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Vroom Announces Second Quarter 2024 Results

Continued Progress on Operational Initiatives and Improved Portfolio Performance at UACC

Vroom, Inc. (Nasdaq:VRM) today announced financial results for the second quarter ended June 30, 2024.

HIGHLIGHTS OF SECOND QUARTER 2024

  • $63.4 million cash and cash equivalents as of June 30, 2024
  • $34.0 million of liquidity available to UACC under the warehouse credit facilities
  • $(19.1) million net loss from continuing operations
  • $(7.5) million Adjusted EBITDA
  • Successfully Completed UACC Securitization Transaction in April 2024

Tom Shortt, the Company’s Chief Executive Officer, said “Overall, I am pleased with our second quarter 2024 results. We grew origination volume and our serviced loan portfolio year over year, while continuing to focus on portfolio performance. We currently expect originations since early 2023 to perform at pre-pandemic levels, and are beginning to see positive impacts of our prior decision to tighten credit, resulting in improvements in credit losses compared to the prior quarter. We are focused on improving processes and technology, digitization and automation, and reducing costs across the business.”

SECOND QUARTER 2024 FINANCIAL DISCUSSION

All financial comparisons are on a year-over-year basis unless otherwise noted. The following financial information is unaudited.

 

 

Three Months Ended

June 30,

 

 

 

 

 

Six Months Ended

June 30,

 

 

 

 

 

 

2024

 

 

2023

 

 

$ Change

 

 

2024

 

 

2023

 

 

$ Change

 

Interest income

 

$

51,862

 

 

$

46,995

 

 

$

4,867

 

 

$

102,939

 

 

$

81,363

 

 

$

21,576

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Warehouse credit facility

 

 

6,986

 

 

 

3,658

 

 

 

3,328

 

 

 

16,457

 

 

 

6,757

 

 

 

9,700

 

Securitization debt

 

 

7,995

 

 

 

5,981

 

 

 

2,014

 

 

 

12,864

 

 

 

10,326

 

 

 

2,538

 

Total interest expense

 

 

14,981

 

 

 

9,639

 

 

 

5,342

 

 

 

29,321

 

 

 

17,083

 

 

 

12,238

 

Net interest income

 

 

36,881

 

 

 

37,356

 

 

 

(475

)

 

 

73,618

 

 

 

64,280

 

 

 

9,338

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized losses, net of recoveries

 

 

18,729

 

 

 

23,187

 

 

 

(4,458

)

 

 

49,548

 

 

 

38,915

 

 

 

10,633

 

Net interest income after losses and recoveries

 

 

18,152

 

 

 

14,169

 

 

 

3,983

 

 

 

24,070

 

 

 

25,365

 

 

 

(1,295

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Servicing income

 

 

1,587

 

 

 

2,551

 

 

 

(964

)

 

 

3,606

 

 

 

5,405

 

 

 

(1,799

)

Warranties and GAP income (loss), net

 

 

1,378

 

 

 

751

 

 

 

627

 

 

 

(8,264

)

 

 

3,586

 

 

 

(11,850

)

CarStory revenue

 

 

2,913

 

 

 

3,224

 

 

 

(311

)

 

 

5,892

 

 

 

6,394

 

 

 

(502

)

Gain on debt extinguishment

 

 

 

 

 

10,931

 

 

 

(10,931

)

 

 

 

 

 

19,640

 

 

 

(19,640

)

Other income

 

 

3,141

 

 

 

3,071

 

 

 

70

 

 

 

5,925

 

 

 

6,103

 

 

 

(178

)

Total noninterest income

 

 

9,019

 

 

 

20,528

 

 

 

(11,509

)

 

 

7,159

 

 

 

41,128

 

 

 

(33,969

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

27,176

 

 

 

21,341

 

 

 

5,835

 

 

 

51,286

 

 

 

44,562

 

 

 

6,724

 

Professional fees

 

 

1,488

 

 

 

2,444

 

 

 

(956

)

 

 

4,831

 

 

 

7,417

 

 

 

(2,586

)

Software and IT costs

 

 

4,036

 

 

 

4,804

 

 

 

(768

)

 

 

8,658

 

 

 

10,050

 

 

 

(1,392

)

Depreciation and amortization

 

 

7,232

 

 

 

7,190

 

 

 

42

 

 

 

14,858

 

 

 

14,422

 

 

 

436

 

Interest expense on corporate debt

 

 

1,549

 

 

 

1,527

 

 

 

22

 

 

 

2,940

 

 

 

2,867

 

 

 

73

 

Impairment charges

 

 

 

 

 

 

 

 

 

 

 

2,752

 

 

 

 

 

 

2,752

 

Other expenses

 

 

4,961

 

 

 

4,571

 

 

 

390

 

 

 

9,416

 

 

 

9,773

 

 

 

(357

)

Total expenses

 

 

46,442

 

 

 

41,877

 

 

 

4,565

 

 

 

94,741

 

 

 

89,091

 

 

 

5,650

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from continuing operations before provision for income taxes

 

 

(19,271

)

 

 

(7,180

)

 

 

(12,091

)

 

 

(63,512

)

 

 

(22,598

)

 

 

(40,914

)

(Benefit) provision for income taxes from continuing operations

 

 

(167

)

 

 

286

 

 

 

(453

)

 

 

269

 

 

 

337

 

 

 

(68

)

Net loss from continuing operations

 

$

(19,104

)

 

$

(7,466

)

 

$

(11,638

)

 

$

(63,781

)

 

$

(22,935

)

 

$

(40,846

)

Net loss from discontinued operations

 

$

(2,084

)

 

$

(58,573

)

 

$

56,489

 

 

$

(25,025

)

 

$

(117,844

)

 

$

92,819

 

Net loss

 

$

(21,188

)

 

$

(66,039

)

 

$

44,851

 

 

$

(88,806

)

 

$

(140,779

)

 

$

51,973

 

 

Results by Segment

UACC

 

Three Months Ended

June 30,

 

 

 

 

 

 

 

 

2024

 

 

2023

 

 

Change

 

 

% Change

 

 

(in thousands)

 

 

 

 

 

 

 

Interest income

$

52,389

 

 

$

47,531

 

 

$

4,858

 

 

 

10.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

Warehouse credit facility

 

6,986

 

 

 

3,658

 

 

 

3,328

 

 

 

91.0

%

Securitization debt

 

7,995

 

 

 

5,981

 

 

 

2,014

 

 

 

33.7

%

Total interest expense

 

14,981

 

 

 

9,639

 

 

 

5,342

 

 

 

55.4

%

Net interest income

 

37,408

 

 

 

37,892

 

 

 

(484

)

 

 

(1.3

)%

 

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized losses, net of recoveries

 

19,582

 

 

 

20,386

 

 

 

(804

)

 

 

(3.9

)%

Net interest income after losses and recoveries

 

17,826

 

 

 

17,506

 

 

 

320

 

 

 

1.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

Servicing income

 

1,587

 

 

 

2,551

 

 

 

(964

)

 

 

(37.8

)%

Warranties and GAP income, net

 

1,640

 

 

 

1,478

 

 

 

162

 

 

 

11.0

%

Other income

 

2,098

 

 

 

977

 

 

 

1,121

 

 

 

114.7

%

Total noninterest income

 

5,325

 

 

 

5,006

 

 

 

319

 

 

 

6.4

%

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

20,539

 

 

 

16,392

 

 

 

4,147

 

 

 

25.3

%

Professional fees

 

575

 

 

 

1,028

 

 

 

(453

)

 

 

(44.1

)%

Software and IT costs

 

2,605

 

 

 

2,974

 

 

 

(369

)

 

 

(12.4

)%

Depreciation and amortization

 

5,630

 

 

 

5,582

 

 

 

48

 

 

 

0.9

%

Interest expense on corporate debt

 

629

 

 

 

436

 

 

 

193

 

 

 

44.2

%

Other expenses

 

3,054

 

 

 

1,841

 

 

 

1,213

 

 

 

65.9

%

Total expenses

 

33,032

 

 

 

28,253

 

 

 

4,779

 

 

 

16.9

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

(2,824

)

 

$

291

 

 

$

(3,115

)

 

 

(1,070.4

)%

 

 

 

 

 

 

 

 

 

 

 

 

Interest income on cash and cash equivalents

$

(560

)

 

$

(506

)

 

 

(54

)

 

 

10.7

%

Stock compensation expense

$

865

 

 

$

519

 

 

 

346

 

 

 

66.8

%

 

 

Six Months Ended

June 30,

 

 

 

 

 

 

 

 

2024

 

 

2023

 

 

Change

 

 

% Change

 

 

(in thousands)

 

 

 

 

 

 

 

Interest income

$

103,930

 

 

$

82,830

 

 

$

21,100

 

 

 

25.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

Warehouse credit facility

 

16,457

 

 

 

6,757

 

 

 

9,700

 

 

 

143.6

%

Securitization debt

 

12,864

 

 

 

10,326

 

 

 

2,538

 

 

 

24.6

%

Total interest expense

 

29,321

 

 

 

17,083

 

 

 

12,238

 

 

 

71.6

%

Net interest income

 

74,609

 

 

 

65,747

 

 

 

8,862

 

 

 

13.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized losses, net of recoveries

 

47,343

 

 

 

32,658

 

 

 

14,685

 

 

 

45.0

%

Net interest income after losses and recoveries

 

27,266

 

 

 

33,089

 

 

 

(5,823

)

 

 

(17.6

)%

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

Servicing income

 

3,606

 

 

 

5,405

 

 

 

(1,799

)

 

 

(33.3

)%

Warranties and GAP income, net

 

3,250

 

 

 

3,681

 

 

 

(431

)

 

 

(11.7

)%

Other income

 

4,568

 

 

 

2,031

 

 

 

2,537

 

 

 

124.9

%

Total noninterest income

 

11,424

 

 

 

11,117

 

 

 

307

 

 

 

2.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

39,327

 

 

 

34,928

 

 

 

4,399

 

 

 

12.6

%

Professional fees

 

1,451

 

 

 

3,569

 

 

 

(2,118

)

 

 

(59.3

)%

Software and IT costs

 

5,702

 

 

 

5,679

 

 

 

23

 

 

 

0.4

%

Depreciation and amortization

 

11,651

 

 

 

11,209

 

 

 

442

 

 

 

3.9

%

Interest expense on corporate debt

 

1,100

 

 

 

633

 

 

 

467

 

 

 

73.7

%

Impairment charges

 

2,752

 

 

 

 

 

 

2,752

 

 

 

100.0

%

Other expenses

 

5,577

 

 

 

4,261

 

 

 

1,316

 

 

 

30.9

%

Total expenses

 

67,561

 

 

 

60,279

 

 

 

7,282

 

 

 

12.1

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

(12,970

)

 

$

(4,177

)

 

$

(8,793

)

 

 

210.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Interest income on cash and cash equivalents

$

(1,128

)

 

$

(954

)

 

 

(174

)

 

 

18.2

%

Stock compensation expense

$

1,033

 

 

$

1,008

 

 

 

24

 

 

 

2.4

%

 

CarStory

 

Three Months Ended

June 30,

 

 

 

 

 

 

 

 

2024

 

 

2023

 

 

Change

 

 

% Change

 

 

(in thousands)

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

CarStory revenue

$

2,913

 

 

$

3,224

 

 

$

(311

)

 

 

(9.6

)%

Other income

 

190

 

 

 

93

 

 

 

97

 

 

 

104.3

%

Total noninterest income

 

3,103

 

 

 

3,317

 

 

 

(214

)

 

 

(6.5

)%

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

2,461

 

 

 

2,420

 

 

 

41

 

 

 

1.7

%

Professional fees

 

80

 

 

 

113

 

 

 

(33

)

 

 

(29.3

)%

Software and IT costs

 

21

 

 

 

171

 

 

 

(150

)

 

 

(87.7

)%

Depreciation and amortization

 

1,602

 

 

 

1,608

 

 

 

(6

)

 

 

(0.4

)%

Other expenses

 

55

 

 

 

152

 

 

 

(97

)

 

 

(63.8

)%

Total expenses

 

4,219

 

 

 

4,464

 

 

 

(245

)

 

 

(5.5

)%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

372

 

 

$

634

 

 

$

(262

)

 

 

(41.3

)%

 

 

 

 

 

 

 

 

 

 

 

 

Interest income on cash and cash equivalents

$

(190

)

 

$

(88

)

 

 

(102

)

 

 

116.9

%

Stock compensation expense

$

76

 

 

$

261

 

 

 

(185

)

 

 

(71.0

)%

 

 

Six Months Ended

June 30,

 

 

 

 

 

 

 

 

2024

 

 

2023

 

 

Change

 

 

% Change

 

 

(in thousands)

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

CarStory revenue

$

5,892

 

 

$

6,394

 

 

$

(502

)

 

 

(7.9

)%

Other income

 

363

 

 

 

141

 

 

 

222

 

 

 

157.4

%

Total noninterest income

 

6,255

 

 

 

6,535

 

 

 

(280

)

 

 

(4.3

)%

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

4,675

 

 

 

4,821

 

 

 

(146

)

 

 

(3.0

)%

Professional fees

 

202

 

 

 

290

 

 

 

(88

)

 

 

(30.4

)%

Software and IT costs

 

188

 

 

 

345

 

 

 

(157

)

 

 

(45.5

)%

Depreciation and amortization

 

3,207

 

 

 

3,213

 

 

 

(6

)

 

 

(0.2

)%

Other expenses

 

173

 

 

 

301

 

 

 

(128

)

 

 

(42.5

)%

Total expenses

 

8,444

 

 

 

8,969

 

 

 

(525

)

 

 

(5.9

)%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

930

 

 

$

1,201

 

 

$

(271

)

 

 

(22.5

)%

 

 

 

 

 

 

 

 

 

 

 

 

Interest income on cash and cash equivalents

$

(363

)

 

$

(134

)

 

 

(229

)

 

 

170.7

%

Stock compensation expense

$

276

 

 

$

556

 

 

 

(281

)

 

 

(50.4

)%

 

Corporate

 

Three Months Ended

June 30,

 

 

 

 

 

 

 

 

2024

 

 

2023

 

 

Change

 

 

% Change

 

 

(in thousands)

 

 

 

 

 

 

 

Interest income

$

(527

)

 

$

(536

)

 

$

9

 

 

 

1.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized losses, net of recoveries

 

(853

)

 

 

2,801

 

 

 

(3,654

)

 

 

(130.4

)%

Net interest income after losses and recoveries

 

325

 

 

 

(3,337

)

 

 

3,663

 

 

 

109.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

Warranties and GAP loss, net

$

(262

)

 

$

(727

)

 

$

465

 

 

 

64.0

%

Gain on debt extinguishment

 

 

 

 

10,931

 

 

 

(10,931

)

 

 

(100.0

)%

Other income

 

853

 

 

 

2,001

 

 

 

(1,148

)

 

 

(57.4

)%

Total noninterest income

 

591

 

 

 

12,205

 

 

 

(11,614

)

 

 

(95.2

)%

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

4,176

 

 

 

2,529

 

 

 

1,647

 

 

 

65.1

%

Professional fees

 

833

 

 

 

1,303

 

 

 

(470

)

 

 

(36.0

)%

Software and IT costs

 

1,410

 

 

 

1,659

 

 

 

(249

)

 

 

(15.0

)%

Interest expense on corporate debt

 

920

 

 

 

1,091

 

 

 

(171

)

 

 

(15.7

)%

Other expenses

 

1,852

 

 

 

2,578

 

 

 

(726

)

 

 

(28.2

)%

Total expenses

 

9,191

 

 

 

9,160

 

 

 

31

 

 

 

0.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

(5,089

)

 

$

(11,244

)

 

$

6,155

 

 

 

54.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Interest income on cash and cash equivalents

$

(432

)

 

$

(2,000

)

 

 

1,568

 

 

 

78.4

%

Stock compensation expense

$

1,505

 

 

$

889

 

 

 

615

 

 

 

69.2

%

 

 

Six Months Ended

June 30,

 

 

 

 

 

 

 

 

2024

 

 

2023

 

 

Change

 

 

% Change

 

 

(in thousands)

 

 

 

 

 

 

 

Interest income

$

(991

)

 

$

(1,467

)

 

$

476

 

 

 

32.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized losses, net of recoveries

 

2,205

 

 

 

6,257

 

 

 

(4,052

)

 

 

(64.8

)%

Net interest income after losses and recoveries

 

(3,196

)

 

 

(7,724

)

 

 

4,528

 

 

 

58.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest (loss) income:

 

 

 

 

 

 

 

 

 

 

 

Warranties and GAP loss, net

 

(11,514

)

 

 

(95

)

 

$

(11,419

)

 

 

12,020.0

%

Gain on debt extinguishment

 

 

 

 

19,640

 

 

 

(19,640

)

 

 

(100.0

)%

Other income

 

994

 

 

 

3,931

 

 

 

(2,937

)

 

 

(74.7

)%

Total noninterest (loss) income

 

(10,520

)

 

 

23,476

 

 

 

(33,996

)

 

 

(144.8

)%

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

7,284

 

 

 

4,813

 

 

 

2,470

 

 

 

51.3

%

Professional fees

 

3,178

 

 

 

3,559

 

 

 

(381

)

 

 

(10.7

)%

Software and IT costs

 

2,768

 

 

 

4,025

 

 

 

(1,258

)

 

 

(31.2

)%

Interest expense on corporate debt

 

1,840

 

 

 

2,234

 

 

 

(394

)

 

 

(17.6

)%

Other expenses

 

3,666

 

 

 

5,211

 

 

 

(1,546

)

 

 

(29.7

)%

Total expenses

 

18,735

 

 

 

19,842

 

 

 

(1,108

)

 

 

(5.6

)%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

(27,654

)

 

$

(23,644

)

 

$

(4,010

)

 

 

17.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Interest income on cash and cash equivalents

$

(695

)

 

$

(3,930

)

 

 

3,235

 

 

 

82.3

%

Stock compensation expense

$

2,461

 

 

$

1,783

 

 

 

678

 

 

 

38.0

%

 

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 and Adjusted EBITDA. 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 and Adjusted EBITDA are supplemental performance measures that our management uses to assess our operating performance and the operating leverage in our business. Because EBITDA and Adjusted EBITDA 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 on corporate debt, interest income on cash and cash equivalents, income tax expense and depreciation and amortization expense.

We calculate Adjusted EBITDA as EBITDA adjusted to exclude stock compensation expense, severance expense related to the continuing operations, gain on debt extinguishment and long-lived asset impairment charges.

The following table presents a reconciliation of EBITDA and Adjusted EBITDA to net loss from continuing operations, which is the most directly comparable U.S. GAAP measure:

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

 

 

(in thousands)

 

 

(in thousands)

 

Net loss from continuing operations

 

$

(19,104

)

 

$

(7,466

)

 

$

(63,781

)

 

$

(22,935

)

Adjusted to exclude the following:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense on corporate debt

 

 

1,549

 

 

 

1,527

 

 

 

2,940

 

 

 

2,867

 

Interest income on cash and cash equivalents

 

 

(1,182

)

 

 

(2,594

)

 

 

(2,187

)

 

 

(5,019

)

Provision for income taxes

 

 

(167

)

 

 

286

 

 

 

269

 

 

 

337

 

Depreciation and amortization

 

 

7,232

 

 

 

7,190

 

 

 

14,858

 

 

 

14,422

 

EBITDA

 

$

(11,672

)

 

$

(1,057

)

 

$

(47,901

)

 

$

(10,328

)

Stock compensation expense

 

 

2,446

 

 

 

1,669

 

 

$

3,770

 

 

$

3,348

 

Severance

 

 

1,685

 

 

 

 

 

$

1,685

 

 

 

 

Gain on debt extinguishment

 

 

 

 

 

(10,931

)

 

 

 

 

 

(19,640

)

Impairment charges

 

 

 

 

 

 

 

 

2,752

 

 

 

 

Adjusted EBITDA

 

$

(7,541

)

 

$

(10,319

)

 

$

(39,694

)

 

$

(26,620

)

About Vroom (Nasdaq: VRM)

Vroom owns and operates United Auto Credit Corporation (UACC), a leading indirect automotive lender serving the independent and franchise dealer market nationwide, and CarStory, a leader in AI-powered analytics and digital services for automotive retail. During fiscal 2023, Vroom also operated an end-to-end ecommerce platform to buy and sell used vehicles. Pursuant to its previously announced Value Maximization Plan, Vroom discontinued its ecommerce operations and used vehicle dealership business.

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 cost-savings and their expected benefits, our expectations regarding UACC's business, including with respect to originations and the impact of credit tightening, future results of operations and financial position, including profitability and our available liquidity under the warehouse credit facilities, and the timing of any of the foregoing. 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, 2023, as updated by our Quarterly report on Form 10-Q for the quarter ended June 30, 2024, 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

June 30,

 

 

As of

December 31,

 

 

 

2024

 

 

2023

 

ASSETS

 

 

 

 

 

 

Cash and cash equivalents

 

$

63,393

 

 

$

135,585

 

Restricted cash (including restricted cash of consolidated VIEs of $47.3 million and $49.1 million, respectively)

 

 

48,205

 

 

 

73,234

 

Finance receivables at fair value (including finance receivables of consolidated VIEs of $429.3 million and $341.4 million, respectively)

 

 

466,905

 

 

 

348,670

 

Finance receivables held for sale, net (including finance receivables of consolidated VIEs of $399.3 million and $457.2 million, respectively)

 

 

413,670

 

 

 

503,546

 

Interest receivable (including interest receivables of consolidated VIEs of $13.9 million and $13.7 million, respectively)

 

 

14,973

 

 

 

14,484

 

Property and equipment, net

 

 

2,219

 

 

 

4,982

 

Intangible assets, net

 

 

118,381

 

 

 

131,892

 

Operating lease right-of-use assets

 

 

8,918

 

 

 

7,063

 

Other assets (including other assets of consolidated VIEs of $9.6 million and $13.3 million, respectively)

 

 

33,908

 

 

 

59,429

 

Assets from discontinued operations

 

 

10,137

 

 

 

196,537

 

Total assets

 

$

1,180,709

 

 

$

1,475,422

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

Warehouse credit facilities of consolidated VIEs

 

$

270,784

 

 

$

421,268

 

Long-term debt (including securitization debt of consolidated VIEs of $272.4 million at amortized cost and $199.8 million at fair value as of June 30, 2024 and $314.1 million at fair value as of December 31, 2023)

 

 

794,734

 

 

 

626,583

 

Operating lease liabilities

 

 

11,587

 

 

 

10,459

 

Other liabilities (including other liabilities of consolidated VIEs of $16.0 million and $14.3 million, respectively)

 

 

51,581

 

 

 

61,321

 

Liabilities from discontinued operations

 

 

8,881

 

 

 

228,120

 

Total liabilities

 

 

1,137,567

 

 

 

1,347,751

 

Commitments and contingencies (Note 11)

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock, $0.001 par value; 500,000,000 shares authorized as of June 30, 2024 and December 31, 2023; 1,806,777 and 1,791,286 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

 

 

2

 

 

 

2

 

Additional paid-in-capital

 

 

2,092,657

 

 

 

2,088,381

 

Accumulated deficit

 

 

(2,049,517

)

 

 

(1,960,712

)

Total stockholders’ equity

 

 

43,142

 

 

 

127,671

 

Total liabilities and stockholders’ equity

 

$

1,180,709

 

 

$

1,475,422

 

 

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,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Interest income

 

$

51,862

 

 

$

46,995

 

 

$

102,939

 

 

$

81,363

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

Warehouse credit facility

 

 

6,986

 

 

 

3,658

 

 

 

16,457

 

 

 

6,757

 

Securitization debt

 

 

7,995

 

 

 

5,981

 

 

 

12,864

 

 

 

10,326

 

Total interest expense

 

 

14,981

 

 

 

9,639

 

 

 

29,321

 

 

 

17,083

 

Net interest income

 

 

36,881

 

 

 

37,356

 

 

 

73,618

 

 

 

64,280

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized losses, net of recoveries

 

 

18,729

 

 

 

23,187

 

 

 

49,548

 

 

 

38,915

 

Net interest income after losses and recoveries

 

 

18,152

 

 

 

14,169

 

 

 

24,070

 

 

 

25,365

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

Servicing income

 

 

1,587

 

 

 

2,551

 

 

 

3,606

 

 

 

5,405

 

Warranties and GAP income (loss), net

 

 

1,378

 

 

 

751

 

 

 

(8,264

)

 

 

3,586

 

CarStory revenue

 

 

2,913

 

 

 

3,224

 

 

 

5,892

 

 

 

6,394

 

Gain on debt extinguishment

 

 

 

 

 

10,931

 

 

 

 

 

 

19,640

 

Other income

 

 

3,141

 

 

 

3,071

 

 

 

5,925

 

 

 

6,103

 

Total noninterest income

 

 

9,019

 

 

 

20,528

 

 

 

7,159

 

 

 

41,128

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

27,176

 

 

 

21,341

 

 

 

51,286

 

 

 

44,562

 

Professional fees

 

 

1,488

 

 

 

2,444

 

 

 

4,831

 

 

 

7,417

 

Software and IT costs

 

 

4,036

 

 

 

4,804

 

 

 

8,658

 

 

 

10,050

 

Depreciation and amortization

 

 

7,232

 

 

 

7,190

 

 

 

14,858

 

 

 

14,422

 

Interest expense on corporate debt

 

 

1,549

 

 

 

1,527

 

 

 

2,940

 

 

 

2,867

 

Impairment charges

 

 

 

 

 

 

 

 

2,752

 

 

 

 

Other expenses

 

 

4,961

 

 

 

4,571

 

 

 

9,416

 

 

 

9,773

 

Total expenses

 

 

46,442

 

 

 

41,877

 

 

 

94,741

 

 

 

89,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from continuing operations before provision for income taxes

 

 

(19,271

)

 

 

(7,180

)

 

 

(63,512

)

 

 

(22,598

)

(Benefit) provision for income taxes from continuing operations

 

 

(167

)

 

 

286

 

 

 

269

 

 

 

337

 

Net loss from continuing operations

 

$

(19,104

)

 

$

(7,466

)

 

$

(63,781

)

 

$

(22,935

)

Net loss from discontinued operations

 

$

(2,084

)

 

$

(58,573

)

 

$

(25,025

)

 

$

(117,844

)

Net loss

 

$

(21,188

)

 

$

(66,039

)

 

$

(88,806

)

 

$

(140,779

)

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

(10.61

)

 

$

(4.29

)

 

$

(35.49

)

 

$

(13.22

)

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

 

$

(1.16

)

 

$

(33.68

)

 

$

(13.92

)

 

$

(67.90

)

Total net loss per share attributable to common stockholders, basic and diluted

 

$

(11.77

)

 

$

(37.97

)

 

$

(49.41

)

 

$

(81.12

)

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

 

 

1,800,486

 

 

 

1,739,336

 

 

 

1,797,394

 

 

 

1,735,486

 

 

VROOM, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

 

Six Months Ended

June 30,

 

 

 

2024

 

 

2023

 

Operating activities

 

 

 

 

 

 

Net loss from continuing operations

 

$

(63,781

)

 

$

(22,935

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Impairment charges

 

 

2,752

 

 

 

 

Profit share receivable

 

 

11,405

 

 

 

 

Gain on debt extinguishment

 

 

 

 

 

(19,640

)

Depreciation and amortization

 

 

14,858

 

 

 

14,422

 

Amortization of debt issuance costs

 

 

2,021

 

 

 

1,623

 

Losses on finance receivables and securitization debt, net

 

 

69,430

 

 

 

42,532

 

Stock-based compensation expense

 

 

3,937

 

 

 

3,348

 

Provision to record finance receivables held for sale at lower of cost or fair value

 

 

(4,434

)

 

 

1,651

 

Amortization of unearned discounts on finance receivables at fair value

 

 

(9,772

)

 

 

(13,414

)

Other, net

 

 

(2,845

)

 

 

(6,755

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Finance receivables, held for sale

 

 

 

 

 

 

Originations of finance receivables, held for sale

 

 

(231,639

)

 

 

(274,707

)

Principal payments received on finance receivables, held for sale

 

 

85,905

 

 

 

42,862

 

Other

 

 

790

 

 

 

505

 

Interest receivable

 

 

(489

)

 

 

(5,028

)

Other assets

 

 

5,605

 

 

 

7,161

 

Other liabilities

 

 

(9,740

)

 

 

(11,488

)

Net cash used in operating activities from continuing operations

 

 

(125,997

)

 

 

(239,863

)

Net cash provided by operating activities from discontinued operations

 

 

82,820

 

 

 

7,738

 

Net cash used in operating activities

 

 

(43,177

)

 

 

(232,125

)

Investing activities

 

 

 

 

 

 

Finance receivables, held for investment at fair value

 

 

 

 

 

 

Purchases of finance receivables, held for investment at fair value

 

 

 

 

 

(3,392

)

Principal payments received on finance receivables, held for investment at fair value

 

 

65,523

 

 

 

91,892

 

Consolidation of VIEs

 

 

 

 

 

11,409

 

Principal payments received on beneficial interests

 

 

1,421

 

 

 

3,306

 

Purchase of property and equipment

 

 

(926

)

 

 

(1,249

)

Net cash provided by investing activities from continuing operations

 

 

66,018

 

 

 

101,966

 

Net cash provided by (used in) investing activities from discontinued operations

 

 

10,834

 

 

 

(7,272

)

Net cash provided by investing activities

 

 

76,852

 

 

 

94,694

 

Financing activities

 

 

 

 

 

 

Proceeds from borrowings under secured financing agreements, net of issuance costs

 

 

296,569

 

 

 

261,991

 

Principal repayment under secured financing agreements

 

 

(135,017

)

 

 

(103,980

)

Proceeds from financing of beneficial interests in securitizations

 

 

15,821

 

 

 

24,506

 

Principal repayments of financing of beneficial interests in securitizations

 

 

(6,281

)

 

 

(2,304

)

Proceeds from warehouse credit facilities

 

 

193,400

 

 

 

211,400

 

Repayments of warehouse credit facilities

 

 

(343,884

)

 

 

(263,216

)

Repurchases of convertible senior notes

 

 

 

 

 

(13,194

)

Other financing activities

 

 

(326

)

 

 

(1,043

)

Net cash provided by financing activities from continuing operations

 

 

20,282

 

 

 

114,160

 

Net cash used in financing activities from discontinued operations

 

 

(151,178

)

 

 

(144,508

)

Net cash used in financing activities

 

 

(130,896

)

 

 

(30,348

)

Net decrease in cash, cash equivalents and restricted cash

 

 

(97,221

)

 

 

(167,779

)

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

 

 

208,819

 

 

 

472,010

 

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

 

$

111,598

 

 

$

304,231

 

 

VROOM, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in thousands)

(unaudited)

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

Cash paid for interest

 

$

29,321

 

 

$

16,301

 

Cash paid for income taxes

 

$

373

 

 

$

3,682

 

Supplemental disclosure of non-cash investing and financing activities:

 

 

 

 

 

 

Finance receivables from consolidation of 2022-2 securitization transaction

 

$

 

 

$

180,706

 

Elimination of beneficial interest from the consolidation of 2022-2 securitization transaction

 

$

 

 

$

9,811

 

Securitization debt from consolidation of 2022-2 securitization transaction

 

$

 

 

$

186,386

 

Reclassification of finance receivables held for sale to finance receivables at fair value, net

 

$

 

 

$

248,081

 

 

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