Carvana reported Q4 revenue of $5.6B (+58% YoY) on 163,522 retail units (+43%), capping a full year of $20.3B in revenue (+49%). Today we also publish a complete 8-lens committee analysis — the most comprehensive framework we have applied to any equity — replacing the prior 2-lens assessment. Across 13 signals and 8 independent analytical lenses, the committee finds genuine operational strength housed within a governance structure that two lenses independently classify between CAPTURED and MISALIGNED.
The Numbers
The headline GAAP net income of $1.9B requires context: it was driven by a $2,785M non-cash deferred tax asset release on a pre-tax loss of ($890M). Adjusted EBITDA of $2,187M reflects genuine operational improvement. Management retired $709M in corporate notes, ended the year with $2.3B cash, and explicitly targets “investment-grade quality credit ratios.”
Q4 EBITDA margin dipped to 9.1% (from 10.1% YoY) due to reconditioning cost headwinds. Management guided 3-6 month resolution. Loan purchase partnerships expanded from 3 to 5 partners with $18B total capacity, though the Ally facility ($6B) expires October 2026.
8-Lens Committee: 13 Signals Assessed
This is the first equity to receive our full 8-lens treatment with the Black Swan Beacon tail risk overlay. Each lens conducted independent persona-based discourse (analyst debate, adversarial critique, convergence) before signals were aggregated. Read the full deep dive for the detailed findings.
The Garcia RPT Complex
The scale of related-party transactions became clearer with FY2025 disclosures. Total annual RPTs with Garcia-controlled entities now exceed $590M (MDA $338M +75% YoY, reconditioning $147M, leases $66M, wholesale $39M). The Tax Receivable Agreement liability surged from $65M to $2,228M ($1,721M to related parties) due to LLC unit conversions. Grant Thornton serves as auditor for Carvana, DriveTime, and GoFi — a shared auditor arrangement that two lenses flagged as a structural concern.
On the Q4 call, CEO Garcia III characterized short seller allegations as “100% inaccurate” — a blanket denial without point-by-point rebuttal that three lenses flagged as a management communication gap during an active SEC investigation.
Prediction Markets: 2 Resolved, 8 Active
Two prediction markets resolved with today's earnings. The ensemble correctly predicted that “Other” GPU would stay above $420 (52% probability, Brier 0.23) and that OCF/NI conversion would not fall below 50% (18% probability, Brier 0.03 — excellent). Five existing markets were updated and three new markets were added to maintain coverage across all signal categories.
The largest shift was in the litigation market (+7pp to 65%), reflecting the case surviving both the original motion to dismiss and a subsequent motion for reconsideration — a higher bar than the initial analysis assumed. The ABS spread market moved lower (-4pp to 12%) after loan purchase partnerships expanded from 3 to 5, suggesting growing investor appetite for Carvana paper. View all 8 active CVNA forecast markets with updated predictions.
Tail Risk Assessment
The Black Swan Beacon — our tail risk and consensus bias lens — classified ASSUMPTION_FRAGILITY as FRAGILE, TAIL_RISK_SEVERITY as SEVERE, and CONSENSUS_BLINDSPOT as SIGNIFICANT_GAPS. The committee noted that all 7 primary lens assessments depend on financial statement accuracy supported by a single auditor alleged to operate across both sides of the RPT structure. The SEC cascade scenario (3-10% probability) produces 70-90% equity destruction. Restructuring tools used in 2022 (PIK conversion, debt exchange) have been permanently consumed, leaving fewer financial engineering escape routes in a downside scenario.
Full 8-lens analysis with 13 signals, persona-based discourse, tail risk scenarios, and monitoring triggers