VRM 8-K
Vroom, Inc. (VRM)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): August 11, 2021
VROOM, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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001-39315 |
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901112566 |
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(State or other jurisdiction of incorporation or organization) |
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(Commission File Number) |
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(I.R.S. Employer Identification No.) |
1375 Broadway, Floor 11
New York, New York 10018
(Address of principal executive offices) (Zip Code)
(855) 524-1300
(Registrant’s telephone number, include area code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
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Common Stock, $0.001 par value per share |
VRM |
The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On August 11, 2021, Vroom, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended June 30, 2021. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information contained in this Item 2.02, including Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filings, unless expressly incorporated by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:
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Exhibit No. |
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Description |
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99.1 |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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VROOM, INC. |
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Date: August 11, 2021 |
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By: |
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/s/ David K. Jones |
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David K. Jones |
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Chief Financial Officer |
Exhibit 99.1
Vroom Reports Second Quarter 2021 Results
Vroom Delivers Record Ecommerce Units and Gross Profit
Ecommerce Unit Sales Up 172% YoY
Ecommerce Gross Profit Up 588% YoY
NEW YORK – August 11, 2021 – Vroom, Inc. (Nasdaq:VRM), a leading ecommerce platform for buying and selling used vehicles, today announced financial results for the second quarter ended June 30, 2021 (“Q2 2021”).
HIGHLIGHTS OF SECOND QUARTER 2021
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18,268 ecommerce units sold, up 172% YoY |
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Ecommerce revenue of $579.7 million, up 230% YoY |
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Ecommerce gross profit of $49.6 million, up 588% YoY |
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Convertible Note offering provided over $600.0 million of additional liquidity |
Paul Hennessy, Chief Executive Officer of Vroom, commented:
“Vroom had an outstanding second quarter. We drove strong expansion in units and gross profit per unit. Ecommerce gross profit per unit continued its upward trajectory, growing $664 (+32%) quarter over quarter, as we continue to execute against our expansion plans in a favorable yet dynamic pricing environment. Our ecommerce units accelerated as our offering to consumers continues to resonate. Moving forward, we intend to continue to scale our capacity and efficiency ahead of growing demand with investments across our business, particularly in logistics, where we are ahead of schedule compared to our initial targets. We will also continue to strive for a frictionless ecommerce checkout experience to drive a compelling customer proposition and improved unit economics over time.”
SECOND QUARTER 2021 FINANCIAL DISCUSSION
All financial comparisons are on a year-over-year basis unless otherwise noted.
Ecommerce Results
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2021 |
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2020 |
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Change |
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% Change |
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2021 |
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2020 |
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Change |
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% Change |
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(in thousands, except unit data and average days to sale) |
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(in thousands, except unit data and average days to sale) |
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Ecommerce units sold |
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18,268 |
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6,713 |
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11,555 |
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172.1 |
% |
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33,772 |
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14,643 |
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19,129 |
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130.6 |
% |
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Ecommerce revenue: |
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Vehicle revenue |
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$ |
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559,010 |
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$ |
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170,460 |
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$ |
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388,550 |
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227.9 |
% |
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$ |
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967,324 |
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$ |
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396,065 |
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$ |
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571,259 |
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144.2 |
% |
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Product revenue |
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20,653 |
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5,108 |
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15,545 |
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304.3 |
% |
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34,647 |
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12,675 |
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21,972 |
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173.3 |
% |
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Total ecommerce revenue |
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$ |
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579,663 |
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$ |
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175,568 |
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$ |
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404,095 |
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230.2 |
% |
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$ |
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1,001,971 |
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$ |
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408,740 |
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$ |
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593,231 |
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145.1 |
% |
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Ecommerce gross profit: |
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Vehicle gross profit |
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$ |
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28,985 |
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$ |
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2,111 |
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$ |
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26,874 |
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1,273.0 |
% |
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$ |
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46,828 |
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$ |
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8,811 |
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$ |
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38,017 |
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431.5 |
% |
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Product gross profit |
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20,653 |
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5,108 |
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15,545 |
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304.3 |
% |
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34,647 |
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12,675 |
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21,972 |
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173.3 |
% |
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Total ecommerce gross profit |
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$ |
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49,638 |
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$ |
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7,219 |
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$ |
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42,419 |
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587.6 |
% |
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$ |
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81,475 |
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$ |
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21,486 |
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$ |
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59,989 |
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279.2 |
% |
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Average vehicle selling price per ecommerce unit |
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$ |
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30,601 |
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$ |
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25,393 |
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$ |
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5,208 |
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20.5 |
% |
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$ |
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28,643 |
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$ |
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27,048 |
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$ |
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1,595 |
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5.9 |
% |
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Gross profit per ecommerce unit: |
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Vehicle gross profit per ecommerce unit |
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$ |
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1,587 |
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$ |
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314 |
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$ |
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1,273 |
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405.4 |
% |
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$ |
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1,387 |
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$ |
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602 |
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$ |
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785 |
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130.4 |
% |
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Product gross profit per ecommerce unit |
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1,131 |
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761 |
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370 |
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48.6 |
% |
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1,026 |
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866 |
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160 |
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18.5 |
% |
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Total gross profit per ecommerce unit |
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$ |
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2,718 |
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$ |
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1,075 |
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$ |
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1,643 |
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152.8 |
% |
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$ |
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2,413 |
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$ |
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1,468 |
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$ |
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945 |
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64.4 |
% |
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Ecommerce average days to sale |
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68 |
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66 |
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2 |
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3.0 |
% |
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76 |
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67 |
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9 |
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13.4 |
% |
2
Ecommerce Units
Ecommerce units sold increased 172.1% to 18,268 driven by higher inventory levels, increased marketing spend, increased consumer demand as a result of the popularity of our business model, strong market demand for used vehicles, and further process improvements in our ecommerce platform. Average monthly unique visitors to our platform increased 75.0% to 1,749,480.
Ecommerce Revenue
Ecommerce revenue increased 230.2% to $579.7 million.
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Ecommerce Vehicle revenue increased 227.9% to $559.0 million. The increase in ecommerce Vehicle revenue was primarily attributable to the increase in ecommerce units sold as well as an increase in the average selling price per unit, which increased from $25,393 to $30,601. |
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Ecommerce Product revenue increased 304.3% to $20.7 million. The increase in ecommerce Product revenue was primarily attributable to the increase in ecommerce units sold as well as an increase in ecommerce Product revenue per unit, which increased from $761 to $1,131 per unit. |
Ecommerce Gross Profit
Ecommerce gross profit increased 587.6% to $49.6 million.
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Ecommerce Vehicle gross profit increased to $28.9 million. The increase in ecommerce Vehicle gross profit was primarily due to a $1,273 increase in ecommerce Vehicle gross profit per unit to $1,587 as well as an increase in ecommerce units sold. |
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Ecommerce Product gross profit increased 304.3% to $ 20.7 million. The increase in ecommerce Product gross profit was primarily attributable to the increase in ecommerce units sold as well as an increase in ecommerce Product gross profit per unit, which increased from $761 to $1,131 per unit. |
Ecommerce Gross Profit per Unit
Ecommerce gross profit per unit increased 152.8% to $2,718.
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Ecommerce Product gross profit per unit increased 48.6% to $1,131, primarily driven by higher attachment rates and an increase in the average loan size as a result of higher ASP. |
3
Results by Segment
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2021 |
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2020 (1) |
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Change |
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% Change |
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2021 |
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2020 (1) |
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Change |
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% Change |
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(in thousands, except unit data) |
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(in thousands, except unit data) |
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Units: |
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Ecommerce |
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18,268 |
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6,713 |
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11,555 |
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172.1 |
% |
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33,772 |
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14,643 |
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19,129 |
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130.6 |
% |
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Wholesale |
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10,020 |
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3,259 |
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6,761 |
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207.5 |
% |
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18,661 |
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7,944 |
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10,717 |
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134.9 |
% |
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TDA |
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1,583 |
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1,110 |
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473 |
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42.6 |
% |
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3,358 |
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4,145 |
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(787 |
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(19.0 |
)% |
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Total units |
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29,871 |
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11,082 |
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18,789 |
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169.5 |
% |
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55,791 |
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26,732 |
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29,059 |
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108.7 |
% |
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Revenue: |
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Ecommerce |
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$ |
579,663 |
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$ |
175,568 |
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$ |
404,095 |
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230.2 |
% |
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$ |
1,001,971 |
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$ |
408,740 |
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$ |
593,231 |
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145.1 |
% |
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Wholesale |
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128,108 |
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50,921 |
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77,187 |
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151.6 |
% |
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246,132 |
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106,497 |
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139,635 |
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131.1 |
% |
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TDA |
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50,759 |
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26,318 |
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24,441 |
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92.9 |
% |
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98,346 |
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112,902 |
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(14,556 |
) |
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(12.9 |
)% |
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All Other (2) |
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3,360 |
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286 |
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3,074 |
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1,074.8 |
% |
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6,559 |
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726 |
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5,833 |
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803.4 |
% |
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Total revenue |
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$ |
761,890 |
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$ |
253,093 |
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$ |
508,797 |
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201.0 |
% |
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$ |
1,353,008 |
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$ |
628,865 |
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$ |
724,143 |
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115.2 |
% |
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Gross profit (loss): |
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Ecommerce |
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$ |
49,638 |
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$ |
7,219 |
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$ |
42,419 |
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587.6 |
% |
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$ |
81,475 |
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$ |
21,486 |
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$ |
59,989 |
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279.2 |
% |
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Wholesale |
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8,516 |
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(543 |
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9,059 |
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1,668.3 |
% |
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8,234 |
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(1,838 |
) |
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10,072 |
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548.0 |
% |
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TDA |
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3,148 |
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864 |
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2,284 |
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264.4 |
% |
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5,939 |
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6,124 |
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(185 |
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(3.0 |
)% |
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All Other (2) |
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1,826 |
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67 |
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1,759 |
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2,625.4 |
% |
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3,656 |
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222 |
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3,434 |
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1,546.8 |
% |
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Total gross profit |
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$ |
63,128 |
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$ |
7,607 |
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$ |
55,521 |
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729.9 |
% |
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$ |
99,304 |
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$ |
25,994 |
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$ |
73,310 |
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282.0 |
% |
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Gross profit (loss) per unit (3): |
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Ecommerce |
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$ |
2,718 |
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$ |
1,075 |
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$ |
1,643 |
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152.8 |
% |
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$ |
2,413 |
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$ |
1,468 |
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$ |
945 |
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64.4 |
% |
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Wholesale |
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$ |
850 |
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$ |
(167 |
) |
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$ |
1,017 |
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609.0 |
% |
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$ |
441 |
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$ |
(231 |
) |
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$ |
672 |
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290.9 |
% |
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TDA |
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$ |
1,988 |
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$ |
778 |
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$ |
1,210 |
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155.5 |
% |
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$ |
1,768 |
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$ |
1,477 |
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$ |
291 |
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19.7 |
% |
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(1) |
We reclassified other revenue and gross profit related to the vehicle repair service at TDA from the TDA reportable segment to the “All Other” category to conform to current year presentation. |
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(2) |
All Other revenues and gross profit consist of the CarStory business and vehicle repair services at TDA. |
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(3) |
Gross profit per unit metrics exclude the CarStory business and vehicle repair services at TDA. |
Total Units
Total units sold increased 169.5% to 29,871.
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• |
TDA units sold increased 42.6% to 1,583. Despite strong market demand for used vehicles, TDA unit sales continue to be negatively impacted by reduced inventory at the TDA location as the ecommerce business continues to scale. TDA units sold were negatively impacted during the second quarter of 2020 as a result of a significant reduction in foot traffic due to the COVID-19 pandemic. |
Total Revenue
Total revenue increased 201.0% to $761.9 million.
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• |
Ecommerce revenue increased 230.2% to $579.7 million, as discussed above. |
4
|
|
• |
Wholesale revenue increased 151.6% to $128.1 million. The increase in wholesale revenue was primarily attributable to the increase in wholesale units sold, partially offset by a lower average selling price per unit, which decreased from $15,625 to $12,785. The higher average selling price per unit in the second quarter of 2020 was primarily driven by the sale of retail vehicles through wholesale channels to reduce our inventory levels at the start of the COVID-19 pandemic. |
|
|
• |
TDA revenue increased 92.9% to $50.8 million, primarily due to a higher average selling price per unit, which increased from $23,144 to $31,021 as well as the increase in TDA units sold. |
Total Gross Profit (Loss)
Total gross profit increased 729.9% to $63.1 million.
|
|
• |
Ecommerce gross profit increased 588% to $49.6 million, as discussed above. |
|
|
• |
Wholesale gross profit increased to $8.5 million. Wholesale gross profit increased primarily due to a higher gross profit per unit, which increased from gross loss per unit of $(167) to gross profit per unit of $850. |
|
|
• |
TDA gross profit increased 264.4% to $3.1 million. TDA gross profit increased primarily due to an increase in TDA gross profit per unit of $1,210 as well as an increase in TDA units sold. |
Gross Profit (Loss) per Unit
|
|
• |
Ecommerce gross profit per unit increased 152.8% to $2,718, as discussed above. |
|
|
• |
Wholesale gross profit per unit increased 609.0% to $850 as a result of favorable wholesale market conditions. Additionally, in the second quarter of 2020, our sales margin was negatively impacted by the sale of retail vehicles through wholesale channels to reduce our inventory levels at the start of the COVID-19 pandemic. Based on data from Cox Automotive, wholesale prices appear to have reached their peak in June and are expected to begin to gradually return to normal market conditions and vehicle depreciation during the second half of 2021. |
|
|
• |
TDA gross profit per unit increased 155.5% to $1,988 driven primarily by higher sales margin and improvements in reconditioning and inbound logistics costs, partially offset by a higher inventory reserve as a result of an increase in inventory levels. Strong sales margin per unit was partially driven by a record retail pricing environment during the second quarter of 2021 as well as an increase in vehicles sourced directly from consumers and further improvements in our pricing methodologies. Additionally, in the second quarter of 2020, our sales margin was negatively impacted by a strategic decision to reduce vehicle pricing in order to sell pre-COVID-19 inventory. Based on data from Cox Automotive, retail prices are expected to peak in the third quarter and begin to gradually return to normal market conditions and vehicle depreciation during the second half of 2021. |
5
SG&A
|
|
|
Three Months Ended June 30, |
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
2021 |
|
|
|
2020 |
|
|
Change |
|
|
% Change |
|
|
|
2021 |
|
|
|
2020 |
|
|
Change |
|
|
% Change |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Compensation & benefits |
|
$ |
|
51,811 |
|
|
$ |
|
20,618 |
|
|
$ |
31,193 |
|
|
|
151.3 |
% |
|
$ |
|
91,681 |
|
|
$ |
|
40,940 |
|
|
$ |
50,741 |
|
|
|
123.9 |
% |
|
Marketing expense |
|
|
|
23,495 |
|
|
|
|
11,573 |
|
|
|
11,922 |
|
|
|
103.0 |
% |
|
|
|
53,053 |
|
|
|
|
29,488 |
|
|
|
23,565 |
|
|
|
79.9 |
% |
|
Outbound logistics |
|
|
|
20,153 |
|
|
|
|
5,470 |
|
|
|
14,683 |
|
|
|
268.4 |
% |
|
|
|
35,271 |
|
|
|
|
11,261 |
|
|
|
24,010 |
|
|
|
213.2 |
% |
|
Occupancy and related costs |
|
|
|
4,042 |
|
|
|
|
2,267 |
|
|
|
1,775 |
|
|
|
78.3 |
% |
|
|
|
7,964 |
|
|
|
|
4,964 |
|
|
|
3,000 |
|
|
|
60.4 |
% |
|
Professional fees |
|
|
|
4,259 |
|
|
|
|
1,465 |
|
|
|
2,794 |
|
|
|
190.7 |
% |
|
|
|
8,257 |
|
|
|
|
3,924 |
|
|
|
4,333 |
|
|
|
110.4 |
% |
|
Other |
|
|
|
20,138 |
|
|
|
|
6,518 |
|
|
|
13,620 |
|
|
|
209.0 |
% |
|
|
|
36,538 |
|
|
|
|
15,714 |
|
|
|
20,824 |
|
|
|
132.5 |
% |
|
Total selling, general & administrative expenses |
|
$ |
|
123,898 |
|
|
$ |
|
47,911 |
|
|
$ |
75,987 |
|
|
|
158.6 |
% |
|
$ |
|
232,764 |
|
|
$ |
|
106,291 |
|
|
$ |
126,473 |
|
|
|
119.0 |
% |
Selling, general and administrative expenses increased 158.6% to $123.9 million. The increase was primarily due to:
|
|
• |
$31.2 million increase in compensation and benefits due to an increase in headcount, an increase in variable fees for third-party sales and sales support providers as a result of an increase in units sold, as well as a $1.3 million increase in stock-based compensation to $5.4 million; |
|
|
• |
$14.7 million increase in outbound logistics costs partially attributable to the growth in ecommerce units sold, which increased outbound logistics costs by $9.4 million, and increases in market rates of logistics providers, which increased outbound logistics costs by $5.3 million; |
|
|
• |
$13.6 million increase in other selling, general and administrative expenses primarily related to volume-based fees for software licenses and other variable expenses as our business continues to scale as well as additional insurance costs associated with being a publicly traded company and growing inventory; and |
|
|
• |
$11.9 million increase in marketing expense as we expanded our national broad-reach brand advertising and increased performance and online marketing as we continue to grow our listed inventory. |
We expect selling, general and administrative expenses to increase in the future as we scale our business and sell more ecommerce units. We also expect to incur increased selling, general and administrative expenses as we continue to invest in and improve our customer experience, invest in expanding our proprietary logistics and reconditioning networks, and explore a variety of strategies for a proprietary lending operation.
Loss from Operations and Net Loss
Loss from operations increased 54.2% to $ 63.8 million. Net loss increased 4.1% to $ 65.8 million.
6
Non-GAAP Financial Measures
In addition to our results determined in accordance with U.S. 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 U.S. 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 U.S. 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 U.S. GAAP. We have reconciled all non-GAAP financial measures with the most directly comparable U.S. GAAP financial measures.
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.
EBITDA and Adjusted EBITDA
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 and the one-time, IPO related non-cash revaluation of a preferred stock warrant. The following table presents a reconciliation of EBITDA and Adjusted EBITDA to net loss, which is the most directly comparable U.S. GAAP measure:
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
|
Net loss |
|
$ |
(65,807 |
) |
|
$ |
(63,228 |
) |
|
$ |
(142,996 |
) |
|
$ |
(104,287 |
) |
|
Adjusted to exclude the following: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
3,880 |
|
|
|
1,297 |
|
|
|
7,692 |
|
|
|
4,123 |
|
|
Interest income |
|
|
(2,062 |
) |
|
|
(715 |
) |
|
|
(4,358 |
) |
|
|
(2,671 |
) |
|
Provision for income taxes |
|
|
194 |
|
|
|
52 |
|
|
|
350 |
|
|
|
105 |
|
|
Depreciation and amortization expense |
|
|
3,122 |
|
|
|
1,089 |
|
|
|
6,028 |
|
|
|
2,059 |
|
|
EBITDA |
|
$ |
(60,673 |
) |
|
$ |
(61,505 |
) |
|
$ |
(133,284 |
) |
|
$ |
(100,671 |
) |
|
One-time IPO related acceleration of non-cash stock-based compensation |
|
|
— |
|
|
|
1,262 |
|
|
|
— |
|
|
|
1,262 |
|
|
One-time IPO related non-cash revaluation of preferred stock warrant |
|
|
— |
|
|
|
21,260 |
|
|
|
— |
|
|
|
20,470 |
|
|
Adjusted EBITDA |
|
$ |
(60,673 |
) |
|
$ |
(38,983 |
) |
|
$ |
(133,284 |
) |
|
$ |
(78,939 |
) |
Adjusted loss from Operations
We calculate Adjusted loss from operations as loss from operations adjusted to exclude the one-time, IPO related acceleration of non-cash stock-based compensation expense. The following table presents a reconciliation of Adjusted loss from operations to loss from operations, which is the most directly comparable U.S. GAAP measure:
7
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
|
Loss from operations |
|
$ |
(63,828 |
) |
|
$ |
(41,387 |
) |
|
$ |
(139,360 |
) |
|
$ |
(82,346 |
) |
|
Add: One-time IPO related acceleration of non-cash stock based compensation |
|
|
— |
|
|
|
1,262 |
|
|
|
— |
|
|
|
1,262 |
|
|
Adjusted loss from operations |
|
$ |
(63,828 |
) |
|
$ |
(40,125 |
) |
|
$ |
(139,360 |
) |
|
$ |
(81,084 |
) |
Non-GAAP net loss, Non-GAAP net loss per share and Non-GAAP net loss per share, as adjusted
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 and the one-time, IPO related non-cash revaluation of a preferred stock warrant. We calculate Non-GAAP net loss per share as Non-GAAP net loss divided by weighted average number of shares outstanding. The following table presents a reconciliation of Non-GAAP net loss and Non-GAAP net loss per share to net loss and net loss per share, which are the most directly comparable U.S. GAAP measures:
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands, except share and per share amounts) |
|
||||||||||||||
|
Net loss |
|
$ |
(65,807 |
) |
|
$ |
(63,228 |
) |
|
$ |
(142,996 |
) |
|
$ |
(104,287 |
) |
|
Net loss attributable to common stockholders |
|
$ |
(65,807 |
) |
|
$ |
(63,228 |
) |
|
$ |
(142,996 |
) |
|
$ |
(104,287 |
) |
|
Add: One-time IPO related acceleration of non-cash stock based compensation |
|
|
— |
|
|
|
1,262 |
|
|
|
— |
|
|
|
1,262 |
|
|
Add: One-time IPO related non-cash revaluation of preferred stock warrant |
|
|
— |
|
|
|
21,260 |
|
|
|
— |
|
|
|
20,470 |
|
|
Non-GAAP net loss |
|
$ |
(65,807 |
) |
|
$ |
(40,706 |
) |
|
$ |
(142,996 |
) |
|
$ |
(82,555 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average number of shares outstanding used to compute net loss per share, basic and diluted |
|
|
136,507,177 |
|
|
|
31,599,497 |
|
|
|
136,002,344 |
|
|
|
20,035,476 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share, basic and diluted |
|
$ |
(0.48 |
) |
|
$ |
(2.00 |
) |
|
$ |
(1.05 |
) |
|
$ |
(5.21 |
) |
|
Impact of one-time IPO related acceleration of non-cash stock based compensation |
|
|
— |
|
|
|
0.04 |
|
|
|
— |
|
|
|
0.07 |
|
|
Impact of one-time IPO related non-cash revaluation of preferred stock warrant |
|
|
— |
|
|
|
0.67 |
|
|
|
— |
|
|
|
1.02 |
|
|
Non-GAAP net loss per share, basic and diluted |
|
$ |
(0.48 |
) |
|
$ |
(1.29 |
) |
|
$ |
(1.05 |
) |
|
$ |
(4.12 |
) |
|
Non-GAAP net loss per share, as adjusted, basic and diluted(a) |
|
$ |
(0.48 |
) |
|
$ |
(0.34 |
) |
|
$ |
(1.05 |
) |
|
$ |
(0.70 |
) |
(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 and (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. The computation of Non-GAAP net loss per share, as adjusted is as follows:
8
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands, except share and per share amounts) |
|
||||||||||||||
|
Non-GAAP net loss |
|
$ |
(65,807 |
) |
|
$ |
(40,706 |
) |
|
$ |
(142,996 |
) |
|
$ |
(82,555 |
) |
|
Non-GAAP net loss, as adjusted |
|
$ |
(65,807 |
) |
|
$ |
(40,706 |
) |
|
$ |
(142,996 |
) |
|
$ |
(82,555 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average number of shares outstanding used to compute net loss per share, basic and diluted |
|
|
136,507,177 |
|
|
|
31,599,497 |
|
|
|
136,002,344 |
|
|
|
20,035,476 |
|
|
Add: unweighted adjustment for common stock issued in connection with IPO |
|
|
— |
|
|
|
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 |
|
|
Less: Adjustment for the impact of the above items already included in weighted-average number of shares outstanding for the periods presented |
|
|
— |
|
|
|
(22,960,956 |
) |
|
|
— |
|
|
|
(11,480,478 |
) |
|
Weighted-average number of shares outstanding used to compute net loss per share, as adjusted, basic and diluted |
|
|
136,507,177 |
|
|
|
118,609,435 |
|
|
|
136,002,344 |
|
|
|
118,525,892 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net loss per share, as adjusted, basic and diluted |
|
$ |
(0.48 |
) |
|
$ |
(0.34 |
) |
|
$ |
(1.05 |
) |
|
$ |
(0.70 |
) |
9
Financial Outlook
For the full year 2021, we continue to 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 third quarter 2021, we expect the following results:
•Ecommerce unit sales of 20,000 to 20,500, implying year over year growth of 130% at the mid-point of the guidance range.
•Average ecommerce selling price per unit of $32,000 to $33,000 and average ecommerce gross profit per unit of $2,350 to $2,450.
•Wholesale unit sales of 9,500 to 10,500, average selling price per unit of $12,000 to $13,000 and average gross profit per unit of $50 to $100.
•TDA unit sales of 1,550 to 1,650, average selling price per unit of $32,000 to $33,000 and average gross profit per unit of $1,650 to $1,750.
•Total revenue of $858 to $891 million.
•Total gross profit of $51 to $56 million.
•EBITDA* of $(100) to $(92) million.
•Stock-based compensation expense of $6.6 million.
•Net loss per share of $(0.78) to $(0.73).
*A reconciliation of non-GAAP guidance measures to corresponding GAAP measures for our third 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 the second quarter 2021 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 third quarter and the full year 2021:
|
|
|
Quarter |
|
YTD |
|
|
2021 |
|
136,717,347 |
|
136,359,846 |
|
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 August 11, 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, August 11, 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 1597432. 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.
10
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, grow inventory, expand reconditioning capacity, invest in logistics and improve our end-to-end customer experience, and for future results of operations and financial position, including our ability to improve our unit economics and our outlook for the third quarter ended September 30, 2021 and the year ended December 31, 2021. 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, as updated by our Quarterly report on Form 10-Q for the quarter ended June 30, 2021, each of 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.
Investor Relations:
Vroom
Allen Miller
Media Contact:
Moxie Communications Group
Alyssa Galella
(562) 294-6261
11
VROOM, INC.
(in thousands, except share and per share amounts)
(unaudited)
|
|
|
As of |
|
|
As of |
|
||
|
|
|
June 30, |
|
|
December 31, |
|
||
|
|
|
2021 |
|
|
2020 |
|
||
|
ASSETS |
|
|
|
|
|
|
|
|
|
Current Assets: |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,463,573 |
|
|
$ |
1,056,213 |
|
|
Restricted cash |
|
|
37,116 |
|
|
|
33,826 |
|
|
Accounts receivable, net of allowance of $3,304 and $2,803, respectively |
|
|
100,491 |
|
|
|
60,576 |
|
|
Inventory |
|
|
519,966 |
|
|
|
423,647 |
|
|
Prepaid expenses and other current assets |
|
|
49,984 |
|
|
|
23,617 |
|
|
Total current assets |
|
|
2,171,130 |
|
|
|
1,597,879 |
|
|
Property and equipment, net |
|
|
21,397 |
|
|
|
15,092 |
|
|
Intangible assets, net |
|
|
31,318 |
|
|
|
34 |
|
|
Goodwill |
|
|
159,306 |
|
|
|
78,172 |
|
|
Operating lease right-of-use assets |
|
|
17,679 |
|
|
|
17,137 |
|
|
Other assets |
|
|
19,809 |
|
|
|
15,742 |
|
|
Total assets |
|
$ |
2,420,639 |
|
|
$ |
1,724,056 |
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
69,813 |
|
|
$ |
32,925 |
|
|
Accrued expenses |
|
|
86,328 |
|
|
|
59,405 |
|
|
Vehicle floorplan |
|
|
363,614 |
|
|
|
329,231 |
|
|
Deferred revenue |
|
|
41,648 |
|
|
|
24,822 |
|
|
Operating lease liabilities, current |
|
|
6,612 |
|
|
|
6,052 |
|
|
Other current liabilities |
|
|
90,986 |
|
|
|
30,275 |
|
|
Total current liabilities |
|
|
659,001 |
|
|
|
482,710 |
|
|
Convertible senior notes |
|
|
608,960 |
|
|
|
— |
|
|
Operating lease liabilities, excluding current portion |
|
|
12,348 |
|
|
|
12,093 |
|
|
Other long-term liabilities |
|
|
3,584 |
|
|
|
2,151 |
|
|
Total liabilities |
|
|
1,283,893 |
|
|
|
496,954 |
|
|
Commitments and contingencies (Note 10) |
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value; 500,000,000 shares authorized as of June 30, 2021 and December 31, 2020; 136,717,347 and 134,043,969 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively |
|
|
134 |
|
|
|
132 |
|
|
Additional paid-in-capital |
|
|
2,057,479 |
|
|
|
2,004,841 |
|
|
Accumulated deficit |
|
|
(920,867 |
) |
|
|
(777,871 |
) |
|
Total stockholders’ equity |
|
|
1,136,746 |
|
|
|
1,227,102 |
|
|
Total liabilities and stockholders’ equity |
|
$ |
2,420,639 |
|
|
$ |
1,724,056 |
|
12
VROOM, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(unaudited)
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail vehicle, net |
|
$ |
608,116 |
|
|
$ |
196,150 |
|
|
$ |
1,062,439 |
|
|
$ |
504,862 |
|
|
Wholesale vehicle |
|
|
128,108 |
|
|
|
50,921 |
|
|
|
246,132 |
|
|
|
106,497 |
|
|
Product, net |
|
|
22,306 |
|
|
|
5,736 |
|
|
|
37,878 |
|
|
|
16,780 |
|
|
Other |
|
|
3,360 |
|
|
|
286 |
|
|
|
6,559 |
|
|
|
726 |
|
|
Total revenue |
|
|
761,890 |
|
|
|
253,093 |
|
|
|
1,353,008 |
|
|
|
628,865 |
|
|
Cost of sales |
|
|
698,762 |
|
|
|
245,486 |
|
|
|
1,253,704 |
|
|
|
602,871 |
|
|
Total gross profit |
|
|
63,128 |
|
|
|
7,607 |
|
|
|
99,304 |
|
|
|
25,994 |
|
|
Selling, general and administrative expenses |
|
|
123,898 |
|
|
|
47,911 |
|
|
|
232,764 |
|
|
|
106,291 |
|
|
Depreciation and amortization |
|
|
3,058 |
|
|
|
1,083 |
|
|
|
5,900 |
|
|
|
2,049 |
|
|
Loss from operations |
|
|
(63,828 |
) |
|
|
(41,387 |
) |
|
|
(139,360 |
) |
|
|
(82,346 |
) |
|
Interest expense |
|
|
3,880 |
|
|
|
1,297 |
|
|
|
7,692 |
|
|
|
4,123 |
|
|
Interest income |
|
|
(2,062 |
) |
|
|
(715 |
) |
|
|
(4,358 |
) |
|
|
(2,671 |
) |
|
Revaluation of preferred stock warrant |
|
|
— |
|
|
|
21,260 |
|
|
|
— |
|
|
|
20,470 |
|
|
Other income, net |
|
|
(33 |
) |
|
|
(53 |
) |
|
|
(48 |
) |
|
|
(86 |
) |
|
Loss before provision for income taxes |
|
|
(65,613 |
) |
|
|
(63,176 |
) |
|
|
(142,646 |
) |
|
|
(104,182 |
) |
|
Provision for income taxes |
|
|
194 |
|
|
|
52 |
|
|
|
350 |
|
|
|
105 |
|
|
Net loss |
|
$ |
(65,807 |
) |
|
$ |
(63,228 |
) |
|
$ |
(142,996 |
) |
|
$ |
(104,287 |
) |
|
Net loss per share attributable to common stockholders, basic and diluted |
|
$ |
(0.48 |
) |
|
$ |
(2.00 |
) |
|
$ |
(1.05 |
) |
|
$ |
(5.21 |
) |
|
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted |
|
|
136,507,177 |
|
|
|
31,599,497 |
|
|
|
136,002,344 |
|
|
|
20,035,476 |
|
13
VROOM, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
|
|
|
Six Months Ended June 30, |
|
|||||
|
|
|
2021 |
|
|
2020 |
|
||
|
Operating activities |
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(142,996 |
) |
|
$ |
(104,287 |
) |
|
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
6,028 |
|
|
|
2,059 |
|
|
Amortization of debt issuance costs |
|
|
698 |
|
|
|
375 |
|
|
Stock-based compensation expense |
|
|
8,212 |
|
|
|
4,700 |
|
|
Provision to record inventory at lower of cost or net realizable value |
|
|
3,093 |
|
|
|
(1,564 |
) |
|
Revaluation of preferred stock warrant |
|
|
— |
|
|
|
20,470 |
|
|
Other |
|
|
2,818 |
|
|
|
632 |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(41,393 |
) |
|
|
14,863 |
|
|
Inventory |
|
|
(99,412 |
) |
|
|
66,247 |
|
|
Prepaid expenses and other current assets |
|
|
(26,669 |
) |
|
|
(7,909 |
) |
|
Other assets |
|
|
(3,948 |
) |
|
|
(1,285 |
) |
|
Accounts payable |
|
|
36,507 |
|
|
|
919 |
|
|
Accrued expenses |
|
|
26,306 |
|
|
|
4,714 |
|
|
Deferred revenue |
|
|
16,788 |
|
|
|
(1,835 |
) |
|
Other liabilities |
|
|
62,117 |
|
|
|
1,905 |
|
|
Net cash (used in) provided by operating activities |
|
|
(151,851 |
) |
|
|
4 |
|
|
Investing activities |
|
|
|
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(8,943 |
) |
|
|
(3,128 |
) |
|
Acquisition of business, net of cash acquired |
|
|
(76,145 |
) |
|
|
— |
|
|
Net cash used in investing activities |
|
|
(85,088 |
) |
|
|
(3,128 |
) |
|
Financing activities |
|
|
|
|
|
|
|
|
|
Proceeds from vehicle floorplan |
|
|
1,070,110 |
|
|
|
465,663 |
|
|
Repayments of vehicle floorplan |
|
|
(1,035,727 |
) |
|
|
(529,341 |
) |
|
Payment of vehicle floorplan upfront commitment fees |
|
|
— |
|
|
|
(1,125 |
) |
|
Proceeds from issuance of convertible senior notes |
|
|
625,000 |
|
|
|
— |
|
|
Issuance costs paid for convertible senior notes |
|
|
(16,175 |
) |
|
|
— |
|
|
Proceeds from the issuance of redeemable convertible preferred stock, net |
|
|
— |
|
|
|
21,694 |
|
|
Repurchase of common stock |
|
|
— |
|
|
|
(1,818 |
) |
|
Common stock shares withheld to satisfy employee tax withholding obligations |
|
|
— |
|
|
|
(878 |
) |
|
Proceeds from the issuance of common stock in connection with IPO, net of underwriting discount |
|
|
— |
|
|
|
504,023 |
|
|
Payments of costs related to IPO |
|
|
— |
|
|
|
(1,740 |
) |
|
Proceeds from exercise of stock options |
|
|
4,381 |
|
|
|
13 |
|
|
Other financing activities |
|
|
— |
|
|
|
(66 |
) |
|
Net cash provided by financing activities |
|
|
647,589 |
|
|
|
456,425 |
|
|
Net increase in cash, cash equivalents and restricted cash |
|
|
410,650 |
|
|
|
453,301 |
|
|
Cash, cash equivalents and restricted cash at the beginning of period |
|
|
1,090,039 |
|
|
|
219,587 |
|
|
Cash, cash equivalents and restricted cash at the end of period |
|
$ |
1,500,689 |
|
|
$ |
672,888 |
|
14