Class A common stock each from his personal shareholdings once employees reach their two-year employment anniversary ("CEO Milestone Gift" or "Gift"). As a result and during the three months ended March 31, 2022, the Company granted 23 restricted stock units ("RSUs") to each current employee, which vest after they complete their second year of employment, for a total of 435,035 RSUs granted during the period. For every gift that vests, and pursuant to a contribution agreement (the "Contribution Agreement") entered into by and between the Company and Mr. Garcia on February 22, 2022, Mr. Garcia contributes to the Company, at the end of each fiscal quarter, the number of shares of Class A common stock, granted pursuant to the CEO Milestone Gift, that have vested during such quarter. The shares contributed shall be shares of Class A common stock that Mr. Garcia individually owns, at no charge. The contribution is intended to fund RSU awards to certain employees of the Company upon their satisfying the applicable employment tenure requirements. During the years ended December 31, 2023 and 2022, 62,606 and 128,133 RSUs, respectively, vested and an equal number of shares of Class A common stock were contributed by Mr. Garcia. Although the Company does not expect Mr. Garcia to incur any tax obligations related to the contribution, the Company has agreed to indemnify Mr. Garcia from any such obligations that may arise. Private Placement On July 17, 2023, the Company entered into a Transaction Support Agreement pursuant to which, among other things, and subject to certain conditions, the Garcia Parties committed to purchase up to $126 million of equity in the Company. In satisfaction of that commitment, on August 18, 2023, the Company entered into a Securities Purchase Agreement with the Garcia Parties providing for the purchase of an aggregate of 3.4 million Class A Units, together with 2.7 million shares of Class B common stock, at a price equivalent to $46.31 per share of Class A common stock, or $37.048 per Class A Unit on an as-exchanged basis. The Company used the proceeds therefrom to partially fund the cash tender offer to purchase a portion of the 2025 Senior Unsecured Notes (as defined below). |
Finance Receivable Sale Agreeme
Finance Receivable Sale Agreements | 12 Months Ended |
Dec. 31, 2023 | |
Transfers and Servicing [Abstract] | |
Finance Receivable Sale Agreements | NOTE 8 — FINANCE RECEIVABLE SALE AGREEMENTS The Company originates loans for its customers and sells them to partners and investors pursuant to finance receivable sale agreements. Historically, the Company has sold loans through two types of arrangements: forward flow agreements and fixed pool loan sales, including securitization transactions. Master Purchase and Sale Agreement In December 2016, the Company entered into a master purchase and sale agreement (the "Master Purchase and Sale Agreement" or "MPSA") with Ally Bank and Ally Financial Inc. (collectively the "Ally Parties"). Pursuant to the MPSA, the Company sells finance receivables meeting certain underwriting criteria under a committed forward flow arrangement without recourse to the Company for their post-sale performance. The Company and the Ally Parties amended the MPSA at various times throughout 2021, 2022, and 2023 to extend the scheduled commitment termination date to January 12, 2024, establish a commitment by the Ally Parties to purchase up to a maximum of $4.0 billion of principal balances of finance receivables between January 13, 2023 and the scheduled commitment termination date, and broaden the scope of finance receivables eligible for sale to the Ally Parties. On January 11, 2024, the Company and the Ally Parties amended the MPSA to reestablish the commitment by the Ally Parties to purchase up to $4.0 billion of principal balances of finance receivables between January 11, 2024 and January 10, 2025. During the years ended December 31, 2023, 2022, and 2021, the Company sold $3.6 billion, $3.8 billion, and $2.1 billion, respectively, in principal balances of finance receivables under the MPSA and had $0.4 billion of unused capacity as of December 31, 2023. Securitization Transactions 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 sale 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 the Risk Retention Rules, as defined and further discussed in Note 9 — Securitizations and Variable Interest Entities. During the years ended December 31, 2023, 2022 and 2021, the Company sold $2.8 billion, $2.4 billion and $5.0 billion, respectively, in principal balances of finance receivables through securitization transactions. Gain on Loan Sales The total gain related to finance receivables sold to financing partners and pursuant to securitization transactions was $434 million, $411 million, and $718 million during the years ended December 31, 2023, 2022, and 2021, respectively, which is included in other sales and revenues in the accompanying consolidated statements of operations. |
Securitizations and Variable In
Securitizations and Variable Interest Entities | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Securitizations and Variable Interest Entities | NOTE 9 — SECURITIZATIONS AND VARIABLE INTEREST ENTITIES As noted in Note 8 — Finance Receivable Sale Agreements, 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 sale 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 Regulation RR of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "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. 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, providing industry standard representations and warranties regarding the underlying finance receivables, and performing ministerial duties as the trust administrator. As of December 31, 2023, 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. As such, 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 consolidated balance sheets, which as of December 31, 2023 and 2022 were $366 million and $321 million, respectively. The Company held no other assets or liabilities related to its involvement with unconsolidated VIEs as of December 31, 2023 and 2022. 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 December 31, 2023 and 2022. 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. December 31, 2023 December 31, 2022 Carrying Value Total Exposure Carrying Value Total Exposure (in millions) Rated notes $ 287 $ 287 $ 252 $ 252 Certificates and other assets 79 79 69 69 Total unconsolidated VIEs $ 366 $ 366 $ 321 $ 321 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 the Risk Retention Rules. As described in Note 10 — Debt Instruments, the Company has entered into secured borrowing facilities through which it finances certain of these retained beneficial interests in securitizations. 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 December 31, 2023 and 2022 were as follows: December 31, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value (in millions) Rated notes $ 294 $ 287 $ 268 $ 252 Certificates and other assets 71 79 43 69 Total securities available for sale $ 365 $ 366 $ 311 $ 321 |
Debt Instruments
Debt Instruments | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt Instruments | NOTE 10 — DEBT INSTRUMENTS Debt instruments, excluding finance leases, which are discussed in Note 16 — Leases, as of December 31, 2023 and 2022 consisted of the following: December 31, 2023 2022 (in millions) Asset-based financing: Floor plan facility $ 113 $ 569 Finance receivable facilities 555 965 Financing of beneficial interest in securitizations 293 268 Notes payable — 3 Real estate financing 485 486 Total asset-based financing 1,446 2,291 Senior Secured Notes (1) 4,378 — Senior Unsecured Notes 205 5,725 Total debt 6,029 8,016 Less: current portion (777) (1,638) Less: unamortized debt issuance costs (2) (60) (82) Plus: unamortized premium (3) 37 — Total included in long-term debt, net $ 5,229 $ 6,296 (1) Includes $185 million of accrued PIK interest through December 31, 2023, which will increase the principal amount of Senior Secured Notes on February 15, 2024, the next semi-annual interest payment date. (2) The unamortized debt issuance costs related to long-term debt are presented as a reduction of the carrying amount of the corresponding liabilities on the accompanying consolidated balance sheets. Unamortized debt issuance costs related to revolving debt arrangements are presented within other assets on the accompanying consolidated balance sheets and not included here. (3) The unamortized premium relates to a portion of the Offers (as defined below) which were accounted for as a debt modification. Short-Term Revolving Facilities Floor Plan Facility The Company previously entered into a floor plan facility with a lender to finance its vehicle inventory, which was secured by Carvana LLC's vehicle inventory, general intangibles, accounts receivable, and finance receivables (as amended, the "Floor Plan Facility"). On September 1, 2023, the Company amended the Floor Plan Facility in connection with the issuance of the Senior Secured Notes discussed below to provide for an additional exclusive grant of collateral over certain deposit accounts and the cash on deposit in those accounts in favor of the lender and to amend certain other affirmative and negative covenants. The Company amended and restated the Floor Plan Facility on November 1, 2023, to resize the line of credit to $1.5 billion through April 30, 2025 and to lower the interest rate to (i) a prime rate plus 0.10% when amounts drawn under the facility are under 50% of the then current inventory balance and (ii) a prime rate plus 0.50% when amounts drawn are over 50%. Under the Floor Plan Facility, repayment of amounts drawn for the purchase of a vehicle should generally be made within several days after selling or otherwise disposing of the vehicle. Outstanding balances related to vehicles held in inventory for more than 120 days require monthly principal payments equal to 10% of the original principal amount of that vehicle until the remaining outstanding balance is equal to the lesser of (i) 50% of the original principal amount or (ii) 50% of the wholesale value. Prepayments may be made without incurring a premium or penalty. Additionally, the Company is permitted to make prepayments to the lender to be held as principal payments under the Floor Plan Facility and subsequently reborrow such amounts. The Floor Plan Facility also requires monthly interest payments and required that at least 12.5% of the total principal amount owed to the lender be held as restricted cash. On November 1, 2023, the restricted cash requirements were amended to introduce a sliding scale whereby at least 12.5% of the total principal amount owed to the lender is required to be held as restricted cash if amounts drawn are under 50% of the then current inventory balance, which requirement increases to (i) 17.5% required to be held as restricted cash if amounts drawn are between 50% and 59.99%, (ii) 22.5% required to be held as restricted cash if amounts drawn are between 60% and 69.99%, and (iii) 25% required to be held as restricted cash if amounts drawn are equal to or over 70%. The Company is also required to pay the lender an availability fee based on the average unused capacity during the prior calendar quarter under the Floor Plan Facility. As of December 31, 2023, the Company had $113 million outstanding under the Floor Plan Facility, unused capacity of $1.4 billion, and held $14 million in restricted cash related to this facility. During the year ended December 31, 2023, the Company's effective interest rate on the Floor Plan Facility was 7.86%. As of December 31, 2022, the Company had $569 million outstanding under the Floor Plan Facility, unused capacity of $1.6 billion, and held $71 million in restricted cash related to this facility. For the year ended December 31, 2022, the Company's effective interest rate on the facility was 3.57%. Finance Receivable Facilities The Company has various short-term revolving credit facilities to fund certain finance receivables originated by the Company prior to selling them, which are typically secured by the finance receivables pledged to them (the "Finance Receivable Facilities"). In January 2020, the Company entered into an agreement pursuant to which a lender agreed to provide a revolving credit facility to fund certain finance receivables originated by the Company. In 2023, the Company amended its agreement to, among other things, adjust the line of credit to $500 million and extend the maturity date to January 24, 2024, and in January 2024, the maturity was further extended to January 19, 2025. In February 2020, the Company entered into an agreement pursuant to which a second lender agreed to provide a $500 million revolving credit facility to fund certain finance receivables originated by the Company. In December 2021, the Company amended its agreement to, among other things, increase the line of credit to $600 million and extend the maturity date to December 8, 2023. In December 2023, the Company amended its agreement to, among other things, extend the maturity date to December 8, 2025. In April 2021, the Company entered into an agreement pursuant to which a third lender agreed to provide a $500 million revolving credit facility to fund certain finance receivables originated by the Company. In December 2021 and September 2022, the Company amended its agreement to, among other things, increase this line of credit to $600 million and extend the maturity date to March 30, 2024. In October 2021, the Company entered into an agreement pursuant to which a fourth lender agreed to provide a $350 million revolving credit facility to fund certain finance receivables originated by the Company. On May 8, 2023, the Company settled all outstanding amounts owed and terminated the agreement with the lender. In March 2022, the Company entered into an agreement pursuant to which a fifth lender agreed to provide a $500 million revolving credit facility to fund certain finance receivables originated by the Company. In September 2023, the Company amended its agreement to extend the maturity date to September 18, 2024. In May 2023, the Company entered into an agreement pursuant to which a sixth lender agreed to provide a $500 million revolving credit facility to fund certain finance receivables originated by the Company. The Company can draw upon this facility until May 31, 2024. The Finance Receivable Facilities require that any undistributed amounts collected on the pledged finance receivables be held as restricted cash. The Finance Receivable Facilities require monthly payments of interest and fees based on usage and unused facility amounts. The Finance Receivable Facilities self-amortize from the end of the draw period until maturity, offer full prepayment rights, and have no credit sublimits or aging restrictions, subject to negotiated concentration limits. The subsidiaries that entered into these Finance Receivable Facilities are each wholly-owned, special purpose entities whose assets are not available to the general creditors of the Company. As of December 31, 2023 and 2022, the Company had $555 million and $965 million, respectively, outstanding under these Finance Receivable Facilities, unused capacity of $2.1 billion and $1.6 billion, respectively, and held $8 million and $36 million, respectively, in restricted cash related to these Finance Receivable Facilities. For the years ended December 31, 2023 and 2022, the Company's effective interest rate on these Finance Receivable Facilities was 6.60% and 2.93%. Long-Term Debt Senior Secured Notes On September 1, 2023, the Company completed a series of transactions whereby it exchanged validly tendered senior unsecured notes for newly issued senior secured notes (the "Exchange Offers"). Concurrently with the Exchange Offers, the Company also completed a cash tender offer to purchase any and all of the Company's outstanding 2025 Senior Unsecured Notes for cash at a purchase price equal to 85.0% of the aggregate principal amount thereof (the "Cash Tender Offer" and together with the Exchange Offers, the "Offers"). Upon consummation of the Offers, the Company exchanged Senior Unsecured Notes with an aggregate outstanding principal amount of $5.5 billion for $4.2 billion in aggregate principal amount of newly issued senior secured notes (collectively the "Senior Secured Notes"), paid $341 million in cash for validly tendered 2025 Senior Unsecured Notes, and paid $146 million in cash related to accrued and unpaid interest for validly tendered Senior Unsecured Notes. Additionally, the Company wrote off $66 million of debt issuance costs in connection with the Offers. The Company assessed the Offers to determine whether the transactions represent debt modifications or debt extinguishments under Accounting Standards Codification 470. As a result of certain lenders that participated in the Offers, the Company determined that a majority of the Offers were a debt extinguishment and the remainder of the Offers were a debt modification, which resulted in a gain on debt extinguishment of $878 million. As a result, the Company initially recognized a $40 million premium which is reflected as an addition to the principal balance of the Senior Secured Notes and will be amortized against interest expense over the respective lives of the Senior Secured Notes. The aggregate principal amounts of the Senior Unsecured Notes that were validly tendered and accepted by the Company in the Offers are set forth in the table below. Principal Amount Validly Tendered and Accepted Allocation to Senior Secured Notes Issued Senior Unsecured Notes Outstanding Principal Prior to Exchange Accepted as % of Outstanding Cash Tender Offer Payment 2028 Senior Secured Notes 2030 Senior Secured Notes 2031 Senior Secured Notes Total Senior Secured Notes (in millions, except percentages) 2025 Senior Unsecured Notes $ 500 $ 402 80.3 % $ 341 $ — $ — $ — $ — 2027 Senior Unsecured Notes 600 568 94.7 % — 102 153 181 436 2028 Senior Unsecured Notes 600 578 96.3 % — 90 135 160 385 2029 Senior Unsecured Notes 750 724 96.6 % — 110 165 195 470 2030 Senior Unsecured Notes 3,275 3,248 99.2 % — 679 1,018 1,205 2,902 Total $ 5,725 $ 5,520 96.4 % $ 341 $ 981 $ 1,471 $ 1,741 $ 4,193 The following table summarizes the components and interest rate terms of the Company's Senior Secured Notes: Senior Secured Notes December 31, December 31, Year 1 PIK Interest Rate Year 2 Cash/PIK Toggle Interest Rate Thereafter Cash Interest Rate (in millions, except percentages) Notes due December 1, 2028 (the "2028 Senior Secured Notes") $ 981 $ — 12% 9%/12% 9% Notes due June 1, 2030 (the "2030 Senior Secured Notes") 1,471 — 13% 11%/13% 9% Notes due June 1, 2031 (the "2031 Senior Secured Notes") 1,741 — 14% --/14% 9% Accrued PIK interest 185 — Total principal amount $ 4,378 $ — Less: unamortized debt issuance costs (53) — Plus: unamortized premium 37 — Total Senior Secured debt $ 4,362 $ — Interest on each of the Senior Secured Notes is payable semi-annually on February 15 and August 15, commencing on February 15, 2024. The Company may redeem some or all of each series of Senior Secured Notes at any time prior to certain specified redemption dates (the "Secured Early Redemption Dates") and at 100% of the principal amount outstanding plus applicable make-whole premiums set forth in each respective indenture, plus any accrued and unpaid interest to the redemption date. Prior to the Secured Early Redemption Dates, the Company may also redeem up to 35% of the original aggregate principal amount of the 2028 and 2030 Senior Secured Notes at a redemption price equal to 109% of the principal amount outstanding, together with accrued and unpaid interest to, but not including, the date of redemption, using the net cash proceeds of certain equity offerings. Finally, on or after the Secured Early Redemption Dates, the Company may redeem its Senior Secured Notes in whole or in part at redemption prices set forth in each respective indenture, plus accrued and unpaid interest up to but excluding the redemption date. If the Company experiences certain change of control events, it must make an offer to purchase all of the Senior Secured Notes at 101% of the principal amount thereof, plus any accrued and unpaid interest, to the repurchase date. The Senior Secured Notes mature as specified in the table above unless earlier repurchased or redeemed and are fully and unconditionally guaranteed on a senior secured basis, jointly and severally, by all of the domestic restricted subsidiaries of the Company (other than the subsidiaries formed for inventory, finance receivables, securitization facilities, immaterial subsidiaries, or unrestricted subsidiaries). The Senior Secured Notes and the guarantees are secured by (i) second-priority liens on certain assets and property of the Company, pledged in favor of the Ally Parties under the Floor Plan Facility and (ii) first-priority liens on certain assets and property of the Company and the guarantors, as identified in the indentures to the Senior Secured Notes. The indentures to the Senior Secured Notes contain restrictive covenants that limit the ability of the Company and its restricted subsidiaries to, among other things and subject to certain exceptions, incur additional debt or issue preferred stock, create new liens, create restrictions on 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. Senior Unsecured Notes The Company has issued various tranches of senior unsecured notes (the "Senior Unsecured Notes") each under a separate indenture, as further described below. The following table summarizes components of the Company's Senior Unsecured Notes: December 31, December 31, Interest Rate (in millions, except percentages) Senior Unsecured Notes due October 1, 2025 ("2025 Senior Unsecured Notes") $ 98 $ 500 5.625 % Senior Unsecured Notes due April 15, 2027 ("2027 Senior Unsecured Notes") 32 600 5.500 % Senior Unsecured Notes due October 1, 2028 ("2028 Senior Unsecured Notes") 22 600 5.875 % Senior Unsecured Notes due September 1, 2029 ("2029 Senior Unsecured Notes") 26 750 4.875 % Senior Unsecured Notes due May 1, 2030 ("2030 Senior Unsecured Notes") 27 3,275 10.250 % Total principal amount 205 5,725 Less: unamortized debt issuance cost (1) (76) Total Senior Unsecured debt $ 204 $ 5,649 Each of the 2025, 2027, 2028 and 2029 Senior Unsecured Notes were issued pursuant to an indenture entered into by and among the Company, each of the guarantors party thereto and U.S. Bank National Association, as trustee. The 2030 Senior Unsecured Notes were issued pursuant to an indenture entered into by and among the Company, each of the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee. Interest on each of the Senior Unsecured Notes is payable semi-annually. The Senior Unsecured Notes mature as specified in the table above unless earlier repurchased or redeemed and are guaranteed by the Company's existing domestic restricted subsidiaries (other than the subsidiaries formed for inventory, finance receivables, securitization facilities, immaterial subsidiaries, or unrestricted subsidiaries). In March 2023, the Company designated ADESA and its subsidiaries as unrestricted subsidiaries under the indentures governing the Senior Unsecured Notes. The Company may redeem some or all of each series of Senior Unsecured Notes at any time prior to certain specified redemption dates (the "Unsecured Early Redemption Dates") at the redemption prices and applicable make-whole premiums set forth in each respective indenture, plus any accrued and unpaid interest to the redemption date. Prior to the Unsecured Early Redemption Dates, the Company may also redeem up to 35% of the aggregate principal amount at a redemption price equal to 100% plus the respective interest rate specified in the table above, together with accrued and unpaid interest to, but not including, the date of redemption, with the net cash proceeds of certain equity offerings. With respect to the 2030 Senior Unsecured Notes, the Company may, at its option, redeem in the aggregate up to 10% of the original aggregate principal amount of the 2030 Senior Unsecured Notes during the period from, and including, May 1, 2025 to, but excluding May 1, 2027, at a redemption price equal to 105.125% of the 2030 Senior Unsecured Notes to be redeemed, plus accrued and unpaid interest thereon to the relevant redemption rate. Finally, on or after the Unsecured Early Redemption Dates, the Company may redeem some or all of the Senior Unsecured Notes in whole or in part at redemption prices set forth in each respective indenture, plus accrued and unpaid interest up to but excluding the redemption date. As discussed above, on September 1, 2023, the Company completed the Offers, including the Exchange Offers to exchange an outstanding principal amount of $5.1 billion of the Senior Unsecured Notes for newly issued Senior Secured Notes, and the Cash Tender Offer to purchase an outstanding principal amount of $402 million of the 2025 Senior Unsecured Notes, leading to a total reduction of an aggregate outstanding principal amount of $5.5 billion of the Senior Unsecured Notes. In connection with the Exchange Offers, the Company obtained consents from holders of each series of Senior Unsecured Notes to amend the indentures governing the notes to eliminate substantially all of the restrictive covenants as well as certain events of default and related provisions therein, and on August 30, 2023, the Company and the trustee entered into supplemental indentures to effect such amendments. Notes Payable The Company 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 served 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. The notes had a fixed annual interest rate, a two Real Estate Financing The Company finances certain purchases and construction of its property and equipment through various sale and leaseback transactions. As of December 31, 2023, 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 of 20 to 25 years. Some of the agreements are subject to renewal options of up to 25 years and some are subject to base rent increases throughout the term. As of December 31, 2023 and 2022, the outstanding liability associated with these sale and leaseback arrangements, net of unamortized debt issuance costs, was $482 million and $483 million, respectively, and was included in long-term debt in the accompanying consolidated balance sheets. Financing of Beneficial Interests in Securitizations As discussed in Note 9 — Securitizations and Variable Interest Entities, the Company has retained certain beneficial interests in securitizations pursuant to the Company’s obligations as a sponsor under the Risk Retention Rules. Beginning in June 2019, the Company entered into secured borrowing facilities through which it finances certain retained beneficial interests in securitizations whereby the Company sells such interests and agrees to repurchase them for their fair value at a stated time of repurchase. As of December 31, 2023 and 2022, the Company has pledged $293 million and $268 million, respectively, of its beneficial interests in securitizations as collateral under the repurchase agreements with expected repurchases ranging from March 2024 to December 2030. The securitization trusts distribute payments related to the Company's pledged beneficial interests in securitizations directly to the lenders, which reduces the beneficial interests in securitizations and the related debt balance. Pledged collateral levels are monitored daily and are generally maintained at an agreed-upon percentage of the fair value of the amounts borrowed during the life of the transactions. In the event of a decline in the fair value of the pledged collateral, the repurchase price of the pledged collateral will be increased by the amount of the decline. The outstanding balance of these facilities, net of unamortized debt issuance costs, was $290 million and $265 million, as of December 31, 2023 and 2022, respectively, of which $108 million and $102 million, respectively was included in current portion of long-term debt in the accompanying consolidated balance sheets. The following table summarizes the aggregate principal maturities due in each period for Senior Secured Notes (excluding any accrued PIK interest), Senior Unsecured Notes, real estate financing, and financing of beneficial interests in securitizations as of December 31, 2023. Maturities related to financing of beneficial interests in securitizations are estimated based on expected timing of payments from the securitization trusts to the lender. As of December 31, 2023 (in millions) 2024 $ 108 2025 183 2026 59 2027 62 2028 1,013 Thereafter 3,751 Total $ 5,176 As of December 31, 2023, the Company was in compliance with all debt covenants. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | NOTE 11 — STOCKHOLDERS' EQUITY (DEFICIT) Organizational Transactions Carvana Co.'s amended and restated certificate of incorporation, among other things, authorizes (i) 50 million shares of Preferred Stock, par value $0.01 per share, (ii) 500 million shares of Class A common stock, par value $0.001 per share, and (iii) 125 million shares of Class B common stock, par value $0.001 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: (i) Class A Units and (ii) Class B Units (together, 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 Co. Sub LLC'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 if an Original LLC Unitholder elects to exchange them, together with 1.25 times as many LLC Units, for consideration from the Company. Such consideration from the Company can be, at the Company's election, either shares of Class A common stock or cash. As of December 31, 2023 and 2022, there were 250 million and 236 million Class A Units, respectively, and 2 million and 1 million Class B Units, respectively (as adjusted for the participation thresholds and closing price of Class A common stock on December 31, 2023 and 2022), issued and outstanding. As discussed in Note 13 — 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. Equity Offerings On April 26, 2022, the Company completed a public offering of 15.625 million shares of its Class A common stock at an offering price of $80 for total net proceeds of $1.2 billion, after deducting underwriting discounts and offering expenses. The Garcia Parties purchased an aggregate of 5.4 million shares of the Class A common stock offered at the public offering price. The Company used the net proceeds to purchase 19.5 million newly-issued LLC Units in Carvana Group. At-the-Market Offering On July 19, 2023, the Company entered into a distribution agreement with Citigroup Global Markets Inc. and Moelis & Company LLC, whereby the Company may sell up to the greater of (i) shares of Class A common stock representing an aggregate offering price of $1.0 billion, or (ii) an aggregate of 35 million shares of Class A common stock, from time to time, through an "at-the-market offering" program (the "ATM Program"). The following table summarizes the activity pursuant to the ATM Program for the period presented: Year Ended December 31, 2023 (in millions, except share and per share amounts) Shares of Class A common stock issued 7,156,838 Weighted-average issuance price per share $ 46.94 Gross proceeds (1) $ 336 (1) Net proceeds were $327 million after deducting $9 million of commissions and other offering expenses incurred. Private Placement On July 17, 2023, the Company entered into a Transaction Support Agreement pursuant to which, among other things, and subject to certain conditions, the Garcia Parties committed to purchase up to $126 million of equity in the Company. In satisfaction of that commitment, on August 18, 2023, the Company entered into a Securities Purchase Agreement with the Garcia Parties providing for the purchase of an aggregate of 3.4 million Class A Units, together with 2.7 million shares of Class B common stock, at a price equivalent to $46.31 per share of Class A common stock. The price equivalent of $46.31 per share of Class A common stock was equal to the weighted average sale price per share of Class A common stock sold under the ATM Program through August 18, 2023. As further described below, Class B common stock is exchangeable for an equivalent number of shares of Class A common stock, which exchange must be accompanied by 1.25 times as many Class A Units. As exchanged, the price per Class A Unit was $37.048. The Company may, at its election, pay consideration for such exchange in either shares of Class A common stock or in cash. The Company used the proceeds therefrom to partially fund the Cash Tender Offer as discussed in Note 10 — Debt Instruments. Exchange Agreement Carvana Co. and the Original LLC Unitholders together with any holders of LLC Units issued subsequent to the IPO (together, 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 (i) conversion ratio adjustments for stock splits, stock dividends, reclassifications and similar transactions, (ii) vesting for certain LLC Units, and (iii) the respective participation threshold for Class B Units. To the extent such owners also hold Class B common stock, they are 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 are 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 each of the years ended December 31, 2023 and 2022, certain LLC Unitholders exchanged less than 0.1 million LLC Units and no shares of Class B common stock for less than 0.1 million newly-issued shares of Class A common stock. Simultaneously, and in connection with these exchanges, Carvana Co. received less than 0.1 million LLC Units during each of the years ended December 31, 2023 and 2022, increasing its total ownership interest in Carvana Group. Class A Non-Convertible Preferred Units On October 2, 2018, Carvana Group, LLC 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 its Senior Unsecured Notes, as discussed further and defined in Note 10 — Debt Instruments. On October 2, 2020, Carvana Group, LLC amended and restated its LLC Agreement to, among other things, authorize the issuance of 1.1 million Class A Non-Convertible Preferred Units to be sold to Carvana Co. in connection with the issuance of its 2025 and 2028 Senior Unsecured Notes and authorize the issuance of additional Class A Non-Convertible Preferred Units, in each case in consideration for the capital contribution made or deemed to have been made by Carvana Co. of the net proceeds of notes issuances. Carvana Co. used the net proceeds from the issuance of its Senior Unsecured Notes to purchase the Class A Non-Convertible Preferred Units, and, in the case of the Senior Secured Notes, received Class A Non-Convertible Preferred Units upon the cancellation of units previously issued in connection with the issuance of the Senior Unsecured Notes, as specified below: Date Senior Notes Issuance Class A Non-Convertible Preferred Units Cancelled in Connection with Offers Net Total Class A Non-Convertible Preferred Units (in thousands) October 2020 2025 Senior Unsecured Notes 500 (402) 98 March 2021 2027 Senior Unsecured Notes 600 (568) 32 October 2020 2028 Senior Unsecured Notes 600 (578) 22 August 2021 2029 Senior Unsecured Notes 750 (724) 26 May 2022 2030 Senior Unsecured Notes 3,275 (3,248) 27 September 2023 2028 Senior Secured Notes 981 — 981 September 2023 2030 Senior Secured Notes 1,471 — 1,471 September 2023 2031 Senior Secured Notes 1,741 — 1,741 9,918 (5,520) 4,398 When Carvana Co. makes payments on the Senior Unsecured Notes and Senior Secured Notes (collectively the "Senior Notes"), Carvana Group makes an equal cash distribution, as necessary, 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 is canceled and retired. As discussed in Note 10 — Debt Instruments, the Company exchanged a majority of its Senior Unsecured Notes for new Senior Secured Notes, at which time 5.5 million Class A Non-Convertible Preferred Units were canceled and retired. Tax Asset Preservation Plan On January 16, 2023, the Company entered into a Section 382 Rights Agreement (the “Tax Asset Preservation Plan”) designed to preserve shareholder value and the value of certain tax assets primarily associated with federal net operating loss carryforwards and built-in losses under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”). The Tax Asset Preservation Plan is intended to act as a deterrent to any person or group acquiring 4.9% or more of the Company's outstanding Class A common stock (any such person an “Acquiring Person”), without the approval of the Company’s board of directors (the "Board"). In connection therewith, the Board declared a dividend of one preferred share purchase right (a “Right”) for each share of Class A common stock, par value $0.001 per share, of the Company. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series B Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Shares”) at a price of $50.00 per one one-thousandth of a Preferred Share represented by a Right, subject to adjustment. The Rights will separate and begin trading separately from the Class A common stock, and right certificates will be caused to evidence the Rights, on the earlier to occur of (i) the Close of Business (as such term is defined in the Tax Asset Preservation Plan) on the tenth day following a public announcement, or the public disclosure of facts indicating, that a Person (as such term is defined in the Tax Asset Preservation Plan) or group of affiliated or associated Persons has acquired Beneficial Ownership (as such term is defined in the Tax Asset Preservation Plan) of 4.9% or more of the outstanding Class A common stock (or, in the event that the Board determines to effect an exchange in accordance with Section 24 of the Tax Asset Preservation Plan and the Board determines that a later date is advisable, then such later date) and (ii) the close of business on the tenth business day (or such later date as may be determined by action of the Board prior to such time as any Person becomes an Acquiring Person) following the commencement of a tender offer or exchange offer the consummation of which would result in the Beneficial Ownership by a Person or group of 4.9% or more of the outstanding Class A common stock. If issued, each Right, other than Rights beneficially owned by the Acquiring Person (which will thereupon become void) will become exercisable for Class A common stock having a value equal to two times the exercise price of the Right. However, prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including without limitation any dividend, voting or liquidation rights. |
Non-controlling Interests
Non-controlling Interests | 12 Months Ended |
Dec. 31, 2023 | |
Noncontrolling Interest [Abstract] | |
Non-controlling Interests | NOTE 12 — 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 years ended December 31, 2023, 2022, and 2021, 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 $1 million, $1 million, and $43 million, respectively, which have been included in exchanges of LLC Units in the accompanying consolidated statements of stockholders' equity (deficit). During the years ended December 31, 2023, and 2022, Carvana Co. utilized its net proceeds from its equity offerings to purchase LLC Units, which resulted in adjustments to increase non-controlling interests and to decrease additional paid-in capital by $83 million, and $554 million, respectively, which have been included in adjustment to non-controlling interests related to equity offerings in the accompanying consolidated statements of stockholders' equity (deficit). No LLC Units were purchased during 2021. As of December 31, 2023, Carvana Co. owned 56.6% of Carvana Group with the LLC Unitholders owning the remaining 43.4%. The net income (loss) attributable to the non-controlling interests on the accompanying consolidated statements of operations represents the portion of the net income (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. For the Years Ended December 31, 2023 2022 2021 (in millions) Transfers from (to) non-controlling interests: Decrease as a result of issuances of Class A and B common stock $ (83) $ (554) $ — Increase as a result of exchanges of LLC Units 1 1 43 Total transfers from (to) non-controlling interests $ (82) $ (553) $ 43 |
Equity-Based Compensation
Equity-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-Based Compensation | NOTE 13 — EQUITY-BASED COMPENSATION Equity-based compensation 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 recognized during the years ended December 31, 2023, 2022, and 2021 is as follows: For the Years Ended December 31, 2023 2022 2021 (in millions) Restricted Stock Units and Awards excluding those granted in relation to the CEO Milestone Gift $ 66 $ 41 $ 35 Restricted Stock Units granted in relation to the CEO Milestone Gift (1) 39 — Options 16 13 11 Class A Units — — 1 Total equity-based compensation 81 93 47 Equity-based compensation capitalized to property and equipment (7) (8) (7) Equity-based compensation capitalized to inventory (1) (16) (1) Equity-based compensation, net of capitalized amounts $ 73 $ 69 $ 39 During the years ended December 31, 2023, 2022, and 2021, the Company capitalized $7 million, $8 million, and $7 million, respectively, of equity-based compensation to property and equipment related to software development and real estate projects and $1 million, $16 million, and $1 million, respectively, to inventory related to reconditioning and inbound transportation of vehicles. All other equity-based compensation is included in selling, general, and administrative expenses in the accompanying consolidated statements of operations. As of December 31, 2023, unrecognized equity-based compensation related to outstanding awards and the related weighted-average period over which it is expected to be recognized subsequent to December 31, 2023 is presented in the table below. Total unrecognized equity-based compensation will be adjusted for actual forfeitures. Unrecognized Equity-Based Compensation Related to Outstanding Awards (in millions) Remaining Weighted-Average Amortization Period (in years) Restricted Stock Units and Awards $ 143 2.7 Options 33 2.5 Total unrecognized equity-based compensation $ 176 2017 Omnibus Incentive Plan In connection with the IPO, the Company adopted the 2017 Omnibus Incentive Plan (the "2017 Incentive Plan"). The number of shares authorized for issuance under the 2017 Incentive Plan is subject to an automatic annual increase (the "Automatic Increase") of the lesser of two percent of the Company's outstanding Class A common stock or an amount determined by the Compensation and Nominating Committee of the Board. On each of January 1, 2023, and January 1, 2024, the number of shares authorized for issuance under the 2017 Incentive Plan increased by two percent of the outstanding Class A common stock under the Automatic Increase. In addition, on May 1, 2023, the Company's stockholders approved an amendment to the 2017 Incentive Plan to further increase the number of shares available under the 2017 Incentive Plan by 20 million shares (the "Amendment Increase"). After taking into account the January 1, 2023 Automatic Increase and the Amendment Increase, as of December 31, 2023, 36 million shares of Class A common stock are available for issuance under the 2017 Incentive Plan, which the Company may grant as stock options, stock appreciation rights, restricted stock, restricted stock units and other equity-based awards to employees, directors, officers, and consultants. The majority of equity granted by the Company vests over four-year periods based on continued employment with the Company. As of December 31, 2023, 17 million shares remain available for future equity-based award grants under this plan. The Company also maintains a clawback policy (the "Clawback Policy"), which requires the Company's officers, as defined by Rule 16a-1 of the Securities Exchange Act of 1934, to repay the Company certain Incentive Compensation (as defined in the Clawback Policy) if (i) the Company is required to prepare an accounting restatement of its financial statements due to its material noncompliance with any financial reporting requirement under the securities laws, including any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period (each a "Restatement"), and (ii) no more than three years have elapsed since the original filing date of the financial statements. In the event of a Restatement, the Company must recover the amount of Incentive Compensation received that exceeds the amount of Incentive Compensation that otherwise would have been received, had it been determined based on the restated amounts, computed without regard to any taxes paid. To date, there has been no repayment of compensation from executive officers pursuant to the Clawback Policy. Restricted Stock Awards and Restricted Stock Units Restricted stock awards ("RSAs") entitle recipients to vote and to receive all dividends declared with respect to such shares, payable upon vesting. RSAs vest over a period of two years, subject to the recipient's continued employment or service. During the year ended December 31, 2022, the Company issued certain employees an aggregate of less than 0.1 million RSAs pursuant to the terms of the 2017 Incentive Plan with a weighted-average grant-date fair value of $34.21. The Company determined the grant-date fair value of the RSAs based on the closing price of the Company's Class A common stock on the grant date. The Company did not grant any RSAs during the years ended December 31, 2023 and 2021. Restricted stock units ("RSUs") do not entitle recipients to vote or receive dividends. RSUs generally vest over a period of four years, subject to the recipient's continued employment. RSUs also include performance-based awards granted to certain executive employees that cliff vest upon the achievement of certain financial targets, subject to the recipient's continued employment. During the years ended December 31, 2023, 2022, and 2021, the Company issued certain employees an aggregate of 10.4 million, 3.5 million, and 0.3 million RSUs, respectively, pursuant to the terms of the 2017 Incentive Plan with a weighted-average grant-date fair value of $13.13, $65.26, and $288.27, respectively. The Company determined the grant-date fair value of the RSUs based on the closing price of the Company's Class A common stock on the grant date. RSUs are settled in shares of Class A common stock on a one-to-one basis within thirty days of vesting. As discussed in Note 7 — Related Party Transactions, the RSUs granted during the year ended December 31, 2022 include 0.5 million RSUs granted in connection with the CEO Milestone Gift for which the Company recognized a benefit of $1 million as a result of more forfeitures than employees continuing to vest and an expense of $39 million for the years ended December 31, 2023 and 2022, respectively, a portion of which related to the production of the Company's used vehicle inventory and was therefore capitalized to inventory. RSA and RSU activity during the years ended December 31, 2023, 2022, and 2021 was as follows: Number of RSAs/RSUs (in thousands) Weighted-Average Grant-Date Fair Value Outstanding at January 1, 2021 738 $ 76.43 Granted 258 $ 288.27 Settled (385) $ 86.57 Forfeited (58) $ 132.88 Outstanding and nonvested at December 31, 2021 553 $ 162.32 Granted 3,482 $ 65.26 Settled (432) $ 113.96 Forfeited (951) $ 134.83 Outstanding and nonvested at December 31, 2022 2,652 $ 52.62 Granted 10,392 $ 13.13 Settled (1,550) $ 41.39 Forfeited (1,591) $ 24.25 Outstanding and nonvested at December 31, 2023 9,903 $ 17.49 Employee Stock Purchase Plan In May 2021, the Company adopted an employee stock purchase plan (the "ESPP"). On July 1, 2021, the ESPP went into effect. The ESPP allows substantially all employees, excluding members of senior management, to acquire shares of the Company's Class A common stock through payroll deductions over six-month offering periods, commencing on January 1 and July 1 of each year. The per share purchase price is equal to 90% of the fair market value of a share of the Company's Class A common stock on the last day of the offering period. Participant purchases are limited to maximums that may vary between $10,000 and $25,000 of stock per calendar year. The Company is authorized to grant up to 0.5 million shares of Class A common stock under the ESPP. During the years ended December 31, 2023, 2022 and 2021, the Company issued 32,790, 86,352 and 2,494 shares of Class A common stock, respectively, and as of December 31, 2023, 378,364 shares of Class A common stock remained available for future issuance. During all three years ended December 31, 2023, 2022 and 2021, the Company recognized less than $1 million of equity-based compensation expense related to the ESPP. Non-Qualified Stock Options Non-qualified stock options allow recipients to purchase shares of Class A common stock at a fixed exercise price. The fixed exercise price is equal to the price of a share of Class A common stock at the time of grant. The options typically vest 25% on the anniversary of the grant date and in equal monthly installments thereafter for a total vesting period of four years and expire ten years after the grant date. Stock option activity during the years ended December 31, 2023, 2022, and 2021 was as follows: Number of Options (in thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Life (in years) Aggregate Intrinsic Value (in millions) Outstanding at January 1, 2021 1,072 $ 41.01 7.7 $ 213 Options granted 97 $ 178.42 n/a Options exercised (75) $ 24.32 $ 20 Options forfeited or expired (28) $ 27.62 n/a Outstanding at December 31, 2021 1,066 $ 39.74 6.7 $ 183 Options granted 297 $ 119.53 n/a Options exercised (89) $ 37.89 $ 7 Options forfeited or expired (9) $ 30.97 n/a Outstanding at December 31, 2022 1,265 $ 80.26 6.4 $ — Options granted 2,805 $ 10.07 n/a Options exercised (17) $ 13.62 $ — Options forfeited or expired (47) $ 50.08 n/a Outstanding at December 31, 2023 4,006 $ 31.75 8.1 $ 135 Vested and exercisable as of December 31, 2023 996 $ 68.23 5.3 $ 14 Expected to vest as of December 31, 2023 3,010 $ 19.68 9.1 $ 120 The Company determined the grant-date fair value of the options granted during the years ended December 31, 2023, 2022, and 2021 using the Black-Scholes valuation model with the following weighted-average assumptions: Years Ended December 31, 2023 2022 2021 Expected volatility (1) 74.6 % 69.2 % 67.1 % Expected dividend yield — % — % — % Expected term (in years) (2) 6.30 6.28 6.14 Risk-free interest rate 3.6 % 2.0 % 0.7 % Weighted-average grant-date fair value per option $6.94 $74.85 $178.41 (1) Measured using the Company's historical data, market option volatility and selected high-growth guideline companies and considering the risk factors that would influence the range of expected volatility because the Company does not have sufficient historical data to provide a reasonable basis upon which to estimate the expected volatility for the entirety of the term. (2) Expected term represents the estimated period of time until an option is exercised and was determined using the simplified method because the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. Class A Units During 2018, the Company granted certain employees Class A Units with service-based vesting over two 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. A summary of the Class A Unit activity for the years ended December 31, 2023, 2022, and 2021 is as follows: Class A Units Number of Class A Units (in thousands) Weighted-Average Grant Date Fair Value Outstanding at January 1, 2021 121 Granted — n/a Exchanged (36) $ 18.58 Forfeited — n/a Outstanding at December 31, 2021 85 Granted — n/a Exchanged — n/a Forfeited (6) $ 18.58 Outstanding at December 31, 2022 79 Granted — n/a Exchanged — n/a Forfeited — n/a Outstanding at December 31, 2023 79 Vested as of December 31, 2023 79 $ 18.58 Expected to vest as of December 31, 2023 — n/a Class B Units In March 2015, Carvana Group adopted the LLC Equity Incentive Plan. Under the LLC Equity Incentive Plan, Carvana Group could grant Class B Units to eligible employees, non-employee officers, consultants and directors with service-based vesting, typically four A summary of the Class B Unit activity for the years ended December 31, 2023, 2022, and 2021 is as follows: Class B Units Number of Class B Units (in thousands) Weighted-Average Participation Threshold per Class B Unit Outstanding at January 1, 2021 3,163 $ 4.94 Granted — n/a Exchanged (535) $ 1.70 Forfeited (1) $ 12.00 Outstanding at December 31, 2021 2,627 $ 5.60 Granted — n/a Exchanged (61) $ 5.75 Forfeited — n/a Outstanding at December 31, 2022 2,566 $ 5.60 Granted — n/a Exchanged (34) $ 3.52 Forfeited — n/a Outstanding at December 31, 2023 2,532 $ 5.62 Vested as of December 31, 2023 2,532 $ 5.62 Expected to vest as of December 31, 2023 — n/a |
Net Earnings (Loss) Per Share
Net Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Earnings (Loss) Per Share | NOTE 14 — NET EARNINGS (LOSS) PER SHARE Basic and diluted net earnings (loss) per share is computed by dividing the net earnings (loss) attributable to Class A common stockholders by the weighted-average shares of Class A common stock outstanding during the period. Diluted net earnings (loss) per share is computed by giving effect to all potentially dilutive shares. For the years ended December 31, 2022 and 2021, potentially dilutive shares are excluded from diluted net earnings (loss) per share because they would have an anti-dilutive impact. Net earnings (loss) for all periods presented is attributable only to Class A common stockholders, due to no activity related to convertible preferred stock during those periods. The following table presents the calculation of basic and diluted net earnings (loss) per share during the years ended December 31, 2023, 2022, and 2021: Years Ended December 31, 2023 2022 2021 (in millions, except number of shares, which are reflected in thousands, and per share amounts) Numerator: Net income (loss) attributable to Carvana Co. Class A common stockholders - basic $ 450 $ (1,587) $ (135) Impact on net income of assumed conversions from LLC Units (300) — — Net income (loss) attributable to Carvana Co. Class A common stockholders - diluted $ 150 $ (1,587) $ (135) Denominator: Weighted-average shares of Class A common stock outstanding 109,347 100,848 82,839 Nonvested weighted-average restricted stock awards (24) (20) (34) Weighted-average shares of Class A common stock outstanding - basic 109,323 100,828 82,805 Dilutive effect of Class A common shares: Options (1) 979 — — Restricted Stock Units and Awards (1) 4,815 — — Class A Units (2) 83,976 — — Class B Units (2) 1,485 — — Weighted-average shares of Class A common stock outstanding - diluted 200,578 100,828 82,805 Net earnings (loss) per share of Class A common stock - basic $ 4.12 $ (15.74) $ (1.63) Net earnings (loss) per share of Class A common stock - diluted $ 0.75 $ (15.74) $ (1.63) (1) Calculated using the treasury stock method, if dilutive (2) Calculated using the if-converted method, if dilutive 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 earnings (loss) per share of Class B common stock under the two-class method has not been presented. The following table presents potentially dilutive securities, as of the end of the period, excluded from the computations of diluted net earnings (loss) per share of Class A common stock for the years ended December 31, 2023, 2022, and 2021: Years Ended December 31, 2023 2022 2021 (in thousands) Options (1) 976 1,265 1,066 Restricted Stock Units and Awards (1) 1,308 64 666 Class A Units (2) — 82,963 89,773 Class B Units (2) — 1,559 2,217 _________________________ (1) Represents number of instruments outstanding at the end of the period that were evaluated under the treasury stock method for potentially dilutive effects and were determined to be anti-dilutive. (2) Represents the weighted-average as-converted LLC units that were evaluated under the if-converted method for potentially dilutive effects and were determined to be anti-dilutive. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 15 — INCOME TAXES As described in Note 1 — Business Organization and Note 11 — Stockholders' Equity (Deficit), 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. Net income (loss) before income taxes was $175 million, $(2.9) billion, and $(286) million for the years ended December 31, 2023, 2022, and 2021, respectively. The Company had an income tax expense of $25 million for the year ended December 31, 2023, and $1 million for both years ended December 31, 2022 and 2021. The components of income tax expense are as follows: Years Ended December 31, 2023 2022 2021 (in millions) Federal - Current $ 25 $ 2 $ 2 Federal - Deferred (4) (1) (1) Federal - Total 21 1 1 State - Current 4 — — State - Deferred — — — State - Total 4 — — Income tax provision $ 25 $ 1 $ 1 A reconciliation of the U.S. federal rate to the Company’s effective income tax rate is as follows: Years Ended December 31, 2023 2022 2021 Amount Percent Amount Percent Amount Percent (dollars in millions) Expected U.S. federal income taxes at statutory rate $ 37 21.0 % $ (607) 21.0 % $ (60) 21.0 % Loss attributable to non-controlling interests 61 34.9 % 274 (9.5) % 32 (11.2) % State taxes 19 10.9 % (64) 2.2 % (8) 2.8 % Stock based compensation — — % — — % (16) 5.6 % Valuation allowance (96) (54.9) % 398 (13.7) % 53 (18.5) % Disallowed interest 5 2.9 % — — % — — % Benefit of tax credits (2) (1.1) % — — % — — % Other 1 0.6 % — — % — — % Income tax provision $ 25 14.3 % $ 1 — % $ 1 (0.3) % Deferred income taxes reflect the net tax effects of temporary differences between the tax basis in an asset or liability and its reported amount under GAAP. These temporary differences result in taxable or deductible amounts in future years. The components of the Company’s deferred tax assets are as follows: Years Ended December 31, 2023 2022 (in millions) Deferred tax assets: Investment in Carvana Group $ 1,362 $ 1,471 Net operating loss carryforward 299 451 Interest expense carryforward 177 130 Tax credit carryforward 4 6 Cancellation of debt income 116 — Other 9 2 Total gross deferred tax assets 1,967 2,060 Valuation allowance (1,962) (2,058) Total deferred tax assets, net of valuation allowance $ 5 $ 2 Deferred tax liabilities: Intangibles $ — $ (1) Total deferred tax assets and liabilities $ 5 $ 1 As of December 31, 2023 and 2022, the Company had federal and state net operating loss carry forwards of $1.2 billion and $1.9 billion, respectively. Federal losses that arose prior to 2018 are anticipated to be fully utilized. Federal losses generated after 2017 will be carried forward indefinitely. As described in Note 11 — Stockholders' Equity (Deficit), during the year ended December 31, 2023, the Company acquired less than 0.1 million LLC Units in connection with exchanges with LLC Unitholders. The Company also issued 7.2 million shares of Class A common stock and received gross proceeds of $336 million under the ATM program. The Company utilized the proceeds from the issuance of Class A common stock to purchase 8.9 million newly issued Class A units in Carvana Group. As a result, the Company recognized a gross deferred tax asset of less than $1 million associated with the basis difference in its investment in Carvana Group which is reflected as an increase to additional paid-in capital in the accompanying statements of stockholders' equity (deficit). During the year ended December 31, 2022, the Company acquired less than 0.1 million LLC Units in connection with exchanges with LLC Unitholders. On April 26, 2022, the Company issued 15.625 million shares of its Class A common stock and received net proceeds from the offering of $1.2 billion. The Company utilized the proceeds from the issuance of Class A common stock to purchase 19.5 million newly issued Class A units in Carvana Group. As a result, the Company recognized a gross deferred tax asset of $22 million associated with the basis difference in its investment in Carvana Group which is reflected as an increase to additional paid-in capital in the accompanying consolidated statements of stockholders' equity (deficit). As described in Note 10 — Debt Instruments, the Company completed the Exchange Offers, whereby it exchanged validly tendered Senior Unsecured Notes for newly issued Senior Secured Notes. For U.S. tax purposes the Company is required to recognize cancellation of debt income (“CODI”) on the difference between the adjusted issue price of the debt exchanged and the fair market value of the new debt issued. The Company has determined that it should recognize $1.4 billion of CODI for tax purposes. As described in Note 3 — Business Combinations, the Company acquired ADESA on May 9, 2022. The Company made an election under Section 336(e) of the United States Internal Revenue Code of 1986, as amended (the “Code”) to treat the acquisition as a deemed asset acquisition for income tax purposes and as such will receive a step up in asset basis and will be able to amortize the acquired Goodwill under Section 197 of the Code over a 15-year period. The total Goodwill amortization expense for the years ended December 31, 2023 and 2022 was $56 million and $37 million, respectively. During the year ended December 31, 2023, 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 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 of $2.0 billion against its deferred tax assets. The Company has $5 million in deferred tax assets and less than $1 million in deferred tax liabilities from separate filing entities that are not available to offset 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 the year ended December 31, 2023 and 2022, the Company has not identified any uncertain tax positions and has not recognized any related reserves. The Company's effective tax rate for the years ended December 31, 2023 and 2022 was an expense of 14.3% and 0.0%, respectively. The effective tax rate for the year ended December 31, 2023 differs from the statutory tax rate primarily due to the current year income tax expense related to the impact of CODI, partially offset by a change to the valuation allowance on the Company's deferred tax assets. 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 LLC Unitholders and other qualifying transactions. As described in Note 11 — Stockholders' Equity (Deficit), 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 TRA. Under the TRA, the Company generally will be required to pay to the 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 December 31, 2023, the Company has recorded a $14 million TRA liability related to the estimated cash savings in U.S. federal, state or local tax related to the tax benefits utilized to offset recognized CODI, which is included in other liabilities in the accompanying consolidated balance sheets, and of which $11 million will be paid to related parties. For the remaining $1.6 billion TRA liability as of December 31, 2023, 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 an additional liability related to the tax savings it may realize from utilization of such deferred tax assets. 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. Uncertain Tax Positions Based on the Company's analysis of tax positions taken on income tax returns filed, no uncertain tax positions existed as of December 31, 2023, 2022, and 2021. Carvana Co. was formed in November 2016 and did not engage in any operations prior to the IPO and associated organizational transactions. Carvana Co. was not required to file 2016 tax returns and filed its first tax returns for the tax year 2017, the first year it became subject to examination by taxing authorities for U.S. federal and state income tax purposes. Carvana Group, LLC is treated as a partnership for U.S. federal and state income tax purposes and its tax returns are subject to examination by taxing authorities. Carvana Group has filed income tax returns for years through 2022. These returns are subject to examination by the taxing authorities in the respective jurisdictions, generally for three or four years after they were filed. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | NOTE 16 — 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 December 31, 2023, the Company is a tenant under various operating leases related to certain of its hubs, vending machines, inspection and reconditioning centers, auction locations, storage, parking, and corporate offices. The initial terms expire at various dates between 2024 and 2038. Many of the leases include one or more renewal options ranging from one respectively, and is included in selling, general and administrative expenses in the accompanying consolidated statements of operations. The Company's operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities on the accompanying consolidated balance sheets. Refer to Note 7 — 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 four Lease Costs and Activity The Company's lease costs and activity during the years ended December 31, 2023, 2022, and 2021 were as follows: December 31, 2023 2022 2021 (in millions) Lease costs: Finance leases: Amortization of finance lease assets $ 108 $ 95 $ 38 Interest obligations under finance leases 17 19 8 Total finance lease costs $ 125 $ 114 $ 46 Operating leases: Fixed lease costs to non-related parties (1) $ 66 $ 129 $ 56 Fixed lease costs to related parties 5 5 6 Variable short-term lease costs to related parties — 1 1 Total operating lease costs $ 71 $ 135 $ 63 Cash payments related to lease liabilities included in operating cash flows: Operating lease liabilities to non-related parties $ 109 $ 83 $ 35 Operating lease liabilities to related parties $ 5 $ 5 $ 5 Interest payments on finance lease liabilities $ 18 $ 19 $ 8 Cash payments related to lease liabilities included in financing cash flows: Principal payments on finance lease liabilities $ 115 $ 139 $ 56 (1) The year ended December 31, 2022 includes $28 million of lease termination fees, net of amounts written off for the corresponding operating lease right-of-use assets and operating lease liabilities which were terminated. Maturity Analysis of Lease Liabilities The following table summarizes maturities of lease liabilities as of December 31, 2023: Operating Leases (1) Finance Leases Related Party (2) Non-Related Party Total Operating Total (in millions) 2024 $ 95 $ 3 $ 92 $ 95 $ 190 2025 85 2 90 92 177 2026 72 2 86 88 160 2027 35 2 79 81 116 2028 7 1 72 73 80 Thereafter — 1 225 226 226 Total minimum lease payments 294 11 644 655 949 Less: amount representing interest (27) (2) (159) (161) (188) Total lease liabilities $ 267 $ 9 $ 485 $ 494 $ 761 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to exercise 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 of December 31, 2023 and 2022, 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 December 31, 2023, 2022, and 2021 were as follows, excluding short-term operating leases: December 31, 2023 2022 2021 Weighted average remaining lease terms (years) Operating leases 7.8 8.4 9.2 Finance leases 3.5 4.2 4.4 Weighted-average discount rate Operating leases 7.1 % 7.1 % 7.2 % Finance leases 5.9 % 5.7 % 5.4 % |
Leases | NOTE 16 — 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 December 31, 2023, the Company is a tenant under various operating leases related to certain of its hubs, vending machines, inspection and reconditioning centers, auction locations, storage, parking, and corporate offices. The initial terms expire at various dates between 2024 and 2038. Many of the leases include one or more renewal options ranging from one respectively, and is included in selling, general and administrative expenses in the accompanying consolidated statements of operations. The Company's operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities on the accompanying consolidated balance sheets. Refer to Note 7 — 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 four Lease Costs and Activity The Company's lease costs and activity during the years ended December 31, 2023, 2022, and 2021 were as follows: December 31, 2023 2022 2021 (in millions) Lease costs: Finance leases: Amortization of finance lease assets $ 108 $ 95 $ 38 Interest obligations under finance leases 17 19 8 Total finance lease costs $ 125 $ 114 $ 46 Operating leases: Fixed lease costs to non-related parties (1) $ 66 $ 129 $ 56 Fixed lease costs to related parties 5 5 6 Variable short-term lease costs to related parties — 1 1 Total operating lease costs $ 71 $ 135 $ 63 Cash payments related to lease liabilities included in operating cash flows: Operating lease liabilities to non-related parties $ 109 $ 83 $ 35 Operating lease liabilities to related parties $ 5 $ 5 $ 5 Interest payments on finance lease liabilities $ 18 $ 19 $ 8 Cash payments related to lease liabilities included in financing cash flows: Principal payments on finance lease liabilities $ 115 $ 139 $ 56 (1) The year ended December 31, 2022 includes $28 million of lease termination fees, net of amounts written off for the corresponding operating lease right-of-use assets and operating lease liabilities which were terminated. Maturity Analysis of Lease Liabilities The following table summarizes maturities of lease liabilities as of December 31, 2023: Operating Leases (1) Finance Leases Related Party (2) Non-Related Party Total Operating Total (in millions) 2024 $ 95 $ 3 $ 92 $ 95 $ 190 2025 85 2 90 92 177 2026 72 2 86 88 160 2027 35 2 79 81 116 2028 7 1 72 73 80 Thereafter — 1 225 226 226 Total minimum lease payments 294 11 644 655 949 Less: amount representing interest (27) (2) (159) (161) (188) Total lease liabilities $ 267 $ 9 $ 485 $ 494 $ 761 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to exercise 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 of December 31, 2023 and 2022, 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 December 31, 2023, 2022, and 2021 were as follows, excluding short-term operating leases: December 31, 2023 2022 2021 Weighted average remaining lease terms (years) Operating leases 7.8 8.4 9.2 Finance leases 3.5 4.2 4.4 Weighted-average discount rate Operating leases 7.1 % 7.1 % 7.2 % Finance leases 5.9 % 5.7 % 5.4 % |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 17 — 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 $16 million and $19 million, as of December 31, 2023 and 2022, respectively, and is included in accounts payable and other accrued liabilities in the accompanying consolidated balance sheets. The expense was $87 million, $144 million, and $111 million for the years ended December 31, 2023, 2022, and 2021, respectively, and is included in selling, general and administrative expenses in the accompanying consolidated statements of operations. Purchase Obligations The Company has purchase obligations for certain customary services related to operating a wholesale auction business of $139 million in aggregate over the next five years, as of December 31, 2023. These purchase obligations are recorded as liabilities when the services are rendered. Legal Matters From time to time, the Company is involved in various claims and legal actions that arise in the ordinary course of business for a publicly traded auto retail and e-commerce company. For example, the Company is currently a party to legal and regulatory disputes, including putative class action and shareholder derivative lawsuits, alleging, among other things, the violation of federal securities and antitrust laws and state laws regarding consumer protection, stockholders' rights and the titling and registration of vehicles sold to its customers. These disputes include, but are not limited to, In re Carvana Co. Securities Litigation, United States District Court for the District of Arizona (Case No. CV-22-2126-PHX-MTL); In re Carvana Co. Stockholders Litigation, Delaware Chancery Court (Case No. 2020-0415-KSJM); Taiae Bradley v. Carvana, LLC, United States District Court for the Eastern District of Pennsylvania (Case No. 2:22-cv-02525-MMB); Dana Jennings, et al. v. Carvana, LLC, United States District Court for the Eastern District of Pennsylvania (Case No. 5:21-cv-05400-EGS); Syretta Harvin et al. v. Carvana, LLC et al., United States District Court for the Eastern District of Pennsylvania (Case No. 2:23-cv-02068-MRP); and In re Carvana Co. Stockholders Litigation , Delaware Chancery Court (Case No. 2023-0600-KSJM). In 2023, Neal Vestal v. Carvana Co., et al ., Delaware Chancery Court (Case No. 2022-0609-KSJM), Mountaineer Motors of Lenoir, LLC v. Carvana, LLC, et al ., United States District Court for the Western District of North Carolina (Case No. 5:22-cv-00171), and City of Warwick Retirement System v. Carvana Co., et al ., Maricopa County, Arizona Superior Court (Case No. CV2022-013054) were all dismissed with prejudice, and Brittany Fischer v. Carvana, LLC , Lee County, Florida Circuit Court (Case No. 2022-007133-CA-01) was settled for an immaterial amount. The Company believes the claims in these matters are not material or are without merit and intends to defend the matters vigorously. The Company also continues to work closely with government agencies to respond to their requests. It is not possible to determine the probability of loss or estimate damages, if any, for any of the above matters, and therefore, the Company has not established reserves for any of these proceedings. If the Company determines that a loss is both probable and reasonably estimable, the Company will record a liability, and, if the liability is material, disclose the amount of the liability reserved. If an unfavorable ruling or development were to occur, there exists the possibility of a material adverse impact on the Company's business, results of operations, financial condition or cash flows. 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 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 | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 18 — FAIR VALUE OF FINANCIAL INSTRUMENTS The Company holds certain assets that are required to be measured at fair value on a recurring basis, and beneficial interests in securitizations for which it elected the fair value option. A description of the fair value hierarchy and the Company's methodologies are included in Note 2 — Summary of Significant Accounting Policies. The following tables are a summary of fair value measurements and hierarchy level at December 31, 2023 and 2022: December 31, 2023 Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Money market funds $ 339 $ 339 $ — $ — Beneficial interests in securitizations $ 366 $ — $ — $ 366 December 31, 2022 Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Money market funds $ 272 $ 272 $ — $ — Beneficial interests in securitizations $ 321 $ — $ — $ 321 Money market funds consist of highly liquid investments with original maturities of three months or less and are classified in cash and cash equivalents and restricted cash in the accompanying consolidated balance sheets. As of December 31, 2023 and 2022, the Company has purchase price adjustment receivables of $7 million and $37 million, respectively, which are carried at fair value and classified as other assets in the accompanying consolidated balance sheets. Under the MPSA, the purchaser will make future cash payments to the Company based on the performance of the finance receivables sold. The fair value of the purchase price adjustment receivables are determined based on the extent to which the Company’s estimated performance of the underlying finance receivables exceeds a mutually agreed upon performance threshold of the underlying finance receivables as of measurement dates specified in the MPSA. The Company develops its estimate of future cumulative losses based on the historical performance of finance receivables it originated with similar characteristics as well as general macro-economic trends. The Company then utilizes a discounted cash flow model to calculate the present value of the expected future payment amounts. Due to the lack of observable market data these receivables are classified as Level 3. The adjustments to the fair value of the purchase price adjustment receivables were a gain of $1 million and $14 million during the years ended December 31, 2023 and 2022, respectively, and are reflected in other (income) expense, net in the accompanying consolidated statements of operations. Beneficial Interests in Securitizations Beneficial interests in securitizations include rated notes and certificates of the securitization trusts, the same securities as issued to other investors as described in Note 9 — Securitizations and Variable Interest Entities. Beneficial interests in securitizations are initially treated as Level 2 assets when the securitization transaction occurs in close proximity to the end of the period and there is a lack of observable changes in the economic inputs. When the securitization transaction does not occur in close proximity to the end of the period and there have been observable changes in the economic inputs, beneficial interests in securitizations are classified as Level 3. The Company's beneficial interests in securitizations include rated notes and certificates and other assets, all of which are classified as Level 3 due to the lack of observable market data. The Company determines the fair value of its rated notes based on non-binding broker quotes. The non-binding broker quotes are based on models that consider the prevailing interest rates, recent market transactions, and current business conditions. The Company determines the fair value of its certificates and other assets using a combination of non-binding market quotes and internally developed discounted cash flow models. The discounted cash flow models use discount rates based on prevailing interest rates and the characteristics of the specific instruments. As of December 31, 2023 and 2022, the range of discount rates were 6.2% to 12.0% and 7.1% to 11.3%, respectively. Significant increases or decreases in the inputs to the models could result in a significantly higher or lower fair value measurement. The Company elected the fair value option on its beneficial interests in securitizations, which allows it to recognize changes in the fair value of these assets in the period the fair value changes. Changes in the fair value of the beneficial interests in securitizations are reflected in other (income) expense, net in the accompanying consolidated statements of operations. For beneficial interests in securitizations measured at fair value on a recurring basis, the Company's transfers between levels of the fair value hierarchy are deemed to have occurred at the beginning of the reporting period on a quarterly basis. There were no transfers out of Level 3 during the years ended December 31, 2023 and 2022. In December 2021, the Company began selling certain of its beneficial interests in securitizations that are not required to be retained by the Risk Retention Rules. For the years ended December 31, 2023 and 2022, the Company sold beneficial interests in securitizations for a purchase price totaling $13 million and $43 million, respectively. The following table presents additional information about Level 3 beneficial interests in securitizations measured at fair value on a recurring basis for the years ended December 31, 2023 and 2022: Years Ended December 31, 2023 2022 (in millions) Opening Balance $ 321 $ 382 Received in securitization transactions 194 148 Payments received (150) (172) Change in fair value 14 6 Sales of beneficial interests (13) (43) Ending Balance $ 366 $ 321 Fair Value of Financial Instruments The carrying amounts of restricted cash, accounts receivable, accounts payable and accrued liabilities, and accounts payable to related party approximate fair value due to their respective short-term maturities. The carrying value of the short-term revolving facilities were determined to approximate fair value due to their short-term duration and variable interest rates that approximate 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 years ended December 31, 2023 and 2022. The carrying value of the financing of beneficial interests in securitizations was determined to approximate fair value because in the event of a decline in the fair value of the pledged collateral of the financing, the repurchase price of the pledged collateral will be increased by the amount of the decline. The fair value of the Senior Notes, which are not carried at fair value on the accompanying 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 December 31, 2023 and 2022 was as follows: December 31, 2023 2022 (in millions) Carrying value, net of unamortized debt issuance costs, unamortized premium, and accrued PIK interest $ 4,566 $ 5,649 Fair value $ 3,866 $ 2,533 The fair value of finance receivables, which are not carried at fair value on the accompanying 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 December 31, 2023 and 2022 were as follows: December 31, 2023 2022 (in millions) Carrying value $ 807 $ 1,334 Fair value $ 854 $ 1,437 Investment in Equity Securities In October 2021, the Company purchased Series A convertible preferred shares in Root, Inc. ("Root"), an equity security that does not have a readily determinable fair value. The Company elected to measure this investment using a measurement alternative pursuant to the accounting standards and recorded the investment at its cost of $126 million, which will subsequently be adjusted for observable price changes. The Company considered all relevant transactions since the date of its investment and has not recorded any impairments or upward or downward adjustments to the carrying amount of its investment in Root, as there have not been changes in the observable price of its equity interest through December 31, 2023. On August 12, 2022, Root effected a reverse stock split of its Class A common stock and Class B common stock at a ratio of 18:1, whereby each 18 shares of Root's Class A common stock and Class B common stock were automatically combined into one share of Class A common stock or Class B common stock, respectively (the "Reverse Stock Split"). The shares of Root's Class A common stock issuable to the Company on the conversion of the Series A convertible preferred shares were adjusted proportionally. Also in October 2021, the Company entered into a commercial agreement with Root, under which the Root auto insurance products were to be embedded into the Company's e-commerce platform. In accordance with the provisions of the commercial agreement, the Company received eight tranches of warrants to purchase shares of Root's Class A common stock (the "Root Warrants"). On September 1, 2022, the integrated auto insurance solution, which embedded into the Company's e-commerce platform (the "Integrated Platform"), was completed. The first tranche of Root Warrants, consisting of 2.4 million shares of Root's Class A common stock, as adjusted pursuant to the Reverse Stock Split, became exercisable upon completion of the Integrated Platform, and is considered a derivative instrument. The second tranche of Root Warrants, consisting of 3.2 million shares of Root's Class A common stock, became exercisable on November 14, 2023, upon the achievement of certain insurance sales metrics through the Integrated Platform, and is considered a derivative instrument. The other tranches vest based on further insurance product sales through the Integrated Platform and are considered derivative instruments. The Company used a Monte Carlo simulation to estimate the fair value of these Root Warrants, which are classified as Level 3. At contract inception, the Company recognized an asset of $30 million for the Root Warrants and deferred revenue, classified in other assets and other liabilities, respectively in the accompanying consolidated balance sheets. During the year ended December 31, 2022, the Company determined it was probable that the volume of insurance products required to earn the Root Warrants would be achieved and recorded an additional $75 million of Root Warrants and deferred revenue based on the contract inception date fair value as determined by the Monte Carlo simulation. The Root Warrants and deferred revenue are classified in other assets and other liabilities, respectively, in the accompanying consolidated balance sheets. The deferred revenue is recognized over the expected contract performance period within other sales and revenues in the accompanying consolidated statements of operations. The following table presents changes in the Company's Level 3 Root Warrants measured at fair value: Years Ended December 31 2023 2022 (in millions) Opening Balance $ 2 $ 6 Warrants to acquire Root's Class A common stock — 75 Total unrealized gain (loss) 3 (79) Ending Balance $ 5 $ 2 The Company recognized the increase (decrease) in fair value in relation to the Root Warrants through other (income) expense, net in the accompanying consolidated statements of operations. The Company recognized an increase in fair value of $3 million and a decrease in fair value of $79 million during the years ended December 31, 2023 and 2022, respectively. Derivative Instruments The Company utilizes non-designated cash flow hedges including interest rate cap agreements to minimize its exposure to interest rate fluctuations on variable rate debt borrowings. Interest rate caps provide that the counterparty will pay the purchaser at the end of each contractual period in which the index interest rate exceeds the contractually agreed upon cap rate. During the year ended December 31, 2023, the Company entered into two interest rate cap agreements to limit exposure to interest rate risk on variable rate debt associated with finance receivables. The two interest rate caps each had cap rates of 5.0%, notional amounts of $364 million and $236 million, and expiry date of July 2027 and April 2027, respectively. The fair value of the Company's interest rate caps is impacted by the credit risk of both the Company and its counterparty. The Company has an agreement with its derivative financial instrument counterparty that contains provisions providing that if the Company defaults on the indebtedness associated with its derivative financial instrument, then the Company could also be declared in default on its derivative financial instrument obligation. In addition, the Company minimizes nonperformance risk on its derivative instrument by evaluating the creditworthiness of its counterparty, which is limited to major banks and financial institutions. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | NOTE 19 — SUPPLEMENTAL CASH FLOW INFORMATION The following table summarizes supplemental cash flow information for the years ended December 31, 2023, 2022, and 2021: For the Years Ended December 31, 2023 2022 2021 (in millions) Supplemental cash flow information: Cash payments for interest $ 538 $ 423 $ 152 Cash payments for taxes $ 28 $ 3 $ 2 Non-cash investing and financing activities: Capital expenditures included in accounts payable and accrued liabilities $ 1 $ 18 $ 102 Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 2 $ 375 $ 253 Property and equipment acquired under finance leases $ 51 $ 326 $ 152 Warrants to acquire Root Class A common stock $ — $ 75 $ 30 Equity-based compensation expense capitalized to property and equipment $ 8 $ 8 $ 7 Fair value of beneficial interests received in securitization transactions $ 194 $ 148 $ 338 Reductions of beneficial interests in securitizations and associated long-term debt $ 110 $ 134 $ 38 The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the accompanying consolidated balance sheets that sum to the total of the same amounts shown in the accompanying consolidated statements of cash flows for all periods presented: December 31, 2023 2022 2021 (in millions) Cash and cash equivalents $ 530 $ 434 $ 403 Restricted cash 64 194 233 Total cash, cash equivalents and restricted cash $ 594 $ 628 $ 636 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 20 — SUBSEQUENT EVENTS Master Purchase and Sale Agreement On January 11, 2024, the Company and the Ally Parties amended the MPSA to, among other things, reestablish the commitment by the Ally Parties to purchase up to $4.0 billion of principal balances of finance receivables between January 11, 2024 and January 10, 2025. Finance Receivable Facilities On January 19, 2024, the Company amended one of its agreements governing one of its short-term revolving credit facilities to, among other things, extend the maturity date to January 19, 2025. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | Schedule II - Valuation and Qualifying Accounts Additions Balance at beginning of period Charged to costs and expenses Charged to other accounts Reductions Balance at end of period (in millions) Deferred tax asset valuation allowance: Year ended December 31, 2023 $ 2,058 $ (96) $ — (1) $ — $ 1,962 Year ended December 31, 2022 $ 1,638 $ 398 $ 22 (1) $ — $ 2,058 Year ended December 31, 2021 $ 677 $ 53 $ 908 (1) $ — $ 1,638 (1) Amount relates to a valuation allowance established on deferred taxes related to our investment in Carvana Group. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net income (loss) attributable to Carvana Co. Class A common stockholders - diluted | $ 450 | $ (1,587) | $ (135) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 12 Months Ended |
Dec. 31, 2023 shares | Dec. 31, 2023 shares | |
Trading Arrangements, by Individual | ||
Non-Rule 10b5-1 Arrangement Adopted | false | |
Non-Rule 10b5-1 Arrangement Terminated | false | |
Mark Jenkins [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | On December 15, 2023, Mark Jenkins, the Company's Chief Financial Officer, terminated a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a "10b5-1 Plan"). Mr. Jenkins's 10b5-1 Plan was adopted on March 15, 2021 and provided for the potential sale of up to 499,965 shares of Class A common stock, including shares obtained from the conversion of Carvana Group, LLC Class B common units into shares of Class A common stock. Following the termination of the previous 10b5-1 Plan, on December 15, 2023, Mr. Jenkins entered into a new 10b5-1 Plan, which provides for the potential sale of up to 310,000 shares of Class A common stock, including shares obtained from the exercise of vested stock options covered by the 10b5-1 Plan between on or after March 15, 2024 and December 31, 2025. | |
Stephen Palmer [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | On November 8, 2023, Stephen Palmer, the Company's Vice President of Accounting and Finance, entered into a 10b5-1 Plan. Mr. Palmer's 10b5-1 Plan provides for the potential sale of up to 15,000 shares of Class A common stock between on or after March 1, 2024 and August 31, 2024. | |
Name | Stephen Palmer | |
Title | Vice President of Accounting and Finance | |
Rule 10b5-1 Arrangement Adopted | true | |
Adoption Date | November 8, 2023 | |
Arrangement Duration | 183 days | |
Aggregate Available | 15,000 | 15,000 |
Mark Jenkins - March 2021 Trading Plan [Member] | Mark Jenkins [Member] | ||
Trading Arrangements, by Individual | ||
Name | Mark Jenkins | |
Title | Company's Chief Financial Officer | |
Rule 10b5-1 Arrangement Adopted | true | |
Adoption Date | December 15, 2023 | |
Rule 10b5-1 Arrangement Terminated | true | |
Arrangement Duration | 1005 days | |
Aggregate Available | 499,965 | 499,965 |
Mark Jenkins - December 2023 Trading Plan [Member] | Mark Jenkins [Member] | ||
Trading Arrangements, by Individual | ||
Name | Mark Jenkins | |
Title | Company's Chief Financial Officer | |
Rule 10b5-1 Arrangement Adopted | true | |
Adoption Date | December 15, 2023 | |
Arrangement Duration | 640 days | |
Aggregate Available | 310,000 | 310,000 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
Use of Estimates | Use of Estimates The preparation of these consolidated financial statements in conformity with 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. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company has cash deposits and cash equivalents deposited in or managed by major financial institutions. Cash equivalents include highly liquid investment instruments with original maturities of three months or less, and consist primarily of money market funds. At times the related amounts are in excess of the amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses with these financial institutions and does not believe it represents significant credit risk. |
Restricted Cash | Restricted Cash |
Accounts Receivable, Net | Accounts Receivable, Net |
Finance Receivables Held for Sale, Net | Finance Receivables Held for Sale, Net Finance receivables include installment contracts the Company originates to its customers to facilitate vehicle sales. The Company classifies these receivables as held for sale, as it does not intend to hold the finance receivables it originates to maturity. The Company typically sells the finance receivables it originates, as explained in Note 8 — Finance Receivable Sale Agreements and Note 9 — Securitizations and Variable Interest Entities. The Company records a valuation allowance to report finance receivables at the lower of unpaid principal balance or fair value. To determine the fair value of finance receivables the Company utilizes industry-standard modeling, such as discounted cash flow analysis, factoring in the Company’s historical experience, the credit quality of the underlying receivables, loss trends and recovery rates, as well as the overall economic environment. For purposes of determining the valuation allowance, finance receivables are evaluated collectively to determine the allowance as they represent a large group of smaller-balance homogeneous loans. The allowance was $59 million and $36 million as of December 31, 2023 and 2022, respectively. Principal balances of finance receivables are charged-off when the Company is unable to sell the finance receivable and the related vehicle has been repossessed and liquidated or the receivable has otherwise been deemed uncollectible. Interest income on finance receivables held for sale is recognized when earned based on contractual loan terms and is included in other sales and revenues. Loan origination costs are capitalized and recognized as a reduction to the gain on loan sale when the loans are sold. |
Vehicle Inventory | Vehicle Inventory Vehicle inventory consists of used vehicles, primarily acquired directly from customers and at auction. Direct and indirect vehicle reconditioning costs including parts and labor, inbound transportation costs and other incremental overhead costs are capitalized as a component of inventory. Inventory is stated at the lower of cost or net realizable value. Vehicle inventory cost is determined by specific identification. Net realizable value is the estimated selling price less costs to complete, dispose and transport the vehicles. Selling prices are derived from historical data and trends, such as sales price and inventory turn times of similar vehicles, as well as independent market resources. Each reporting period the Company recognizes any necessary adjustments to reflect vehicle inventory at the lower of cost or net realizable value through cost of sales in the accompanying consolidated statements of operations. |
Property and Equipment | Property and Equipment Property and equipment consists of land, buildings and improvements, transportation fleet equipment, software, and furniture, fixtures and equipment and is stated at cost less accumulated depreciation and amortization. Repairs and maintenance costs that extend the life or utility of an asset are also capitalized. Ordinary repairs and maintenance are charged to expense as incurred. Costs incurred during construction are capitalized as construction in progress and reclassified to the appropriate fixed asset categories when the project is completed. In addition, interest on borrowings during the active construction period of construction projects is capitalized and depreciated over the estimated useful lives of the related assets. Costs incurred during the preliminary project planning phase are charged to expense as incurred. The Company capitalizes direct costs of materials and services consumed in developing or obtaining internal-use software. The Company also capitalizes payroll and payroll-related costs for employees who are directly associated with and who devote time to the development of software products for internal use, to the extent of the time spent directly on the project. Capitalization of costs begins during the application development stage and ends when the software is available for general use. Costs incurred during the preliminary project and post-implementation stages are charged to expense as incurred. Depreciation and amortization are computed using the straight-line method over the lesser of the remaining lease term or the following estimated useful lives: Buildings and improvements 15-30 years Transportation fleet equipment 5-6 years Software 3 years Furniture, fixtures and equipment 3-5 years |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Intangible assets are recognized and recorded at their acquisition date fair values. Definite-lived intangible assets consist of developed technology, customer relationships, and non-compete agreements and are generally amortized on a straight-line basis over their estimated useful lives. The Company determined the useful lives of its definite-lived intangible assets based on multiple factors including technological obsolescence, the make-up of the acquired customer base and expected attrition, and the period over which expected cash flows are used to measure the fair value of the intangible asset at acquisition. The Company periodically reassesses the useful lives of its definite-lived intangible assets when events or circumstances indicate that useful lives have significantly changed from the previous estimate. No impairment charges related to intangible assets were recognized during the years ended December 31, 2023, 2022, or 2021. |
Leases | Leases 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, the Company's leases generally 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 on the accompanying consolidated balance sheets. The Company's finance leases are included in property and equipment and long-term debt on the accompanying 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 VIEs, 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. |
Other Assets | Other Assets Other current assets consist of various items, including, among other items, software licenses and subscriptions, prepaid expenses, the estimated reserve for vehicle inventory returns, the current portion of the purchase price adjustment receivables based on the performance of the Company's finance receivables, the current portion of the receivable related to the excess cash reserves over realized claims of vehicle service contracts ("VSCs"), and deposits. Other assets consist of various items, including, among other items, investment in equity instruments (as further discussed in Note 18 — Fair Value of Financial Instruments), the purchase price adjustment receivables based on the performance of the Company's finance receivables, the receivable related to the excess cash reserves over realized claims of VSCs, collateral for insurance, and debt issuance costs on revolving debt instruments. |
Accrued Liabilities | Accrued Liabilities Accrued liabilities consist of various items payable within one year, including, among other items, accruals for sales tax, compensation and benefits, vehicle licenses and fees, interest expense on the Senior Unsecured Notes, reserves for returns and cancellations, and advertising expenses. |
Other Liabilities | Other Liabilities As of December 31, 2023 and 2022, other current liabilities primarily consist of the current portion of operating lease liabilities. Other liabilities consist of various items to be recognized beyond one year, including the deferred revenue associated with Root Warrants (as further discussed in Note 18 — Fair Value of Financial Instruments) and tax receivable agreement ("TRA") liability (as further discussed in Note 15 — Income Taxes). |
Revenue Recognition and Shipping and Handling | Revenue Recognition The Company recognizes revenue in accordance with the five-step model prescribed by ASC 606 that includes: (1) identify the contract; (2) identify the performance obligations; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations; and (5) recognize revenue when (or as) performance obligations are satisfied. Retail Vehicle Sales The Company sells retail vehicles directly to its customers through its website. The prices of retail vehicles are set forth in the customer contracts at stand-alone selling prices which are agreed upon prior to delivery. The Company satisfies its performance obligation for retail vehicle sales upon delivery when the risks and rewards of ownership and control pass to the customer. The Company recognizes revenue at the agreed upon purchase price stated in the contract, including any delivery charges, less an estimate for returns. Estimates for returns are based on an analysis of historical experience, trends and sales data. Changes in these estimates are reflected as an adjustment to revenue in the period identified. The amount of consideration received for retail vehicle sales includes noncash consideration representing the value of trade-in vehicles, if applicable, as stated in the contract. Prior to the delivery of the vehicle, the payment is received or financing has been arranged. Payments from customers that finance their purchases with third parties are typically due and collected within 30 days of delivery of the retail vehicle. Revenue excludes any sales taxes, title and registration fees, and other government fees that are collected from customers. Wholesale Sales and Revenues The Company sells vehicles to wholesalers. These vehicles sold to wholesalers are primarily acquired from customers and do not meet the Company’s quality standards to list and sell through its website. The Company satisfies its performance obligation for wholesale sales and revenues when the wholesale purchaser obtains control of the underlying vehicle, which is upon delivery or pick up at an auction when the transfer of title, risks and rewards of ownership, and control pass to the wholesale purchaser. The Company recognizes revenue at the amount it expects to receive for the used wholesale vehicle, which is the fixed price determined at the auction, or for wholesale marketplace transactions, at the amount it expects to receive for auction fees charged in facilitating the transaction. The purchase price of the wholesale vehicle is typically due and collected within 30 days of delivery of the wholesale vehicle and auction fees are typically due within two days of a completed sale. Other Sales and Revenues Other sales and revenues include gains on the sales of finance receivables, commissions on VSCs, GAP waiver coverage, and customer insurance and interest income received on finance receivables prior to selling them to investors. Customers purchasing retail vehicles from the Company may enter into contracts for VSCs and, if they finance with the Company, GAP waiver coverage. The prices of VSCs and GAP waiver coverage are set forth in each contract. The Company sells and receives a commission on VSCs under a master dealer agreement with DriveTime, pursuant to which the Company sells VSCs that DriveTime administers and is the obligor. The Company receives a commission on GAP waiver coverage contracts where the administrator of the contract is obligated to reimburse the holder of the underlying finance receivable for a balance that is in excess of the value of the financed vehicle in the event of a total loss. The Company recognizes commission revenue at the time of sale, net of a reserve for estimated contract cancellations. GAP waiver coverage contracts obligate whoever holds the underlying finance receivable to not attempt collection of a balance that is in excess of the value of the financed vehicle in the event of a total loss. GAP waiver coverage is recognized as the performance obligation is satisfied over the period of coverage, generally on a straight-line basis over the expected period the outstanding balance of the related finance receivable will exceed the value of the financed vehicle, less a reserve for cancellations. Upon selling the corresponding finance receivable, the Company recognizes any remaining deferred revenue. The reserve for cancellations of VSCs and GAP waiver coverage contracts is estimated based upon historical experience and recent trends and is reflected as a reduction of other sales and revenues. Changes in these estimates are reflected as an adjustment to other sales and revenues in the period identified. Under the master dealer agreement with DriveTime, the Company is also contractually entitled to receive profit-sharing revenues based on the performance of the VSCs once a required claims period has passed. This is a form of variable consideration the Company recognizes as revenue to the extent that it is probable that it will not result in a significant revenue reversal. The Company applies the expected value method, utilizing expected VSC performance based on historical claims and cancellation data from its customers, as well as other qualitative assumptions to estimate the amount it expects to receive. The Company reassesses the estimate each reporting period with any changes reflected as an adjustment to other sales and revenues in the period identified. Profit-sharing payments will begin when the underlying VSCs reach a specified level of claims history. As of December 31, 2023 and 2022, the Company had ending receivables of less than $1 million and $8 million, respectively, related to cumulative profit-sharing payments recognized as revenue to which it expects to be entitled. The receivables are included in other current assets and other assets on the accompanying consolidated balance sheets. The Company accounts for sales of finance receivables in accordance with ASC Topic 860, Transfers and Servicing ("ASC 860"). ASC 860 states that a transfer of an entire financial asset, a group of entire financial assets, or a participating interest in an entire financial asset in which the transferor surrenders control over those financial assets is accounted for as a sale only if all of the following conditions are met: • The transferred financial assets have been isolated from the transferor - put presumptively beyond the reach of the transferor and its creditors, even in bankruptcy or other receivership. • Each transferee has the right to pledge or exchange the assets (or beneficial interests) it received, and no condition both constrains the transferee (or third-party holder of its beneficial interests) from taking advantage of its right to pledge or exchange the asset and provides more than a trivial benefit to the transferor. • The transferor, its consolidated affiliates included in the financial statements being presented or its agents do not maintain effective control over the transferred financial assets or third-party beneficial interests related to those transferred assets. For the years ended December 31, 2023, 2022, and 2021, all transfers of finance receivables met the requirements for sale treatment. The Company records the gain on the sale of a finance receivable upon receipt of proceeds, in an amount equal to the fair value of the net proceeds received less the carrying amount of the finance receivable. The Company has made customary representations related to the sales of finance receivables. Any significant estimated post-sale obligations or contingent obligations to the purchaser of the receivables would be accrued if probable and estimable in accordance with ASC 450, Contingencies . Any such obligations are considered in the Company's determination of the accounting for the transfers of the finance receivables under ASC 860 . Shipping and Handling |
Cost of Sales | Cost of Sales Cost of sales includes the cost to acquire used vehicles and direct and indirect vehicle reconditioning costs associated with preparing the vehicles for resale. Vehicle reconditioning costs include parts, labor, inbound transportation costs, and other incremental overhead costs, which are allocated to inventory via specific identification and standard costing. Occupancy and labor costs not related to vehicle acquisition or reconditioning, including those incurred in connection with expanding production capacity, are expensed as incurred as a component of selling, general and administrative expense. Cost of sales also includes any necessary adjustments to reflect vehicle inventory at the lower of cost or net realizable value. |
Selling, General, and Administrative Expenses | Selling, General, and Administrative Expenses Selling, general, and administrative ("SG&A") expenses primarily include compensation and benefits, advertising, depreciation expense, facilities costs, technology expenses, logistics and fulfillment expenses, and other administrative expenses. SG&A expenses exclude the costs related to reconditioning vehicles and inbound transportation, which are included in cost of sales, and payroll costs of employees related to the development of software products for internal use, which are capitalized to software and depreciated over the estimated useful lives of the related assets. |
Advertising Costs | Advertising Costs |
Equity-Based Compensation | Equity-Based Compensation |
Defined Contribution Plan | Defined Contribution Plan |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company from time to time enters into primarily short-term derivative instruments to manage risks arising from its business operations and economic conditions, primarily cash flow variability that may arise from interest rate changes between the time the Company originates finance receivables and the time it sells them through securitizations. The Company does not designate these derivative instruments as hedges under ASC 815, Derivatives and Hedging for hedge accounting treatment and as a result they are accounted for as economic hedges. Gains and losses related to the derivative instruments are included within other sales and revenues to follow the presentation of the hedged item within the accompanying consolidated statements of operations and any derivative instruments outstanding as of the end of the period are reported at fair value on the accompanying consolidated balance sheets. |
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 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 full 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 operating segment and therefore one reportable segment. The chief operating decision maker ("CODM") 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. |
Income Taxes | Income Taxes |
Accounting Standards Issued But Not Yet Adopted | Accounting Standards Issued But Not Yet Adopted In November 2023, the Financial Accounting Standard Board “FASB” issued Accounting Standards Update “ASU” 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which modifies the disclosure and presentation requirements of reportable segments. The amendments in the update require the disclosure of significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit and loss. The amendments also require disclosure of all other segment items by reportable segment and a description of its composition. Additionally, the amendments require disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. This update is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which expands disclosures in an entity’s income tax rate reconciliation table and disclosures regarding cash taxes paid both in the U.S. and foreign jurisdictions. The update will be effective for annual periods beginning after December 15, 2025. The Company is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes. |
Net Earnings (Loss) Per Share | Basic and diluted net earnings (loss) per share is computed by dividing the net earnings (loss) attributable to Class A common stockholders by the weighted-average shares of Class A common stock outstanding during the period. Diluted net earnings (loss) per share is computed by giving effect to all potentially dilutive shares. For the years ended December 31, 2022 and 2021, potentially dilutive shares are excluded from diluted net earnings (loss) per share because they would have an anti-dilutive impact. Net earnings (loss) for all periods presented is attributable only to Class A common stockholders, due to no activity related to convertible preferred stock during those periods. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Property and Equipment | Depreciation and amortization are computed using the straight-line method over the lesser of the remaining lease term or the following estimated useful lives: Buildings and improvements 15-30 years Transportation fleet equipment 5-6 years Software 3 years Furniture, fixtures and equipment 3-5 years The following table summarizes property and equipment, net, as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Land and site improvements $ 1,331 $ 1,331 Buildings and improvements 1,344 1,267 Transportation fleet 570 673 Software 296 245 Furniture, fixtures, and equipment 144 158 Total property and equipment excluding construction in progress 3,685 3,674 Less: accumulated depreciation and amortization on property and equipment (775) (564) Property and equipment excluding construction in progress, net 2,910 3,110 Construction in progress 72 134 Property and equipment, net $ 2,982 $ 3,244 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the allocation of the purchase price consideration to identifiable assets acquired and liabilities assumed as of December 31, 2022: Purchase Price Allocation (in millions) Assets Acquired Current assets $ 208 Property and equipment 1,281 Operating lease right-of-use assets 188 Intangible assets 79 Other assets 1 Total Assets Acquired 1,757 Liabilities Assumed Current liabilities 233 Operating lease liabilities 167 Total Liabilities Assumed 400 Net Assets Acquired 1,357 Purchase price consideration 2,195 Goodwill $ 838 Identifiable intangible assets acquired consist of the following (in millions): Fair Value Useful Life Customer relationships $ 50 10 years Developed technology $ 29 3 years |
Business Acquisition, Pro Forma Information | The following unaudited pro forma combined results of operations information for the years ended December 31, 2022 and 2021 have been prepared as if the ADESA Acquisition occurred on January 1, 2021: Unaudited Year ended December 31, 2022 2021 (in millions) Revenues $ 13,903 $ 13,675 Net loss (3,024) (571) Net loss attributable to non-controlling interests (1,343) (276) Net loss attributable to Carvana Co. $ (1,681) $ (295) Net loss per share of Class A common stock - basic and diluted $ (15.89) $ (3.00) Weighted-average shares of Class A common stock - basic and diluted 105,808 98,459 The unaudited pro forma combined results of operations information reflect the following pro forma adjustments: Unaudited Year ended December 31, 2022 2021 (in millions) Interest expense $ 123 $ 345 Lease expense $ 5 $ (16) Depreciation and amortization expense $ 13 $ (6) Intercompany revenues and cost of sales $ (7) $ (20) |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Depreciation and amortization are computed using the straight-line method over the lesser of the remaining lease term or the following estimated useful lives: Buildings and improvements 15-30 years Transportation fleet equipment 5-6 years Software 3 years Furniture, fixtures and equipment 3-5 years The following table summarizes property and equipment, net, as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Land and site improvements $ 1,331 $ 1,331 Buildings and improvements 1,344 1,267 Transportation fleet 570 673 Software 296 245 Furniture, fixtures, and equipment 144 158 Total property and equipment excluding construction in progress 3,685 3,674 Less: accumulated depreciation and amortization on property and equipment (775) (564) Property and equipment excluding construction in progress, net 2,910 3,110 Construction in progress 72 134 Property and equipment, net $ 2,982 $ 3,244 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets and Goodwill Related to Acquisition | The following table summarizes intangible assets, net as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Customer relationships $ 50 $ 50 Developed technology 41 41 Non-compete agreements — 1 Intangible assets, acquired cost 91 92 Less: accumulated amortization (39) (22) Intangible assets, net $ 52 $ 70 |
Schedule of Future Amortization Expense | The anticipated annual amortization expense to be recognized in future years as of December 31, 2023 is as follows: Expected Future Amortization (in millions) 2024 $ 18 2025 14 2026 7 2027 5 2028 3 Thereafter 5 Total $ 52 |
Accounts Payable and Other Ac_2
Accounts Payable and Other Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Other Accrued Liabilities | The following table summarizes accounts payable and other accrued liabilities as of December 31, 2023 and 2022: December 31, 2023 2022 (in millions) Accounts payable, including $7 and $16, respectively, due to related parties $ 231 $ 232 Sales taxes and vehicle licenses and fees 77 76 Reserve for returns and cancellations 57 60 Accrued compensation and benefits 41 65 Customer deposits 30 23 Accrued interest expense (1) 7 99 Accrued advertising costs 4 7 Income tax liability 3 — Accrued property and equipment 1 10 Other accrued liabilities 145 205 Total accounts payable and other accrued liabilities $ 596 $ 777 (1) As discussed in Note 10 — Debt Instruments, accrued payment-in-kind ("PIK") interest is included in long-term debt within the accompanying consolidated balance sheets. |
Securitizations and Variable _2
Securitizations and Variable Interest Entities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities Total Exposure | As such, the total exposure presented below is not an indication of the Company's expected losses. December 31, 2023 December 31, 2022 Carrying Value Total Exposure Carrying Value Total Exposure (in millions) Rated notes $ 287 $ 287 $ 252 $ 252 Certificates and other assets 79 79 69 69 Total unconsolidated VIEs $ 366 $ 366 $ 321 $ 321 December 31, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value (in millions) Rated notes $ 294 $ 287 $ 268 $ 252 Certificates and other assets 71 79 43 69 Total securities available for sale $ 365 $ 366 $ 311 $ 321 |
Schedule of Amortized Cost and Fair Value of Securities Available for Sale | As such, the total exposure presented below is not an indication of the Company's expected losses. December 31, 2023 December 31, 2022 Carrying Value Total Exposure Carrying Value Total Exposure (in millions) Rated notes $ 287 $ 287 $ 252 $ 252 Certificates and other assets 79 79 69 69 Total unconsolidated VIEs $ 366 $ 366 $ 321 $ 321 December 31, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value (in millions) Rated notes $ 294 $ 287 $ 268 $ 252 Certificates and other assets 71 79 43 69 Total securities available for sale $ 365 $ 366 $ 311 $ 321 |
Debt Instruments (Tables)
Debt Instruments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Debt instruments, excluding finance leases, which are discussed in Note 16 — Leases, as of December 31, 2023 and 2022 consisted of the following: December 31, 2023 2022 (in millions) Asset-based financing: Floor plan facility $ 113 $ 569 Finance receivable facilities 555 965 Financing of beneficial interest in securitizations 293 268 Notes payable — 3 Real estate financing 485 486 Total asset-based financing 1,446 2,291 Senior Secured Notes (1) 4,378 — Senior Unsecured Notes 205 5,725 Total debt 6,029 8,016 Less: current portion (777) (1,638) Less: unamortized debt issuance costs (2) (60) (82) Plus: unamortized premium (3) 37 — Total included in long-term debt, net $ 5,229 $ 6,296 (1) Includes $185 million of accrued PIK interest through December 31, 2023, which will increase the principal amount of Senior Secured Notes on February 15, 2024, the next semi-annual interest payment date. (2) The unamortized debt issuance costs related to long-term debt are presented as a reduction of the carrying amount of the corresponding liabilities on the accompanying consolidated balance sheets. Unamortized debt issuance costs related to revolving debt arrangements are presented within other assets on the accompanying consolidated balance sheets and not included here. (3) The unamortized premium relates to a portion of the Offers (as defined below) which were accounted for as a debt modification. The aggregate principal amounts of the Senior Unsecured Notes that were validly tendered and accepted by the Company in the Offers are set forth in the table below. Principal Amount Validly Tendered and Accepted Allocation to Senior Secured Notes Issued Senior Unsecured Notes Outstanding Principal Prior to Exchange Accepted as % of Outstanding Cash Tender Offer Payment 2028 Senior Secured Notes 2030 Senior Secured Notes 2031 Senior Secured Notes Total Senior Secured Notes (in millions, except percentages) 2025 Senior Unsecured Notes $ 500 $ 402 80.3 % $ 341 $ — $ — $ — $ — 2027 Senior Unsecured Notes 600 568 94.7 % — 102 153 181 436 2028 Senior Unsecured Notes 600 578 96.3 % — 90 135 160 385 2029 Senior Unsecured Notes 750 724 96.6 % — 110 165 195 470 2030 Senior Unsecured Notes 3,275 3,248 99.2 % — 679 1,018 1,205 2,902 Total $ 5,725 $ 5,520 96.4 % $ 341 $ 981 $ 1,471 $ 1,741 $ 4,193 The following table summarizes the components and interest rate terms of the Company's Senior Secured Notes: Senior Secured Notes December 31, December 31, Year 1 PIK Interest Rate Year 2 Cash/PIK Toggle Interest Rate Thereafter Cash Interest Rate (in millions, except percentages) Notes due December 1, 2028 (the "2028 Senior Secured Notes") $ 981 $ — 12% 9%/12% 9% Notes due June 1, 2030 (the "2030 Senior Secured Notes") 1,471 — 13% 11%/13% 9% Notes due June 1, 2031 (the "2031 Senior Secured Notes") 1,741 — 14% --/14% 9% Accrued PIK interest 185 — Total principal amount $ 4,378 $ — Less: unamortized debt issuance costs (53) — Plus: unamortized premium 37 — Total Senior Secured debt $ 4,362 $ — The following table summarizes components of the Company's Senior Unsecured Notes: December 31, December 31, Interest Rate (in millions, except percentages) Senior Unsecured Notes due October 1, 2025 ("2025 Senior Unsecured Notes") $ 98 $ 500 5.625 % Senior Unsecured Notes due April 15, 2027 ("2027 Senior Unsecured Notes") 32 600 5.500 % Senior Unsecured Notes due October 1, 2028 ("2028 Senior Unsecured Notes") 22 600 5.875 % Senior Unsecured Notes due September 1, 2029 ("2029 Senior Unsecured Notes") 26 750 4.875 % Senior Unsecured Notes due May 1, 2030 ("2030 Senior Unsecured Notes") 27 3,275 10.250 % Total principal amount 205 5,725 Less: unamortized debt issuance cost (1) (76) Total Senior Unsecured debt $ 204 $ 5,649 |
Schedule of Future Minimum Principal Payments of Notes Payable | The following table summarizes the aggregate principal maturities due in each period for Senior Secured Notes (excluding any accrued PIK interest), Senior Unsecured Notes, real estate financing, and financing of beneficial interests in securitizations as of December 31, 2023. Maturities related to financing of beneficial interests in securitizations are estimated based on expected timing of payments from the securitization trusts to the lender. As of December 31, 2023 (in millions) 2024 $ 108 2025 183 2026 59 2027 62 2028 1,013 Thereafter 3,751 Total $ 5,176 As of December 31, 2023, the Company was in compliance with all debt covenants. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Schedule of Sale of Stock | The following table summarizes the activity pursuant to the ATM Program for the period presented: Year Ended December 31, 2023 (in millions, except share and per share amounts) Shares of Class A common stock issued 7,156,838 Weighted-average issuance price per share $ 46.94 Gross proceeds (1) $ 336 (1) Net proceeds were $327 million after deducting $9 million of commissions and other offering expenses incurred. |
Purchase of Stock | Carvana Co. used the net proceeds from the issuance of its Senior Unsecured Notes to purchase the Class A Non-Convertible Preferred Units, and, in the case of the Senior Secured Notes, received Class A Non-Convertible Preferred Units upon the cancellation of units previously issued in connection with the issuance of the Senior Unsecured Notes, as specified below: Date Senior Notes Issuance Class A Non-Convertible Preferred Units Cancelled in Connection with Offers Net Total Class A Non-Convertible Preferred Units (in thousands) October 2020 2025 Senior Unsecured Notes 500 (402) 98 March 2021 2027 Senior Unsecured Notes 600 (568) 32 October 2020 2028 Senior Unsecured Notes 600 (578) 22 August 2021 2029 Senior Unsecured Notes 750 (724) 26 May 2022 2030 Senior Unsecured Notes 3,275 (3,248) 27 September 2023 2028 Senior Secured Notes 981 — 981 September 2023 2030 Senior Secured Notes 1,471 — 1,471 September 2023 2031 Senior Secured Notes 1,741 — 1,741 9,918 (5,520) 4,398 |
Non-controlling Interests (Tabl
Non-controlling Interests (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Noncontrolling Interest [Abstract] | |
Summary of Effects of Changes in Ownership in Carvana Group on Equity | For the Years Ended December 31, 2023 2022 2021 (in millions) Transfers from (to) non-controlling interests: Decrease as a result of issuances of Class A and B common stock $ (83) $ (554) $ — Increase as a result of exchanges of LLC Units 1 1 43 Total transfers from (to) non-controlling interests $ (82) $ (553) $ 43 |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Equity-based Compensation Expense Included in Selling, General and Administrative | A summary of equity-based compensation recognized during the years ended December 31, 2023, 2022, and 2021 is as follows: For the Years Ended December 31, 2023 2022 2021 (in millions) Restricted Stock Units and Awards excluding those granted in relation to the CEO Milestone Gift $ 66 $ 41 $ 35 Restricted Stock Units granted in relation to the CEO Milestone Gift (1) 39 — Options 16 13 11 Class A Units — — 1 Total equity-based compensation 81 93 47 Equity-based compensation capitalized to property and equipment (7) (8) (7) Equity-based compensation capitalized to inventory (1) (16) (1) Equity-based compensation, net of capitalized amounts $ 73 $ 69 $ 39 |
Schedule of Unrecognized Compensation Costs | As of December 31, 2023, unrecognized equity-based compensation related to outstanding awards and the related weighted-average period over which it is expected to be recognized subsequent to December 31, 2023 is presented in the table below. Total unrecognized equity-based compensation will be adjusted for actual forfeitures. Unrecognized Equity-Based Compensation Related to Outstanding Awards (in millions) Remaining Weighted-Average Amortization Period (in years) Restricted Stock Units and Awards $ 143 2.7 Options 33 2.5 Total unrecognized equity-based compensation $ 176 |
Schedule of Restricted Stock Unit Activity | RSA and RSU activity during the years ended December 31, 2023, 2022, and 2021 was as follows: Number of RSAs/RSUs (in thousands) Weighted-Average Grant-Date Fair Value Outstanding at January 1, 2021 738 $ 76.43 Granted 258 $ 288.27 Settled (385) $ 86.57 Forfeited (58) $ 132.88 Outstanding and nonvested at December 31, 2021 553 $ 162.32 Granted 3,482 $ 65.26 Settled (432) $ 113.96 Forfeited (951) $ 134.83 Outstanding and nonvested at December 31, 2022 2,652 $ 52.62 Granted 10,392 $ 13.13 Settled (1,550) $ 41.39 Forfeited (1,591) $ 24.25 Outstanding and nonvested at December 31, 2023 9,903 $ 17.49 |
Schedule of Stock Options Activity | Stock option activity during the years ended December 31, 2023, 2022, and 2021 was as follows: Number of Options (in thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Life (in years) Aggregate Intrinsic Value (in millions) Outstanding at January 1, 2021 1,072 $ 41.01 7.7 $ 213 Options granted 97 $ 178.42 n/a Options exercised (75) $ 24.32 $ 20 Options forfeited or expired (28) $ 27.62 n/a Outstanding at December 31, 2021 1,066 $ 39.74 6.7 $ 183 Options granted 297 $ 119.53 n/a Options exercised (89) $ 37.89 $ 7 Options forfeited or expired (9) $ 30.97 n/a Outstanding at December 31, 2022 1,265 $ 80.26 6.4 $ — Options granted 2,805 $ 10.07 n/a Options exercised (17) $ 13.62 $ — Options forfeited or expired (47) $ 50.08 n/a Outstanding at December 31, 2023 4,006 $ 31.75 8.1 $ 135 Vested and exercisable as of December 31, 2023 996 $ 68.23 5.3 $ 14 Expected to vest as of December 31, 2023 3,010 $ 19.68 9.1 $ 120 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The Company determined the grant-date fair value of the options granted during the years ended December 31, 2023, 2022, and 2021 using the Black-Scholes valuation model with the following weighted-average assumptions: Years Ended December 31, 2023 2022 2021 Expected volatility (1) 74.6 % 69.2 % 67.1 % Expected dividend yield — % — % — % Expected term (in years) (2) 6.30 6.28 6.14 Risk-free interest rate 3.6 % 2.0 % 0.7 % Weighted-average grant-date fair value per option $6.94 $74.85 $178.41 (1) Measured using the Company's historical data, market option volatility and selected high-growth guideline companies and considering the risk factors that would influence the range of expected volatility because the Company does not have sufficient historical data to provide a reasonable basis upon which to estimate the expected volatility for the entirety of the term. (2) Expected term represents the estimated period of time until an option is exercised and was determined using the simplified method because the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. |
Class A Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Common Units | A summary of the Class A Unit activity for the years ended December 31, 2023, 2022, and 2021 is as follows: Class A Units Number of Class A Units (in thousands) Weighted-Average Grant Date Fair Value Outstanding at January 1, 2021 121 Granted — n/a Exchanged (36) $ 18.58 Forfeited — n/a Outstanding at December 31, 2021 85 Granted — n/a Exchanged — n/a Forfeited (6) $ 18.58 Outstanding at December 31, 2022 79 Granted — n/a Exchanged — n/a Forfeited — n/a Outstanding at December 31, 2023 79 Vested as of December 31, 2023 79 $ 18.58 Expected to vest as of December 31, 2023 — n/a |
Class B Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Common Units | A summary of the Class B Unit activity for the years ended December 31, 2023, 2022, and 2021 is as follows: Class B Units Number of Class B Units (in thousands) Weighted-Average Participation Threshold per Class B Unit Outstanding at January 1, 2021 3,163 $ 4.94 Granted — n/a Exchanged (535) $ 1.70 Forfeited (1) $ 12.00 Outstanding at December 31, 2021 2,627 $ 5.60 Granted — n/a Exchanged (61) $ 5.75 Forfeited — n/a Outstanding at December 31, 2022 2,566 $ 5.60 Granted — n/a Exchanged (34) $ 3.52 Forfeited — n/a Outstanding at December 31, 2023 2,532 $ 5.62 Vested as of December 31, 2023 2,532 $ 5.62 Expected to vest as of December 31, 2023 — n/a |
Net Earnings (Loss) Per Share (
Net Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Summary of the Calculation of Basic and Diluted Net Loss Per Unit | The following table presents the calculation of basic and diluted net earnings (loss) per share during the years ended December 31, 2023, 2022, and 2021: Years Ended December 31, 2023 2022 2021 (in millions, except number of shares, which are reflected in thousands, and per share amounts) Numerator: Net income (loss) attributable to Carvana Co. Class A common stockholders - basic $ 450 $ (1,587) $ (135) Impact on net income of assumed conversions from LLC Units (300) — — Net income (loss) attributable to Carvana Co. Class A common stockholders - diluted $ 150 $ (1,587) $ (135) Denominator: Weighted-average shares of Class A common stock outstanding 109,347 100,848 82,839 Nonvested weighted-average restricted stock awards (24) (20) (34) Weighted-average shares of Class A common stock outstanding - basic 109,323 100,828 82,805 Dilutive effect of Class A common shares: Options (1) 979 — — Restricted Stock Units and Awards (1) 4,815 — — Class A Units (2) 83,976 — — Class B Units (2) 1,485 — — Weighted-average shares of Class A common stock outstanding - diluted 200,578 100,828 82,805 Net earnings (loss) per share of Class A common stock - basic $ 4.12 $ (15.74) $ (1.63) Net earnings (loss) per share of Class A common stock - diluted $ 0.75 $ (15.74) $ (1.63) (1) Calculated using the treasury stock method, if dilutive (2) Calculated using the if-converted method, if dilutive |
Schedule of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following table presents potentially dilutive securities, as of the end of the period, excluded from the computations of diluted net earnings (loss) per share of Class A common stock for the years ended December 31, 2023, 2022, and 2021: Years Ended December 31, 2023 2022 2021 (in thousands) Options (1) 976 1,265 1,066 Restricted Stock Units and Awards (1) 1,308 64 666 Class A Units (2) — 82,963 89,773 Class B Units (2) — 1,559 2,217 _________________________ (1) Represents number of instruments outstanding at the end of the period that were evaluated under the treasury stock method for potentially dilutive effects and were determined to be anti-dilutive. (2) Represents the weighted-average as-converted LLC units that were evaluated under the if-converted method for potentially dilutive effects and were determined to be anti-dilutive. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of the Components of Income Tax Expense (Benefit) | The components of income tax expense are as follows: Years Ended December 31, 2023 2022 2021 (in millions) Federal - Current $ 25 $ 2 $ 2 Federal - Deferred (4) (1) (1) Federal - Total 21 1 1 State - Current 4 — — State - Deferred — — — State - Total 4 — — Income tax provision $ 25 $ 1 $ 1 |
Schedule of Reconciliation of Effective Income Tax Rate | A reconciliation of the U.S. federal rate to the Company’s effective income tax rate is as follows: Years Ended December 31, 2023 2022 2021 Amount Percent Amount Percent Amount Percent (dollars in millions) Expected U.S. federal income taxes at statutory rate $ 37 21.0 % $ (607) 21.0 % $ (60) 21.0 % Loss attributable to non-controlling interests 61 34.9 % 274 (9.5) % 32 (11.2) % State taxes 19 10.9 % (64) 2.2 % (8) 2.8 % Stock based compensation — — % — — % (16) 5.6 % Valuation allowance (96) (54.9) % 398 (13.7) % 53 (18.5) % Disallowed interest 5 2.9 % — — % — — % Benefit of tax credits (2) (1.1) % — — % — — % Other 1 0.6 % — — % — — % Income tax provision $ 25 14.3 % $ 1 — % $ 1 (0.3) % |
Schedule of Deferred Tax Assets | The components of the Company’s deferred tax assets are as follows: Years Ended December 31, 2023 2022 (in millions) Deferred tax assets: Investment in Carvana Group $ 1,362 $ 1,471 Net operating loss carryforward 299 451 Interest expense carryforward 177 130 Tax credit carryforward 4 6 Cancellation of debt income 116 — Other 9 2 Total gross deferred tax assets 1,967 2,060 Valuation allowance (1,962) (2,058) Total deferred tax assets, net of valuation allowance $ 5 $ 2 Deferred tax liabilities: Intangibles $ — $ (1) Total deferred tax assets and liabilities $ 5 $ 1 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Lease Cost and Activity | The Company's lease costs and activity during the years ended December 31, 2023, 2022, and 2021 were as follows: December 31, 2023 2022 2021 (in millions) Lease costs: Finance leases: Amortization of finance lease assets $ 108 $ 95 $ 38 Interest obligations under finance leases 17 19 8 Total finance lease costs $ 125 $ 114 $ 46 Operating leases: Fixed lease costs to non-related parties (1) $ 66 $ 129 $ 56 Fixed lease costs to related parties 5 5 6 Variable short-term lease costs to related parties — 1 1 Total operating lease costs $ 71 $ 135 $ 63 Cash payments related to lease liabilities included in operating cash flows: Operating lease liabilities to non-related parties $ 109 $ 83 $ 35 Operating lease liabilities to related parties $ 5 $ 5 $ 5 Interest payments on finance lease liabilities $ 18 $ 19 $ 8 Cash payments related to lease liabilities included in financing cash flows: Principal payments on finance lease liabilities $ 115 $ 139 $ 56 (1) The year ended December 31, 2022 includes $28 million of lease termination fees, net of amounts written off for the corresponding operating lease right-of-use assets and operating lease liabilities which were terminated. |
Schedule of Finance Lease, Maturity | The following table summarizes maturities of lease liabilities as of December 31, 2023: Operating Leases (1) Finance Leases Related Party (2) Non-Related Party Total Operating Total (in millions) 2024 $ 95 $ 3 $ 92 $ 95 $ 190 2025 85 2 90 92 177 2026 72 2 86 88 160 2027 35 2 79 81 116 2028 7 1 72 73 80 Thereafter — 1 225 226 226 Total minimum lease payments 294 11 644 655 949 Less: amount representing interest (27) (2) (159) (161) (188) Total lease liabilities $ 267 $ 9 $ 485 $ 494 $ 761 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to exercise 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 | The following table summarizes maturities of lease liabilities as of December 31, 2023: Operating Leases (1) Finance Leases Related Party (2) Non-Related Party Total Operating Total (in millions) 2024 $ 95 $ 3 $ 92 $ 95 $ 190 2025 85 2 90 92 177 2026 72 2 86 88 160 2027 35 2 79 81 116 2028 7 1 72 73 80 Thereafter — 1 225 226 226 Total minimum lease payments 294 11 644 655 949 Less: amount representing interest (27) (2) (159) (161) (188) Total lease liabilities $ 267 $ 9 $ 485 $ 494 $ 761 (1) Leases that are on a month-to-month basis, short-term leases, and lease extensions that the Company does not expect to exercise 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 Weighted-Average Remaining Lease Terms and Discount Rates | The weighted-average remaining lease terms and discount rates as of December 31, 2023, 2022, and 2021 were as follows, excluding short-term operating leases: December 31, 2023 2022 2021 Weighted average remaining lease terms (years) Operating leases 7.8 8.4 9.2 Finance leases 3.5 4.2 4.4 Weighted-average discount rate Operating leases 7.1 % 7.1 % 7.2 % Finance leases 5.9 % 5.7 % 5.4 % |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value Measurements and Hierarchy Level | The following tables are a summary of fair value measurements and hierarchy level at December 31, 2023 and 2022: December 31, 2023 Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Money market funds $ 339 $ 339 $ — $ — Beneficial interests in securitizations $ 366 $ — $ — $ 366 December 31, 2022 Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Money market funds $ 272 $ 272 $ — $ — Beneficial interests in securitizations $ 321 $ — $ — $ 321 |
Scheduled of Additional Information of Beneficial Interests in Securitizations | The following table presents additional information about Level 3 beneficial interests in securitizations measured at fair value on a recurring basis for the years ended December 31, 2023 and 2022: Years Ended December 31, 2023 2022 (in millions) Opening Balance $ 321 $ 382 Received in securitization transactions 194 148 Payments received (150) (172) Change in fair value 14 6 Sales of beneficial interests (13) (43) Ending Balance $ 366 $ 321 |
Schedule of Carrying Value and Fair Value of Senior Notes, Finance Receivables, and Beneficial Interests in Securitizations | The fair value of the Senior Notes as of December 31, 2023 and 2022 was as follows: December 31, 2023 2022 (in millions) Carrying value, net of unamortized debt issuance costs, unamortized premium, and accrued PIK interest $ 4,566 $ 5,649 Fair value $ 3,866 $ 2,533 December 31, 2023 2022 (in millions) Carrying value $ 807 $ 1,334 Fair value $ 854 $ 1,437 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents changes in the Company's Level 3 Root Warrants measured at fair value: Years Ended December 31 2023 2022 (in millions) Opening Balance $ 2 $ 6 Warrants to acquire Root's Class A common stock — 75 Total unrealized gain (loss) 3 (79) Ending Balance $ 5 $ 2 The Company recognized the increase (decrease) in fair value in relation to the Root Warrants through other (income) expense, net in the accompanying consolidated statements of operations. The Company recognized an increase in fair value of $3 million and a decrease in fair value of $79 million during the years ended December 31, 2023 and 2022, respectively. |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow Information | The following table summarizes supplemental cash flow information for the years ended December 31, 2023, 2022, and 2021: For the Years Ended December 31, 2023 2022 2021 (in millions) Supplemental cash flow information: Cash payments for interest $ 538 $ 423 $ 152 Cash payments for taxes $ 28 $ 3 $ 2 Non-cash investing and financing activities: Capital expenditures included in accounts payable and accrued liabilities $ 1 $ 18 $ 102 Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 2 $ 375 $ 253 Property and equipment acquired under finance leases $ 51 $ 326 $ 152 Warrants to acquire Root Class A common stock $ — $ 75 $ 30 Equity-based compensation expense capitalized to property and equipment $ 8 $ 8 $ 7 Fair value of beneficial interests received in securitization transactions $ 194 $ 148 $ 338 Reductions of beneficial interests in securitizations and associated long-term debt $ 110 $ 134 $ 38 |
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 consolidated balance sheets that sum to the total of the same amounts shown in the accompanying consolidated statements of cash flows for all periods presented: December 31, 2023 2022 2021 (in millions) Cash and cash equivalents $ 530 $ 434 $ 403 Restricted cash 64 194 233 Total cash, cash equivalents and restricted cash $ 594 $ 628 $ 636 |
Business Organization - Narrati
Business Organization - Narrative (Details) | 12 Months Ended |
Dec. 31, 2023 class | |
Subsidiary, Sale of Stock [Line Items] | |
Number of classes of common ownership interests | 2 |
Carvana Group | |
Subsidiary, Sale of Stock [Line Items] | |
Ownership percentage by Carvana Co. | 56.60% |
Ownership percentage by LLC unitholders | 43.40% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) | 3 Months Ended | 12 Months Ended | |||||
Jul. 17, 2023 USD ($) | Jan. 01, 2022 | Dec. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Nov. 01, 2023 USD ($) | |
Accounting Policies [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity (up to) | $ 500,000,000 | $ 500,000,000 | |||||
Other comprehensive income | 0 | $ 0 | $ 0 | ||||
Allowance for doubtful accounts | 9,000,000 | 9,000,000 | 12,000,000 | ||||
Finance receivable, allowance | 59,000,000 | 59,000,000 | 36,000,000 | ||||
Impairment charges | 0 | 0 | 0 | ||||
Impairment charges related to intangible assets | $ 0 | 0 | 0 | ||||
Number of operating segments | segment | 1 | ||||||
Number of reporting units | segment | 1 | ||||||
Goodwill impairment | $ 0 | 847,000,000 | 0 | ||||
Advertising expense | 228,000,000 | 490,000,000 | 479,000,000 | ||||
Selling, general and administrative expenses, to related parties | $ 1,796,000,000 | 2,736,000,000 | 2,033,000,000 | ||||
Employer matching contribution, percent of match | 40% | ||||||
Employer matching contribution, percent of employees' gross pay | 6% | ||||||
Vesting period | 4 years | 5 years | |||||
Employer contributions | $ 8,000,000 | 8,000,000 | 5,000,000 | ||||
Number of reportable segments | segment | 1 | ||||||
Shipping and Handling | |||||||
Accounting Policies [Line Items] | |||||||
Selling, general and administrative expenses, to related parties | $ 119,000,000 | 235,000,000 | 148,000,000 | ||||
Line of Credit | Floor Plan Facility, 18-Month | |||||||
Accounting Policies [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity (up to) | $ 1,500,000,000 | ||||||
Related Party | |||||||
Accounting Policies [Line Items] | |||||||
Selling, general and administrative expenses, to related parties | 33,000,000 | 33,000,000 | $ 27,000,000 | ||||
Related Party | DriveTime Automotive Group, Inc. | Master Dealer Agreement | |||||||
Accounting Policies [Line Items] | |||||||
Ending receivables, related to excess cash flow from contracts (less than for the year ended 12/31/2023) | 1,000,000 | 1,000,000 | $ 8,000,000 | ||||
At-the-market Offering "ATM Offering" | |||||||
Accounting Policies [Line Items] | |||||||
Consideration received on transaction, net | $ 327,000,000 | 327,000,000 | |||||
Conditional Sale of Equity to Related Party | Related Party | |||||||
Accounting Policies [Line Items] | |||||||
Sale of stock, net proceeds received | $ 126,000,000 | $ 126,000,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Property and Equipment, Schedule of Useful Lives (Details) | Dec. 31, 2023 |
Software | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Minimum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life | 15 years |
Minimum | Transportation fleet equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Minimum | Furniture, fixtures and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Maximum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life | 30 years |
Maximum | Transportation fleet equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 6 years |
Maximum | Furniture, fixtures and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Business Combinations - Narrati
Business Combinations - Narrative (Details) ft² in Millions, $ in Millions | 12 Months Ended | |||
May 09, 2022 USD ($) a ft² site | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | ||||
Land, acres acquired | a | 4,000 | |||
Useful Life | 5 years | |||
Amortization expense | $ 17 | $ 16 | $ 2 | |
ADESA U.S. Physical Auction Acquisition | ||||
Business Acquisition [Line Items] | ||||
Percentage of voting interests acquired | 100% | |||
Consideration transferred | $ 2,200 | |||
Number of sites acquired | site | 56 | |||
Buildings, square feet acquired | ft² | 6.5 | |||
Useful Life | 5 years 7 months 6 days | |||
Goodwill, end of year | $ 838 | |||
Cost of sales recognized | $ 770 | 472 | ||
Net loss recognized | 83 | 101 | ||
Depreciation and amortization recognized | 122 | 83 | ||
Amortization expense | 15 | 15 | ||
ADESA U.S. Physical Auction Acquisition | Wholesale sales and revenues | ||||
Business Acquisition [Line Items] | ||||
Wholesale sales and revenues recognized | $ 856 | $ 490 |
Business Combinations - Purchas
Business Combinations - Purchase Price Allocated to Liabilities Assumed and Assets Acquired (Details) - USD ($) $ in Millions | 12 Months Ended | |
May 09, 2022 | Dec. 31, 2023 | |
Liabilities Assumed | ||
Useful Life | 5 years | |
ADESA U.S. Physical Auction Acquisition | ||
Assets Acquired | ||
Current assets | $ 208 | |
Property and equipment | 1,281 | |
Operating lease right-of-use assets | 188 | |
Intangible assets | 79 | |
Other assets | 1 | |
Total Assets Acquired | 1,757 | |
Liabilities Assumed | ||
Current liabilities | 233 | |
Operating lease liabilities | 167 | |
Total Liabilities Assumed | 400 | |
Net Assets Acquired | 1,357 | |
Purchase price consideration | 2,195 | |
Goodwill, end of year | 838 | |
Useful Life | 5 years 7 months 6 days | |
ADESA U.S. Physical Auction Acquisition | Customer relationships | ||
Liabilities Assumed | ||
Fair Value | $ 50 | |
Useful Life | 10 years | |
ADESA U.S. Physical Auction Acquisition | Developed technology | ||
Liabilities Assumed | ||
Fair Value | $ 29 | |
Useful Life | 3 years |
Business Combinations - Pro For
Business Combinations - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||
Net loss per share of Class A common stock - basic (in dollars per share) | $ (3) | |
Net loss per share of Class A common stock - diluted (in dollars per share) | $ (3) | |
Weighted-average shares of Class A common stock - basic (in shares) | 98,459 | |
Weighted-average shares of Class A common stock - diluted (in shares) | 98,459 | |
ADESA U.S. Physical Auction Acquisition | ||
Business Acquisition [Line Items] | ||
Revenues | $ 13,903 | $ 13,675 |
Net loss | (3,024) | (571) |
Net loss attributable to non-controlling interests | (1,343) | (276) |
Net loss attributable to Carvana Co. | $ (1,681) | (295) |
Net loss per share of Class A common stock - basic (in dollars per share) | $ (15.89) | |
Net loss per share of Class A common stock - diluted (in dollars per share) | $ (15.89) | |
Weighted-average shares of Class A common stock - basic (in shares) | 105,808 | |
Weighted-average shares of Class A common stock - diluted (in shares) | 105,808 | |
Interest expense | $ 123 | 345 |
Lease expense | 5 | (16) |
Depreciation and amortization expense | 13 | (6) |
Intercompany revenues and cost of sales | $ (7) | $ (20) |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | $ 3,685 | $ 3,674 |
Less: accumulated depreciation and amortization on property and equipment | (775) | (564) |
Property and equipment, net | 2,982 | 3,244 |
Land and site improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | 1,331 | 1,331 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | 1,344 | 1,267 |
Transportation fleet | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | 570 | 673 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | 296 | 245 |
Furniture, fixtures, and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | 144 | 158 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment excluding construction in progress | 72 | 134 |
Excluding construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 2,910 | $ 3,110 |
Property and Equipment, Net - N
Property and Equipment, Net - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Incurred interest | $ 637 | $ 503 | $ 185 |
Capitalized interest | 5 | 17 | 9 |
Depreciation and amortization expense | 352 | 261 | 105 |
Property, Plant and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense | 386 | 346 | 153 |
Property, Plant and Equipment | Inventories | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense | 51 | 49 | 26 |
Software & Construction-in-Progress | |||
Property, Plant and Equipment [Line Items] | |||
Capitalized computer software additions, related to payroll costs | 56 | 85 | 59 |
Software | |||
Property, Plant and Equipment [Line Items] | |||
Capitalized computer software additions, related to payroll costs | 42 | 68 | 45 |
Selling, general and administrative | Property, Plant and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense | 166 | 183 | 103 |
Cost of Sales | Property, Plant and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense | 169 | 114 | 24 |
Cost of Sales, Previously Capitalized to Vehicle Inventory | Property, Plant and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and amortization expense | $ 66 | $ 52 | $ 24 |
Intangible Assets - Summary of
Intangible Assets - Summary of Fair Value of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, net | $ 52,000 | $ 70,000 |
Car360 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, acquired cost | 91,000 | 92,000 |
Less: accumulated amortization | (39,000) | (22,000) |
Intangible assets, net | 52,000 | 70,000 |
Car360 | Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, acquired cost | 50,000 | 50,000 |
Car360 | Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, acquired cost | 41,000 | 41,000 |
Car360 | Non-compete agreements | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, acquired cost | $ 0 | $ 1,000 |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill impairment | $ 0 | $ 847 | $ 0 |
Amortization expense | $ 17 | $ 16 | $ 2 |
Useful Life | 5 years |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 | $ 18 | |
2025 | 14 | |
2026 | 7 | |
2027 | 5 | |
2028 | 3 | |
Thereafter | 5 | |
Intangible assets, net | $ 52 | $ 70 |
Accounts Payable and Other Ac_3
Accounts Payable and Other Accrued Liabilities - Summary of Accounts Payable and Other Accrued Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Line Items] | ||
Accounts payable, including $7 and $16, respectively, due to related parties | $ 231 | $ 232 |
Sales taxes and vehicle licenses and fees | 77 | 76 |
Reserve for returns and cancellations | 57 | 60 |
Accrued compensation and benefits | 41 | 65 |
Customer deposits | 30 | 23 |
Accrued interest expense | 7 | 99 |
Accrued advertising costs | 4 | 7 |
Income tax liability | 3 | 0 |
Accrued property and equipment | 1 | 10 |
Other accrued liabilities | 145 | 205 |
Total accounts payable and other accrued liabilities | 596 | 777 |
Related Party | ||
Payables and Accruals [Line Items] | ||
Accounts payable, including $7 and $16, respectively, due to related parties | 7 | 16 |
Total accounts payable and other accrued liabilities | $ 7 | $ 16 |
Related Party Transactions - Le
Related Party Transactions - Lease Agreements (Details) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Mar. 31, 2017 | Feb. 28, 2017 renewal_option | Dec. 31, 2023 USD ($) renewal_option | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Related Party Transaction [Line Items] | |||||
Operating lease, number of renewal options | renewal_option | 1 | ||||
Operating lease, cost | $ | $ 71 | $ 135 | $ 63 | ||
Related Party | DriveTime Automotive Group, Inc. | Related Party Lease Agreements | Building | |||||
Related Party Transaction [Line Items] | |||||
Termination rights, prior written notice period | 60 days | ||||
Operating lease term | 12 months | ||||
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 | Verde Investments, Inc. and DriveTime Automotive Group Inc. | Lease Agreement for Fully-Operational Inspection and Reconditioning Center | |||||
Related Party Transaction [Line Items] | |||||
Operating lease, cost | $ | $ 3 | $ 4 | $ 5 |
Related Party Transactions - Of
Related Party Transactions - Office Leases (Details) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2019 renewal_option | Sep. 30, 2016 renewal_option | Dec. 31, 2023 USD ($) renewal_option | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Related Party Transaction [Line Items] | |||||
Operating lease, number of renewal options | 1 | ||||
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 | 3 | ||||
Operating leases, renewal term | 5 years | ||||
Related Party | DriveTime Automotive Group, Inc. | Subleased Office Space, First Floor | |||||
Related Party Transaction [Line Items] | |||||
Rent expense | $ | $ 1 | $ 1 | $ 1 | ||
Related Party | Verde Investments, Inc. | Office Building Lease | Tempe, Arizona | |||||
Related Party Transaction [Line Items] | |||||
Operating lease term | 10 years | ||||
Operating lease, number of renewal options | 2 | ||||
Operating leases, renewal term | 5 years | ||||
Rent expense | $ | $ 1 | $ 1 | $ 1 |
Related Party Transactions - Wh
Related Party Transactions - Wholesale Revenue (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Net sales and operating revenues | $ 10,771 | $ 13,604 | $ 12,814 |
Wholesale sales and revenues | |||
Related Party Transaction [Line Items] | |||
Net sales and operating revenues | 2,504 | 2,609 | 1,920 |
Wholesale sales and revenues | Related Party | |||
Related Party Transaction [Line Items] | |||
Net sales and operating revenues | 19 | 32 | 54 |
Wholesale sales and revenues | DriveTime Automotive Group, Inc. | Related Party | |||
Related Party Transaction [Line Items] | |||
Net sales and operating revenues | $ 19 | $ 32 | $ 54 |
Related Party Transactions - Re
Related Party Transactions - Retail Vehicle Acquisitions and Reconditioning (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Inventory (less than for 2023) | $ 1,150 | $ 1,876 | |
Cost of sales, to related parties | 9,047 | 12,358 | $ 10,885 |
Related Party | |||
Related Party Transaction [Line Items] | |||
Cost of sales, to related parties | 4 | 22 | 65 |
Used Vehicles | DriveTime Automotive Group, Inc. | Related Party | |||
Related Party Transaction [Line Items] | |||
Inventory (less than for 2023) | 1 | 1 | |
Used Vehicle Sales | DriveTime Automotive Group, Inc. | Related Party | |||
Related Party Transaction [Line Items] | |||
Cost of sales, to related parties | $ 4 | $ 22 | $ 62 |
Related Party Transactions - Ma
Related Party Transactions - Master Dealer Agreement (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Net sales and operating revenues | $ 10,771 | $ 13,604 | $ 12,814 |
DriveTime Automotive Group, Inc. | Related Party | Master Dealer Agreement | |||
Related Party Transaction [Line Items] | |||
Payments for excess reserves | 138 | 176 | 186 |
General and administrative expense | $ 17 | $ 18 | $ 15 |
Related Party Transactions - Pr
Related Party Transactions - Profit Sharing Agreement (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Net sales and operating revenues, from related parties | $ 10,771 | $ 13,604 | $ 12,814 |
Other sales and revenues | |||
Related Party Transaction [Line Items] | |||
Net sales and operating revenues, from related parties | 753 | 741 | 1,043 |
Other sales and revenues | Related Party | |||
Related Party Transaction [Line Items] | |||
Net sales and operating revenues, from related parties | 145 | 176 | $ 208 |
DriveTime Automotive Group, Inc. | Other sales and revenues | Related Party | |||
Related Party Transaction [Line Items] | |||
Net sales and operating revenues, from related parties | $ 7 | $ 3 |
Related Party Transactions - Se
Related Party Transactions - Servicing and Administrative Fees (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
DriveTime Automotive Group, Inc. | Servicing and Administrative Fees | Related Party | |||
Related Party Transaction [Line Items] | |||
General and administrative expense | $ 13 | $ 10 | $ 6 |
Related Party Transactions - Ai
Related Party Transactions - Aircraft Time Sharing Agreement (Details) - Verde Investments, Inc. - Related Party - Air Transportation Equipment $ in Millions | 12 Months Ended | ||||
Oct. 22, 2015 aircraft | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2017 aircraft | |
Aircraft Time Sharing Agreement | |||||
Related Party Transaction [Line Items] | |||||
Number of aircrafts | 2 | ||||
Contractual agreement term | 12 months | ||||
Contractual agreement, perpetual automatic renewal | 12 months | ||||
Number of allowable days prior to contract termination with written notice | 30 days | ||||
Reimbursement expense (less than) | $ | $ 1 | $ 1 | $ 1 | ||
Aircraft Time Sharing Agreement, Amended 2017 | |||||
Related Party Transaction [Line Items] | |||||
Number of aircrafts | 2 |
Related Party Transactions - Sh
Related Party Transactions - Shared Services Agreement with DriveTime (Details) - DriveTime Automotive Group, Inc. - Related Party - Shared Services Agreement with DriveTime - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||||
Number of allowable days prior to contract termination with written notice | 30 days | |||
Number of allowable days prior to contract termination with written notice from service provider | 90 days | |||
Payments to acquire GAP waiver insurance policy (less than) | $ 1 | $ 1 | $ 1 |
Related Party Transactions - Ac
Related Party Transactions - Accounts Payable Due to Related Party (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Related Party Transaction [Line Items] | ||
Accounts payable and accrued liabilities, due to related parties | $ 596 | $ 777 |
Related Party | ||
Related Party Transaction [Line Items] | ||
Accounts payable and accrued liabilities, due to related parties | $ 7 | $ 16 |
Related Party Transactions - Co
Related Party Transactions - Contributions of Class A Common Shares From Ernest Garcia III (Details) - Contribution Agreement, CEO Milestone Gift - Related Party - Chief Executive Officer - shares | 3 Months Ended | 12 Months Ended | ||
Jan. 05, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||||
Vesting period | 2 years | |||
Restricted Stock Units (RSUs) | ||||
Related Party Transaction [Line Items] | ||||
Shares granted during period, per employee (in shares) | 23 | |||
Issuance of common stock (in shares) | 435,035 | |||
Shares vested during period (in shares) | 62,606 | 128,133 | ||
Class A | ||||
Related Party Transaction [Line Items] | ||||
Stock contribution commitment, shares per employee (in shares) | 23 |
Related Party Transactions - _2
Related Party Transactions - Private Placement (Details) - Related Party - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Aug. 18, 2023 | Jul. 17, 2023 | Dec. 31, 2023 | |
Class A LLC Units | |||
Related Party Transaction [Line Items] | |||
Sale of stock, number of shares to be issued (in shares) | 3.4 | ||
Share price | $ 37.048 | ||
Class B | |||
Related Party Transaction [Line Items] | |||
Sale of stock, number of shares to be issued (in shares) | 2.7 | ||
Class A | |||
Related Party Transaction [Line Items] | |||
Share price | $ 46.31 | ||
Conditional Sale of Equity to Related Party | |||
Related Party Transaction [Line Items] | |||
Sale of stock, net proceeds received | $ 126 | $ 126 |
Finance Receivable Sale Agree_2
Finance Receivable Sale Agreements (Details) | 12 Months Ended | ||||
Dec. 31, 2023 USD ($) agreementType | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jan. 11, 2024 USD ($) | Jan. 13, 2023 USD ($) | |
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | |||||
Number of agreement types | agreementType | 2 | ||||
Consumer Loan | MPSA | |||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | |||||
Commitment of purchaser, current availability financing, principal balances of finance receivables (up to) | $ 4,000,000,000 | ||||
Principal balances of finance receivables through securitization transactions, sold | $ 3,600,000,000 | $ 3,800,000,000 | $ 2,100,000,000 | ||
Receivable purchase agreement, remaining unused capacity | 400,000,000 | ||||
Consumer Loan | MPSA | Subsequent Event | |||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | |||||
Commitment of purchaser, current availability financing, principal balances of finance receivables (up to) | $ 4,000,000,000 | ||||
Consumer Loan | Master Purchase and Sale Agreement and Master Transfer Agreements | |||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | |||||
Gain on loan sales | 434,000,000 | 411,000,000 | 718,000,000 | ||
Securitization Transaction | |||||
Securitization or Asset-backed Financing Arrangement, Financial Asset for which Transfer is Accounted as Sale [Line Items] | |||||
Principal balances of finance receivables through securitization transactions, sold | $ 2,800,000,000 | $ 2,400,000,000 | $ 5,000,000,000 |
Securitizations and Variable _3
Securitizations and Variable Interest Entities - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Variable Interest Entity [Line Items] | ||
Carrying Value | $ 366 | $ 321 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | $ 366 | $ 321 |
Securitizations and Variable _4
Securitizations and Variable Interest Entities - Schedule of Expected Losses (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Variable Interest Entity [Line Items] | ||
Carrying Value | $ 366 | $ 321 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 366 | 321 |
Total Exposure | 366 | 321 |
Rated notes | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 287 | 252 |
Total Exposure | 287 | 252 |
Certificates and other assets | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 79 | 69 |
Total Exposure | $ 79 | $ 69 |
Securitizations and Variable _5
Securitizations and Variable Interest Entities - Schedule of Cost and Fair Value of Securities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Variable Interest Entity [Line Items] | ||
Fair Value | $ 366 | $ 321 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Amortized Cost | 365 | 311 |
Fair Value | 366 | 321 |
Rated notes | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Amortized Cost | 294 | 268 |
Fair Value | 287 | 252 |
Certificates and other assets | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Amortized Cost | 71 | 43 |
Fair Value | $ 79 | $ 69 |
Debt Instruments - Schedule of
Debt Instruments - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Sep. 01, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | |||
Total debt | $ 6,029,000 | $ 8,016,000 | |
Total asset-based financing | 1,446,000 | 2,291,000 | |
Less: current portion | (777,000) | (1,638,000) | |
Less: unamortized debt issuance cost | (60,000) | (82,000) | |
Plus: unamortized premium | 37,000 | 0 | |
Total included in long-term debt, net | 5,229,000 | 6,296,000 | |
Interest payable, payment-in-kind | 185,000 | ||
Financing of beneficial interest in securitizations | |||
Debt Instrument [Line Items] | |||
Total debt | 293,000 | 268,000 | |
Real estate financing | |||
Debt Instrument [Line Items] | |||
Total debt | 485,000 | 486,000 | |
Senior Notes | |||
Debt Instrument [Line Items] | |||
Less: unamortized debt issuance cost | (1,000) | (76,000) | |
Plus: unamortized premium | 37,000 | 0 | |
Floor plan facility | Line of Credit | |||
Debt Instrument [Line Items] | |||
Total debt | 113,000 | 569,000 | |
Finance receivable facilities | Line of Credit | |||
Debt Instrument [Line Items] | |||
Total debt | 555,000 | 965,000 | |
Notes payable | Notes payable | |||
Debt Instrument [Line Items] | |||
Total debt | 0 | 3,000 | |
Senior Secured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Total debt | 4,378,000 | 0 | |
Plus: unamortized premium | $ 40,000 | ||
Senior Unsecured Notes Effective September 2018, 2023 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Total debt | $ 205,000 | $ 5,725,000 |
Debt Instruments - Floor Plan F
Debt Instruments - Floor Plan Facilities (Details) - USD ($) | 1 Months Ended | ||||
Nov. 01, 2023 | Nov. 30, 2019 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 500,000,000 | ||||
Line of credit, outstanding | 668,000,000 | $ 1,534,000,000 | |||
Restricted cash | $ 64,000,000 | $ 194,000,000 | $ 233,000,000 | ||
Line of Credit | Under 50% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Deposit required under floor plan facility, percentage of principal balance | 12.50% | ||||
Line of Credit | Between 50-59.99% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Deposit required under floor plan facility, percentage of principal balance | 17.50% | ||||
Line of Credit | Between 60-60.99% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Deposit required under floor plan facility, percentage of principal balance | 22.50% | ||||
Line of Credit | Over 70% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Deposit required under floor plan facility, percentage of principal balance | 25% | ||||
Line of Credit | Floor plan facility | |||||
Line of Credit Facility [Line Items] | |||||
Outstanding balance, days held in inventory threshold | 120 days | ||||
Outstanding balance, held in inventory, percentage of original principal amount due | 10% | ||||
Outstanding balance, held in inventory, original principal amount, threshold | 50% | ||||
Outstanding balance, held in inventory, wholesale value, threshold | 50% | ||||
Deposit required under floor plan facility, percentage of principal balance | 12.50% | ||||
Interest rate | 7.86% | 3.57% | |||
Line of credit, outstanding | $ 569,000,000 | ||||
Line of credit facility, remaining borrowing capacity | 1,600,000,000 | ||||
Restricted cash | $ 71,000,000 | ||||
Line of Credit | Floor Plan Facility, 12-Month | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit, outstanding | $ 113,000,000 | ||||
Line of credit facility, remaining borrowing capacity | 1,400,000,000 | ||||
Restricted cash | $ 14,000,000 | ||||
Line of Credit | Floor Plan Facility, 18-Month | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 1,500,000,000 | ||||
Line of Credit | Floor Plan Facility, 18-Month | Under 50% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 50% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Over 50% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 50% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Between 50-59.99% Current Inventory | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 50% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Between 50-59.99% Current Inventory | Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 59.99% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Between 60-60.99% Current Inventory | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 60% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Between 60-60.99% Current Inventory | Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 69.99% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Over 70% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, amount drawn, percent of inventory balance, threshold | 70% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Prime Rate | Under 50% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, basis spread on variable rate | 0.10% | ||||
Line of Credit | Floor Plan Facility, 18-Month | Prime Rate | Over 50% Current Inventory | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, basis spread on variable rate | 0.50% |
Debt Instruments - Active Finan
Debt Instruments - Active Finance Receivable Facilities (Details) - USD ($) | Dec. 31, 2023 | May 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2021 | Apr. 30, 2021 | Feb. 29, 2020 |
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 500,000,000 | |||||||
Line of credit, outstanding | 668,000,000 | $ 1,534,000,000 | ||||||
Restricted cash | 64,000,000 | 194,000,000 | $ 233,000,000 | |||||
Revolving Credit Facility | SPVANA II Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | 600,000,000 | $ 500,000,000 | ||||||
Revolving Credit Facility | SPVANA III Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | $ 500,000,000 | ||||||
Revolving Credit Facility | SPVANA IV Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 500,000,000 | $ 350,000,000 | ||||||
Line of credit, outstanding | 555,000,000 | $ 1,600,000,000 | ||||||
Line of credit facility, remaining borrowing capacity | 2,100,000,000 | |||||||
Restricted cash | $ 8,000,000 | |||||||
Interest rate | 6.60% | 2.93% | ||||||
Revolving Credit Facility | Finance receivable facilities | ||||||||
Debt Instrument [Line Items] | ||||||||
Restricted cash | $ 36,000,000 | |||||||
Revolving Credit Facility | SPVANA VI Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 500,000,000 |
Debt Instruments - Past Finance
Debt Instruments - Past Finance Receivable Facilities (Details) $ in Millions | Dec. 31, 2023 USD ($) |
Debt Instrument [Line Items] | |
Line of credit facility, maximum borrowing capacity (up to) | $ 500 |
Debt Instruments - Long-Term De
Debt Instruments - Long-Term Debt (Details) - USD ($) | 12 Months Ended | ||||
Sep. 01, 2023 | Aug. 16, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||
Payments for accrued and unpaid interest from exchange of notes | $ 146,000,000 | ||||
Derecognition unamortized debt issuance costs and premium | 66,000,000 | ||||
Gain on debt extinguishment | $ (878,000,000) | $ 0 | $ 0 | ||
Plus: unamortized premium | 37,000,000 | 0 | |||
Cancelled in connection with offers | 5,500,000,000 | ||||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | 205,000,000 | 5,725,000,000 | |||
Plus: unamortized premium | $ 37,000,000 | 0 | |||
Senior Unsecured Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | 5,725,000,000 | ||||
Cancelled in connection with offers | 5,520,000,000 | ||||
Senior Unsecured Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | $ 5,100,000,000 | ||||
Percent of principal amount outstanding | 85% | ||||
Senior Unsecured Notes | Senior Notes | Debt Instrument, Redemption, Period One | |||||
Debt Instrument [Line Items] | |||||
Redemption price, percentage | 100% | ||||
2030 Senior Unsecured Notes | |||||
Debt Instrument [Line Items] | |||||
Cancelled in connection with offers | $ 3,248,000,000 | ||||
2030 Senior Unsecured Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | $ 27,000,000 | 3,275,000,000 | |||
2030 Senior Unsecured Notes | Senior Notes | Debt Instrument, Redemption, Period One | |||||
Debt Instrument [Line Items] | |||||
Redemption price, percentage of principal amount redeemed (up to) | 10% | ||||
Redemption price, percentage | 105.125% | ||||
Senior Unsecured Notes Effective September 2018, 2023 Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | 5,500,000,000 | ||||
Senior Secured Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | 4,193,000,000 | $ 4,378,000,000 | 0 | ||
Plus: unamortized premium | $ 40,000,000 | ||||
Percent of principal amount outstanding | 100% | ||||
Redemption price, percentage of principal amount redeemed (up to) | 35% | ||||
Redemption price, percentage | 109% | ||||
Percent of principal amount outstanding, change control events | 101% | ||||
2025 Senior Unsecured Notes | |||||
Debt Instrument [Line Items] | |||||
Repayments of senior debt | $ 341,000,000 | ||||
Cancelled in connection with offers | 402,000,000 | ||||
2025 Senior Unsecured Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | 98,000,000 | 500,000,000 | |||
2029 Senior Unsecured Notes | |||||
Debt Instrument [Line Items] | |||||
Cancelled in connection with offers | $ 724,000,000 | ||||
2029 Senior Unsecured Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Unsecured Notes | $ 26,000,000 | $ 750,000,000 | |||
2029 Senior Unsecured Notes | Senior Notes | Debt Instrument, Redemption, Period One | |||||
Debt Instrument [Line Items] | |||||
Redemption price, percentage of principal amount redeemed (up to) | 35% |
Debt Instruments - Exchange of
Debt Instruments - Exchange of Senior Notes (Details) - USD ($) | Sep. 01, 2023 | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | |||
Principal Amount Validly Tendered and Accepted | $ 5,500,000,000 | ||
Accepted as % of Outstanding | 96.40% | ||
Cash Tender Offer Payment | $ 341,000,000 | ||
Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 205,000,000 | $ 5,725,000,000 | |
2025 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Principal Amount Validly Tendered and Accepted | $ 402,000,000 | ||
Accepted as % of Outstanding | 80.30% | ||
Cash Tender Offer Payment | $ 341,000,000 | ||
2025 Senior Unsecured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 98,000,000 | 500,000,000 | |
2027 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Principal Amount Validly Tendered and Accepted | $ 568,000,000 | ||
Accepted as % of Outstanding | 94.70% | ||
Cash Tender Offer Payment | $ 0 | ||
2027 Senior Unsecured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 32,000,000 | 600,000,000 | |
2028 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Principal Amount Validly Tendered and Accepted | $ 578,000,000 | ||
Accepted as % of Outstanding | 96.30% | ||
Cash Tender Offer Payment | $ 0 | ||
2028 Senior Unsecured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 22,000,000 | 600,000,000 | |
2029 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Principal Amount Validly Tendered and Accepted | $ 724,000,000 | ||
Accepted as % of Outstanding | 96.60% | ||
Cash Tender Offer Payment | $ 0 | ||
2029 Senior Unsecured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 26,000,000 | 750,000,000 | |
2030 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Principal Amount Validly Tendered and Accepted | $ 3,248,000,000 | ||
Accepted as % of Outstanding | 99.20% | ||
Cash Tender Offer Payment | $ 0 | ||
2030 Senior Unsecured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 27,000,000 | 3,275,000,000 | |
2028 Senior Secured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 981,000,000 | 981,000,000 | 0 |
2028 Senior Secured Notes | Senior Notes | 2025 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 0 | ||
2028 Senior Secured Notes | Senior Notes | 2027 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 102,000,000 | ||
2028 Senior Secured Notes | Senior Notes | 2028 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 90,000,000 | ||
2028 Senior Secured Notes | Senior Notes | 2029 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 110,000,000 | ||
2028 Senior Secured Notes | Senior Notes | 2030 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 679,000,000 | ||
2030 Senior Secured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 1,471,000,000 | 1,471,000,000 | 0 |
2030 Senior Secured Notes | Senior Notes | 2025 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 0 | ||
2030 Senior Secured Notes | Senior Notes | 2027 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 153,000,000 | ||
2030 Senior Secured Notes | Senior Notes | 2028 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 135,000,000 | ||
2030 Senior Secured Notes | Senior Notes | 2029 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 165,000,000 | ||
2030 Senior Secured Notes | Senior Notes | 2030 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 1,018,000,000 | ||
2031 Senior Secured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 1,741,000,000 | 1,741,000,000 | 0 |
2031 Senior Secured Notes | Senior Notes | 2025 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 0 | ||
2031 Senior Secured Notes | Senior Notes | 2027 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 181,000,000 | ||
2031 Senior Secured Notes | Senior Notes | 2028 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 160,000,000 | ||
2031 Senior Secured Notes | Senior Notes | 2029 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 195,000,000 | ||
2031 Senior Secured Notes | Senior Notes | 2030 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 1,205,000,000 | ||
Senior Secured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 4,193,000,000 | $ 4,378,000,000 | 0 |
Senior Secured Notes | Senior Notes | 2025 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 0 | ||
Senior Secured Notes | Senior Notes | 2027 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 436,000,000 | ||
Senior Secured Notes | Senior Notes | 2028 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 385,000,000 | ||
Senior Secured Notes | Senior Notes | 2029 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 470,000,000 | ||
Senior Secured Notes | Senior Notes | 2030 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 2,902,000,000 | ||
Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 5,725,000,000 | ||
Principal Amount Validly Tendered and Accepted | 5,520,000,000 | ||
Senior Unsecured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 5,100,000,000 |
Debt Instruments - Senior Secur
Debt Instruments - Senior Secured Notes (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 01, 2023 USD ($) | |
Debt Instrument [Line Items] | ||||
Payment-in-kind interest expense | $ 184,000 | $ 0 | $ 0 | |
Plus: unamortized premium | 37,000 | 0 | ||
Total | 5,176,000 | |||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior Unsecured Notes | 205,000 | 5,725,000 | ||
Payment-in-kind interest expense | 185,000 | 0 | ||
Less: unamortized debt issuance costs | (53,000) | 0 | ||
Plus: unamortized premium | 37,000 | 0 | ||
2028 Senior Secured Notes | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior Unsecured Notes | $ 981,000 | 0 | $ 981,000 | |
Year 1 PIK Interest Rate | 12% | |||
Debt instrument, interest rate, cash rate year two | 0.09 | |||
Thereafter Cash Interest Rate | 9% | |||
2030 Senior Secured Notes | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior Unsecured Notes | $ 1,471,000 | 0 | 1,471,000 | |
Year 1 PIK Interest Rate | 13% | |||
Debt instrument, interest rate, cash rate year two | 0.11 | |||
Thereafter Cash Interest Rate | 9% | |||
2031 Senior Secured Notes | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior Unsecured Notes | $ 1,741,000 | 0 | 1,741,000 | |
Year 1 PIK Interest Rate | 14% | |||
Debt instrument, interest rate, cash rate year two | 0 | |||
Thereafter Cash Interest Rate | 9% | |||
Senior Secured Notes | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Senior Unsecured Notes | $ 4,378,000 | 0 | 4,193,000 | |
Plus: unamortized premium | $ 40,000 | |||
Total | $ 4,362,000 | $ 0 |
Debt Instruments - Senior Unsec
Debt Instruments - Senior Unsecured Notes (Details) - USD ($) | Dec. 31, 2023 | Sep. 01, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | |||
Less: unamortized debt issuance cost | $ (60,000,000) | $ (82,000,000) | |
Total | 5,176,000,000 | ||
Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 5,725,000,000 | ||
Senior Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | 205,000,000 | 5,725,000,000 | |
Less: unamortized debt issuance cost | (1,000,000) | (76,000,000) | |
Senior Notes | 2025 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 98,000,000 | 500,000,000 | |
Interest Rate | 5.625% | ||
Senior Notes | 2027 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 32,000,000 | 600,000,000 | |
Interest Rate | 5.50% | ||
Senior Notes | 2028 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 22,000,000 | 600,000,000 | |
Interest Rate | 5.875% | ||
Senior Notes | 2029 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 26,000,000 | 750,000,000 | |
Interest Rate | 4.875% | ||
Senior Notes | 2030 Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 27,000,000 | 3,275,000,000 | |
Interest Rate | 10.25% | ||
Senior Notes | Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Senior Unsecured Notes | $ 5,100,000,000 | ||
Total | $ 204,000,000 | $ 5,649,000,000 |
Debt Instruments - Notes Payabl
Debt Instruments - Notes Payable (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | ||
Notes payable, due within next twelve months | $ 189 | $ 201 |
Notes payable | Notes Payable, Other Payables | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 7.50% | |
Notes payable | $ 3 | |
Notes payable, due within next twelve months | $ 1 | |
Minimum | Notes payable | Notes Payable, Other Payables | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 2 years | |
Maximum | Notes payable | Notes Payable, Other Payables | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 3 years |
Debt Instruments - Real Estate
Debt Instruments - Real Estate Financing (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Sale Leaseback Transaction [Line Items] | ||
Total Senior Unsecured debt | $ 5,176,000 | |
Real estate financing | ||
Sale Leaseback Transaction [Line Items] | ||
Total Senior Unsecured debt | $ 482,000 | $ 483,000 |
Minimum | ||
Sale Leaseback Transaction [Line Items] | ||
Sale leaseback transaction, expiration period | 20 years | |
Maximum | ||
Sale Leaseback Transaction [Line Items] | ||
Sale leaseback transaction, expiration period | 25 years | |
Sale leaseback transaction, renewal period (up to) | 25 years |
Debt Instruments - Financing of
Debt Instruments - Financing of Beneficial Interests in Securitizations (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Variable Interest Entity [Line Items] | ||
Beneficial interests in securitization, pledged assets as collateral | $ 7,071,000 | $ 8,698,000 |
Total Senior Unsecured debt | 5,176,000 | |
Long-term debt, current portion | 777,000 | 1,638,000 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Total Senior Unsecured debt | 290,000 | 265,000 |
Long-term debt, current portion | 108,000 | 102,000 |
Variable Interest Entity, Not Primary Beneficiary | Asset Pledged as Collateral | ||
Variable Interest Entity [Line Items] | ||
Beneficial interests in securitization, pledged assets as collateral | $ 293,000 | $ 268,000 |
Debt Instruments - Minimum Fina
Debt Instruments - Minimum Financing Payments (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Debt Disclosure [Abstract] | |
2024 | $ 108,000 |
2025 | 183,000 |
2026 | 59,000 |
2027 | 62,000 |
2028 | 1,013,000 |
Thereafter | 3,751,000 |
Total | $ 5,176,000 |
Stockholders' Equity (Deficit_2
Stockholders' Equity (Deficit) - Organizational Transactions (Details) | 12 Months Ended | |||||
May 03, 2017 vote $ / shares shares | May 02, 2017 | Dec. 31, 2023 class $ / shares shares | Dec. 31, 2020 | Jan. 16, 2023 $ / shares | Dec. 31, 2022 $ / shares shares | |
Limited Partners' Capital Account [Line Items] | ||||||
Preferred stock, shares authorized (in shares) | 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 | ||
Classes of common stock, ownership interest | class | 2 | |||||
Conversion ratio | 1.25 | |||||
Common unit, multiplier used for conversion ratio | 1.25 | |||||
Class A Units | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Conversion ratio | 0.80 | |||||
Class A Units | Carvana Group | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Common units, issued (in shares) | 250,000,000 | 236,000,000 | ||||
Common unit, outstanding (in shares) | 250,000,000 | 236,000,000 | ||||
Class B Units | Carvana Group | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Common units, issued (in shares) | 2,000,000 | 1,000,000 | ||||
Common unit, outstanding (in shares) | 2,000,000 | 1,000,000 | ||||
Garcia Parties | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Ownership percentage of outstanding shares, minimum requirement | 25% | |||||
Carvana Sub | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Percentage of voting power | 0.10% | |||||
Class A | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Common stock, shares authorized (in shares) | 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 | ||
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 A | Exchange Agreement | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Conversion ratio | 0.8 | |||||
Class B | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Common stock, shares authorized (in shares) | 125,000,000 | 125,000,000 | 125,000,000 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||
Number of votes | vote | 1 | |||||
Conversion ratio | 0.8 | |||||
Class B | Garcia Parties | ||||||
Limited Partners' Capital Account [Line Items] | ||||||
Number of votes | vote | 10 |
Stockholders' Equity (Deficit_3
Stockholders' Equity (Deficit) - Equity Offerings (Details) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Apr. 26, 2022 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Subsidiary, Sale of Stock [Line Items] | |||
Stockholders' equity note, stock split, conversion ratio | 0.0556 | ||
Public Equity Offering | Carvana Group | Class A Units | |||
Subsidiary, Sale of Stock [Line Items] | |||
Investment owned, balance (in shares) | 19,500,000 | ||
Follow-On Public Offering | |||
Subsidiary, Sale of Stock [Line Items] | |||
Stock sold during period, net proceeds | $ | $ 327 | $ 1,227 | |
Class A | Follow-On Offering | |||
Subsidiary, Sale of Stock [Line Items] | |||
Sale of stock, number of shares issued in transaction (in shares) | 15,625,000 | ||
Class A | Public Equity Offering | |||
Subsidiary, Sale of Stock [Line Items] | |||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 80 | ||
Stock sold during period, net proceeds | $ | $ 1,200 | ||
Class A | Follow-On Public Offering | Garcia Parties | |||
Subsidiary, Sale of Stock [Line Items] | |||
Investment, number of shares purchased in transaction | 5,400,000 |
Stockholders' Equity (Deficit_4
Stockholders' Equity (Deficit) - At-the-Market Equity Offering Program (Details) - At-the-market Offering "ATM Offering" - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |
Jul. 19, 2023 | Dec. 31, 2023 | Dec. 31, 2023 | |
Class of Stock [Line Items] | |||
Consideration received on transaction, net | $ 327 | $ 327 | |
Costs related to issuance of equity included in accrued liabilities | $ 9 | ||
Class A | |||
Class of Stock [Line Items] | |||
Sale of stock, number of shares to be issued (in shares) | 35,000,000 | ||
Sale of stock, consideration to be received on transaction | $ 1,000 | ||
Sale of stock, number of shares issued in transaction (in shares) | 7,156,838 | ||
Sale of stock, price per share (in dollars per share) | $ 46.94 | $ 46.94 | |
Sale of stock, net proceeds received | $ 336 |
Stockholders' Equity (Deficit_5
Stockholders' Equity (Deficit) - Private Placement (Details) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Aug. 18, 2023 $ / shares shares | Jul. 17, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Class of Stock [Line Items] | |||
Common unit, multiplier used for conversion ratio | 1.25 | ||
Related Party | Class A LLC Units | |||
Class of Stock [Line Items] | |||
Sale of stock, number of shares to be issued (in shares) | shares | 3.4 | ||
Share price | $ / shares | $ 37.048 | ||
Related Party | Class B | |||
Class of Stock [Line Items] | |||
Sale of stock, number of shares to be issued (in shares) | shares | 2.7 | ||
Related Party | Class A | |||
Class of Stock [Line Items] | |||
Share price | $ / shares | $ 46.31 | ||
Related Party | Conditional Sale of Equity to Related Party | |||
Class of Stock [Line Items] | |||
Sale of stock, net proceeds received | $ | $ 126 | $ 126 |
Stockholders' Equity (Deficit_6
Stockholders' Equity (Deficit) - Exchange Agreement (Details) shares in Millions | 12 Months Ended | ||
May 03, 2017 | Dec. 31, 2023 shares | Dec. 31, 2022 shares | |
Limited Partners' Capital Account [Line Items] | |||
Conversion ratio | 1.25 | ||
Class B | |||
Limited Partners' Capital Account [Line Items] | |||
Conversion ratio | 0.8 | ||
Exchange Agreement | |||
Limited Partners' Capital Account [Line Items] | |||
Conversion of stock, converted (less than) (in shares) | 0.1 | 0.1 | |
LLC units received (less than) (in shares) | 0.1 | 0.1 | |
Exchange Agreement | Class B | |||
Limited Partners' Capital Account [Line Items] | |||
Conversion of stock, converted (less than) (in shares) | 0 | 0 | |
Exchange Agreement | Class A | |||
Limited Partners' Capital Account [Line Items] | |||
Conversion ratio | 0.8 | ||
Conversion of stock, issued (less than) (in shares) | 0.1 | 0.1 |
Stockholders' Equity (Deficit_7
Stockholders' Equity (Deficit) - Class A Non-Convertible Preferred Units (Details) - USD ($) | 12 Months Ended | ||
Oct. 02, 2020 | Oct. 02, 2018 | Dec. 31, 2023 | |
Senior Notes | 2023 Notes | |||
Limited Partners' Capital Account [Line Items] | |||
Amount of debt repaid criteria | $ 1,000 | ||
Class A Non-Convertible Preferred Units | Senior Notes | |||
Limited Partners' Capital Account [Line Items] | |||
Issuance of stock during the period (in shares) | 9,918,000 | ||
Class A Non-Convertible Preferred Units | Senior Notes | 2027 Senior Unsecured Notes | |||
Limited Partners' Capital Account [Line Items] | |||
Issuance of stock during the period (in shares) | 600,000 | ||
Class A Non-Convertible Preferred Units | Senior Notes | 2029 Senior Unsecured Notes | |||
Limited Partners' Capital Account [Line Items] | |||
Issuance of stock during the period (in shares) | 750,000 | ||
Carvana Group | Class A Non-Convertible Preferred Units | |||
Limited Partners' Capital Account [Line Items] | |||
Issuance of stock during the period (in shares) | 1,100,000 | ||
Repayment of debt, number of shares canceled and retired (in shares) | 5,500,000 | 1 |
Stockholders' Equity (Deficit_8
Stockholders' Equity (Deficit) - Purchase of Class A Non-Convertible Preferred Units (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2023 shares | |
Class of Stock [Line Items] | |
Cancelled in connection with offers (in shares) | (5,520) |
Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 4,398 |
Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 9,918 |
2025 Senior Unsecured Notes | |
Class of Stock [Line Items] | |
Cancelled in connection with offers (in shares) | (402) |
2025 Senior Unsecured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 98 |
2025 Senior Unsecured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 500 |
2027 Senior Unsecured Notes | |
Class of Stock [Line Items] | |
Cancelled in connection with offers (in shares) | (568) |
2027 Senior Unsecured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 32 |
2027 Senior Unsecured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 600 |
2028 Senior Unsecured Notes | |
Class of Stock [Line Items] | |
Cancelled in connection with offers (in shares) | (578) |
2028 Senior Unsecured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 22 |
2028 Senior Unsecured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 600 |
2029 Senior Unsecured Notes | |
Class of Stock [Line Items] | |
Cancelled in connection with offers (in shares) | (724) |
2029 Senior Unsecured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 26 |
2029 Senior Unsecured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 750 |
2030 Senior Unsecured Notes | |
Class of Stock [Line Items] | |
Cancelled in connection with offers (in shares) | (3,248) |
2030 Senior Unsecured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 27 |
2030 Senior Unsecured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 3,275 |
2028 Senior Secured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 981 |
2028 Senior Secured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 981 |
2030 Senior Secured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 1,471 |
2030 Senior Secured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 1,471 |
2031 Senior Secured Notes | Senior Notes | |
Class of Stock [Line Items] | |
Net total Class A non-convertible preferred units (in shares) | 1,741 |
2031 Senior Secured Notes | Class A Non-Convertible Preferred Units | Senior Notes | |
Class of Stock [Line Items] | |
Issuance of stock during the period (in shares) | 1,741 |
Stockholders' Equity (Deficit_9
Stockholders' Equity (Deficit) - Tax Asset Preservation Plan (Details) | Dec. 31, 2023 $ / shares | Jan. 16, 2023 shares $ / shares | Dec. 31, 2022 $ / shares | May 03, 2017 $ / shares |
Class of Stock [Line Items] | ||||
Preferred stock purchase right (in shares) | shares | 1 | |||
Preferred stock, portion of share | shares | 0.001 | |||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 |
Price per one one-thousandth of a preferred share | 50 | |||
Class A | ||||
Class of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 |
Non-controlling Interests - Nar
Non-controlling Interests - Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) shares | |
Noncontrolling Interest [Line Items] | |||
Conversion ratio | 1.25 | ||
Adjustments to non-controlling interests | $ 0 | $ 0 | $ 0 |
Increase as a result of exchanges of LLC Units | $ 1 | 1 | $ 43 |
LLC units purchased (in shares) | shares | 0 | ||
Carvana Group | |||
Noncontrolling Interest [Line Items] | |||
Ownership percentage by Carvana Co. | 56.60% | ||
Ownership percentage by existing unitholders | 43.40% | ||
Additional Paid-in Capital | |||
Noncontrolling Interest [Line Items] | |||
Adjustments to non-controlling interests | $ (1) | (1) | $ (43) |
Increase as a result of exchanges of LLC Units | 1 | 1 | 43 |
Additional Paid-in Capital | Follow-On Public Offering | |||
Noncontrolling Interest [Line Items] | |||
Adjustments to non-controlling interests | 83 | 554 | |
Non-controlling Interests | |||
Noncontrolling Interest [Line Items] | |||
Adjustments to non-controlling interests | 1 | 1 | $ 43 |
Non-controlling Interests | Follow-On Public Offering | |||
Noncontrolling Interest [Line Items] | |||
Adjustments to non-controlling interests | $ (83) | $ (554) |
Non-controlling Interests - Cha
Non-controlling Interests - Changes in Ownership (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Transfers from (to) non-controlling interests: | |||
Increase as a result of exchanges of LLC Units | $ 1 | $ 1 | $ 43 |
Total transfers from (to) non-controlling interests | (82) | (553) | 43 |
Class A | |||
Transfers from (to) non-controlling interests: | |||
Decrease as a result of issuances of Class A and B common stock | $ (83) | $ (554) | $ 0 |
Equity-Based Compensation - Sch
Equity-Based Compensation - Schedule of Equity-based Compensation Expense Recognized (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total equity-based compensation | $ 81 | $ 93 | $ 47 |
Equity-based compensation, net of capitalized amounts | 73 | 69 | 39 |
Property and Equipment | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Equity-based compensation capitalized | (7) | (8) | (7) |
Inventory | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Equity-based compensation capitalized | (1) | (16) | (1) |
Restricted Stock Units and Awards excluding those granted in relation to the CEO Milestone Gift | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total equity-based compensation | 66 | 41 | 35 |
Restricted Stock Units granted in relation to the CEO Milestone Gift | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total equity-based compensation | (1) | 39 | 0 |
Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total equity-based compensation | 16 | 13 | 11 |
Class A Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total equity-based compensation | $ 0 | $ 0 | $ 1 |
Equity-Based Compensation - Nar
Equity-Based Compensation - Narrative (Details) | 1 Months Ended | 12 Months Ended | ||||||
May 01, 2023 shares | May 31, 2021 USD ($) shares | Mar. 31, 2015 | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 | Dec. 31, 2018 $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Automatic annual increase lesser of, percent of common stock | 2% | |||||||
Number of additional shares authorized (in shares) | 20,000,000 | |||||||
Conversion ratio | 1.25 | |||||||
Equity-based compensation expense | $ | $ 73,000,000 | $ 69,000,000 | $ 39,000,000 | |||||
Equity-based compensation, net of capitalized amounts | $ | $ 73,000,000 | $ 69,000,000 | $ 39,000,000 | |||||
Class A Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 0 | 0 | 0 | |||||
Granted (in dollars per share) | $ / shares | $ 18.58 | |||||||
Conversion ratio | 0.80 | |||||||
Class B Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 0 | 0 | 0 | |||||
Minimum | Class A Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 2 years | |||||||
Minimum | Class B Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 4 years | |||||||
Granted (in dollars per share) | $ / shares | $ 0 | |||||||
Maximum | Class A Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 4 years | |||||||
Maximum | Class B Units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 5 years | |||||||
Granted (in dollars per share) | $ / shares | $ 12 | |||||||
2017 Omnibus Incentive Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Maximum number of awards authorized for grant (in shares) | 36,000,000 | |||||||
Award vesting period | 4 years | |||||||
2017 Omnibus Incentive Plan | Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 100,000 | |||||||
2017 Omnibus Incentive Plan | Restricted Stock Units (RSUs) | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 4 years | 7 days | ||||||
Conversion ratio | 1 | |||||||
Settlement period after vesting | 30 days | |||||||
Equity-based compensation expense | $ | $ (1,000,000) | $ 39,000,000 | ||||||
2017 Omnibus Incentive Plan | RSAs & RSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 10,392,000 | 3,482,000 | 258,000 | |||||
Granted (in dollars per share) | $ / shares | $ 13.13 | $ 65.26 | $ 288.27 | |||||
2017 Omnibus Incentive Plan | Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 4 years | |||||||
Award expiration period | 10 years | |||||||
2017 Omnibus Incentive Plan | Options | Year Two, Following Grant Date Anniversary | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25% | |||||||
2017 Omnibus Incentive Plan | Options | Year One, Following Grant Date Anniversary | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25% | |||||||
2017 Omnibus Incentive Plan | Options | Year Three, Following Grant Date Anniversary | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25% | |||||||
2017 Omnibus Incentive Plan | Options | Grant Date Anniversary | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25% | |||||||
2017 Omnibus Incentive Plan | Minimum | Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 2 years | |||||||
2017 Omnibus Incentive Plan | Class A | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares available for grant (in shares) | 17,000,000 | |||||||
2017 Omnibus Incentive Plan | Class A | Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Granted (in dollars per share) | $ / shares | $ 34.21 | |||||||
2017 Omnibus Incentive Plan | Class A | Restricted Stock Units (RSUs) | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 3,500,000 | 300,000 | ||||||
Granted (in dollars per share) | $ / shares | $ 13.13 | $ 65.26 | $ 288.27 | |||||
Issuance of stock during the period (in shares) | 500,000 | |||||||
Employee Stock Purchase Plan | ESPP | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Equity-based compensation, net of capitalized amounts | $ | $ 1,000,000 | $ 1,000,000 | $ 1,000,000 | |||||
Employee Stock Purchase Plan | Class A | ESPP | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Maximum number of awards authorized for grant (in shares) | 500,000 | |||||||
Number of shares available for grant (in shares) | 378,364 | |||||||
ESPP, purchase period | 6 months | |||||||
ESPP, purchase price of common stock, percent of fair market value | 90% | |||||||
ESPP, number of shares issued (in shares) | 32,790 | 86,352 | 2,494 | |||||
Employee Stock Purchase Plan | Class A | Minimum | ESPP | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
ESPP, maximum contribution amount | $ | $ 10,000 | |||||||
Employee Stock Purchase Plan | Class A | Maximum | ESPP | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
ESPP, maximum contribution amount | $ | $ 25,000 | |||||||
Property, Plant and Equipment | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Equity-based compensation capitalized | $ | $ 7,000,000 | $ 8,000,000 | $ 7,000,000 | |||||
Inventories | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Equity-based compensation capitalized | $ | $ 1,000,000 | $ 16,000,000 | 1,000,000 | |||||
Equity-based compensation capitalized (less than) | $ | $ 1,000,000 |
Equity-Based Compensation - S_2
Equity-Based Compensation - Schedule of Unrecognized Compensation and Weighted-Average Amortization Periods (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Equity-Based Compensation Related to Outstanding Awards (in millions) | $ 176 |
Restricted Stock Units and Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Equity-Based Compensation Related to Outstanding Awards (in millions) | $ 143 |
Remaining Weighted-Average Amortization Period (in years) | 2 years 8 months 12 days |
Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized Equity-Based Compensation Related to Outstanding Awards (in millions) | $ 33 |
Remaining Weighted-Average Amortization Period (in years) | 2 years 6 months |
Equity-Based Compensation - S_3
Equity-Based Compensation - Schedule of RSU and RSA Activity (Details) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Weighted-Average Grant-Date Fair Value | |||
Settled (in dollars per share) | $ 18.58 | ||
2017 Omnibus Incentive Plan | RSAs & RSUs | |||
Number of RSAs/RSUs (in thousands) | |||
Outstanding, beginning of period (in shares) | 2,652 | 553 | 738 |
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 10,392 | 3,482 | 258 |
Settled (in shares) | (1,550) | (432) | (385) |
Forfeited (in shares) | (1,591) | (951) | (58) |
Outstanding and nonvested, end of period (in shares) | 9,903 | 2,652 | 553 |
Weighted-Average Grant-Date Fair Value | |||
Outstanding, beginning of period (in dollars per share) | $ 52.62 | $ 162.32 | $ 76.43 |
Granted (in dollars per share) | 13.13 | 65.26 | 288.27 |
Settled (in dollars per share) | 41.39 | 113.96 | 86.57 |
Forfeited (in dollars per share) | 24.25 | 134.83 | 132.88 |
Outstanding and nonvested, end of period (in dollars per share) | $ 17.49 | $ 52.62 | $ 162.32 |
Equity-Based Compensation - S_4
Equity-Based Compensation - Schedule of Stock Option Activity (Details) - 2017 Omnibus Incentive Plan - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Options (in thousands) | ||||
Outstanding, Beginning of Period (in shares) | 1,265,000 | 1,066,000 | 1,072,000 | |
Options granted (in shares) | 2,805,000 | 297,000 | 97,000 | |
Options exercised (in shares) | (17,000) | (89,000) | (75,000) | |
Options forfeited or expired (in shares) | (47,000) | (9,000) | (28,000) | |
Outstanding, End of Period (in shares) | 4,006,000 | 1,265,000 | 1,066,000 | 1,072,000 |
Vested and exercisable, End of Period (in shares) | 996,000 | |||
Expected to vest, End of Period (in shares) | 3,010,000 | |||
Weighted-Average Exercise Price | ||||
Options outstanding, beginning balance (in dollars per share) | $ 80.26 | $ 39.74 | $ 41.01 | |
Options granted (in dollars per share) | 10.07 | 119.53 | 178.42 | |
Options exercised (in dollars per share) | 13.62 | 37.89 | 24.32 | |
Options forfeited or expired (in dollars per share) | 50.08 | 30.97 | 27.62 | |
Options outstanding, ending balance (in dollars per share) | 31.75 | $ 80.26 | $ 39.74 | $ 41.01 |
Options vested and exercisable (in dollars per share) | 68.23 | |||
Options expected to vest, end of period (in dollars per share) | $ 19.68 | |||
Weighted-Average Remaining Contractual Life (in years) | ||||
Options outstanding (in years) | 8 years 1 month 6 days | 6 years 4 months 24 days | 6 years 8 months 12 days | 7 years 8 months 12 days |
Options vested and exercisable, end of period (in years) | 5 years 3 months 18 days | |||
Options expected to vest, end of period (in years) | 9 years 1 month 6 days | |||
Aggregate Intrinsic Value (in millions) | ||||
Options exercised | $ 0 | $ 7 | $ 20 | |
Options outstanding | 135 | $ 0 | $ 183 | $ 213 |
Options vested and exercisable, end of period | 14 | |||
Options expected to vest, end of period | $ 120 |
Equity-Based Compensation - Val
Equity-Based Compensation - Valuation Assumptions, Options and Class B Units (Details) - 2017 Omnibus Incentive Plan - Options - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 74.60% | 69.20% | 67.10% |
Expected dividend yield | 0% | 0% | 0% |
Expected term (in years) | 6 years 3 months 18 days | 6 years 3 months 10 days | 6 years 1 month 20 days |
Risk-free interest rate | 3.60% | 2% | 0.70% |
Weighted-average grant-date fair value per option (in dollars per share) | $ 6.94 | $ 74.85 | $ 178.41 |
Equity-Based Compensation - Cla
Equity-Based Compensation - Class A Units (Details) shares in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 31, 2020 shares | Dec. 31, 2018 $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Conversion ratio | 1.25 | ||||
Weighted-Average Grant-Date Fair Value | |||||
Vested (in dollars per share) | $ / shares | $ 18.58 | ||||
Class A Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (in dollars per share) | $ / shares | $ 18.58 | ||||
Conversion ratio | 0.80 | ||||
Number of Class A Units (in thousands) | |||||
Outstanding, beginning of period (in shares) | 79 | 85 | 121 | ||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 0 | 0 | 0 | ||
Exchanged (in shares) | 0 | 0 | (36) | ||
Forfeited (in shares) | 0 | (6) | 0 | ||
Outstanding and nonvested, end of period (in shares) | 79 | 79 | 85 | 121 | |
Vested, end of period (in shares) | 79 | ||||
Expected to vest, end of period (in shares) | 0 | ||||
Weighted-Average Grant-Date Fair Value | |||||
Exchanged (in dollars per share) | $ / shares | $ 18.58 | $ 18.58 | |||
Class A Units | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 2 years | ||||
Class A Units | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 4 years |
Equity-Based Compensation - C_2
Equity-Based Compensation - Class B Units (Details) | 1 Months Ended | 12 Months Ended | |||
Mar. 31, 2015 | Dec. 31, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 31, 2020 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Conversion ratio | 1.25 | ||||
Class B Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 0 | 0 | 0 | ||
Number of Class B Units (in thousands) | |||||
Outstanding, beginning of period (in shares) | 2,566,000 | 2,627,000 | 3,163,000 | ||
Granted (less than for year ended 2023 under 2017 Incentive Plan) (in shares) | 0 | 0 | 0 | ||
Exchanged (in shares) | (34,000) | (61,000) | (535,000) | ||
Forfeited (in shares) | 0 | 0 | (1,000) | ||
Outstanding, end of period (in shares) | 2,532,000 | 2,566,000 | 2,627,000 | 3,163,000 | |
Vested, end of period (in shares) | 2,532,000 | ||||
Expected to vest, end of period (in shares) | 0 | ||||
Weighted-Average Participation Threshold per Class B Unit | |||||
Exchanged (in dollars per share) | $ / shares | $ 3.52 | $ 5.75 | $ 1.70 | ||
Forfeited (in dollars per share) | $ / shares | 12 | ||||
Outstanding (in dollars per share) | $ / shares | 5.62 | 5.60 | $ 5.60 | $ 4.94 | |
Vested, end of period (in dollars per share) | $ / shares | $ 5.62 | ||||
Class B Units | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 4 years | ||||
Participation threshold (in dollars per share) | $ / shares | 0 | ||||
Class B Units | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 5 years | ||||
Participation threshold (in dollars per share) | $ / shares | $ 12 |
Net Earnings (Loss) Per Share -
Net Earnings (Loss) Per Share - Calculation of Basic and Diluted Net Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Numerator: | ||||
Net income (loss) attributable to Carvana Co. Class A common stockholders - basic | $ 450 | $ (1,587) | $ (135) | |
Impact on net income of assumed conversions from LLC Units | (300) | 0 | 0 | |
Net income (loss) attributable to Carvana Co. Class A common stockholders - diluted | $ 150 | $ (1,587) | $ (135) | |
Denominator: | ||||
Nonvested weighted-average restricted stock awards (in shares) | (24) | (20) | (34) | |
Weighted-average shares of Class A common stock to compute basic net loss per Class A common share (in shares) | 109,323 | 100,828 | 82,805 | |
Weighted-average shares of Class A common stock to compute diluted net loss per Class A common share (in shares) | 200,578 | 100,828 | 82,805 | |
Net earnings (loss) per share of Class A common stock, basic (in dollars per share) | $ 4.12 | $ (15.74) | $ (1.63) | |
Net earnings (loss) per share of Class A common stock, diluted (in dollars per share) | $ 0.75 | $ (15.74) | $ (1.63) | |
Net income (loss) attributable to Carvana Co. Class A common stockholders - diluted | $ 450 | $ (1,587) | $ (135) | |
Class A | ||||
Denominator: | ||||
Weighted-average shares of Class A common stock outstanding (in shares) | 109,347 | 100,848 | 82,839 | |
Weighted-average shares of Class A common stock to compute basic net loss per Class A common share (in shares) | [1] | 109,323 | 100,828 | 82,805 |
Weighted-average shares of Class A common stock to compute diluted net loss per Class A common share (in shares) | 200,578 | 100,828 | 82,805 | |
Net earnings (loss) per share of Class A common stock, basic (in dollars per share) | $ 4.12 | $ (15.74) | $ (1.63) | |
Net earnings (loss) per share of Class A common stock, diluted (in dollars per share) | $ 0.75 | $ (15.74) | $ (1.63) | |
Class A | Options | ||||
Denominator: | ||||
Dilutive effect of Class A common shares (in shares) | 979 | 0 | 0 | |
Class A | Restricted Stock Units and Awards | ||||
Denominator: | ||||
Dilutive effect of Class A common shares (in shares) | 4,815 | 0 | 0 | |
Class A | Class A Units | ||||
Denominator: | ||||
Dilutive effect of Class A common shares (in shares) | 83,976 | 0 | 0 | |
Class A | Class B Units | ||||
Denominator: | ||||
Dilutive effect of Class A common shares (in shares) | 1,485 | 0 | 0 | |
[1]Weighted-average shares of Class A common stock outstanding - basic have been adjusted for unvested restricted stock awards. |
Net Earnings (Loss) Per Share_2
Net Earnings (Loss) Per Share - Schedule of Potentially Dilutive Securities (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 976 | 1,265 | 1,066 |
Restricted Stock Units and Awards | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,308 | 64 | 666 |
Class A Units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 82,963 | 89,773 |
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) | 0 | 1,559 | 2,217 |
Net Earnings (Loss) Per Share_3
Net Earnings (Loss) Per Share - Narrative (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
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) | 0 | 1,559 | 2,217 |
Options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 976 | 1,265 | 1,066 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) | 12 Months Ended | |||
Apr. 26, 2022 USD ($) shares | Dec. 31, 2023 USD ($) shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) | |
Tax Credit Carryforward [Line Items] | ||||
Net loss, before income taxes | $ (175,000,000) | $ 2,893,000,000 | $ 286,000,000 | |
Income tax (benefit) expense | 25,000,000 | 1,000,000 | $ 1,000,000 | |
Net operating loss carryforwards | 1,200,000,000 | 1,900,000,000 | ||
Deferred tax asset, gross, less than | 1,000,000 | |||
Goodwill, tax-basis amortization expense | 56,000,000 | 37,000,000 | ||
Deferred tax assets | 5,000,000 | 1,000,000 | ||
Cancellation-of-debt income | 1,400,000,000 | |||
Deferred tax assets, valuation allowance | 1,962,000,000 | 2,058,000,000 | ||
Total deferred tax assets, net of valuation allowance | 5,000,000 | 2,000,000 | ||
Related reserves | $ 0 | $ 0 | ||
Income tax expense (benefit), percent | 14.30% | 0% | (0.30%) | |
Amount of cash savings as a result of tax attributes created from sales/exchanges, percent | 0.85 | |||
Remaining tax benefits, percent | 0.15 | |||
Deferred tax liability recognized, tax receivable agreement | $ 14,000,000 | |||
Deferred tax liability, unrecorded, tax receivable agreement | 1,600,000,000 | |||
Uncertain tax positions | 0 | $ 0 | $ 0 | |
Related Party | ||||
Tax Credit Carryforward [Line Items] | ||||
Deferred tax assets | 5,000,000 | |||
Deferred tax liabilities, less than | 1,000,000 | |||
Deferred tax liability recognized, tax receivable agreement | $ 11,000,000 | |||
Class A | ||||
Tax Credit Carryforward [Line Items] | ||||
Shares purchased (in shares) | shares | 8,900,000 | |||
Class A | Follow-On Offering | ||||
Tax Credit Carryforward [Line Items] | ||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 15,625,000 | |||
Class A | Public Equity Offering | ||||
Tax Credit Carryforward [Line Items] | ||||
Issuance of Class A common stock, net of underwriters' discounts and commissions and offering expenses | $ 1,200,000,000 | |||
Class A | At-the-market Offering "ATM Offering" | ||||
Tax Credit Carryforward [Line Items] | ||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 7,156,838 | |||
Sale of stock, net proceeds received | $ 336,000,000 | |||
Carvana Group | ||||
Tax Credit Carryforward [Line Items] | ||||
Establishment of deferred tax assets related to increases in tax basis in Carvana Group | 22,000,000 | 908,000,000 | ||
Carvana Group | Additional Paid-in Capital | ||||
Tax Credit Carryforward [Line Items] | ||||
Establishment of deferred tax assets related to increases in tax basis in Carvana Group | $ 22,000,000 | $ 908,000,000 | ||
Carvana Group | Class A Units | Public Equity Offering | ||||
Tax Credit Carryforward [Line Items] | ||||
Investment owned, balance (in shares) | shares | 19,500,000 | |||
Exchange Agreement | ||||
Tax Credit Carryforward [Line Items] | ||||
Conversion of stock, converted (less than) (in shares) | shares | 100,000 | 100,000 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Federal - Current | $ 25 | $ 2 | $ 2 |
Federal - Deferred | (4) | (1) | (1) |
Federal - Total | 21 | 1 | 1 |
State - Current | 4 | 0 | 0 |
State - Deferred | 0 | 0 | 0 |
State - Total | 4 | 0 | 0 |
Income tax provision | $ 25 | $ 1 | $ 1 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Amount | |||
Expected U.S. federal income taxes at statutory rate | $ 37,000 | $ (607,000) | $ (60,000) |
Loss attributable to non-controlling interests | 61,000 | 274,000 | 32,000 |
State taxes | 19,000 | (64,000) | (8,000) |
Stock based compensation | 0 | 0 | (16,000) |
Valuation allowance | (96,000) | 398,000 | 53,000 |
Disallowed interest | 5,000 | 0 | 0 |
Benefit of tax credits | (2,000) | 0 | 0 |
Other | 1,000 | 0 | 0 |
Income tax provision | $ 25,000 | $ 1,000 | $ 1,000 |
Percent | |||
Expected U.S. federal income taxes at statutory rate | 21% | 21% | 21% |
Loss attributable to non-controlling interests | 34.90% | (9.50%) | (11.20%) |
State taxes | 10.90% | 2.20% | 2.80% |
Stock based compensation | 0% | 0% | 5.60% |
Valuation allowance | (54.90%) | (13.70%) | (18.50%) |
Disallowed interest | 2.90% | 0% | 0% |
Benefit of tax credits | (1.10%) | 0% | 0% |
Income tax provision | 14.30% | 0% | (0.30%) |
Other | 0.60% | 0% | 0% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Investment in Carvana Group | $ 1,362 | $ 1,471 |
Net operating loss carryforward | 299 | 451 |
Interest expense carryforward | 177 | 130 |
Tax credit carryforward | 4 | 6 |
Cancellation of debt income | 116 | 0 |
Other | 9 | 2 |
Total gross deferred tax assets | 1,967 | 2,060 |
Valuation allowance | (1,962) | (2,058) |
Total deferred tax assets, net of valuation allowance | 5 | 2 |
Deferred tax liabilities: | ||
Intangibles | 0 | (1) |
Total deferred tax assets and liabilities | $ 5 | $ 1 |
Leases - Narrative (Details)
Leases - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) renewal_option | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Operating lease, number of renewal options | renewal_option | 1 | ||
Sublease income | $ | $ 5,000,000 | $ 3,000,000 | $ 0 |
Equipment | |||
Lessee, Lease, Description [Line Items] | |||
Finance leases, extension term (up to) | 4 years | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, renewal term | 1 year | ||
Minimum | Equipment | |||
Lessee, Lease, Description [Line Items] | |||
Finance leases, term of contract | 2 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, renewal term | 20 years | ||
Maximum | Equipment | |||
Lessee, Lease, Description [Line Items] | |||
Finance leases, term of contract | 5 years |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Costs and Activity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Finance leases: | |||
Amortization of finance lease assets | $ 108 | $ 95 | $ 38 |
Interest obligations under finance leases | 17 | 19 | 8 |
Total finance lease costs | 125 | 114 | 46 |
Operating leases: | |||
Total operating lease costs | 71 | 135 | 63 |
Cash payments related to lease liabilities included in operating cash flows: | |||
Interest payments on finance lease liabilities | 18 | 19 | 8 |
Cash payments related to lease liabilities included in financing cash flows: | |||
Principal payments on finance lease liabilities | 115 | 139 | 56 |
Lease termination fee | 28 | ||
Non-Related Party | |||
Operating leases: | |||
Fixed lease costs | 66 | 129 | 56 |
Cash payments related to lease liabilities included in operating cash flows: | |||
Operating lease liabilities | 109 | 83 | 35 |
Related Party | |||
Operating leases: | |||
Fixed lease costs | 5 | 5 | 6 |
Variable short-term lease costs to related parties | 0 | 1 | 1 |
Cash payments related to lease liabilities included in operating cash flows: | |||
Operating lease liabilities | $ 5 | $ 5 | $ 5 |
Leases - Schedule of Operating
Leases - Schedule of Operating and Finance Lease Maturities (Details) $ in Millions | Dec. 31, 2023 USD ($) |
Finance Leases | |
2024 | $ 95 |
2025 | 85 |
2026 | 72 |
2027 | 35 |
2028 | 7 |
Thereafter | 0 |
Total minimum lease payments | 294 |
Less: amount representing interest | (27) |
Total lease liabilities | 267 |
Operating Leases | |
2024 | 95 |
2025 | 92 |
2026 | 88 |
2027 | 81 |
2028 | 73 |
Thereafter | 226 |
Total minimum lease payments | 655 |
Less: amount representing interest | (161) |
Total lease liabilities | 494 |
Total | |
2024 | 190 |
2025 | 177 |
2026 | 160 |
2027 | 116 |
2028 | 80 |
Thereafter | 226 |
Total minimum lease payments | 949 |
Less: amount representing interest | $ (188) |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Notes Payable, Current And Long-Term Debt, Excluding Current Maturities [Member] |
Total lease liabilities | $ 761 |
Related Party | |
Operating Leases | |
2024 | 3 |
2025 | 2 |
2026 | 2 |
2027 | 2 |
2028 | 1 |
Thereafter | 1 |
Total minimum lease payments | 11 |
Less: amount representing interest | (2) |
Total lease liabilities | 9 |
Non-Related Party | |
Operating Leases | |
2024 | 92 |
2025 | 90 |
2026 | 86 |
2027 | 79 |
2028 | 72 |
Thereafter | 225 |
Total minimum lease payments | 644 |
Less: amount representing interest | (159) |
Total lease liabilities | $ 485 |
Leases - Schedule of Lease Term
Leases - Schedule of Lease Terms and Discount Rates (Details) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Weighted average remaining lease terms (years) | |||
Operating leases | 7 years 9 months 18 days | 8 years 4 months 24 days | 9 years 2 months 12 days |
Finance leases | 3 years 6 months | 4 years 2 months 12 days | 4 years 4 months 24 days |
Weighted-average discount rate | |||
Operating leases | 7.10% | 7.10% | 7.20% |
Finance leases | 5.90% | 5.70% | 5.40% |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 USD ($) mile | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |||
Limited warranty, period | 100 days | ||
Limited warranty, number of miles | mile | 4,189 | ||
Accrued limited warranty | $ 16 | $ 19 | |
Product warranty expense | 87 | $ 144 | $ 111 |
Purchase obligation | $ 139 | ||
Purchase obligation, term | 5 years |
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 Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Beneficial interests in securitizations | $ 366 | $ 321 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Beneficial interests in securitizations | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Beneficial interests in securitizations | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Beneficial interests in securitizations | 366 | 321 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | 339 | 272 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | 339 | 272 |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | 0 | 0 |
Money market funds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Narrative (Details) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Sep. 01, 2022 shares | Oct. 31, 2021 USD ($) tranche | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Derivative, cap interest rate | 5% | |||||
Tranche 1 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Class of warrant or right, exercisable (in shares) | shares | 2,400,000 | |||||
Tranche 2 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Class of warrant or right, exercisable (in shares) | shares | 3,200,000 | |||||
Interest Rate Cap | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Derivative, gain (loss) on derivative, net | $ 2 | |||||
Derivative, fair value, net | 0 | |||||
Root, Inc. | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Equity securities, not readily determinable fair value | $ 126 | |||||
Root, Inc. | Warrant | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Equity securities, number of tranches | tranche | 8 | |||||
Level 3 | Root, Inc. | Warrant | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Equity securities, fair value | 30 | |||||
Deferred revenue | 30 | |||||
Warrants to acquire Root's Class A common stock | 0 | $ 75 | ||||
Level 2 | Interest Rate Cap | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Derivative, notional amount | $ 236 | $ 364 | ||||
Fair Value, Measurements, Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Purchase price adjustment receivable | 7 | 37 | ||||
Purchase price adjustment receivable, fair value adjustment | (1) | (14) | ||||
Fair Value, Measurements, Recurring | Level 3 | Variable Interest Entity, Not Primary Beneficiary | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Sales of beneficial interests | 13 | 43 | ||||
Proceeds from sale of beneficial interests | $ 13 | $ 43 | ||||
Fair Value, Measurements, Recurring | Minimum | Level 3 | Variable Interest Entity, Not Primary Beneficiary | Measurement Input, Discount Rate | Valuation Technique, Discounted Cash Flow | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Measurement input, discount rate | 0.062 | 0.071 | ||||
Fair Value, Measurements, Recurring | Maximum | Level 3 | Variable Interest Entity, Not Primary Beneficiary | Measurement Input, Discount Rate | Valuation Technique, Discounted Cash Flow | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Measurement input, discount rate | 0.120 | 0.113 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Reconciliation Level Three, Beneficial Interests in Securitizations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Opening Balance | $ 321,000 | |
Ending Balance | 366,000 | $ 321,000 |
Variable Interest Entity, Not Primary Beneficiary | Level 3 | Fair Value, Measurements, Recurring | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Opening Balance | 321,000 | 382,000 |
Received in securitization transactions | 194,000 | 148,000 |
Payments received | (150,000) | (172,000) |
Change in fair value | 14,000 | 6,000 |
Sales of beneficial interests | $ (13,000) | (43,000) |
Ending Balance | $ 321,000 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Carrying Value and Fair Value, Senior Notes (Details) - Level 2 - Senior Notes - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes | $ 4,566 | $ 5,649 |
Fair value | Senior Unsecured Notes Effective September 2018, 2023 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior Notes | $ 3,866 | $ 2,533 |
Fair Value of Financial Instr_7
Fair Value of Financial Instruments - Carrying Value and Fair Value, Finance Receivables (Details) - Level 2 - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Carrying value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Finance receivables | $ 807 | $ 1,334 |
Fair value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Finance receivables | $ 854 | $ 1,437 |
Fair Value of Financial Instr_8
Fair Value of Financial Instruments - Changes in the Company's Level 3 Warrants (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Opening Balance | $ 321,000 | |
Ending Balance | 366,000 | $ 321,000 |
Root, Inc. | Level 3 | Warrant | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Opening Balance | 2,000 | 6,000 |
Warrants to acquire Root's Class A common stock | 0 | 75,000 |
Total unrealized gain (loss) | 3,000 | (79,000) |
Ending Balance | $ 5,000 | $ 2,000 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Supplemental cash flow information: | |||
Cash payments for interest | $ 538 | $ 423 | $ 152 |
Cash payments for taxes | 28 | 3 | 2 |
Non-cash investing and financing activities: | |||
Capital expenditures included in accounts payable and accrued liabilities | 1 | 18 | 102 |
Operating lease right-of-use assets obtained in exchange for operating lease liabilities | 2 | 375 | 253 |
Property and equipment acquired under finance leases | 51 | 326 | 152 |
Warrants to acquire Root Class A common stock | 0 | 75 | 30 |
Equity-based compensation expense capitalized to property and equipment | 8 | 8 | 7 |
Fair value of beneficial interests received in securitization transactions | 194 | 148 | 338 |
Reductions of beneficial interests in securitizations and associated long-term debt | $ 110 | $ 134 | $ 38 |
Supplemental Cash Flow Inform_4
Supplemental Cash Flow Information - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 530 | $ 434 | $ 403 | |
Restricted cash | 64 | 194 | 233 | |
Total cash, cash equivalents and restricted cash | $ 594 | $ 628 | $ 636 | $ 329 |
Subsequent Events (Details)
Subsequent Events (Details) - MPSA - Consumer Loan - USD ($) | Jan. 11, 2024 | Jan. 13, 2023 |
Subsequent Event [Line Items] | ||
Commitment of purchaser, current availability financing, principal balances of finance receivables (up to) | $ 4,000,000,000 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Commitment of purchaser, current availability financing, principal balances of finance receivables (up to) | $ 4,000,000,000 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts (Details) - Deferred tax asset valuation allowance - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | $ 2,058 | $ 1,638 | $ 677 |
Charged to costs and expenses | (96) | 398 | 53 |
Charged to other accounts | 0 | 22 | 908 |
Reductions | 0 | 0 | 0 |
Balance at end of period | $ 1,962 | $ 2,058 | $ 1,638 |