Why Did CVNA Stock Drop After-Hours Despite Q2 Beat?

• The company said on Wednesday it expects a sequential rise in retail units sold in the third quarter.
• For 2026, the company expects adjusted EBITDA of $2.7 billion to $3.0 billion. 
• The company is now looking to scale the number of vehicles sold to three million per year.

Carvana (CVNA) shares plunged nearly 19% in after-hours trading on Wednesday after the used car retailer’s forecasts for 2026 adjusted core profit came in below Wall Street expectations, even though the company delivered record Q2 results.

Record Q2 Numbers

Carvana sold a quarterly high of 197,325 retail units, up 38% from a year earlier. Revenue hit an all-time high of $7.376 billion, up 52%, and above an estimated $6.91 billion. Gross profit rose 30% to $1.384 billion. Adjusted core profit hit a record $769 million.

Gross profit per unit, however, came in at $7,014, down $412 year-over-year but up $231 sequentially.

Looking Ahead

The company said on Wednesday it expects a sequential rise in retail units sold in the third quarter and full-year 2026 adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $2.7 billion to $3.0 billion, up from $2.24 billion in 2025, assuming a stable environment. The estimate, however, is lower at the midpoint than a Wall Street estimate of about $3 billion

With first-half adjusted EBITDA already at about $1.44 billion, this implies roughly flat to only modestly higher second-half results versus the first half.

Company Optimism Lingers

Despite the sharp after-hours selloff, executives struck an optimistic note.

“Q2 2026 was Carvana’s 10th consecutive quarter of industry-leading growth and profitability,” founder and CEO Ernie Garcia said. “At Carvana’s current run-rate scale of almost 800k retail units and over $2 billion Net income, we are still just 1.5% of the U.S. automotive market. Our opportunity is very clear…”

In the shareholder letter, Garcia and CFO Mark Jenkins noted the company remains “the most profitable automotive retailer by a significant margin of 2-3x,” with a 7% net-income margin and 10.4% adjusted-EBITDA margin. They said Carvana holds only about 2% of the used-vehicle retail market and remains “firmly on the path to selling 3 million cars per year and to achieving 13.5% Adjusted EBITDA margin by 2030 to 2035.”

Current facilities already support 1.5 million annual retail units, with real estate ready for 3 million, they said.

How Did CVNA Retail Traders React?

On Stocktwits, retail sentiment around CVNA stock fell from ‘neutral’ to ‘bearish’ over the past 24 hours, while message volume increased from ‘normal’ to ‘high’ levels.

“Complete disaster of a quarter - good place to short ($56-$58) with current trailing stop at $66,” a Stocktwits user wrote.

Another user predicted the stock to fall as low as $40 from the last closing price of $57.08.

CVNA stock has fallen 21% year to date. 

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