Carvana (CVNA) stock has staged a stunning comeback in 2025, soaring about 125% year-to-date (YTD) and grabbing investors’ attention. Once viewed as a high-risk turnaround story, the online auto retailer is now delivering rapid growth, expanding margins, and record profitability.
What’s in store for Carvana stock in 2026? Let’s find out.
Valued at $99.1 billion, Carvana is an online automotive retailer that lets customers buy, sell, and finance used cars entirely online. It allows customers to browse a large inventory of used vehicles online and enables them to purchase or sell a car in minutes with transparent pricing. It also offers in-house financing, trade-ins, and home delivery or pickup. Caravan aims to replace the traditional dealership experience with a speedier, more convenient, and data-driven digital car-buying process.
In the third quarter, retail units sold reached 150,941, up 44% year-over-year (YoY), while revenue surged 55% to $5.65 billion. For the first time in its history, Carvana’s annual revenue run rate exceeded $20 billion, highlighting the scale the business is now achieving. Net income increased to $263 million, with adjusted EBITDA reaching a new high of $637 million. Importantly, Carvana converted nearly 87% of adjusted EBITDA into GAAP operating income, highlighting the exceptional quality of its earnings.
Management stressed that the “feedback flywheel is spinning” with rapidly rising data enhancing pricing, inventory management, logistics, and customer experience. These structural advantages enable Carvana to achieve its long-term aim of selling 3 million cars per year at a 13.5% adjusted EBITDA margin over the next five to ten years. Another factor driving investor enthusiasm is Carvana’s increasing automation and vertical integration. More than 30% of retail buyers now go through the whole shopping process without speaking with a customer representative until delivery or pickup.
This level of automation necessitates closely connected systems, real-time data availability, deterministic decision-making, and clearly defined workflows. Management sees this as a major long-term advantage that streamlines the client experience while lowering operating costs. Carvana’s improving financial position has also impressed investors. The company has retired significant amounts of corporate debt, bringing total debt retired in 2024 and 2025 to $1.2 billion. It also had $2.1 billion in cash on the balance sheet at the end of the third quarter.
