> You gotta love how a roughly %3 decrease in year-to-year revenue leads to a %97 decrease in the stock price and an increase in the net loss from ~$30 million to ~$300 million
It's not that surprising. Revenue is worth nothing without a healthy margin, and that's where Carvana seems to have a problem. This quickly turns a company which could be profitable if it didn't invest as much into the future, into a company that is bleeding money and might be headed for bankruptcy. It explains a big part of the change in valuation.
Not surprising, just indicative of how insane and wild the bull market got over the last decade.
I can't help but think that a lot of businesses which could've ended up as profitable, sustainable market leaders over the long term have been, or will be, decimated by this misalignment of investment priorities. .
It's not that surprising. Revenue is worth nothing without a healthy margin, and that's where Carvana seems to have a problem. This quickly turns a company which could be profitable if it didn't invest as much into the future, into a company that is bleeding money and might be headed for bankruptcy. It explains a big part of the change in valuation.