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0001580864false00015808642021-11-092021-11-09

 

 

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): November 9, 2021

 

 

VROOM, INC.

(Exact name of registrant as specified in its charter)

 

 

 

 

 

 

 

 

Delaware

 

001-39315

 

90-1112566

(State or other jurisdiction

of incorporation or organization)

 

(Commission

File Number)

 

(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:

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

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:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

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 November 9, 2021, Vroom, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended September 30, 2021. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

Item 7.01. Regulation FD Disclosure.

On November 10, 2021, members of the Company’s management will hold an earnings conference call to discuss the Company’s financial results for the quarter ended September 30, 2021, and the presentation furnished as Exhibit 99.2 to this Current Report on Form 8-K will accompany management’s comments.

 

The information contained in Item 2.02, including Exhibit 99.1 hereto and in Item 7.01, including Exhibit 99.2 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 exhibits relating to Item 2.02 and Item 7.01 shall be deemed to be furnished, and not filed:

 

Exhibit No.

 

Description

 

 

99.1

 

Press Release dated November 9, 2021.

99.2

 

Earnings Conference Call Presentation for the Quarter Ended September 30, 2021.

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

 

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.

 

 

 

VROOM, INC.

 

 

 

Date: November 9, 2021

 

By:

 

/s/ Robert R. Krakowiak

 

 

 

 

Robert R. Krakowiak

 

 

 

 

Chief Financial Officer

 

 
EX-99.1

https://cdn.kscope.io/cf9df6e84cfa999665f4a24c4ac27b25-img63169428_0.jpg  

Exhibit 99.1

 

Vroom Reports Strong Third Quarter 2021 Results

 

Vroom Delivers Record Ecommerce Units and Gross Profit

 

Ecommerce Unit Sales Up 123% YoY

 

Ecommerce Gross Profit Up 161% YoY

 

NEW YORK – November 9, 2021 – Vroom, Inc. (Nasdaq:VRM), a leading ecommerce platform for buying and selling used vehicles, today announced financial results for the third quarter ended September 30, 2021 (“Q3 2021”).

 

HIGHLIGHTS OF THIRD QUARTER 2021

 

19,683 ecommerce units sold, up 123% YoY

 

Ecommerce revenue of $701.7 million, up 216% YoY

 

Ecommerce gross profit of $50.4 million, up 161% YoY

 

Vroom enters into definitive agreement to acquire United Auto Credit Corporation ("UACC")

 

Vroom appoints new Chief Financial Officer

 

Paul Hennessy, Chief Executive Officer of Vroom, commented:

 

“Vroom had yet another strong quarter that continued the momentum that has been building all year. By executing well across our organization, we delivered triple digit year-over-year growth in both ecommerce units and gross profit, as well as improvement in unit economics. We also continued to optimize our mix of inventory sources throughout the quarter, with approximately 81% of our retail inventory sold sourced from consumers, enabling us to scale our inventory while maintaining strong unit economics. Looking ahead, we intend to continue to focus on strong execution and maintain the momentum in our business to drive continued growth in unit sales and on improving unit economics. We also are excited to move forward with our acquisition of United Auto Credit Corporation, which will accelerate our strategic objective to establish a captive financing arm.”

 

 

 

 

THIRD QUARTER 2021 FINANCIAL DISCUSSION

 

All financial comparisons are on a year-over-year basis unless otherwise noted.

 

Ecommerce Results

 

 

 

Three Months Ended
September 30,

 

 

 

 

 

 

 

 

 

Nine Months Ended
September 30,

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

 

Change

 

 

% Change

 

 

2021

 

 

2020

 

 

 

Change

 

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except unit
data and average days to sale)

 

 

 

 

 

 

 

 

 

(in thousands, except unit
data and average days to sale)

 

 

 

 

 

 

 

 

Ecommerce units sold

 

 

 

19,683

 

 

 

 

8,823

 

 

 

 

10,860

 

 

 

123.1

%

 

 

 

53,455

 

 

 

 

23,466

 

 

 

 

29,989

 

 

 

127.8

%

Ecommerce revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vehicle revenue

 

$

 

677,170

 

 

$

 

213,943

 

 

$

 

463,227

 

 

 

216.5

%

 

$

 

1,644,494

 

 

$

 

610,008

 

 

$

 

1,034,486

 

 

 

169.6

%

Product revenue

 

 

 

24,508

 

 

 

 

7,818

 

 

 

 

16,690

 

 

 

213.5

%

 

 

 

59,155

 

 

 

 

20,493

 

 

 

 

38,662

 

 

 

188.7

%

Total ecommerce revenue

 

$

 

701,678

 

 

$

 

221,761

 

 

$

 

479,917

 

 

 

216.4

%

 

$

 

1,703,649

 

 

$

 

630,501

 

 

$

 

1,073,148

 

 

 

170.2

%

Ecommerce gross profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vehicle gross profit

 

$

 

25,875

 

 

$

 

11,486

 

 

$

 

14,389

 

 

 

125.3

%

 

$

 

72,704

 

 

$

 

20,296

 

 

$

 

52,408

 

 

 

258.2

%

Product gross profit

 

 

 

24,508

 

 

 

 

7,818

 

 

 

 

16,690

 

 

 

213.5

%

 

 

 

59,155

 

 

 

 

20,493

 

 

 

 

38,662

 

 

 

188.7

%

Total ecommerce gross profit

 

$

 

50,383

 

 

$

 

19,304

 

 

$

 

31,079

 

 

 

161.0

%

 

$

 

131,859

 

 

$

 

40,789

 

 

$

 

91,070

 

 

 

223.3

%

Average vehicle selling price per ecommerce unit

 

$

 

34,404

 

 

$

 

24,248

 

 

$

 

10,156

 

 

 

41.9

%

 

$

 

30,764

 

 

$

 

25,995

 

 

$

 

4,769

 

 

 

18.3

%

Gross profit per ecommerce unit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vehicle gross profit per ecommerce unit

 

$

 

1,315

 

 

$

 

1,302

 

 

$

 

13

 

 

 

1.0

%

 

$

 

1,360

 

 

$

 

865

 

 

$

 

495

 

 

 

57.2

%

Product gross profit per ecommerce unit

 

 

 

1,245

 

 

 

 

886

 

 

 

 

359

 

 

 

40.5

%

 

 

 

1,107

 

 

 

 

873

 

 

 

 

234

 

 

 

26.8

%

Total gross profit per ecommerce unit

 

$

 

2,560

 

 

$

 

2,188

 

 

$

 

372

 

 

 

17.0

%

 

$

 

2,467

 

 

$

 

1,738

 

 

$

 

729

 

 

 

41.9

%

Ecommerce average days to sale

 

 

 

68

 

 

 

 

52

 

 

 

 

16

 

 

 

30.8

%

 

 

 

73

 

 

 

 

62

 

 

 

 

11

 

 

 

17.7

%

 

 

2

 

 

Ecommerce Units

 

Ecommerce units sold increased 123.1% to 19,683 driven by higher inventory levels, strong national brand recognition driven by our national advertising campaign and increased marketing spend, and increased demand due to growing consumer acceptance of our business model. The increase was also attributable to strong market demand generally for used vehicles, caused in part by the shortage of microchips and delays in new car manufacturing. Average monthly unique visitors to our platform increased 140.9% to 2,236,168.

 

Ecommerce Revenue

 

Ecommerce revenue increased 216.4% to $701.7 million.

 

Ecommerce Vehicle revenue increased 216.5% to $677.2 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 $24,248 to $34,404, primarily attributable to market appreciation.

 

Ecommerce Product revenue increased 213.5% to $24.5 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 $886 to $1,245 per unit.

 

Ecommerce Gross Profit

 

Ecommerce gross profit increased 161.0% to $50.4 million.

 

Ecommerce Vehicle gross profit increased 125.3% to $25.9 million. The increase in ecommerce Vehicle gross profit was primarily due to an increase in ecommerce units sold.

 

Ecommerce Product gross profit increased 213.5% to $ 24.5 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 $886 to $1,245 per unit.

 

Ecommerce Gross Profit per Unit

 

Ecommerce gross profit per unit increased 17.0% to $2,560.

 

Ecommerce Vehicle gross profit per unit increased slightly to $1,315, primarily driven by improvements in reconditioning costs, partially offset by lower sales margins as a result of higher purchase prices of vehicle acquisitions.

 

Ecommerce Product gross profit per unit increased 40.5% to $1,245, primarily driven by higher attachment rates and an increase in the average loan size as a result of a higher average selling price per unit.

 

3

 

 

Results by Segment

 

 

 

Three Months Ended
September 30,

 

 

 

 

 

 

 

 

Nine Months Ended
September 30,

 

 

 

 

 

 

 

 

 

2021

 

 

2020 (1)

 

 

Change

 

 

% Change

 

 

2021

 

 

2020 (1)

 

 

Change

 

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except unit data)

 

 

 

 

 

 

 

 

(in thousands, except unit data)

 

 

 

 

 

 

 

Units:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

 

19,683

 

 

 

8,823

 

 

 

10,860

 

 

 

123.1

%

 

 

53,455

 

 

 

23,466

 

 

 

29,989

 

 

 

127.8

%

Wholesale

 

 

9,760

 

 

 

6,166

 

 

 

3,594

 

 

 

58.3

%

 

 

28,421

 

 

 

14,110

 

 

 

14,311

 

 

 

101.4

%

TDA

 

 

1,749

 

 

 

1,463

 

 

 

286

 

 

 

19.5

%

 

 

5,107

 

 

 

5,608

 

 

 

(501

)

 

 

(8.9

)%

Total units

 

 

31,192

 

 

 

16,452

 

 

 

14,740

 

 

 

89.6

%

 

 

86,983

 

 

 

43,184

 

 

 

43,799

 

 

 

101.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

$

701,678

 

 

$

221,761

 

 

$

479,917

 

 

 

216.4

%

 

$

1,703,649

 

 

$

630,501

 

 

$

1,073,148

 

 

 

170.2

%

Wholesale

 

 

131,306

 

 

 

63,972

 

 

 

67,334

 

 

 

105.3

%

 

 

377,438

 

 

 

170,469

 

 

 

206,969

 

 

 

121.4

%

TDA

 

 

60,582

 

 

 

36,955

 

 

 

23,627

 

 

 

63.9

%

 

 

158,928

 

 

 

149,858

 

 

 

9,070

 

 

 

6.1

%

All Other (2)

 

 

3,190

 

 

 

317

 

 

 

2,873

 

 

 

906.3

%

 

 

9,749

 

 

 

1,043

 

 

 

8,706

 

 

 

834.7

%

Total revenue

 

$

896,756

 

 

$

323,005

 

 

$

573,751

 

 

 

177.6

%

 

$

2,249,764

 

 

$

951,871

 

 

$

1,297,893

 

 

 

136.4

%

Gross profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

$

50,383

 

 

$

19,304

 

 

$

31,079

 

 

 

161.0

%

 

$

131,859

 

 

$

40,789

 

 

$

91,070

 

 

 

223.3

%

Wholesale

 

 

2,103

 

 

 

3,343

 

 

 

(1,240

)

 

 

(37.1

)%

 

 

10,337

 

 

 

1,506

 

 

 

8,831

 

 

 

586.4

%

TDA

 

 

3,805

 

 

 

2,675

 

 

 

1,130

 

 

 

42.2

%

 

 

9,743

 

 

 

8,799

 

 

 

944

 

 

 

10.7

%

All Other (2)

 

 

1,798

 

 

 

123

 

 

 

1,675

 

 

 

1,361.8

%

 

 

5,454

 

 

 

345

 

 

 

5,109

 

 

 

1,480.9

%

Total gross profit

 

$

58,089

 

 

$

25,445

 

 

$

32,644

 

 

 

128.3

%

 

$

157,393

 

 

$

51,439

 

 

$

105,954

 

 

 

206.0

%

Gross profit per unit (3):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ecommerce

 

$

2,560

 

 

$

2,188

 

 

$

372

 

 

 

17.0

%

 

$

2,467

 

 

$

1,738

 

 

$

729

 

 

 

41.9

%

Wholesale

 

$

215

 

 

$

542

 

 

$

(327

)

 

 

(60.3

)%

 

$

364

 

 

$

107

 

 

$

257

 

 

 

240.2

%

TDA

 

$

2,175

 

 

$

1,828

 

 

$

347

 

 

 

19.0

%

 

$

1,907

 

 

$

1,569

 

 

$

338

 

 

 

21.5

%

 

(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.
(2)
All Other revenues and gross profit consist of the CarStory business and vehicle repair services at TDA.
(3)
Gross profit per unit metrics exclude the CarStory business and vehicle repair services at TDA.

 

Total Units

 

Total units sold increased 89.6% to 31,192.

 

Ecommerce units sold increased 123.1% to 19,683, as discussed above.

 

Wholesale units sold increased 58.3% to 9,760, primarily driven by an increase in wholesale units purchased from consumers, a higher number of trade-in vehicles associated with the increase in the number of ecommerce units sold and strong wholesale market demand for used vehicles.

 

TDA units sold increased 19.5% to 1,749, primarily due to strong market demand generally for used vehicles and higher inventory levels.

 

Total Revenue

 

Total revenue increased 177.6% to $896.8 million.

 

Ecommerce revenue increased 216.4% to $701.7 million, as discussed above.

 

4

 

 

Wholesale revenue increased 105.3% to $131.3 million. The increase in wholesale revenue was primarily attributable to the increase in wholesale units sold as well as a higher average selling price per unit, which increased from $10,375 to $13,453, primarily attributable to market appreciation.

 

TDA revenue increased 63.9% to $60.6 million, primarily due to a higher average selling price per unit, which increased from $24,316 to $33,474 as well as the increase in TDA units sold.

 

Total Gross Profit

 

Total gross profit increased 128.3% to $58.1 million.

 

Ecommerce gross profit increased 161.0% to $50.4 million, as discussed above.

 

Wholesale gross profit decreased 37.1% to $2.1 million. Wholesale gross profit decreased primarily due to a lower Wholesale gross profit per unit of $327, partially offset by an increase in wholesale units sold.

 

TDA gross profit increased 42.2% to $3.8 million. TDA gross profit increased primarily due to an increase in TDA gross profit per unit of $347 as well as an increase in TDA units sold.

 

Gross Profit per Unit

 

Ecommerce gross profit per unit increased 17.0% to $2,560, as discussed above.

 

Wholesale gross profit per unit decreased 60.3% to $215 as a result sales margin compression due to unfavorable wholesale price movements, which declined during the first half of the third quarter of 2021.

 

TDA gross profit per unit increased 19.0% to $2,175 driven by increased TDA product gross profit per unit of $221, primarily due to improvements in inbound logistics costs and increased TDA vehicle gross profit per unit of $126, primarily due to an increase in the average loan size as a result of a higher average selling price per unit.

 

SG&A

 

 

Three Months Ended
September 30,

 

 

 

 

 

 

 

 

Nine Months Ended
September 30,

 

 

 

 

 

 

 

 

 

 

2021

 

 

 

2020

 

 

Change

 

 

% Change

 

 

 

2021

 

 

 

2020

 

 

Change

 

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

Compensation & benefits

 

$

 

53,900

 

 

$

 

22,881

 

 

$

31,019

 

 

 

135.6

%

 

$

 

145,580

 

 

$

 

63,821

 

 

$

81,759

 

 

 

128.1

%

Marketing expense

 

 

 

35,214

 

 

 

 

15,341

 

 

 

19,873

 

 

 

129.5

%

 

 

 

88,267

 

 

 

 

44,829

 

 

 

43,438

 

 

 

96.9

%

Outbound logistics

 

 

 

22,717

 

 

 

 

8,500

 

 

 

14,217

 

 

 

167.3

%

 

 

 

57,987

 

 

 

 

19,762

 

 

 

38,225

 

 

 

193.4

%

Occupancy and related costs

 

 

 

4,635

 

 

 

 

2,610

 

 

 

2,025

 

 

 

77.6

%

 

 

 

12,599

 

 

 

 

7,574

 

 

 

5,025

 

 

 

66.3

%

Professional fees

 

 

 

7,694

 

 

 

 

1,773

 

 

 

5,921

 

 

 

334.0

%

 

 

 

15,951

 

 

 

 

5,697

 

 

 

10,254

 

 

 

180.0

%

Other

 

 

 

24,558

 

 

 

 

10,022

 

 

 

14,536

 

 

 

145.0

%

 

 

 

61,098

 

 

 

 

25,735

 

 

 

35,363

 

 

 

137.4

%

Total selling, general & administrative expenses

 

$

 

148,718

 

 

$

 

61,127

 

 

$

87,591

 

 

 

143.3

%

 

$

 

381,482

 

 

$

 

167,418

 

 

$

214,064

 

 

 

127.9

%

 

5

 

 

 

Selling, general and administrative expenses increased 143.3% to $148.7 million. The increase was primarily due to:

 

$31.0 million increase in compensation and benefits due to an increase in headcount and an increase in variable fees for third-party sales and sales support providers as a result of an increase in units sold;

 

$19.9 million increase in marketing expense as we expanded our national broad-reach brand advertising, produced new commercials, and increased performance and online marketing as we continue to grow our listed inventory;

 

$14.2 million increase in outbound logistics costs primarily attributable to the growth in ecommerce units sold, which increased outbound logistics costs by $10.5 million, and increases in market rates of logistics providers, which increased outbound logistics costs by $3.7 million;

 

$5.9 million increase in professional fees primarily related to acquisition related costs incurred in connection with the definitive agreement to acquire UACC, as well as increased consulting expenses in the marketing and engineering departments; and

 

$14.5 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.

 

We expect selling, general and administrative expenses to increase in the future as we continue to scale our business, integrate and invest in UACC, invest in and improve our customer experience, and continue expanding our proprietary logistics and reconditioning networks.

 

Loss from Operations and Net Loss

 

Loss from operations increased 154.9% to $94.0 million. Net loss increased 159.2% to $98.1 million.

 

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.

 

6

 

 

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, the one-time, IPO related non-cash revaluation of a preferred stock warrant and costs related to our acquisition of UACC. 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
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

(in thousands)

 

Net loss

 

$

(98,122

)

 

$

(37,850

)

 

$

(241,118

)

 

$

(142,137

)

Adjusted to exclude the following:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

7,028

 

 

 

2,259

 

 

 

14,720

 

 

 

6,382

 

Interest income

 

 

(2,930

)

 

 

(1,289

)

 

 

(7,288

)

 

 

(3,960

)

Provision for income taxes

 

 

29

 

 

 

33

 

 

 

379

 

 

 

138

 

Depreciation and amortization expense

 

 

3,469

 

 

 

1,196

 

 

 

9,497

 

 

 

3,255

 

EBITDA

 

$

(90,526

)

 

$

(35,651

)

 

$

(223,810

)

 

$

(136,322

)

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,262

 

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

20,470

 

Acquisition related costs

 

 

3,412

 

 

 

—

 

 

 

3,412

 

 

 

—

 

Adjusted EBITDA

 

$

(87,114

)

 

$

(35,651

)

 

$

(220,398

)

 

$

(114,590

)

 

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 and costs related to our acquisition of UACC. 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:

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

(in thousands)

 

 

(in thousands)

 

Loss from operations

 

$

(94,005

)

 

$

(36,873

)

 

$

(233,365

)

 

$

(119,218

)

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,262

 

Add: Acquisition related costs

 

 

3,412

 

 

 

—

 

 

 

3,412

 

 

 

—

 

Adjusted loss from operations

 

$

(90,593

)

 

$

(36,873

)

 

$

(229,953

)

 

$

(117,956

)

 

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, the one-time, IPO related non-cash revaluation of a preferred stock warrant and costs related to our acquisition of UACC. 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:

 

7

 

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

(in thousands, except share and per share amounts)

 

Net loss

 

$

(98,122

)

 

$

(37,850

)

 

$

(241,118

)

 

$

(142,137

)

Net loss attributable to common stockholders

 

$

(98,122

)

 

$

(37,850

)

 

$

(241,118

)

 

$

(142,137

)

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,262

 

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

20,470

 

Add: Acquisition related costs

 

 

3,412

 

 

 

—

 

 

 

3,412

 

 

 

—

 

Non-GAAP net loss

 

$

(94,710

)

 

$

(37,850

)

 

$

(237,706

)

 

$

(120,405

)

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

136,766,015

 

 

 

121,123,472

 

 

 

136,256,901

 

 

 

53,731,475

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share, basic and diluted

 

$

(0.72

)

 

$

(0.31

)

 

$

(1.77

)

 

$

(2.65

)

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.02

 

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.38

 

Impact of acquisition related costs

 

 

0.02

 

 

 

—

 

 

 

0.03

 

 

 

—

 

Non-GAAP net loss per share, basic and diluted

 

$

(0.70

)

 

$

(0.31

)

 

$

(1.74

)

 

$

(2.25

)

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

 

$

(0.70

)

 

$

(0.29

)

 

$

(1.74

)

 

$

(0.93

)

 

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

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

(in thousands, except share and per share amounts)

 

Non-GAAP net loss

 

$

(94,710

)

 

$

(37,850

)

 

$

(237,706

)

 

$

(120,405

)

Non-GAAP net loss, as adjusted

 

$

(94,710

)

 

$

(37,850

)

 

$

(237,706

)

 

$

(120,405

)

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

136,766,015

 

 

 

121,123,472

 

 

 

136,256,901

 

 

 

53,731,475

 

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

24,437,500

 

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

 

 

—

 

 

 

—

 

 

 

—

 

 

 

85,533,394

 

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

 

 

—

 

 

 

10,800,000

 

 

 

—

 

 

 

10,800,000

 

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

 

 

—

 

 

 

(1,760,869

)

 

 

—

 

 

 

(44,897,573

)

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

 

 

136,766,015

 

 

 

130,162,603

 

 

 

136,256,901

 

 

 

129,604,796

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

(0.70

)

 

$

(0.29

)

 

$

(1.74

)

 

$

(0.93

)

 

8

 

 

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 fourth quarter 2021, we expect the following results:

 

Ecommerce unit sales of 20,000 to 20,500, implying year over year growth of 84% at the mid-point of the guidance range.

 

Average ecommerce selling price per unit of $35,000 to $36,000 and average ecommerce gross profit per unit of $2,100 to $2,300.

 

Wholesale unit sales of 6,500 to 7,500, average selling price per unit of $13,000 to $14,000 and average gross profit per unit of $550 to $750.

 

TDA unit sales of 1,500 to 1,600, average selling price per unit of $35,000 to $36,000 and average gross profit per unit of $1,800 to $2,000.

 

Total revenue of $865 to $900 million.

 

Total gross profit of $50 to $58 million.

 

Adjusted EBITDA* of $(104) to $(95) million.

 

Stock-based compensation expense of $4.2 million.

 

Net loss per share, as adjusted* of $(0.77) to $(0.70).

 

*A reconciliation of non-GAAP guidance measures to corresponding GAAP measures for our fourth 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 third 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 fourth quarter and the full year 2021:

 

 

 

Quarter

 

YTD

 

2021

 

136,897,954

 

136,417,164

 

 

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 November 9, 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, November 10, 2021 at 8:30 a.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 5685139. 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.

9

 

 

 

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 integrate and develop United Auto Credit Corporation into a captive finance operation, as well as 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 fourth quarter 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 September 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

investors@vroom.com

 

Media Contact:

 

Moxie Communications Group

Alyssa Galella

vroom@moxiegrouppr.com

(562) 294-6261

 

10

 

 

 

VROOM, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

(unaudited)

 

 

 

As of

 

 

As of

 

 

 

September 30,

 

 

December 31,

 

 

 

2021

 

 

2020

 

ASSETS

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,326,543

 

 

$

1,056,213

 

Restricted cash

 

 

69,574

 

 

 

33,826

 

Accounts receivable, net of allowance of $4,937 and $2,803, respectively

 

 

89,900

 

 

 

60,576

 

Inventory

 

 

601,753

 

 

 

423,647

 

Prepaid expenses and other current assets

 

 

62,390

 

 

 

23,617

 

Total current assets

 

 

2,150,160

 

 

 

1,597,879

 

Property and equipment, net

 

 

30,559

 

 

 

15,092

 

Intangible assets, net

 

 

29,762

 

 

 

34

 

Goodwill

 

 

158,817

 

 

 

78,172

 

Operating lease right-of-use assets

 

 

16,994

 

 

 

17,137

 

Other assets

 

 

23,251

 

 

 

15,742

 

Total assets

 

$

2,409,543

 

 

$

1,724,056

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

Accounts payable

 

$

59,522

 

 

$

32,925

 

Accrued expenses

 

 

104,694

 

 

 

59,405

 

Vehicle floorplan

 

 

441,473

 

 

 

329,231

 

Deferred revenue

 

 

64,087

 

 

 

24,822

 

Operating lease liabilities, current

 

 

6,872

 

 

 

6,052

 

Other current liabilities

 

 

66,904

 

 

 

30,275

 

Total current liabilities

 

 

743,552

 

 

 

482,710

 

Convertible senior notes

 

 

609,811

 

 

 

—

 

Operating lease liabilities, excluding current portion

 

 

11,325

 

 

 

12,093

 

Other long-term liabilities

 

 

4,204

 

 

 

2,151

 

Total liabilities

 

 

1,368,892

 

 

 

496,954

 

Commitments and contingencies (Note 10)

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock, $0.001 par value; 500,000,000 shares authorized as of September 30, 2021 and December 31, 2020; 136,897,954 and 134,043,969 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively

 

 

135

 

 

 

132

 

Additional paid-in-capital

 

 

2,059,505

 

 

 

2,004,841

 

Accumulated deficit

 

 

(1,018,989

)

 

 

(777,871

)

Total stockholders’ equity

 

 

1,040,651

 

 

 

1,227,102

 

Total liabilities and stockholders’ equity

 

$

2,409,543

 

 

$

1,724,056

 

 

 

11

 

 

 

VROOM, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(unaudited)

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Retail vehicle, net

 

$

735,716

 

 

$

249,518

 

 

$

1,798,155

 

 

$

754,380

 

Wholesale vehicle

 

 

131,306

 

 

 

63,972

 

 

 

377,438

 

 

 

170,469

 

Product, net

 

 

26,544

 

 

 

9,198

 

 

 

64,422

 

 

 

25,979

 

Other

 

 

3,190

 

 

 

317

 

 

 

9,749

 

 

 

1,043

 

Total revenue

 

 

896,756

 

 

 

323,005

 

 

 

2,249,764

 

 

 

951,871

 

Cost of sales

 

 

838,667

 

 

 

297,560

 

 

 

2,092,371

 

 

 

900,432

 

Total gross profit

 

 

58,089

 

 

 

25,445

 

 

 

157,393

 

 

 

51,439

 

Selling, general and administrative expenses

 

 

148,718

 

 

 

61,127

 

 

 

381,482

 

 

 

167,418

 

Depreciation and amortization

 

 

3,376

 

 

 

1,191

 

 

 

9,276

 

 

 

3,239

 

Loss from operations

 

 

(94,005

)

 

 

(36,873

)

 

 

(233,365

)

 

 

(119,218

)

Interest expense

 

 

7,028

 

 

 

2,259

 

 

 

14,720

 

 

 

6,382

 

Interest income

 

 

(2,930

)

 

 

(1,289

)

 

 

(7,288

)

 

 

(3,960

)

Revaluation of preferred stock warrant

 

 

—

 

 

 

—

 

 

 

—

 

 

 

20,470

 

Other income, net

 

 

(10

)

 

 

(26

)

 

 

(58

)

 

 

(111

)

Loss before provision for income taxes

 

 

(98,093

)

 

 

(37,817

)

 

 

(240,739

)

 

 

(141,999

)

Provision for income taxes

 

 

29

 

 

 

33

 

 

 

379

 

 

 

138

 

Net loss

 

$

(98,122

)

 

$

(37,850

)

 

$

(241,118

)

 

$

(142,137

)

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

 

$

(0.72

)

 

$

(0.31

)

 

$

(1.77

)

 

$

(2.65

)

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

 

 

136,766,015

 

 

 

121,123,472

 

 

 

136,256,901

 

 

 

53,731,475

 

 

 

 

 

12

 

 

 

VROOM, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

Operating activities

 

 

 

 

 

 

Net loss

 

$

(241,118

)

 

$

(142,137

)

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

 

 

 

 

 

 

Depreciation and amortization

 

 

9,497

 

 

 

3,255

 

Amortization of debt issuance costs

 

 

1,784

 

 

 

656

 

Stock-based compensation expense

 

 

9,754

 

 

 

8,930

 

Provision to record inventory at lower of cost or net realizable value

 

 

5,625

 

 

 

2,917

 

Revaluation of preferred stock warrant

 

 

—

 

 

 

20,470

 

Other

 

 

4,874

 

 

 

1,331

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

(32,936

)

 

 

(4,297

)

Inventory

 

 

(183,731

)

 

 

(96,582

)

Prepaid expenses and other current assets

 

 

(39,356

)

 

 

(6,639

)

Other assets

 

 

(7,390

)

 

 

(2,246

)

Accounts payable

 

 

26,144

 

 

 

10,478

 

Accrued expenses

 

 

43,512

 

 

 

15,679

 

Deferred revenue

 

 

39,227

 

 

 

(24

)

Other liabilities

 

 

38,655

 

 

 

5,335

 

Net cash used in operating activities

 

 

(325,459

)

 

 

(182,874

)

Investing activities

 

 

 

 

 

 

Purchase of property and equipment

 

 

(18,786

)

 

 

(5,057

)

Acquisition of business, net of cash acquired

 

 

(75,875

)

 

 

—

 

Net cash used in investing activities

 

 

(94,661

)

 

 

(5,057

)

Financing activities

 

 

 

 

 

 

Proceeds from vehicle floorplan

 

 

1,901,457

 

 

 

842,865

 

Repayments of vehicle floorplan

 

 

(1,789,215

)

 

 

(767,359

)

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

 

 

(16,129

)

 

 

—

 

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

 

 

—

 

 

 

(2,915

)

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

 

 

—

 

 

 

504,023

 

Payments of costs related to IPO

 

 

—

 

 

 

(6,791

)

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

 

 

—

 

 

 

569,471

 

Payments of costs related to follow-on public offering

 

 

—

 

 

 

(196

)

Proceeds from exercise of stock options

 

 

5,085

 

 

 

133

 

Other financing activities

 

 

—

 

 

 

(315

)

Net cash provided by financing activities

 

 

726,198

 

 

 

1,157,667

 

Net increase in cash, cash equivalents and restricted cash

 

 

306,078

 

 

 

969,736

 

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

 

$

1,396,117

 

 

$

1,189,323

 

 

13

 

EX-99.2

 

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© 2021 Vroom, All rights reserved. 1 A picture containing car and trees Third - Quarter 2021 Earnings November 2021

 

 

 

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© 2021 Vroom, All rights reserved. 2 DISCLAIMER Forward Looking Statements This presentation contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 . All statements contained in this presentation 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 integrate and develop United Auto Credit Corporation into a captive finance operation, as well as our ability to scale our business, grow inventory, expand reconditioning capacity, invest in logistics and improve our end - to - end customer experience, and statements regarding our future results of operations and financial position, including our ability to improve our unit economics and our outlook for the fourth quarter 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 presentation, 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 September 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 presentation . We undertake no obligation to update forward - looking statements to reflect future events or circumstances . Industry and Market Information To the extent this presentation includes information concerning the industry and the markets in which the Company operates, including general observations, expectations, market position, market opportunity and market size, such information is based on management's knowledge and experience in the markets in which we operate, including publicly available information from independent industry analysts and publications, as well as the Company’s own estimates. Our estimates are based on third - party sources, as well as internal research, which the Company believes to be reasonable, but which are inherently uncertain and imprecise. Accordingly, you are cautioned not to place undue reliance on such market and industry information. Financial Presentation and Use of Non - GAAP Financial Measures Certain monetary amounts, percentages and other figures included in this presentation have been subject to rounding adjustments. Certain other amounts that appear in this presentation may not sum due to rounding. This presentation contains certain supplemental financial measures that are not calculated pursuant to U.S. generally accepted accounting principles (“GAAP”). These non - GAAP measures are in addition to, and not a substitute or superior to, measures of financial performance prepared in accordance with GAAP. 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. We have reconciled all non - GAAP financial measures with the most directly comparable U.S. GAAP financial measures.

 

 

 

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© 2021 Vroom, All rights reserved. 3 Introducing Bob krakowiak, Chief Financial officer BOB KRAKOWIAK Chief Financial Officer A person in a suit and tie Description automatically generated with medium confidence • Previously served as Chief Financial Officer of Stoneridge Corporation for five years • Held diverse roles in finance and investor relations at Visteon Corporation, Owens Corning, and Kmart Corporation • In his role as Chief Financial Officer, Bob oversees financial reporting, accounting, tax, treasury, risk management and financial planning and analysis, as well as leading investor relations Appointed new Chief Financial Officer on September 13, 2021

 

 

 

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© 2021 Vroom, All rights reserved. 4 Strong performance in the third quarter • Triple - digit YoY ecommerce unit growth • Ecommerce Gross Profit Per Unit (GPPU) beat guidance • Leveraging operating costs across higher ecommerce transaction volume Progress on strategic initiatives • Entered into an agreement to acquire United Auto Credit Corporation (UACC) to establish a captive financing platform • Expanded last mile reach to over 40% of deliveries • Sourced 81% of retail units sold direct from consumers Other developments • Appointed new Chief Financial Officer (Bob Krakowiak) Third - quarter summary Strong unit growth, revenue & gross profit performance (1) Adjusted EBITDA is a non - GAAP measure. For a definition of Adjusted EBITDA and a reconciliation to the most comparable GAAP measure, please see slide 18. 3Q 2021 EBITDA adjusted for $3.4 million in SG&A costs associated with entering an agreement to acquire UACC. (2) A reconciliation of non - GAAP guidance measures to corresponding GAAP measures for 4Q 2021 guidance 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. . Beat Guidance Reported Results Guidance Range Total Revenues $897 million $858 - $891 million Ecommerce Units 19,683 20,000 - 20,500 Ecommerce GPPU $2,560 $2,350 - $2,450 Total Gross Profit $58 million $51 - $56 million Adjusted EBITDA (1) ($87) million ($100) - ($92) million Net loss ($98) million N/A Low End High End Total Revenues $865 million $900 million Ecommerce Units 20,000 20,500 Ecommerce GPPU $2,100 $2,300 Total Gross Profit $50 million $58 million Adjusted EBITDA (1) (2) ($104) million ($95) million . . . . 4 Q 2021 Guidance 3 Q 2021 Performance Highlights

 

 

 

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© 2021 Vroom, All rights reserved. 5 15,504 18,268 19,683 1Q 2021 2Q 2021 3Q 2021 Ecommerce highlights (Ecommerce revenues in millions) Ecommerce units ecommerce revenues up 216% YoY • Driven by triple - digit unit growth and higher average selling prices (ASP) • Increased ASP due to current demand environment and higher used vehicle selling prices • Continued focus on aligning inventory with consumer demand Ecommerce Gross Profit Per Unit up 17% YoY • Increased product gross profit per unit of $359 vs. 3Q 2020 • Slight increase in vehicle gross profit per unit Ecommerce Revenues Ecommerce GPPU +96% YoY +172% +123% $422 $580 $702 1Q 2021 2Q 2021 3Q 2021 +81% YoY +230% +216% $2,054 $2,718 $2,560 1Q 2021 2Q 2021 3Q 2021 +14% YoY +153% +17% ecommerce units grow 123% YoY • Continued success of our marketing campaigns, a healthy demand environment, and strong execution with higher listed inventory Unit and revenue growth momentum continues

 

 

 

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© 2021 Vroom, All rights reserved. 6 Ecommerce unit trends Year - to - date total ecommerce transactions up over 200% Total ecommerce transactions (1) Total ecommerce transactions (1) have accelerated year - to - date • Driven by higher consumer - sourced vehicle acquisitions, amplified marketing campaigns, and expanded reconditioning capacity Successful consumer sourcing initiatives • Sourced 81% of retail units from consumers in the third quarter, up from 65% in the second quarter • Tailwinds from ongoing improvements to our pricing methodology, favorable pricing in the used vehicle industry, and growing brand awareness Amplified marketing • Achieved record website visitation at 2.2+ million average monthly unique visitors in the quarter, up 28% from the prior quarter • Increased marketing spend in the quarter as we capitalized on national advertising opportunities and prepared new campaigns (1) Defined as ecommerce vehicle purchases plus ecommerce units sold. Purchases include trade - ins and straight buys and exclude auction - sourced units. 24,500 34,000 38,000 1Q 2021 2Q 2021 3Q 2021 +145% YoY +325% +190% ~ ~ ~

 

 

 

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© 2021 Vroom, All rights reserved. 7 Vroom Reports Third Quarter 2020 Results - America Online News Broadens customer base and expands addressable market Accelerates sales growth enhances customer experience to improve conversion accelerates captive financing capabilities United auto credit-logo Advancing on our path to profitability through uacc Leverages fixed - cost base to improve margins Enables significant gppu improvement With Uacc, we aim to unlock the Benefits of an asset - light captive finance strategy

 

 

 

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© 2021 Vroom, All rights reserved. 8 A car on a trailer Description automatically generated with medium confidence Supply chain update On track for our 2021 targets Investing in our supply chain infrastructure • Opened our 30 th last mile hub in third quarter, achieving our annual target one quarter ahead of schedule - 41% of ecommerce units delivered with our last mile experience, 15 percentage points higher than second quarter - On track to achieve our 50% run - rate delivery penetration target by end of 2021 • Additional in - house linehaul capacity complements and de - risks the business • Accelerating dedicated Vroom reconditioning center strategy supply chain transitory events • Currently experiencing reconditioning and logistics constraints due to labor shortages and elevated demand at third - party supply chain partners • Current transitory events putting upward pressure on costs and reducing throughput

 

 

 

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© 2021 Vroom, All rights reserved. 9 Sales support and technology Processing record - breaking transactions, both in purchasing and selling Sales support organization • We continue to invest in people, processes and tech Investing in our ecommerce platform • Removing friction from transactions • Improving the customer experience • Provide a world - class touchless transaction for both buying and selling vehicles Drive efficiency and improve costs through scale • Investing today drives us toward a seamless end - to - end ecommerce experience A picture containing text, car Description automatically generated

 

 

 

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© 2021 Vroom, All rights reserved. 10 Summarizing the third quarter Solid performance and strong momentum as we continue to execute our strategy Strong ecommerce unit growth Successful marketing campaigns, healthy demand, and increased listed inventory levels drove 123% YoY growth On track to meet and exceed key 2021 supply chain targets Continued acceleration of last mile program roll out and linehaul investments Current transitory events putting upward pressure on costs and reducing throughput Announced agreement to acquire UACC Aimed to accelerate future profitability and expand addressable market GPPU strength on good execution in a high - demand, constrained supply environment Robust expansion in product gross profit per unit and slight increase in vehicle gross profit per unit Kept pace with rapid transaction growth across our business Total ecommerce transactions increased 190% YoY and 10% from prior quarter (1) (1) Defined as ecommerce vehicle purchases plus ecommerce units sold. Purchases include trade - ins and straight buys and exclude auction - sourced units.

 

 

 

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© 2021 Vroom, All rights reserved. 11 Car and trees Third - Quarter 2021 Financial Update November 2021

 

 

 

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© 2021 Vroom, All rights reserved. 12 Low End High End Total Revenues $865 million $900 million Ecommerce Units 20,000 20,500 Ecommerce GPPU $2,100 $2,300 Total Gross Profit $50 million $58 million Adjusted EBITDA (1) (3) ($104) million ($95) million Third - quarter financial summary Strong revenue and gross profit performance Total revenues up 178% YoY from $323 million • Primarily driven by higher ecommerce revenues fueled by triple - digit unit growth and higher ASPs Ecommerce units up 123% YoY from 8,832 • Strong execution against heightened demand environment and amplified marketing strategy Ecommerce GPPU up 17% YoY from $2,188 • Meaningfully higher product GPPU and slight increase in vehicle GPPU Total gross profit up 128% YoY from $25 million • Driven primarily by expansion of ecommerce GPPU and higher unit volumes Adjusted EBITDA of ($87) million vs. ($36) million in 3Q 2020 (1) Net loss of ($98) million vs. ($38) million in 3Q 2020 Adjusted EPS of ($0.70) vs. ($0.29) in 3Q 2020 (2) Eps of ($0.72) vs. ($0.31) in 3Q 2020 (1) Adjusted EBITDA is a non - GAAP measure. For a definition of Adjusted EBITDA and a reconciliation to the most comparable GAAP measure, please see slide 18. 3Q 2021 EBITDA adjusted for $3.4 million in SG&A costs associated with entering an agreement to acquire UACC. (2) EPS adjusted for $3.4 million in SG&A costs associated with entering an agreement to acquire UACC. EPS, as adjusted is a non - GAA P measure. For a definition of EPS, as adjusted and a reconciliation to the most comparable GAAP measure, please see slides 20 and 21. (3) A reconciliation of non - GAAP guidance measures to corresponding GAAP measures for 4Q 2021 guidance 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. . Beat Guidance Reported Results Guidance Range Total Revenues $897 million $858 - $891 million Ecommerce Units 19,683 20,000 - 20,500 Ecommerce GPPU $2,560 $2,350 - $2,450 Total Gross Profit $58 million $51 - $56 million Adjusted EBITDA (1) ($87) million ($100) - ($92) million Net loss ($98) million N/A . . . . 3 Q 2021 Performance Highlights 4 Q 2021 Guidance

 

 

 

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© 2021 Vroom, All rights reserved. 13 Third - quarter ecommerce financial summary Continued year - over - year growth across all key metrics 15,504 18,268 19,683 1Q 2021 2Q 2021 3Q 2021 (Ecommerce revenues in millions) Ecommerce revenues up 216% YoY from $222 million • Triple - digit unit growth coupled with a 42% YoY increase in ASP Ecommerce vehicle GPPU up 1% YoY from $1,302 • Continued enhancements to pricing algorithms and demand environment have driven improvement each quarter YoY +96% YoY +172% +123% $422 $580 $702 1Q 2021 2Q 2021 3Q 2021 +81% YoY +230% +216% $1,151 $1,587 $1,315 1Q 2021 2Q 2021 3Q 2021 +36% YoY +405% +1% Ecommerce units up 123% YoY from 8,832 • Capitalized on heightened demand environment and marketing strategy and strong execution with higher listed inventory Ecommerce product GPPU up 41% YoY from $886 • Solid growth driven by stronger product attachment rates, and higher average loan sizes on increased ecommerce ASPs $903 $1,131 $1,245 1Q 2021 2Q 2021 3Q 2021 - 5% YoY +49% +41% (1) Vehicle gross profit per unit. (2) Product gross profit per unit. Ecommerce units Ecommerce Revenues Ecommerce VGPPU (1) Ecommerce PGPPU (2)

 

 

 

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© 2021 Vroom, All rights reserved. 14 Third - quarter wholesale and TDA financial summary Prioritized profitability in a heightened demand environment 8,641 10,020 9,760 1Q 2021 2Q 2021 3Q 2021 Wholesale GPPU down 60% YoY from $542 • Ahead of expectations despite margin compression due to unfavorable wholesale price movements TDA units up 20% YoY from 1,463 • Tailwinds from improved inventory and a high - demand environment Wholesale ($33) $850 $215 1Q 2021 2Q 2021 3Q 2021 1,775 1,583 1,749 1Q 2021 2Q 2021 3Q 2021 Wholesale units up 58% YoY from 6,166 units • Primarily driven by an increase in trade - ins on higher ecommerce sales TDA GPPU up 19% YoY from $1,828 • Higher vehicle GPPU on more efficient regional sourcing; increased product GPPU driven by higher loan values $1,572 $1,988 $2,175 1Q 2021 2Q 2021 3Q 2021 TDA (1) units GPPU (1) Texas Direct Auto. units GPPU

 

 

 

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© 2021 Vroom, All rights reserved. 15 Breaking down year - to - date SG&A Beginning to see opex Leverage on incremental total ecommerce transaction volume • SG&A per total ecommerce transaction has levered year - to - date through 3Q with incremental volume • Headwinds from higher logistics costs and transaction - related costs have been offset by leverage on increasing scale • Key investments in staffing and new technology are improving our efficiency SG&A per total ecommerce Transaction ( 1 ) $5,401 $3,953 $134 $35 ($1,617) YTD 2020 Logistics market rate inflation UACC acquisition costs Scaling leverage YTD 2021 (1) Reflects total SG&A divided by total ecommerce transactions. Total ecommerce transactions defined as ecommerce vehicle purchases plus ecommerce units sold. Purchases include trade - ins and straight buys and exclude auction - sourced units. 27% YoY improvement in SG&A per transaction

 

 

 

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© 2021 Vroom, All rights reserved. 16 Third - quarter financial summary Solid performance as we continue to execute our strategy A picture containing text, road, car, auto racing Description automatically generated Robust ecommerce transaction growth Driving our strategy forward 4Q Guidance Continues strong YoY growth Ongoing momentum on ecommerce GPPU Expenses scaling, yet levering on a per - transaction basis

 

 

 

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© 2021 Vroom, All rights reserved. 17 picture containing trees and car Appendix November 2021

 

 

 

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© 2021 Vroom, All rights reserved. 18 Reconciliation of Non - GAAP Financial measures 2021202020212020Net loss(98,122)$ (37,850)$ (241,118)$ (142,137)$ Adjusted to exclude the following: Interest expense7,028 2,259 14,720 6,382 Interest income(2,930) (1,289) (7,288) (3,960) Provision for income taxes29 33 379 138 Depreciation and amortization expense3,469 1,196 9,497 3,255 EBITDA(90,526)$ (35,651)$ (223,810)$ (136,322)$ One-time IPO related acceleration of non-cash stock-based compensation— — — 1,262 One-time IPO related non-cash revaluation of preferred stock warrant— — — 20,470 Acquisition related costs3,412 — 3,412 — Adjusted EBITDA(87,114)$ (35,651)$ (220,398)$ (114,590)$ Three Months Ended September 30, Nine Months Ended September 30, (in thousands)(in thousands) 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, the one - time, IPO related non - cash revaluation of a preferred stock warrant and costs related to our acquisition of UACC. The following table presents a reconciliation of EBITDA and Adjusted EBITDA to net loss, which is the most directly comparable U.S. GAAP measure:

 

 

 

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© 2021 Vroom, All rights reserved. 19 Reconciliation of Non - GAAP Financial measures (cont’d) 2021202020212020Loss from operations(94,005)$ (36,873)$ (233,365)$ (119,218)$ Add: One-time IPO related acceleration of non-cash stock based compensation— — — 1,262 Add: Acquisition related costs3,412 — 3,412 — Adjusted loss from operations(90,593)$ (36,873)$ (229,953)$ (117,956)$ Three Months Ended September 30, Nine Months Ended September 30, (in thousands)(in thousands) 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 and costs related to our acquisition of UACC. 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 :

 

 

 

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© 2021 Vroom, All rights reserved. 20 2021202020212020Net loss(98,122)$ (37,850)$ (241,118)$ (142,137)$ Net loss attributable to common stockholders(98,122)$ (37,850)$ (241,118)$ (142,137)$ Add: One-time IPO related acceleration of non-cash stock based compensation— — — 1,262 Add: One-time IPO related non-cash revaluation of preferred stock warrant— — — 20,470 Add: Acquisition related costs3,412 — 3,412 — Non-GAAP net loss(94,710)$ (37,850)$ (237,706)$ (120,405)$ Weighted-average number of shares outstanding used to compute net loss per 136,766,015 121,123,472 136,256,901 53,731,475 Net loss per share, basic and diluted(0.72)$ (0.31)$ (1.77)$ (2.65)$ Impact of one-time IPO related acceleration of non-cash stock based compensation— — — 0.02 Impact of one-time IPO related non-cash revaluation of preferred stock warrant— — — 0.38 Impact of acquisition related costs0.02 — 0.03 — Non-GAAP net loss per share, basic and diluted(0.70)$ (0.31)$ (1.74)$ (2.25)$ Non-GAAP net loss per share, as adjusted, basic and diluted(a)(0.70)$ (0.29)$ (1.74)$ (0.93)$ Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except share and per share amounts) Reconciliation of Non - GAAP Financial measures (cont’d) (a) Non - GAAP net loss per share, as adjusted has been computed to give effect to, as of the beginning of each period presented, (i) the shares of common stock issued in connection with our IPO, (ii) the automatic conversion of all outstanding shares of redeemable convertible preferred stock into shares of common stock th at occurred upon the consummation of our IPO and (iii) the shares of common stock issued with our follow - on public offering. The computation of Non - GAAP net loss per share, as adjusted is provided on the following page. 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, the one - time, IPO related non - cash revaluation of a preferred stock warrant and costs related to our acquisition of UACC. 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:

 

 

 

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© 2021 Vroom, All rights reserved. 21 Reconciliation of Non - GAAP Financial measures (cont’d) 2021202020212020Non-GAAP net loss(94,710)$ (37,850)$ (237,706)$ (120,405)$ Non-GAAP net loss, as adjusted (94,710)$ (37,850)$ (237,706)$ (120,405)$ Weighted-average number of shares outstanding used to compute net loss per share, basic and diluted136,766,015 121,123,472 136,256,901 53,731,475 Add: unweighted adjustment for common stock issued in connection with IPO— — — 24,437,500 Add: unweighted adjustment for conversion of redeemable convertible preferred stock in connection with IPO— — — 85,533,394 Add: unweighted adjustment for common stock issued in connection with follow-on public offering— 10,800,000 — 10,800,000 Less: Adjustment for the impact of the above items already included in weighted-average number of shares outstanding for the periods presented— (1,760,869) — (44,897,573) Weighted-average number of shares outstanding used to compute net loss per share, as adjusted, basic and diluted136,766,015 130,162,603 136,256,901 129,604,796 Non-GAAP net loss per share, as adjusted, basic and diluted(0.70)$ (0.29)$ (1.74)$ (0.93)$ (in thousands, except share and per share amounts) Three Months Ended September 30, Nine Months Ended September 30, Non - GAAP net loss per share, as adjusted Non - GAAP net loss per share, as adjusted has been computed to give effect to, as of the beginning of each period presented, (i) the shares of common stock issued in connection with our IPO, (ii) the automatic conversion of all outstanding shares of redeemable convertible preferred stock into shares of common stock that occurred upon the consummation of our IPO and (iii) the shares o f common stock issued with our follow - on public offering. The computation of Non - GAAP net loss per share, as adjusted is as follows:

 

 

 

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© 2021 Vroom, All rights reserved. 22 Thank you!