Carvana shares slide as 2026 earnings outlook disappoints analysts

The company’s updated outlook targets adjusted earnings between $2.7 billion and $3 billion for the year. This range sits significantly below the $3.2 billion ceiling anticipated by Deutsche Bank and the more bullish $4.45 billion estimate provided by Morgan Stanley. By suggesting adjusted earnings will hold between $1.3 billion and $1.6 billion for the second half of the year, Carvana indicated that growth would remain relatively flat following a strong start to 2024.

Despite the negative reaction from traders, the firm’s underlying performance remains robust. Carvana reported $7.38 billion in revenue for the second quarter, comfortably beating the $6.91 billion LSEG consensus. Net income climbed to $513 million—a $205 million jump year-over-year—as vehicle sales surged 38% to 197,325 units. The company’s total adjusted earnings for the first half of the year reached $1.4 billion, including a record $769 million in the second quarter alone, putting it on a clear path to exceed its previous annual record of $2.2 billion.