News: Carvana, Toyota, VW, and BMW

Q2: Carvana on Track for Record Year

Carvana has exceeded Wall Street's expectations for the second quarter of 2024, setting the stage for a record-breaking year. Here's a detailed look at the numbers and key developments:

• Net Income: $48M with a net income margin of 1.4%.
• Earnings per Share (EPS): 14 cents, beating the expected loss of 7 cents.
• Revenue: $3.41B, surpassing the $3.24B expected.
• Retail Vehicle Sales: Over 101,400 units, up 32.5% from Q2 2023.
• Gross Profit per Unit (GPU): $7,049, an increase of $529 from the previous year.
• Adjusted EBITDA: $355M, with an adjusted EBITDA margin of 10.4%.

Future Projections and Offerings

• 2024 Forecast: Carvana projects adjusted EBITDA of $1B to $1.2B for the full year, significantly up from $339M in 2023.
• Stock Offering: An at-the-market offering worth approximately $1B in stock (around 35M shares).

CEO Insights

Carvana CEO Ernie Garcia emphasized the company's untapped potential and continuous improvement, projecting a strong second half for 2024 with increased retail vehicle sales.

Toyota's Q1 Performance: Profit Up, Shares Down

Toyota posted a 17% increase in first-quarter profit, reaching 1.3T yen ($8.70B) due to cost-cutting and a weaker yen. However, shares fell nearly 9% as the growth was the weakest in seven quarters. Despite challenges like certification scandals and inventory issues, Toyota maintained its forecast of 4.3T yen profit for the full year.

VW Q2 Dropped, but Optimistic

Volkswagen Group's second-quarter results show a 2.4% drop in operating profit as the company faces restructuring charges and reduced deliveries. Despite these challenges, VW is optimistic about achieving its targets through a series of upcoming model launches in the second half of the year.

• Financial Performance: Operating profit (EBIT) fell to €5.46B ($5.91B), with an operating margin decrease to 6.6% from last year's 7%. Core brand profitability (VW, Skoda, Seat) dropped to 5%, and second-quarter sales decreased by 3.8%.
• Strategic Moves: VW is focusing on cost reduction, including higher severance expenses and adjusting for potential closures, like the Audi plant in Brussels. The company is banking on new model launches and expects operating returns of 6.5% to 7% for 2024.

CFO Arno Antlitz stressed the importance of these measures, indicating that significant efforts are needed to achieve their goals in the competitive automotive landscape.

BMW's Margins Squeezed by China Competition

BMW reported a second-quarter EBIT margin of 8.4%, down from 9.2% last year, missing analyst expectations. The 4% sales slump in China contributed to the dip, although BMW performed better than some competitors. Despite the setbacks, BMW saw strong demand for electric vehicles, increasing EV sales by a quarter in the first half of 2024, underscoring their commitment to e-mobility.