Press release

Vroom Reports Fourth Quarter and FY 2020 Results

0
Sponsored by Businesswire

Vroom, Inc. (Nasdaq:VRM), a leading ecommerce platform for buying and selling used vehicles, today announced financial results for the fourth quarter and fiscal year ended December 31, 2020.

HIGHLIGHTS OF FOURTH QUARTER 2020

  • 11,022 ecommerce units sold, up 74% YoY
  • Ecommerce revenue of $285.0 million, up 43% YoY
  • Ecommerce gross profit of $20.1 million, up 95% YoY

HIGHLIGHTS OF FISCAL YEAR 2020

  • 34,488 ecommerce units sold, up 82% YoY
  • Ecommerce revenue of $915.5 million, up 56% YoY
  • Ecommerce gross profit of $60.9 million, up 89% YoY

Paul Hennessy, Chief Executive Officer of Vroom, commented:

“Vroom had a strong fourth quarter, with significant year-over-year growth in our ecommerce business. Inventory and marketing are scaling as planned, which is increasing the velocity of the Vroom flywheel, driving conversion and increased sales and revenues. Consistent with our relentless focus on data science, we announced the acquisition of CarStory, a leader in AI-powered analytics and digital services for automotive retail, which closed in January 2021. As the used vehicle market continues to embrace the ecommerce model, we will continue to execute our plan and invest in scaling our business and improving our customer experience as we transform the market for buying and selling used vehicles.”

COVID-19 Update

Note: All sequential comparisons are on a fourth quarter over third quarter basis.

After the initial disruption in our ecommerce operations due to the COVID-19 pandemic, consumer demand for used vehicles now exceeds pre-COVID-19 levels and, in the quarter ended December 31, 2020, we experienced continued strong consumer demand for our ecommerce solutions and contact-free delivery. Ecommerce units sold increased sequentially 24.9% to 11,022 units and ecommerce revenue increased sequentially 28.5% to $285.0 million, both driven by increased consumer demand, higher inventory levels and increased marketing spend.

FOURTH QUARTER FINANCIAL DISCUSSION

All financial comparisons are for the fourth quarter on a year-over-year basis unless otherwise noted.

Ecommerce Results

 

 

Three Months Ended

December 31,

 

 

 

 

 

 

 

 

 

 

 

Year Ended

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

 

Change

 

 

% Change

 

 

2020

 

 

2019

 

 

 

Change

 

 

% Change

 

 

 

(in thousands, except unit

data and average days to sale)

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except unit

data and average days to sale)

 

 

 

 

 

 

 

 

 

 

Ecommerce units sold

 

 

 

11,022

 

 

 

 

6,339

 

 

 

 

4,683

 

 

 

73.9

%

 

 

 

34,488

 

 

 

 

18,945

 

 

 

 

15,543

 

 

 

82.0

%

Ecommerce revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vehicle revenue

 

$

 

274,552

 

 

$

 

195,289

 

 

$

 

79,263

 

 

 

40.6

%

 

$

 

884,560

 

 

$

 

576,998

 

 

$

 

307,562

 

 

 

53.3

%

Product revenue

 

 

 

10,398

 

 

 

 

3,904

 

 

 

 

6,494

 

 

 

166.3

%

 

 

 

30,891

 

 

 

 

11,116

 

 

 

 

19,775

 

 

 

177.9

%

Total ecommerce revenue

 

$

 

284,950

 

 

$

 

199,193

 

 

$

 

85,757

 

 

 

43.1

%

 

$

 

915,451

 

 

$

 

588,114

 

 

$

 

327,337

 

 

 

55.7

%

Ecommerce gross profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vehicle gross profit

 

$

 

9,674

 

 

$

 

6,400

 

 

$

 

3,274

 

 

 

51.2

%

 

$

 

29,970

 

 

$

 

21,011

 

 

$

 

8,959

 

 

 

42.6

%

Product gross profit

 

 

 

10,398

 

 

 

 

3,904

 

 

 

 

6,494

 

 

 

166.3

%

 

 

 

30,891

 

 

 

 

11,116

 

 

 

 

19,775

 

 

 

177.9

%

Total ecommerce gross profit

 

$

 

20,072

 

 

$

 

10,304

 

 

$

 

9,768

 

 

 

94.8

%

 

$

 

60,861

 

 

$

 

32,127

 

 

$

 

28,734

 

 

 

89.4

%

Average vehicle selling price per ecommerce unit

 

$

 

24,909

 

 

$

 

30,808

 

 

$

 

(5,899

)

 

 

(19.1

)%

 

$

 

25,648

 

 

$

 

30,456

 

 

$

 

(4,808

)

 

 

(15.8

)%

Gross profit per ecommerce unit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vehicle gross profit per ecommerce unit

 

$

 

878

 

 

$

 

1,010

 

 

$

 

(132

)

 

 

(13.1

)%

 

$

 

869

 

 

$

 

1,109

 

 

$

 

(240

)

 

 

(21.6

)%

Product gross profit per ecommerce unit

 

 

 

943

 

 

 

 

616

 

 

 

 

327

 

 

 

53.1

%

 

 

 

896

 

 

 

 

587

 

 

 

 

309

 

 

 

52.6

%

Total gross profit per ecommerce unit

 

$

 

1,821

 

 

$

 

1,626

 

 

$

 

195

 

 

 

12.0

%

 

$

 

1,765

 

 

$

 

1,696

 

 

$

 

69

 

 

 

4.1

%

Ecommerce average days to sale

 

 

 

77

 

 

 

 

68

 

 

 

 

9

 

 

 

13.2

%

 

 

 

66

 

 

 

 

68

 

 

 

 

(2

)

 

 

(2.9

)%

Fourth Quarter 2020

Ecommerce Units

Ecommerce units sold increased 73.9% to 11,022 driven by increased consumer demand, higher inventory levels and increased marketing spend. Average monthly unique visitors to our platform increased 26.3% to 1,004,368.

Ecommerce Revenue

Ecommerce revenue increased 43.1% to $285.0 million.

  • Ecommerce Vehicle revenue increased 40.6% to $274.6 million. The increase in ecommerce Vehicle revenue was primarily attributable to the increase in ecommerce units sold, partially offset by a decrease in the average selling price per unit, which decreased from $30,808 to $24,909. The decrease in average selling price was primarily driven by demand predicted by our data analytics.
  • Ecommerce Product revenue increased 166.3% to $10.4 million. The increase in ecommerce Product revenue was primarily attributable to the increase in ecommerce units sold, and further increased by an improvement in ecommerce Product revenue per unit, which increased from $616 to $943 per unit. The increase in ecommerce Product revenue per unit was driven by higher attachment rates, improved financing features in our ecommerce platform as well as our strategic lender partnerships.

Ecommerce Gross Profit

Ecommerce gross profit increased 94.8% to $20.1 million.

  • Ecommerce Vehicle gross profit increased 51.2% to $9.7 million. The increase in ecommerce Vehicle gross profit was due to an increase in units sold, partially offset by a $132 decrease in ecommerce Vehicle gross profit per unit, which was driven primarily by lower sales margins, partially offset by improvements in inbound logistics and reconditioning costs.
  • Ecommerce Product gross profit increased 166.3% to $10.4 million. The increase in ecommerce Product gross profit was primarily attributable to the increase in ecommerce units sold, and further increased by an improvement in ecommerce Product gross profit per unit, which increased from $616 to $943 per unit. The increase in Product gross profit per unit was driven by higher attachment rates, improved financing features in our ecommerce platform as well as our strategic lender partnerships.

Ecommerce Gross Profit per Unit

Ecommerce gross profit per unit increased 12.0% to $1,821.

  • Ecommerce Vehicle gross profit per unit decreased 13.1% to $878, driven primarily by lower sales margins, partially offset by improvements in inbound logistics and reconditioning costs per unit.
  • Ecommerce Product gross profit per unit increased 53.1% to $943. The increase in Product gross profit per unit was driven by higher attachment rates, improved financing features in our ecommerce platform as well as our strategic lender partnerships.

Results by Segment

 

 

Three Months Ended

December 31,

 

 

 

 

 

 

 

 

 

 

Year Ended

December 31,

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

Change

 

 

% Change

 

 

2020

 

 

2019

 

 

Change

 

 

% Change

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

Units:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

 

11,022

 

 

 

6,339

 

 

 

4,683

 

 

 

73.9

%

 

 

34,488

 

 

 

18,945

 

 

 

15,543

 

 

 

82.0

%

Wholesale

 

 

6,998

 

 

 

4,151

 

 

 

2,847

 

 

 

68.6

%

 

 

21,108

 

 

 

20,197

 

 

 

911

 

 

 

4.5

%

TDA

 

 

1,777

 

 

 

3,574

 

 

 

(1,797

)

 

 

(50.3

)%

 

 

7,385

 

 

 

13,018

 

 

 

(5,633

)

 

 

(43.3

)%

Total units

 

 

19,797

 

 

 

14,064

 

 

 

5,733

 

 

 

40.8

%

 

 

62,981

 

 

 

52,160

 

 

 

10,821

 

 

 

20.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

$

284,950

 

 

$

199,193

 

 

$

85,757

 

 

 

43.1

%

 

$

915,451

 

 

$

588,114

 

 

$

327,337

 

 

 

55.7

%

Wholesale

 

 

75,111

 

 

 

47,759

 

 

 

27,352

 

 

 

57.3

%

 

 

245,580

 

 

 

213,464

 

 

 

32,116

 

 

 

15.0

%

TDA

 

 

45,768

 

 

 

108,640

 

 

 

(62,872

)

 

 

(57.9

)%

 

 

196,669

 

 

 

390,243

 

 

 

(193,574

)

 

 

(49.6

)%

Total revenue

 

$

405,829

 

 

$

355,592

 

 

$

50,237

 

 

 

14.1

%

 

$

1,357,700

 

 

$

1,191,821

 

 

$

165,879

 

 

 

13.9

%

Gross profit (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

$

20,072

 

 

$

10,304

 

 

$

9,768

 

 

 

94.8

%

 

$

60,861

 

 

$

32,127

 

 

$

28,734

 

 

 

89.4

%

Wholesale

 

 

(2,938

)

 

 

(535

)

 

 

(2,403

)

 

 

449.2

%

 

 

(1,432

)

 

 

340

 

 

 

(1,772

)

 

 

(521.2

)%

TDA

 

 

2,972

 

 

 

6,562

 

 

 

(3,590

)

 

 

(54.7

)%

 

 

12,116

 

 

 

25,392

 

 

 

(13,276

)

 

 

(52.3

)%

Total gross profit

 

$

20,106

 

 

$

16,331

 

 

$

3,775

 

 

 

23.1

%

 

$

71,545

 

 

$

57,859

 

 

$

13,686

 

 

 

23.7

%

Gross profit (loss) per unit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

$

1,821

 

 

$

1,626

 

 

$

195

 

 

 

12.0

%

 

$

1,765

 

 

$

1,696

 

 

$

69

 

 

 

4.1

%

Wholesale

 

$

(420

)

 

$

(129

)

 

$

(291

)

 

 

225.6

%

 

$

(68

)

 

$

17

 

 

$

(85

)

 

 

(500.0

)%

TDA

 

$

1,620

 

 

$

1,836

 

 

$

(216

)

 

 

(11.8

)%

 

$

1,581

 

 

$

1,894

 

 

$

(313

)

 

 

(16.5

)%

Total gross profit per unit

 

$

1,016

 

 

$

1,161

 

 

$

(145

)

 

 

(12.5

)%

 

$

1,136

 

 

$

1,109

 

 

$

27

 

 

 

2.4

%

Fourth Quarter 2020

Total Units

Total units sold increased 40.8% to 19,797.

  • Ecommerce units sold increased 73.9% to 11,022, primarily driven by the reasons discussed above.
  • Wholesale units sold increased 68.6% to 6,998, primarily driven by an increase of wholesale grade units purchased from consumers as well as an increase in the number of trade-in vehicles as a result of the increase in number of ecommerce units sold.
  • TDA units sold decreased 50.3% to 1,777, primarily due to reduced inventory at the TDA location as the ecommerce business continues to scale.

Total Revenue

Total revenue increased 14.1% to $405.8 million.

  • Ecommerce revenue increased 43.1% to $285.0 million, primarily driven by the reasons discussed above.
  • Wholesale revenue increased 57.3% to $75.1 million. The increase in wholesale revenue was primarily attributable to the increase in wholesale units sold, partially offset by a decrease in wholesale average selling price per unit, which decreased from $11,505 to $10,733.
  • TDA revenue decreased 57.9% to $45.7 million, primarily due to the decrease in TDA units sold and a lower average selling price per unit, which decreased from $29,302 to $24,546.

Total Gross Profit (Loss)

Total gross profit increased 23.1% to $20.1 million.

  • Ecommerce gross profit increased 94.8% to $20.1 million, primarily driven by the reasons discussed above.
  • Wholesale gross loss increased to $(2.9) million. Wholesale gross loss increased primarily due to an increase in wholesale units sold at a higher gross loss per unit of $(291) as a result of liquidating aged inventory in the fourth quarter.
  • TDA gross profit decreased 54.7% to $2.9 million. TDA gross profit decreased primarily due to a decrease in TDA units sold and a decrease in TDA gross profit per unit of $216.

Total Gross Profit (Loss) per Unit

Total gross profit per unit decreased 12.5% to $1,016.

  • Ecommerce gross profit per unit increased 12.0% to $1,821.
  • Wholesale gross loss per unit increased 225.6% to $(420).
  • TDA gross profit per unit decreased 11.8% to $1,620.

SG&A

 

 

Three Months Ended

December 31,

 

 

 

 

 

 

 

 

 

 

Year Ended

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

 

2019

 

 

Change

 

 

% Change

 

 

 

2020

 

 

 

2019

 

 

Change

 

 

% Change

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

Compensation & benefits

 

$

 

28,384

 

 

$

 

20,455

 

 

$

7,929

 

 

 

38.8

%

 

$

 

92,205

 

 

$

 

72,473

 

 

$

19,732

 

 

 

27.2

%

Marketing expense

 

 

 

17,564

 

 

 

 

15,424

 

 

 

2,140

 

 

 

13.9

%

 

 

 

62,393

 

 

 

 

49,866

 

 

 

12,527

 

 

 

25.1

%

Outbound logistics

 

 

 

10,500

 

 

 

 

4,751

 

 

 

5,749

 

 

 

121.0

%

 

 

 

30,262

 

 

 

 

13,950

 

 

 

16,312

 

 

 

116.9

%

Occupancy and related costs

 

 

 

3,210

 

 

 

 

3,294

 

 

 

(84

)

 

 

(2.6

)%

 

 

 

10,784

 

 

 

 

11,335

 

 

 

(551

)

 

 

(4.9

)%

Professional fees

 

 

 

4,863

 

 

 

 

2,182

 

 

 

2,681

 

 

 

122.9

%

 

 

 

10,560

 

 

 

 

11,560

 

 

 

(1,000

)

 

 

(8.7

)%

Other

 

 

 

13,607

 

 

 

 

7,673

 

 

 

5,934

 

 

 

77.3

%

 

 

 

39,342

 

 

 

 

25,804

 

 

 

13,538

 

 

 

52.5

%

Total selling, general & administrative expenses

 

$

 

78,128

 

 

$

 

53,779

 

 

$

24,349

 

 

 

45.3

%

 

$

 

245,546

 

 

$

 

184,988

 

 

$

60,558

 

 

 

32.7

%

Fourth Quarter 2020

Selling, general and administrative expenses increased 45.3% to $78.1 million. The increase was primarily due to:

  • $7.9 million increase in compensation and benefits due to an increase in headcount, as well as a $3.7 million increase in stock-based compensation to $4.3 million;
  • $5.9 million increase in other selling, general and administrative expenses primarily related to additional insurance costs associated with being a publicly traded company and volume-based subscription fees as our business continues to scale;
  • $5.7 million increase in outbound logistics costs partially attributable to the growth in ecommerce units sold, which increased outbound logistics costs by $3.5 million, and increases in market rates of logistics providers, which increased outbound logistics costs by $2.2 million;
  • $2.7 million increase in professional fees primarily related to $2.1 million in costs related to the CarStory acquisition; and
  • $2.1 million increase in marketing expense as we expanded our national broad-reach advertising.

We expect selling, general and administrative expenses to increase in the future as we scale our business and sell more ecommerce units. We also will incur increased selling, general and administrative expenses as we continue to invest in and improve our customer experience and invest in expanding our proprietary logistics network, including our last-mile delivery operations.

Loss from Operations and Net Loss

Fourth Quarter 2020

Loss from operations increased 52.6% to $59.4 million. Net loss increased 41.9% to $60.7 million.

Non-GAAP Financial Measures

In addition to our results determined in accordance with accounting principles generally accepted in the United States, or GAAP, we believe the following non-GAAP financial measures are useful in evaluating our operating performance: EBITDA, Adjusted EBITDA, Adjusted loss from operations, Non-GAAP net loss, Non-GAAP net loss per share and Non-GAAP net loss per share, as adjusted. These non-GAAP financial measures have limitations as analytical tools in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP. Because of these limitations, these non-GAAP financial measures should be considered along with other operating and financial performance measures presented in accordance with GAAP. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures.

We calculate EBITDA as net loss before interest expense, interest income, income tax expense and depreciation and amortization expense and we calculate Adjusted EBITDA as EBITDA adjusted to exclude the one-time, IPO related acceleration of non-cash stock-based compensation expense, the one-time, IPO related non-cash revaluation of a preferred stock warrant, and acquisition related costs. We calculate Adjusted loss from operations as operating loss adjusted to exclude the one-time, IPO related acceleration of non-cash stock-based compensation expense and acquisition related costs and we calculate Non-GAAP net loss as net loss adjusted to exclude the one-time, IPO related acceleration of non-cash stock-based compensation expense, the one-time, IPO related non-cash revaluation of a preferred stock warrant, and acquisition related costs. We calculate Non-GAAP net loss per share as Non-GAAP net loss divided by weighted average number of shares outstanding.

EBITDA, Adjusted EBITDA, Adjusted loss from operations, Non-GAAP net loss, Non-GAAP net loss per share and Non-GAAP net loss per share, as adjusted are supplemental performance measures that our management uses to assess our operating performance and the operating leverage in our business. Because EBITDA, Adjusted EBITDA, Adjusted loss from operations, Non-GAAP net loss, Non-GAAP net loss per share and Non-GAAP net loss per share, as adjusted facilitate internal comparisons of our historical operating performance on a more consistent basis, we use these measures for business planning purposes. The following table presents a reconciliation of the Non-GAAP measures to the most directly comparable financial measures prepared in accordance with GAAP, for each of the periods presented.

EBITDA and Adjusted EBITDA

 

 

Three Months Ended

December 31,

 

 

Year Ended

December 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

(in thousands)

 

 

(in thousands)

 

Net loss

 

$

(60,662

)

 

$

(42,735

)

 

$

(202,799

)

 

$

(142,978

)

Adjusted to exclude the following:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

3,274

 

 

 

4,693

 

 

 

9,656

 

 

 

14,596

 

Interest income

 

 

(1,936

)

 

 

(1,153

)

 

 

(5,896

)

 

 

(5,607

)

Provision for income taxes

 

 

(54

)

 

 

46

 

 

 

84

 

 

 

168

 

Depreciation and amortization expense

 

 

1,399

 

 

 

1,474

 

 

 

4,654

 

 

 

6,157

 

EBITDA

 

$

(57,979

)

 

$

(37,675

)

 

$

(194,301

)

 

$

(127,664

)

One-time IPO related acceleration of non-cash stock-based compensation

 

 

 

 

 

 

 

 

1,262

 

 

 

 

One-time IPO related non-cash revaluation of preferred stock warrant

 

 

 

 

 

 

 

 

20,470

 

 

 

 

Acquisition related costs

 

 

2,080

 

 

 

 

 

 

2,080

 

 

 

 

Adjusted EBITDA

 

$

(55,899

)

 

$

(37,675

)

 

$

(170,489

)

 

$

(127,664

)

Adjusted loss from operations

 

 

Three Months Ended

December 31,

 

 

Year Ended

December 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

(in thousands)

 

 

(in thousands)

 

Loss from operations

 

$

(59,381

)

 

$

(38,916

)

 

$

(178,599

)

 

$

(133,148

)

Add: One-time IPO related acceleration of non-cash stock based compensation

 

 

 

 

 

 

 

 

1,262

 

 

 

 

Add: Acquisition related costs

 

 

2,080

 

 

 

 

 

 

2,080

 

 

 

 

Adjusted loss from operations

 

$

(57,301

)

 

$

(38,916

)

 

$

(175,257

)

 

$

(133,148

)

Non-GAAP net loss, Non-GAAP net loss per share and Non-GAAP net loss per share, as adjusted

 

 

Three Months Ended

December 31,

 

 

Year Ended

December 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

(in thousands, except share and

per share amounts)

 

 

(in thousands, except share and

per share amounts)

 

Net loss

 

$

(60,662

)

 

$

(42,735

)

 

$

(202,799

)

 

$

(142,978

)

Accretion of redeemable convertible preferred stock

 

 

 

 

 

(23,221

)

 

 

 

 

 

(132,750

)

Net loss attributable to common stockholders

 

$

(60,662

)

 

$

(65,956

)

 

$

(202,799

)

 

$

(275,728

)

Add: One-time IPO related acceleration of non-cash stock based compensation

 

 

 

 

 

 

 

 

1,262

 

 

 

 

Add: One-time IPO related non-cash revaluation of preferred stock warrant

 

 

 

 

 

 

 

 

20,470

 

 

 

 

Add: Acquisition related costs

 

 

2,080

 

 

 

 

 

 

2,080

 

 

 

 

Non-GAAP net loss

 

$

(58,582

)

 

$

(65,956

)

 

$

(178,987

)

 

$

(275,728

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average number of shares outstanding used to compute net loss per share,

basic and diluted

 

 

132,187,850

 

 

 

8,648,313

 

 

 

73,345,569

 

 

 

8,605,962

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share, basic and diluted

 

$

(0.46

)

 

$

(7.63

)

 

$

(2.76

)

 

$

(32.04

)

Impact of one-time IPO related acceleration of non-cash stock based compensation

 

 

 

 

 

 

 

 

0.02

 

 

 

 

Impact of one-time IPO related non-cash revaluation of preferred stock warrant

 

 

 

 

 

 

 

 

0.28

 

 

 

 

Impact of acquisition related costs

 

 

0.02

 

 

 

 

 

 

0.03

 

 

 

 

Non-GAAP net loss per share, basic and diluted

 

$

(0.44

)

 

$

(7.63

)

 

$

(2.44

)

 

$

(32.04

)

Non-GAAP net loss per share, as adjusted, basic and diluted(a)

 

$

(0.44

)

 

$

(0.33

)

 

$

(1.37

)

 

$

(1.11

)

(a) Non-GAAP net loss per share, as adjusted, has been computed to give effect to, as of the beginning of each period presented (i) the shares of common stock issued in connection with our IPO, (ii) the automatic conversion of all outstanding shares of redeemable convertible preferred stock into shares of common stock that occurred upon the consummation of our IPO and (iii) the shares of common stock issued in connection with our follow-on public offering. The computation of Non-GAAP net loss per share, as adjusted, is as follows:

 

 

Three Months Ended

December 31,

 

 

Year Ended

December 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

(in thousands, except share and

per share amounts)

 

 

(in thousands, except share and

per share amounts)

 

Non-GAAP net loss

 

$

(58,582

)

 

$

(65,956

)

 

$

(178,987

)

 

$

(275,728

)

Add: Accretion of redeemable convertible preferred stock

 

 

 

 

 

23,221

 

 

 

 

 

 

132,750

 

Non-GAAP net loss, as adjusted

 

$

(58,582

)

 

$

(42,735

)

 

$

(178,987

)

 

$

(142,978

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average number of shares outstanding used to compute net loss per share,

basic and diluted

 

 

132,187,850

 

 

 

8,648,313

 

 

 

73,345,569

 

 

 

8,605,962

 

Add: unweighted adjustment for common stock issued in connection with IPO

 

 

 

 

 

24,437,500

 

 

 

24,437,500

 

 

 

24,437,500

 

Add: unweighted adjustment for conversion of redeemable convertible preferred stock in connection with IPO

 

 

 

 

 

85,533,394

 

 

 

85,533,394

 

 

 

85,533,394

 

Add: unweighted adjustment for common stock issued in connection with follow-on public offering

 

 

 

 

 

10,800,000

 

 

 

10,800,000

 

 

 

10,800,000

 

Less: Adjustment for the impact of the above items already included in weighted-average number of shares outstanding for the periods presented

 

 

 

 

 

 

 

 

(63,865,903

)

 

 

 

Weighted-average number of shares outstanding used to compute net loss per share, as adjusted, basic and diluted

 

 

132,187,850

 

 

 

129,419,207

 

 

 

130,250,560

 

 

 

129,376,856

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP net loss per share, as adjusted, basic and diluted

 

$

(0.44

)

 

$

(0.33

)

 

$

(1.37

)

 

$

(1.11

)

Financial Outlook

For the full year 2021, we expect triple digit year-over-year growth in ecommerce unit sales and more than 200% year-over-year growth in aggregate gross profit. For the first quarter 2021, we expect the following results:

  • Ecommerce unit sales of 14,000 to 14,500, implying year over year growth of 80% at the middle of the guidance range.
  • Average ecommerce selling price per unit of $25,000 to $26,000 and average ecommerce gross profit per unit of $1,750 to $1,850.
  • Wholesale unit sales of 7,000 to 8,000, average selling price per unit of $12,000 to $13,000 and average gross loss per unit of $(450) to $(600).
  • TDA unit sales of 1,400 to 1,500, average selling price per unit of $25,000 to $26,000 and average gross profit per unit of $1,300 to $1,400.
  • Total revenue of $500 to $529 million.
  • Total gross profit of $24 to $28 million.
  • EBITDA* of $(80) to $(88) million.
  • Stock-based compensation expense of $3.7 million.
  • Net loss per share of $(0.61) to $(0.68).

*A reconciliation of non-GAAP guidance measures to corresponding GAAP measures for our first quarter 2021 Financial Outlook is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, these costs and expenses that may be incurred in the future. We have provided a reconciliation of GAAP to non-GAAP financial measures for fourth quarter 2020 in the reconciliation table in the Non-GAAP Financial Measures section above.

We expect the following number of GAAP weighted average shares outstanding for the first quarter and the full year 2021:

 

 

Quarter

 

YTD

 

2021

 

135,110,000

 

135,110,000

 

These estimates exclude any shares potentially issuable under stock-based compensation plans.

The foregoing estimates are forward-looking statements that reflect the Company’s expectations as of March 3, 2021 and are subject to substantial uncertainty. See “Forward-Looking Statements” below.

Conference Call & Webcast Information

Vroom management will discuss these results and other information regarding the Company during a conference call and audio webcast Wednesday, March 3, 2021 at 5:00 p.m. ET.

The conference call can be accessed via telephone by dialing 1-833-519-1297 (or 914-800-3868 for international access) and entering the conference ID 1274706. A live audio webcast will also be available at ir.vroom.com. An archived webcast of the conference call will be accessible on the website within 48 hours of its completion.

About Vroom (NASDAQ: VRM)

Vroom is an innovative, end-to-end ecommerce platform that offers a better way to buy and a better way to sell used vehicles. The Company’s scalable, data-driven technology brings all phases of the vehicle buying and selling process to consumers wherever they are and offers an extensive selection of vehicles, transparent pricing, competitive financing, and contact-free, at-home pick-up and delivery. For more information visit www.vroom.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding our expectations regarding our business strategy and plans, including our ability to scale our business and improve customer experience, and for future results of operations. These statements are based on management’s current assumptions and are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. For factors that could cause actual results to differ materially from the forward-looking statements in this press release, please see the risks and uncertainties identified under the heading “Risk Factors” in our Annual report on Form 10-K for the year ended December 31, 2020 which is available on our Investor Relations website at ir.vroom.com and on the SEC website at www.sec.gov. All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect future events or circumstances.

VROOM, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

(unaudited)

 

 

As of

 

 

 

December 31,

 

 

 

2020

 

 

2019

 

ASSETS

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,056,213

 

 

$

217,734

 

Restricted cash

 

 

33,826

 

 

 

1,853

 

Accounts receivable, net of allowance of $2,803 and $789, respectively

 

 

60,576

 

 

 

30,848

 

Inventory

 

 

423,647

 

 

 

205,746

 

Prepaid expenses and other current assets

 

 

23,617

 

 

 

9,149

 

Total current assets

 

 

1,597,879

 

 

 

465,330

 

Property and equipment, net

 

 

15,092

 

 

 

7,828

 

Goodwill

 

 

78,172

 

 

 

78,172

 

Operating lease right-of-use assets

 

 

17,137

 

 

 

 

Other assets

 

 

15,776

 

 

 

12,057

 

Total assets

 

$

1,724,056

 

 

$

563,387

 

LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

32,925

 

 

$

18,987

 

Accrued expenses

 

 

59,405

 

 

 

38,491

 

Vehicle floorplan

 

 

329,231

 

 

 

173,461

 

Deferred revenue

 

 

24,822

 

 

 

17,323

 

Operating lease liabilities, current

 

 

6,052

 

 

 

 

Other current liabilities

 

 

30,275

 

 

 

11,572

 

Total current liabilities

 

 

482,710

 

 

 

259,834

 

Operating lease liabilities, excluding current portion

 

 

12,093

 

 

 

 

Other long-term liabilities

 

 

2,151

 

 

 

3,073

 

Total liabilities

 

 

496,954

 

 

 

262,907

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

 

 

Redeemable convertible preferred stock, $0.001 par value; 10,000,000 and 86,123,364 shares authorized as of December 31, 2020 and 2019, respectively; zero and 83,568,628 shares issued and outstanding as of December 31, 2020 and 2019, respectively

 

 

 

 

 

874,332

 

Stockholders’ equity (deficit):

 

 

 

 

 

 

 

 

Common stock, $0.001 par value; 500,000,000 and 113,443,854 shares authorized as of December 31, 2020 and 2019, respectively; 134,043,969 and 8,650,922 shares issued and outstanding as of December 31, 2020 and 2019, respectively

 

 

132

 

 

 

8

 

Additional paid-in-capital

 

 

2,004,841

 

 

 

 

Accumulated deficit

 

 

(777,871

)

 

 

(573,860

)

Total stockholders’ equity (deficit)

 

 

1,227,102

 

 

 

(573,852

)

Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit)

 

$

1,724,056

 

 

$

563,387

 

VROOM, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(unaudited)

 

 

Three Months Ended

December 31,

 

 

Year Ended

December 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail vehicle, net

 

$

318,171

 

 

$

300,015

 

 

$

1,072,551

 

 

$

952,910

 

Wholesale vehicle

 

 

75,111

 

 

 

47,759

 

 

 

245,580

 

 

 

213,464

 

Product, net

 

 

12,216

 

 

 

7,443

 

 

 

38,195

 

 

 

23,708

 

Other

 

 

331

 

 

 

375

 

 

 

1,374

 

 

 

1,739

 

Total revenue

 

 

405,829

 

 

 

355,592

 

 

 

1,357,700

 

 

 

1,191,821

 

Cost of sales

 

 

385,723

 

 

 

339,261

 

 

 

1,286,155

 

 

 

1,133,962

 

Total gross profit

 

 

20,106

 

 

 

16,331

 

 

 

71,545

 

 

 

57,859

 

Selling, general and administrative expenses

 

 

78,128

 

 

 

53,779

 

 

 

245,546

 

 

 

184,988

 

Depreciation and amortization

 

 

1,359

 

 

 

1,468

 

 

 

4,598

 

 

 

6,019

 

Loss from operations

 

 

(59,381

)

 

 

(38,916

)

 

 

(178,599

)

 

 

(133,148

)

Interest expense

 

 

3,274

 

 

 

4,693

 

 

 

9,656

 

 

 

14,596

 

Interest income

 

 

(1,936

)

 

 

(1,153

)

 

 

(5,896

)

 

 

(5,607

)

Revaluation of preferred stock warrant

 

 

 

 

 

254

 

 

 

20,470

 

 

 

769

 

Other income, net

 

 

(3

)

 

 

(21

)

 

 

(114

)

 

 

(96

)

Loss before provision for income taxes

 

 

(60,716

)

 

 

(42,689

)

 

 

(202,715

)

 

 

(142,810

)

Provision for income taxes

 

 

(54

)

 

 

46

 

 

 

84

 

 

 

168

 

Net loss

 

$

(60,662

)

 

$

(42,735

)

 

$

(202,799

)

 

$

(142,978

)

Accretion of redeemable convertible preferred stock

 

 

 

 

 

(23,221

)

 

 

 

 

 

(132,750

)

Net loss attributable to common stockholders

 

$

(60,662

)

 

$

(65,956

)

 

$

(202,799

)

 

$

(275,728

)

Net loss per share attributable to common stockholders, basic and diluted

 

$

(0.46

)

 

$

(7.63

)

 

$

(2.76

)

 

$

(32.04

)

Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted

 

 

132,187,850

 

 

 

8,648,313

 

 

 

73,345,569

 

 

 

8,605,962

 

VROOM, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

Year Ended

December 31,

 

 

 

2020

 

 

2019

 

Operating activities

 

 

 

 

 

 

 

 

Net loss

 

$

(202,799

)

 

$

(142,978

)

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

4,654

 

 

 

6,157

 

Amortization of debt issuance costs

 

 

938

 

 

 

357

 

Loss on extinguishment of debt

 

 

 

 

 

1,031

 

Stock-based compensation expense

 

 

13,254

 

 

 

2,756

 

Loss on disposal of property and equipment

 

 

46

 

 

 

789

 

Provision for inventory obsolescence

 

 

6,588

 

 

 

2,682

 

Revaluation of preferred stock warrant

 

 

20,470

 

 

 

769

 

Other

 

 

2,329

 

 

 

789

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(32,068

)

 

 

(18,430

)

Inventory

 

 

(224,489

)

 

 

(92,877

)

Prepaid expenses and other current assets

 

 

(9,117

)

 

 

(3,935

)

Other assets

 

 

(4,556

)

 

 

(3,487

)

Accounts payable

 

 

14,066

 

 

 

4,035

 

Accrued expenses

 

 

28,431

 

 

 

10,131

 

Deferred revenue

 

 

7,499

 

 

 

10,902

 

Other liabilities

 

 

19,500

 

 

 

5,673

 

Net cash used in operating activities

 

 

(355,254

)

 

 

(215,636

)

Investing activities

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(11,329

)

 

 

(3,528

)

Proceeds from the sale of property and equipment

 

 

 

 

 

 

Net cash used in investing activities

 

 

(11,329

)

 

 

(3,528

)

Financing activities

 

 

 

 

 

 

 

 

Repayments of long-term debt

 

 

 

 

 

(25,000

)

Payments of debt extinguishment costs

 

 

 

 

 

(685

)

Proceeds from vehicle floorplan

 

 

1,242,736

 

 

 

992,179

 

Repayments of vehicle floorplan

 

 

(1,086,966

)

 

 

(914,200

)

Payment of vehicle floorplan upfront commitment fees

 

 

(2,906

)

 

 

 

Proceeds from the issuance of redeemable convertible preferred stock, net

 

 

21,694

 

 

 

227,502

 

Repurchase of common stock

 

 

(1,818

)

 

 

(5,824

)

Common stock shares withheld to satisfy employee tax withholding obligations

 

 

(2,915

)

 

 

 

Proceeds from the issuance of common stock in connection with IPO, net of underwriting discount

 

 

504,024

 

 

 

 

Payments of costs related to IPO

 

 

(6,791

)

 

 

(723

)

Proceeds from the issuance of common stock in connection with follow-on public offering, net of underwriting discount

 

 

569,471

 

 

 

 

Payments of costs related to follow-on public offering

 

 

(1,519

)

 

 

 

Proceeds from exercise of stock options

 

 

2,341

 

 

 

1,810

 

Other financing activities

 

 

(316

)

 

 

183

 

Net cash provided by financing activities

 

 

1,237,035

 

 

 

275,242

 

Net (decrease) increase in cash, cash equivalents and restricted cash

 

 

870,452

 

 

 

56,078

 

Cash, cash equivalents and restricted cash at the beginning of period

 

 

219,587

 

 

 

163,509

 

Cash, cash equivalents and restricted cash at the end of period

 

$

1,090,039

 

 

$

219,587