Carvana Co. has not produced a significant quarterly profit since it went public in 2017. But the business has made the owners - Ernie Garcia II and his son Ernest - two of the wealthiest people in the U.S.
The father and son behind online second hand-vehicle sales platform Carvana just got $5 billion wealthier as their company finally recorded record profits.
Carvana has previously withheld guidance for its current quarter because of doubts from the world health crisis. The company has averaged roughly $1.1 billion in revenues in the past four quarters and disposed of around 55,000 units in the second half this year.
Chief executive officer Ernie Garcia - who holds the majority shares in the company - said the momentum that the company saw in the second quarter continued in the third - generating a record performance. Revenues in North America have continued to bounce back from the COVID-19 pandemic.
Carvana makes money from cars sold from vending machines. The company allows buyers to select from more than 19,000 vehicles and complete purchases in 10 minutes, the company's website says. Ernest is the company's CEO. He and his father are valued at around $21.4 billion, the Bloomberg Billionaires Index showed.
Carvana's stock has risen nearly 150% so far this year as most Americans have opted to purchase used cars on the internet to avoid mass transit.
According to Piper Sandler analyst Alexander Potter, the pandemic is prompting consumers "to seek out second hand cars, and Carvana is a beneficiary of this trend," Bloomberg quoted him as saying.
