0000950170-23-005820 | 10-K | XBRL Viewer

Fair Value

Weighted Average Useful Life

Purchased technology

Customer relationships

Trade name

Accrued Expenses and Other Current Liabilities

12 Months Ended

Dec. 31, 2022

Accrued Liabilities and Other Liabilities [Abstract]

Accrued Expenses and Other Current Liabilities

9. Accrued Expenses and Other Current Liabilities

The Company’s accrued expenses consisted of the following (in thousands):


	December 31,
	2022		2021
Accrued marketing expenses	$	2,093	$	17,546
Vehicle related expenses		14,789		36,459
Sales taxes		5,983		39,163
Accrued compensation and benefits		28,276		16,150
Accrued professional services		3,488		4,225
Accrued legal settlements(1)		7,383		—
Interest payable		3,990		1,718
Other		10,793		6,247
Total accrued expenses	$	76,795	$	121,508

(1) Accrued legal settlements are primarily related to legal challenges stemming from operational challenges created by the Company's prior rapid growth, which resulted in additional costs incurred, including legal settlements.

The Company’s other current liabilities consisted of the following (in thousands):


	December 31,
	2022		2021
Vehicle payable	$	3,617	$	30,647
Reserve for estimated returns		3,919		26,522
Insurance payable		4,551		-
State income tax payable		4,041		420
Other		1,565		15
Total other current liabilities	$	17,693	$	57,604

Restructuring Activities

12 Months Ended

Dec. 31, 2022

Restructuring and Related Activities [Abstract]

Restructuring Activities

18. Restructuring Activities

On May 5, 2022, the Company approved the Realignment Plan, which was designed to position the Company for long-term profitable growth by prioritizing unit economics, reducing operating expenses and maximizing liquidity.

In connection with the Realignment Plan, the Company reduced headcount across the organization and closed its New York City, Detroit, and one of its Houston office locations as well as several Sell Us Your Car® center facilities.

Additionally, the Company streamlined TDA's operations and closed its service center. The service center was repurposed to replace the reconditioning facility in Stafford, Texas, which was also closed. The Company also restructured its network of logistics hubs in order to align with reduced unit volume and its regional operating model.

The restructuring activities associated with the Realignment Plan were substantially completed during 2022.

The following table summarizes the components of the restructuring charges:


	Year ended December 31,
	2022

Charges by Activity:
Severance and termination benefits (1)	$	7,358
Impairment of operating lease right-of-use assets (2)		6,491
Other costs (3)		1,176
Total Restructuring and Related Charges	$	15,025

(1) Severance and termination costs consist of severance costs provided to employees who have been terminated as well outplacement costs and COBRA benefits.

(2) Impairment of operating lease right-of-use assets consist of costs associated with planned facility closures of $8.6 million, net of applicable sublease income of $2.1 million, for the year ended December 31, 2022, that will continue to be incurred under the contract for its remaining term without economic benefit to the Company.

(3) Other costs consist of legal expenses of $0.6 million incurred in connection with the Realignment Plan and acceleration of depreciation of property and equipment of $0.6 million related to the planned facility closures.

Severance and termination benefits and other costs are included in "Selling, general, and administrative expenses" and impairment of operating lease right-of-use assets are included in "Impairment charges" in the consolidated statements of operations for the year ended December 31, 2022.

The following table is a reconciliation of the beginning and ending restructuring liability for the year ended December 31, 2022:


Balance as of December 31, 2021	$	—
Accrual and accrual adjustments		7,941
Cash payments		(7,131	)
Balance as of December 31, 2022	$	810

The restructuring liability for severance and termination benefits is reflected in "Accrued Expenses" in the consolidated balance sheet as of December 31, 2022. On January 18, 2023, the Company executed a reduction in force, refer to Note 23 – Subsequent Events for further details.

Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

8. Goodwill and Intangible Assets

Goodwill

The following table summarizes the activity in the carrying value of goodwill by reporting unit for the years ended December 31, 2022, and 2021 (in thousands):


	Ecommerce			Wholesale			TDA			Total
Balance as of December 31, 2020	$	72,231		$	1,720		$	4,221		$	78,172
Acquisition		80,645			—			—			80,645
Balance as of December 31, 2021	$	152,876		$	1,720		$	4,221		$	158,817
Acquisition		42,886			—			—			42,886
Goodwill impairment charge		(195,762	)		(1,720	)		(4,221	)		(201,703	)
Balance as of December 31, 2022	$	—		$	—		$	—		$	—

As of March 31, 2022, a quantitative interim goodwill impairment assessment was performed over the Company's reporting units due to further sustained declines in the Company's and comparable companies' stock prices during the three months ended March 31, 2022.

The Company estimated the fair value of the Ecommerce, Wholesale, and TDA reporting units using the discounted cash flow method under the income approach. The significant assumptions used in the valuation include revenue growth rates, future gross profit margins and operating expenses used to calculate projected future cash flows,

determination of the weighted average cost of capital, and future economic and market conditions. The terminal value is based on an exit revenue multiple which requires significant assumptions regarding the selection of appropriate multiples that consider relevant market trading data. The Company bases its estimates and assumptions on its knowledge of the automotive and ecommerce industries, recent performance, expectations of future performance and other assumptions the Company believe to be reasonable.

The Company determined that the estimated fair value of the Ecommerce, Wholesale, and TDA reporting units was less than their carrying amounts. The Company recorded a goodwill impairment charge of $201.7 million in the consolidated statements of operations for the year ended December 31, 2022. No goodwill impairment charges were recorded for the years ended December 31, 2021 and 2020.

Refer to Note 5 – Acquisitions for more information related to the acquisitions that occurred in the year ended December 31, 2022 and 2021.

Intangible Assets

Intangible assets, net consisted of the following (in thousands):


	December 31, 2022							December 31, 2021
	Gross Carrying Value		Accumulated Amortization			Carrying Value		Gross Carrying Value		Accumulated Amortization			Carrying Value
Developed and Purchased Technology	$	108,700	$	(21,053	)	$	87,647	$	25,700	$	(5,043	)	$	20,657
Customer Relationships		69,400		(8,661	)		60,739		5,240		(673	)		4,567
Trademarks and Trade names		12,200		(1,676	)		10,524		3,400		(417	)		2,983
Total intangible assets	$	190,300	$	(31,390	)	$	158,910	$	34,340	$	(6,133	)	$	28,207

Refer to Note 5 – Acquisitions for more information related to the acquisitions that occurred in the years ended December 31, 2022 and 2021.

Amortization expense for intangible assets was $25.3 million, $6.1 million and $0.5 million for the years ended December 31, 2022, 2021, and 2020, respectively.

The estimated amortization expense for intangible assets subsequent to December 31, 2022, consists of the following (in thousands):


Year Ending December 31:
2023	$	27,022
2024		27,022
2025		27,022
2026		21,979
2027		21,882
Thereafter		33,983
	$	158,910

Financial Instruments and Fair Value Measurements - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Transfers into level 3	$ 0
Financial assets		$ 0
Financial liabilities		0
Finance receivables held for sale, Carrying value		0
Finance receivables held for sale, Fair Value		0
Finance receivable fair value on non-recurring basis	22,400,000
Fair Value, Recurring
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Financial assets	356,453,000	751,781,000
Financial liabilities	79,829,000
Fair Value, Recurring \| Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Financial assets	$ 153,174,000	0
Financial liabilities		$ 0

Financial Instruments and Fair Value Measurements - Summary of Fair Value of Financial Instruments Not Carried at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Finance receivables held for sale, Carrying value	$ 321,626
Convertible Senior Notes, Carrying value	359,254	$ 610,618
Convertible Senior Notes, Fair value	128,026	$ 386,100
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Finance receivables held for sale, Carrying value	299,235
Finance receivables held for sale, Fair Value	$ 299,925

Variable Interest Entities and Securitizations

12 Months Ended

Dec. 31, 2022

Variable Interest Entity, Measure of Activity [Abstract]

Variable Interest Entities and Securitizations

4. Variable Interest Entities and Securitizations

A VIE is an entity that either (i) has insufficient equity to finance its activities without additional subordinated financial support, or (ii) has equity investors who lack the characteristics of a controlling financial interest. The Company consolidates VIEs for which it is the primary beneficiary. The Company is the primary beneficiary of a VIE when it has both the power to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive benefits from the entity that could potentially be significant to the VIE. Assets recognized as a result of consolidating VIEs do not represent additional assets that could be used to satisfy claims against the Company's general assets. Liabilities recognized as a result of consolidating VIEs do not represent additional claims on the Company's general assets, rather they represent claims against the specific assets of the consolidated VIEs.

UACC has the power to direct significant activities of its VIEs when it has the ability to exercise discretion in the servicing of financial assets or control investment decisions. UACC generally retains a portion of the economic interests in

UACC-sponsored asset-backed securitization transactions, which could be retained in the form of a portion of the senior interests, the subordinated interests, residual interests, or servicing rights.

UACC has developed a securitization program that involves selling finance receivables to securitization trusts through the private issuance of asset-backed securities which are collateralized by the finance receivables. UACC establishes and sponsors these transactions which create and pass along risks to the variable interest holders, specifically, consumer credit risk and pre-payment risk.

The securitization trusts established in connection with asset-backed securitization transactions are VIEs. For each VIE that UACC establishes in its role as sponsor of securitization transactions, the Company performs an analysis to determine if it is the primary beneficiary of the VIE.

For all securitization transactions consummated prior to the Acquisition Date, the Company consolidated VIEs and accounted for these transactions as secured borrowings. In September 2022, UACC exercised its option to repurchase the 2020-1 securitization debt. As a result, the securitization trust was dissolved and the VIE is no longer being consolidated by the Company. UACC is the primary beneficiary of the United Auto Credit 2021-1 securitization trust, as it has both the power to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive benefits from the entity that could potentially be significant to the VIE. UACC also retained a portion of the economic interests in the 2021-1 asset-backed securitization transaction, in the form of residual interests in accordance with Regulation RR of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Risk Retention Rules"). The Risk Retention Rules require the Company to retain at least 5% of the beneficial interests issued by the securitization trusts. Refer to Note 13 – Long Term Debt for further details.

The VIE model allows for a measurement alternative when a reporting entity elects the fair value option and consolidates a collateralized financing entity (“CFE”). This measurement alternative eliminates the accounting mismatch that may arise from measurement differences between the CFE’s financial assets and third-party financial liabilities in earnings and attributes those earnings to the controlling equity interest in the consolidated income statement. The 2021-1 securitization trust consolidated by UACC meets the definition of a CFE, therefore, the Company has elected to apply the measurement alternative when consolidating this VIE. Refer to Note 17 – Financial Instruments and Fair Value Measurements for further detail.

UACC has four senior secured warehouse credit facilities. Through trusts, UACC entered into warehouse facility agreements with certain banking institutions, primarily to finance the purchase and origination of finance receivables as well as to provide funding for general operating activities. These trusts are secured by eligible finance receivables which are pledged as collateral for the warehouse facilities. These trusts are consolidated VIEs. Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further details on the warehouse facilities.

Creditors or beneficial interest holders of VIEs for which the Company is the primary beneficiary generally have recourse only to the assets and cash flows of the VIEs and do not have recourse to the Company. The following table presents the total assets and total liabilities associated with the Company's variable interests in consolidated VIEs, as classified in the consolidated balance sheets (in thousands):


	As of December 31, 2022
	Securitization Vehicles		Warehouse Facilities1		Total
Current Assets:
Restricted cash	$	9,023	$	15,654	$	24,677
Finance receivables at fair value		5,336		6,156		11,492
Finance receivables held for sale		—		305,917		305,917
Other assets		797		1,561		2,358
Total Current Assets		15,156		329,288		344,444
Finance receivables at fair value		72,568		47,024		119,592
Total Assets	$	87,724	$	376,312	$	464,036
Current Liabilities:
Current portion of securitization debt	$	47,239	$	—	$	47,239
Warehouse credit facilities		—		229,518		229,518
Total Current Liabilities		47,239		229,518		276,757
Securitization debt, net of current portion		32,590		—		32,590
Other liabilities		90		1,316		1,406
Total Liabilities	$	79,919	$	230,834	$	310,753

1 Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further details of the warehouse facilities.

The Company did not have any consolidated VIEs for the year ended December 31, 2021.

UACC establishes securitization trusts to purchase finance receivables. The securitization trusts issue asset-backed securities, which are collateralized by the finance receivables that UACC sells to the securitization trusts. Upon sale of the finance receivables to the securitization trusts, the Company recognizes a gain or loss on sales of finance receivables. On February 16, 2022 and July 14, 2022, UACC sold pools of finance receivables in the United Auto Credit 2022-1 and 2022-2 securitization transactions, respectively. The Company receives net proceeds from the sales in the form of cash plus at least 5% of the beneficial interests issued by the securitization trusts to comply with risk retention rules. During the year ended December 31, 2022 the Company sold $523.7 million of rated asset-backed securities and $49.6 million of residual certificates through securitization transactions. The total gain related to finance receivables sold pursuant to securitization transactions was $45.6 million for the year ended December 31, 2022.

UACC retained the servicing rights to these finance receivables and received beneficial interests in the form of asset-backed securities. UACC owns an insignificant portion of these securities and receives an at market servicing fee. The 2022-1 and 2022-2 securitization trusts are VIEs that the Company does not consolidate. As the servicer, UACC retained the power to direct the activities that are most significant to the entities, however, the Company concluded that it is not the primary beneficiary of the United Auto Credit 2022-1 and 2022-2 securitization trusts because UACC retained interests in the VIEs are insignificant. The beneficial interest retained by UACC included rated notes and unrated residual certificates issued by the 2022-1 and 2022-2 securitization trusts.

UACC has no obligation to repurchase or replace any securitized asset that subsequently becomes delinquent in payment or otherwise is in default, except when representations and warranties about the eligibility of the securitized assets are breached, or when certain changes are made to the underlying asset contracts. Securitization investors have no recourse to UACC or its other assets and have no right to require UACC to repurchase the investments. UACC has no obligation to provide liquidity or contribute cash or additional assets to the VIEs and does not guarantee any asset-backed securities.

As of December 31, 2022, the assets UACC retains in the unconsolidated VIEs were approximately $20.6 million and are included in "Beneficial interests in securitizations" in the Company's consolidated balance sheet. The beneficial

interests in securitizations are subject to restrictions on transfer pursuant to UACC’s obligations as a sponsor under Risk Retention Rules. These securities are interests in securitization trusts, thus there are no contractual maturities.

The following table summarizes the amortized cost, the carrying amount, which is the fair value, and the maximum exposure to losses of UACC's assets related to unconsolidated VIEs (in thousands):


	As of December 31, 2022
	Aggregate Principal Balance		Carrying Value		Total Exposure
Rated notes	$	19,233	$	18,664	$	18,664
Certificates		—		1,928		1,928
Other assets		310		310		310
Total unconsolidated VIEs	$	19,543	$	20,902	$	20,902

Total exposure represents the estimated loss UACC would incur under severe, hypothetical circumstances, such as if the value of the interests in the securitization trusts and any associated collateral declined to zero. The Company believes the possibility of this is remote. As such, the total exposure presented above is not an indication of the Company's expected losses.

Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 83,104	$ 57,460
Accumulated depreciation and amortization	(32,903)	(20,418)
Property and equipment, net	50,201	37,042
Equipment
Property Plant And Equipment [Line Items]
Property and equipment, gross	3,357	1,011
Furniture and Fixtures
Property Plant And Equipment [Line Items]
Property and equipment, gross	1,896	2,244
Logistics fleet
Property Plant And Equipment [Line Items]
Property and equipment, gross	32,468	22,810
Leasehold Improvements
Property Plant And Equipment [Line Items]
Property and equipment, gross	6,577	7,161
Internal-use Software
Property Plant And Equipment [Line Items]
Property and equipment, gross	30,725	18,423
Other
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 8,081	$ 5,811

Financial Instruments and Fair Value Measurements - Summary of Other Relevant Data Related to Finance Receivables Carried at Fair Value (Details) $ in Thousands	Dec. 31, 2022 USD ($)
Finance Receivables of Consolidated CFEs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Aggregate unpaid principal balance included within finance receivables that are reported at fair value	$ 84,477
Aggregate fair value of finance receivables reported at fair value	77,904
Finance Receivables of Consolidated CFEs \| 90 Days or More Past Due
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Unpaid principal balance of receivables within finance receivables that are reported at fair value and are on nonaccrual status	1,097
Aggregate fair value of receivables carried at fair value that are on nonaccrual status	985
Finance Receivables at Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Aggregate unpaid principal balance included within finance receivables that are reported at fair value	89,068
Aggregate fair value of finance receivables reported at fair value	75,270
Finance Receivables at Fair Value \| 90 Days or More Past Due
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Unpaid principal balance of receivables within finance receivables that are reported at fair value and are on nonaccrual status	1,499
Aggregate fair value of receivables carried at fair value that are on nonaccrual status	$ 1,311

Financial Instruments and Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets		$ 0
Total financial liabilities		0
Fair Value, Recurring
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	$ 356,453,000	751,781,000
Total financial liabilities	79,829,000
Fair Value, Recurring \| Securitization Debt of Consolidated VIEs
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial liabilities	79,829,000
Fair Value, Recurring \| Finance Receivables
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	77,904,000
Fair Value, Recurring \| Finance Receivables at Fair Value
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	75,270,000
Fair Value, Recurring \| Beneficial Interests in Securitizations
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	20,592,000
Fair Value, Recurring \| Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents	182,687,000	601,807,000
Fair Value, Recurring \| Commercial Paper
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents		149,974,000
Fair Value, Recurring \| Level 1
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	182,687,000	601,807,000
Fair Value, Recurring \| Level 1 \| Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents	182,687,000	601,807,000
Fair Value, Recurring \| Level 2
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	20,592,000	149,974,000
Total financial liabilities	79,829,000
Fair Value, Recurring \| Level 2 \| Securitization Debt of Consolidated VIEs
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial liabilities	79,829,000
Fair Value, Recurring \| Level 2 \| Beneficial Interests in Securitizations
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	20,592,000
Fair Value, Recurring \| Level 2 \| Commercial Paper
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents		149,974,000
Fair Value, Recurring \| Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	153,174,000	0
Total financial liabilities		$ 0
Fair Value, Recurring \| Level 3 \| Finance Receivables
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	77,904,000
Fair Value, Recurring \| Level 3 \| Finance Receivables at Fair Value
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Total financial assets	$ 75,270,000

Inventory

12 Months Ended

Dec. 31, 2022

Inventory Disclosure [Abstract]

Inventory

6. Inventory

Inventory consisted of the following (in thousands):


	December 31,
	2022		2021
Vehicles	$	317,994	$	724,542
Parts and accessories		2,654		1,842
Total inventory	$	320,648	$	726,384

As of December 31, 2022 and 2021, “Inventory” includes an adjustment of $24.2 million and $22.4 million, respectively, to record the balances at the lower of cost or net realizable value.

Acquisition - Summary of Fair Value of Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Feb. 01, 2022	Dec. 31, 2021	Dec. 31, 2020
Business Acquisition [Line Items]
Goodwill	$ 0		$ 158,817	$ 78,172
Vast Holdings, Inc. (“d/b/a CarStory”)
Business Acquisition [Line Items]
Cash and cash equivalents			865
Accounts receivable, prepaid expenses and other current assets			1,330
Property and equipment and other assets			371
Intangible Assets			34,300
Goodwill			80,645
Current liabilities			(943)
Net assets acquired			$ 116,568
UACC
Business Acquisition [Line Items]
Cash and cash equivalents		$ 5,294
Restricted cash		42,631
Finance receivables at fair value		296,927
Finance receivables, held for sale		263,393
Intangible Assets		156,000
Goodwill		42,886
Other assets		25,934
Total assets acquired		833,065
Warehouse credit facilities		(178,067)
Long term debt		(285,704)
Deferred tax liability		(23,855)
Other liabilities		(30,026)
Total liabilities assumed		(517,652)
Net assets acquired		$ 315,413

Segment Information

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Segment Information

19. Segment Information

As part of the Realignment Plan, initiated in the second quarter of 2022, the Company streamlined TDA's operations and closed its service center. The Company also reevaluated its reporting segments based on relative revenue and gross profit and significance in the Company's long term strategy. As a result of the quantitative analysis, the Company determined to no longer report TDA as a separate segment. The Company now presents three reportable segments: Ecommerce, Wholesale, and Retail Financing. The Company reclassified TDA revenue and TDA gross profit for the comparative period from the TDA reportable segment to the “All Other” category to conform to current year presentation. No operating segments have been aggregated to form the reportable segments.

The Company determined its operating segments based on how the chief operating decision maker (“CODM”) reviews the Company’s operating results in assessing performance and allocating resources. The CODM reviews revenue and gross profit for each of the reportable segments. Gross profit is defined as revenue less cost of sales incurred by the segment. The CODM does not evaluate operating segments using asset information as these are managed on an enterprise-wide group basis. Accordingly, the Company does not report segment asset information. As of December 31, 2022 and December 31, 2021, long-lived assets were predominantly located in the United States.

The Ecommerce reportable segment represents retail sales of used vehicles through the Company’s ecommerce platform, revenue earned on vehicle financing originated by UACC or the Company's third-party financing sources and sales of value-added products associated with those vehicles sales. The Wholesale reportable segment represents sales of used vehicles through wholesale channels. The Retail Financing reportable segment represents UACC’s operations with its network of third-party dealership customers, including the purchases and servicing of vehicle installment contracts. Revenues within the "All Other" category consist of retail sales of used vehicles from TDA and fees earned on sales of value-added products associated with those vehicles sales and the CarStory business.

Information about the Company’s reportable segments are as follows (in thousands):


	Year Ended December 31, 2022
	Ecommerce		Wholesale			Retail Financing		All Other		Total
Revenues from external customers	$	1,364,195	$	293,528		$	152,542	$	138,636	$	1,948,901
Gross profit	$	99,973	$	(10,620	)	$	138,381	$	17,053	$	244,787

	Year Ended December 31, 2021
	Ecommerce		Wholesale			Retail Financing		All Other(1)		Total
Revenues from external customers	$	2,442,369	$	498,981		$	—	$	242,905	$	3,184,255
Gross profit	$	164,746	$	18,120		$	—	$	19,233	$	202,099

	Year Ended December 31, 2020
	Ecommerce		Wholesale			Retail Financing		All Other(1)		Total
Revenues from external customers	$	915,451	$	245,580		$	—	$	196,669	$	1,357,700
Gross profit	$	60,861	$	(1,432	)	$	—	$	12,116	$	71,545

(1)

The Company reclassified TDA revenue and TDA gross profit from the TDA reportable segment to the “All Other” category to conform to current year presentation.

The reconciliation between reportable segment gross profit to consolidated loss before provision for income taxes is as follows (in thousands):


	Year Ended December 31,
	2022			2021			2020
Reconciliation to consolidated total revenue
Total reportable segment revenue	$	1,810,265		$	2,941,350		$	1,161,031
All Other revenues		138,636			242,905			196,669
Consolidated total revenue	$	1,948,901		$	3,184,255		$	1,357,700
Reconciliation to consolidated loss before provision for income taxes
Total reportable segment gross profit	$	227,734		$	182,866		$	59,429
All Other gross profit		17,053			19,233			12,116
Selling, general and administrative expenses		566,387			547,823			245,546
Depreciation and amortization		38,290			12,891			4,598
Impairment charges		211,873			—			—
Gain on debt extinguishment		(164,684	)		—			—
Interest expense		40,693			21,948			9,656
Interest Income		(19,363	)		(10,341	)		(5,896	)
Revaluation of preferred stock warrant		—			—			20,470
Other loss (income), net		43,181			(65	)		(114	)
Consolidated loss before provision for income taxes	$	(471,590	)	$	(370,157	)	$	(202,715	)

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
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-Paragraph 34
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
-Paragraph 21
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Paragraph 32
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599

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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI https://asc.fasb.org/topic&trid=2134510

+ Details

Net Loss Per Share (Tables)

12 Months Ended

Dec. 31, 2022

Earnings Per Share [Abstract]

Summary of Computation of Basic and Diluted Net Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders:


	Year Ended December 31,
(in thousands, except share and per share amounts)	2022			2021			2020
Net loss	$	(451,910	)	$	(370,911	)	$	(202,799	)
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted		137,907,444			136,429,791			73,345,569
Net loss per share attributable to common stockholders, basic and diluted	$	(3.28	)	$	(2.72	)	$	(2.76	)

Summary of Calculation of Diluted Shares Outstanding

The following potentially dilutive shares were not included in the calculation of diluted shares outstanding for the periods presented as the effect would have been anti-dilutive:


	As of December 31,
	2022		2021		2020
Convertible senior notes		6,530,762		11,158,722		—
Stock options		2,857,176		4,076,542		5,617,568
Restricted stock units		8,661,425		1,853,150		1,867,660
Total		18,049,363		17,088,414		7,485,228

Commitments and Contingencies

12 Months Ended

Dec. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

14. Commitments and Contingencies

Litigation

From time to time, the Company is involved in various claims and legal actions that arise in the ordinary course of business and an unfavorable resolution of any of these matters could materially affect the Company’s future results of operations, cash flows or financial position. The Company is also party to various disputes that the Company considers routine and incidental to its business. The Company does not expect the results of any of these routine actions to have a material effect on the Company’s business, results of operations, financial condition, or cash flows. The Company accrues a liability when a loss is considered probable and the amount can be reasonably estimated. When a material loss contingency is reasonably possible but not probable, the Company does not record a liability, but instead discloses the nature and the amount of the claim, and an estimate of the loss or range of loss, if such an estimate can be made. Legal fees are expensed as incurred.

Beginning in March 2021, multiple putative class actions were filed in the U.S. District Court for the Southern District of New York by certain of the Company’s stockholders against the Company and certain of the Company’s officers alleging violations of federal securities laws. The lawsuits were captioned Zawatsky et al. v. Vroom, Inc. et al., Case No. 21-cv-2477; Holbrook v. Vroom, Inc. et al., Case No. 21-cv-2551; and Hudda v. Vroom, Inc. et al., Case No. 21-cv-3296. All three of the lawsuits asserted similar claims under Sections 10(b) and 20(a) of the Exchange Act, and SEC Rule 10b-5. In each case, the named plaintiff(s) sought to represent a proposed class of all persons who purchased or otherwise acquired the Company’s securities during a period from June 9, 2020 to March 3, 2021 (in the case of Holbrook and Hudda), or November 11, 2020 to March 3, 2021 (in the case of Zawatsky). In August 2021, the Court consolidated the cases under the new name In re: Vroom, Inc. Securities Litigation, Case No. 21-cv-2477, appointed a lead plaintiff and lead counsel and ordered a consolidated amended complaint to be filed. The court-appointed lead plaintiff subsequently filed a consolidated amended complaint that reasserts claims under Sections 10(b) and 20(a) of the Exchange Act, and SEC Rule 10b-5 against the Company and certain of the Company’s officers, and added new claims under Sections 11, 12 and 15 of the Securities Act against the Company, certain of its officers, certain of its directors, and the underwriters of the Company’s September 2020 secondary offering. The Company filed a motion to dismiss all claims, and briefing of this motion is complete. The Company believes this lawsuit is without merit and intends to vigorously contest these claims. While the outcome of any complex legal proceeding is inherently unpredictable and subject to significant uncertainties, based upon information presently known to management, the Company believes that the potential liability, if any, will not have a material adverse effect on the Company’s financial condition, cash flows, or results of operations.

In August 2021, November 2021, January 2022, and February 2022, various Company stockholders filed purported shareholder derivative lawsuits on behalf of the Company in the U.S. District Court for the Southern District of New York against certain of the Company’s officers and directors, and nominally against the Company, alleging violations of the federal securities laws and breaches of fiduciary duty to the Company and/or related violations of Delaware law based on the same general course of conduct alleged in In re: Vroom, Inc. Securities Litigation. All four lawsuits have been consolidated under the case caption In re Vroom, Inc. Shareholder Derivative Litigation, Case No. 21-cv-6933, and the court has approved the parties’ stipulation that the cases would remain stayed pending final resolution of In re: Vroom, Inc. Securities Litigation. All four derivative suits remain in preliminary stages and there have been no substantive developments in any matter.

In April 2022, one of the Company’s stockholders filed a purported shareholder derivative lawsuit on behalf of the Company in the U.S. District Court for the District of Delaware against certain of the Company’s officers and directors, and nominally against the Company, alleging violations of the federal securities law and breaches of fiduciary duty to the Company and/or related violations of Delaware law based on the same general course of conduct alleged in In re: Vroom,

Inc. Securities Litigation. The case is captioned Godlu v. Hennessy et al., Case No. 22-cv-569, and the court has approved the parties’ stipulation that the case would remain stayed pending final resolution of In re: Vroom, Inc. Securities Litigation. This lawsuit remains in preliminary stages and there have been no substantive developments.

In April 2022, the Attorney General of Texas filed a petition on behalf of the State of Texas in the District Court of Travis County, Texas against the Company, alleging violation of the Texas Deceptive Trade Practices − Consumer Protection Act, Texas Business and Commerce Code § 17.41 et seq., based on alleged deficiencies and other issues in the Company’s marketing of used vehicles and fulfilment of customer orders, including the titling and registration of sold vehicles. According to the petition, 80% of the customer complaints referenced in the petition were received in the 12 months prior to April 2022. The petition is captioned State of Texas v. Vroom Automotive LLC, and Vroom Inc., Case No. D-1-GN-001809. Vroom Automotive, LLC and the Attorney General of the State of Texas have agreed to a temporary injunction in which Vroom Automotive, LLC agrees to adhere to its existing practice of possessing title for all vehicles it sells or advertises as available for sale on its ecommerce platform. Vroom continues to work cooperatively with the office of the Attorney General of the State of Texas towards a resolution. Because the case is at an early stage and the outcome of any complex legal proceeding is inherently unpredictable and subject to significant uncertainties, the Company cannot determine at present whether any potential liability would have a material adverse effect on the Company’s financial condition, cash flows, or results of operations.

In July 2022 and August 2022, respectively, certain plaintiffs filed two putative class action lawsuits in the District Court of Cleveland County, Oklahoma and the New York State Supreme Court, respectively, against Vroom, Inc., and Vroom Automotive LLC as defendants, alleging, among other things, deficiencies in Vroom’s titling and registration of sold vehicles: Blake Sonne, individually and on behalf of all others similar situated, v. Vroom Automotive, LLC and Vroom, Inc., No. CJ-2022-822 and Emely Reyes Martinez, on behalf of all others similarly situated, v. Vroom Automotive, LLC and Vroom Inc., No. 652684/2022. The Company removed the cases to the U.S. District Court for the Western District of Oklahoma (Case No. 22-cv-761) and the U.S. District Court for the Southern District of New York (Case No. 22-cv-7631), respectively, and has filed motions to compel arbitration of all claims in both cases. Because these cases are at early stages and the outcome of any complex legal proceeding is inherently unpredictable and subject to significant uncertainties, the Company cannot determine at present whether any potential liability would have a material adverse effect on the Company’s financial condition, cash flows, or results of operations.

As previously disclosed, the Company has been subject to audits, requests for information, investigations and other inquiries from its regulators relating to increased customer complaints concerning the same or similar matters alleged in the State of Texas petition. These regulatory matters could continue to progress into legal proceedings as well as enforcement actions. The Company has incurred fines in certain states and could continue to incur fines, penalties, restitution, or alterations in the Company's business practices, which in turn, could lead to increased business expenses, additional limitations on the Company's business activities and further reputational damage, although to date such expenses have not had a material adverse effect on the Company’s financial condition, cash flows, or results of operations.

Other Matters

The Company enters into agreements with third parties in the ordinary course of business that may contain indemnification provisions. In the event that an indemnification claim is asserted, the Company’s liability, if any, would be limited by the terms of the applicable agreement. Historically, the Company has not incurred material costs to defend lawsuits or settle claims related to indemnification provisions.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Operating activities
Net loss	$ (451,910)	$ (370,911)	$ (202,799)
Adjustments to reconcile net loss to net cash used in operating activities:
Impairment charges	211,873
Gain on debt extinguishment	(164,684)
Depreciation and amortization	38,707	13,215	4,654
Amortization of debt issuance costs	4,809	2,872	938
Realized gains on securitization transactions	(45,589)
Deferred taxes	(23,855)	0	0
Losses on finance receivables and securitization debt, net	66,839
Stock-based compensation expense	11,957	13,409	13,254
Provision to record inventory at lower of cost or net realizable value	1,812	9,471	6,588
Revaluation of preferred stock warrant			20,470
Provision for bad debt	13,406	9,416	2,340
Provision to record finance receivables held for sale at lower of cost or fair value	6,541
Amortization of unearned discounts on finance receivables at fair value	(14,593)
Other, net	(7,512)	203	35
Changes in operating assets and liabilities:
Originations of finance receivables held for sale	(625,575)
Principal payments received on finance receivables held for sale	64,521
Proceeds from sale of finance receivables held for sale, net	509,612
Other	(7,701)
Accounts receivable	78,060	(53,206)	(32,068)
Inventory	403,924	(312,208)	(224,489)
Prepaid expenses and other current assets	4,146	(32,452)	(9,117)
Other assets	(2,546)	(9,172)	(4,556)
Accounts payable	(24,281)	19,321	14,066
Accrued expenses	(53,553)	61,170	28,431
Deferred revenue	(65,148)	50,943	7,499
Other liabilities	(38,325)	29,241	19,500
Net cash used in operating activities	(109,065)	(568,688)	(355,254)
Investing activities
Purchases of finance receivables at fair value	(56,484)
Principal payments received on finance receivables at fair value	132,391
Proceeds from sale of finance receivables at fair value, net	43,262
Principal payments received on beneficial interests	8,341
Purchase of property and equipment	(24,234)	(28,413)	(11,329)
Acquisition of business, net of cash acquired	(267,488)	(75,875)
Net cash used in investing activities	(164,212)	(104,288)	(11,329)
Financing activities
Principal repayment under secured financing agreements	(192,839)
Proceeds from vehicle floorplan	1,403,042	2,713,350	1,242,736
Repayments of vehicle floorplan	(1,638,855)	(2,529,780)	(1,086,966)
Proceeds from warehouse credit facilities	520,800
Repayments of warehouse credit facilities	(467,216)
Repayments of convertible senior notes	(90,208)
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
Proceeds from the issuance of common stock in connection with IPO, net of underwriting discount and issuance costs			497,233
Proceeds from the issuance of common stock in connection with follow-on public offering, net of underwriting discount and issuance costs			567,952
Proceeds from exercise of stock options		5,766	2,341
Other financing activities	(4,212)	(495)	(7,955)
Net cash (used in) provided by financing activities	(469,488)	797,712	1,237,035
Net (decrease) increase in cash, cash equivalents and restricted cash	(742,765)	124,736	870,452
Cash, cash equivalents and restricted cash at the beginning of period	1,214,775	1,090,039	219,587
Cash, cash equivalents and restricted cash at the end of period	472,010	1,214,775	1,090,039
Supplemental disclosure of cash flow information:
Cash paid for interest	34,907	15,964	8,540
Cash paid for income taxes	2,409	403	163
Supplemental disclosure of non-cash investing and financing activities:
Fair value of beneficial interests received in securitization transactions	$ 30,082
Conversion of redeemable convertible preferred stock warrant to common stock warrant			21,873
Issuance of common stock as upfront payment to nonemployee			$ 2,127
Issuance of common stock for CarStory acquisition		38,811
Fair value of unvested stock options assumed for acquisition of business		$ 1,017

Leases - Summary of Lease Costs and Activity (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Lease Cost
Operating lease cost	$ 8,402	$ 6,919	$ 5,503
Short-term lease cost	690	1,660	350
Variable lease cost	3,810	2,921	1,915
Sublease income	(72)	(196)	(445)
Net lease cost	12,830	11,304	7,323
Operating cash flows from operating leases	9,322	6,806	5,524
Right-of-use assets obtained in exchange for operating lease liabilities	$ 19,896	$ 1,599	$ 4,600

Leases - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Lessee, Lease, Description [Line Items]
Operating lease, not yet commenced, future lease payments	$ 16.4
Operating lease, not yet commenced, commencement period	12 months
Operating lease, not yet commenced, lease term	7 years
Operating leases weighted-average remaining lease term	4 years 2 months 12 days	2 years 8 months 12 days	3 years 6 months
Operating leases discount rate	5.80%	3.40%	3.40%
Impairment charges related to operating lease right-of-use assets	$ 6.5
Real Estate
Lessee, Lease, Description [Line Items]
Options to renew leases	true
Options to extend leases, description	Certain of the Company’s real estate leases include one or more options to renew, with renewal terms that can extend the lease term from one to five years. The exercise of lease renewal options is at the Company’s sole discretion. If it is reasonably certain that the Company will exercise such options, the periods covered by such options are included in the lease term and are recognized as part of the Company’s right-of-use assets and lease liabilities.
Maximum \| Real Estate
Lessee, Lease, Description [Line Items]
Leases term	9 years
Leases renewal term	5 years
Minimum [Member] \| Real Estate
Lessee, Lease, Description [Line Items]
Leases term	3 months
Leases renewal term	1 year

Related Party Transactions Additional Information (Details) - USD ($) $ in Millions	1 Months Ended
	Jan. 31, 2019	Jul. 31, 2015
Management Services Agreement \| Catterton Management L.L.C
Related Party Transaction [Line Items]
Payment of expenses		$ 0.3
Management Services Agreement \| Catterton Management L.L.C \| Minimum
Related Party Transaction [Line Items]
Percentage of outstanding capital stock		5.00%
Vendor Agreement \| Auto Nation, Inc
Related Party Transaction [Line Items]
Termination period	2020-02
Vendor Agreement \| Auto Nation, Inc \| Minimum
Related Party Transaction [Line Items]
Percentage of outstanding capital stock	5.00%

Stock-based Compensation

12 Months Ended

Dec. 31, 2022

Share-Based Payment Arrangement [Abstract]

Stock-based Compensation

16. Stock-based Compensation

On May 28, 2020, the Company adopted the 2020 Incentive Award Plan (“the 2020 Plan”), which authorized the issuance of (i) up to 3,019,108 shares of the Company’s common stock, (ii) up to 4% of an annual increase on the first day of each year beginning on January 1, 2022 and ending on January 1, 2030, and (iii) any shares of the Company’s common stock subject to awards under the 2014 Plan which are forfeited or lapse unexercised and which following the effective date are not issued under the 2014 Plan. Awards may be issued in the form of restricted stock units, restricted stock, stock appreciation rights, and stock options. On February 28, 2022, the Company registered an additional 5,483,716 shares of the Company's common stock to be issued pursuant to the 2020 Plan. As of December 31, 2022, there were 2,535,711 shares available for future issuance under the 2020 Plan.

On May 20, 2022, the Company adopted the 2022 Inducement Award Plan (the “Inducement Award Plan”). Awards under the Inducement Award Plan may only be granted to a newly hired employee who has not previously been an employee or a member of the Board or an employee who is being rehired following a bona fide period of non-employment by the Company, in each case as a material inducement to the employee’s entering into employment. An aggregate of 3,000,000 shares of the Company’s common stock are reserved for issuance under the Inducement Award Plan. As of December 31, 2022, there were 2,430,646 shares available for future issuance under the Inducement Award Plan.

Stock Options

The following table summarizes stock option activity for the year ended December 31, 2022:


	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Outstanding as of December 31, 2021		4,076,542		$	4.39		6.24
Granted		1,275,000			7.50
Exercised		—			—
Forfeited / cancelled		(2,494,366	)		4.20
Outstanding as of December 31, 2022		2,857,176		$	5.94		7.32
Vested and exercisable as of December 31, 2021		2,964,534		$	4.04		5.81
Vested and exercisable as of December 31, 2022		1,319,498		$	4.73		5.71

The Company recognized $1.5 million, $2.2 million and $2.2 million of stock-based compensation expense related to stock options for the years ended December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022 and 2021, the Company had $1.6 million and $2.5 million, respectively, of unrecognized stock-based compensation expense that is expected to be recognized over a weighted-average period of 1.9 years and 1.7 years, respectively.

There were no options exercised during the year ended December 31, 2022, and the aggregate intrinsic value of options outstanding and options exercisable as of December 31, 2022 was not material.

On May 9, 2022 and May 20, 2022, 600,000 stock options having a fair value of $0.83 per share were granted to the CEO and an aggregate of 650,000 stock options having a grant date fair value of $1.14 per share were granted to certain members of key management, respectively. The exercise price of the stock options is $7.50 per share. The stock options vest ratably over a three-year period subject to continued employment through each applicable vesting date. During the year ended December 31, 2022, 75,000 of these stock options were forfeited as a result of employee separations.

The grant date fair value of stock options granted during the year ended December 31, 2022 was estimated at the time of grant using the Black-Scholes option-pricing model and utilized the following assumptions:


	May 20, 2022			May 9, 2022
Fair value of common stock (per share)	$	1.14		$	0.83
Expected term (in years)	10			10
Risk-free interest rate		2.78	%		3.05	%
Expected volatility		100.00	%		100.00	%
Dividend yield	—%			—%

RSUs

The following table summarizes restricted stock unit ("RSUs") activity for the year ended December 31, 2022:


	Shares			Weighted Average Grant Date Fair Value per Share
Unvested and outstanding as of December 31, 2021		2,269,813		$	24.69
Granted		9,349,754			2.28
Vested		(1,109,012	)		13.09
Forfeited / cancelled		(1,849,130	)		18.68
Unvested and outstanding as of December 31, 2022		8,661,425		$	3.29

The Company recognized $10.5 million, $11.2 million, and $10.9 million of stock-based compensation expense related to RSUs for the years ended December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022 and 2021, the Company had $18.2 million and $21.7 million, respectively, of unrecognized stock-based compensation expense that is expected to be recognized over a weighted-average period of 1.9 and 2.1 years, respectively.

On May 9, 2022 and May 20, 2022, 1,200,000 RSUs having a grant date fair value of $1.08 per share were granted to the CEO and an aggregate of 3,190,000 RSUs having a grant date fair value of $1.45 per share were granted to certain members of the management team. On July 25, 2022, 140,000 RSUs having a grant date fair value of $1.64 per share were granted to a member of the management team. The RSUs were issued under the 2020 Plan and will vest on the third anniversary of the grant date, subject to continued employment through that date. The vesting of RSUs will accelerate in one-third increments if the Company's common stock achieves a closing price at or above $7.50 per share for twenty consecutive trading days during the three-year vesting period; a closing price at or above $15.00 per share for twenty consecutive trading days in the second or third years of the vesting period; and a closing price at or above $21.00 per share for twenty consecutive trading days during the third year of the vesting period. During the year ended December 31, 2022, 355,000 of these RSUs were forfeited as a result of employee separations and became eligible for future issuance under the 2020 Plan. As of December 31, 2022, the accelerated vesting conditions were not met.

Certain of the Company’s RSU grants are subject to acceleration upon a change of control and termination within 12 months, and upon death, disability, retirement and certain “good leaver” circumstances.

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Schedule of Domestic and Foreign Pretax Income (Loss)

Income Tax Provision

Domestic and foreign pretax income (loss) are as follows for the years ended December 31, 2022, 2021, and 2020 (in thousands):


	Year Ended December 31,
	2022			2021			2020
Domestic	$	(472,203	)	$	(370,640	)	$	(202,715	)
Foreign		613			483			—
Total	$	(471,590	)	$	(370,157	)	$	(202,715	)

Schedule of Components of Provision for Income Taxes

The components of the provision for income taxes are as follows (in thousands):


	Year Ended December 31,
	2022			2021		2020
Current:
Federal	$	—		$	—	$	—
State and local		4,083			679		84
Foreign		92			75		—
Total current tax expense		4,175			754		84
Deferred tax (benefit):
Federal		(20,472	)		—		—
State and local		(3,383	)		—		—
Foreign		—			—		—
Total deferred tax (benefit)		(23,855	)		—		—
(Benefit) provision for income taxes	$	(19,680	)	$	754	$	84

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the provision for income taxes at the statutory rate to the amount reflected in the consolidated statements of operations is as follows (in thousands):


	Year Ended December 31,
	2022			2021			2020
Income taxes at statutory rate	$	(99,034	)	$	(77,733	)	$	(42,570	)
State income taxes, net of federal benefit		(3,529	)		(8,251	)		(5,417	)
Foreign Rate Differential		(129	)		(26	)		—
Permanent differences		1,510			(4,800	)		1,264
Goodwill impairment		41,241			—			—
Deferred tax adjustment for acquisition of business		(23,855	)		—			—
Change in valuation allowance		66,634			94,158			46,901
Other		(2,518	)		(2,594	)		(94	)
(Benefit) provision for income taxes	$	(19,680	)	$	754		$	84

Schedule of Deferred Tax Assets and Liabilities

Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands):


	As of December 31,
	2022			2021
Deferred tax assets:
Net operating loss carryforwards	$	265,927		$	203,170
Inventory reserves		9,395			12,278
Stock-based compensation		3,067			3,617
Accrued Expense		—			75
Right of Use Asset		7,086			3,821
Unrealized Gains/Losses		10,549			—
Allowance for Doubtful Accounts		8,342			2,592
Other		2,612			1,905
Total deferred tax assets		306,978			227,458
Less: valuation allowance		(258,796	)		(216,017	)
Net deferred tax assets		48,182			11,441
Deferred tax liabilities:
Intangible amortization		(37,377	)		(6,793	)
Depreciation		(3,017	)		(1,088	)
Repo Expenses		(2,194	)		—
Lease Liability		(5,594	)		(3,560	)
Net deferred tax liabilities		(48,182	)		(11,441	)
Net deferred income taxes	$	—		$	—

Goodwill and Intangible Assets - Schedule of Intangible Assets, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Finite Lived Intangible Assets [Line Items]
Gross Carrying Value	$ 190,300	$ 34,340
Accumulated Amortization	(31,390)	(6,133)
Carrying Value	158,910	28,207
Developed and Purchased Technology
Finite Lived Intangible Assets [Line Items]
Gross Carrying Value	108,700	25,700
Accumulated Amortization	(21,053)	(5,043)
Carrying Value	87,647	20,657
Customer Relationships
Finite Lived Intangible Assets [Line Items]
Gross Carrying Value	69,400	5,240
Accumulated Amortization	(8,661)	(673)
Carrying Value	60,739	4,567
Trademarks and Trade names
Finite Lived Intangible Assets [Line Items]
Gross Carrying Value	12,200	3,400
Accumulated Amortization	(1,676)	(417)
Carrying Value	$ 10,524	$ 2,983

Variable Interest Entities and Securitizations (Tables)

12 Months Ended

Dec. 31, 2022

Variable Interest Entity, Measure of Activity [Abstract]

Summary of Total Assets and Total Liabilities Associated With Variable Interests in Consolidated VIEs

The following table presents the total assets and total liabilities associated with the Company's variable interests in consolidated VIEs, as classified in the consolidated balance sheets (in thousands):


	As of December 31, 2022
	Securitization Vehicles		Warehouse Facilities1		Total
Current Assets:
Restricted cash	$	9,023	$	15,654	$	24,677
Finance receivables at fair value		5,336		6,156		11,492
Finance receivables held for sale		—		305,917		305,917
Other assets		797		1,561		2,358
Total Current Assets		15,156		329,288		344,444
Finance receivables at fair value		72,568		47,024		119,592
Total Assets	$	87,724	$	376,312	$	464,036
Current Liabilities:
Current portion of securitization debt	$	47,239	$	—	$	47,239
Warehouse credit facilities		—		229,518		229,518
Total Current Liabilities		47,239		229,518		276,757
Securitization debt, net of current portion		32,590		—		32,590
Other liabilities		90		1,316		1,406
Total Liabilities	$	79,919	$	230,834	$	310,753

1 Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further details of the warehouse facilities.

Summary of Unconsolidated Variable Interest Entities

The following table summarizes the amortized cost, the carrying amount, which is the fair value, and the maximum exposure to losses of UACC's assets related to unconsolidated VIEs (in thousands):


	As of December 31, 2022
	Aggregate Principal Balance		Carrying Value		Total Exposure
Rated notes	$	19,233	$	18,664	$	18,664
Certificates		—		1,928		1,928
Other assets		310		310		310
Total unconsolidated VIEs	$	19,543	$	20,902	$	20,902

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References + Details

Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Activity in Carrying Value of Goodwill by Reporting Unit

The following table summarizes the activity in the carrying value of goodwill by reporting unit for the years ended December 31, 2022, and 2021 (in thousands):


	Ecommerce			Wholesale			TDA			Total
Balance as of December 31, 2020	$	72,231		$	1,720		$	4,221		$	78,172
Acquisition		80,645			—			—			80,645
Balance as of December 31, 2021	$	152,876		$	1,720		$	4,221		$	158,817
Acquisition		42,886			—			—			42,886
Goodwill impairment charge		(195,762	)		(1,720	)		(4,221	)		(201,703	)
Balance as of December 31, 2022	$	—		$	—		$	—		$	—

Schedule of Intangible Assets, Net

Intangible assets, net consisted of the following (in thousands):


	December 31, 2022							December 31, 2021
	Gross Carrying Value		Accumulated Amortization			Carrying Value		Gross Carrying Value		Accumulated Amortization			Carrying Value
Developed and Purchased Technology	$	108,700	$	(21,053	)	$	87,647	$	25,700	$	(5,043	)	$	20,657
Customer Relationships		69,400		(8,661	)		60,739		5,240		(673	)		4,567
Trademarks and Trade names		12,200		(1,676	)		10,524		3,400		(417	)		2,983
Total intangible assets	$	190,300	$	(31,390	)	$	158,910	$	34,340	$	(6,133	)	$	28,207

Schedule of Estimated Amortization Expense for Intangible Assets

The estimated amortization expense for intangible assets subsequent to December 31, 2022, consists of the following (in thousands):


Year Ending December 31:
2023	$	27,022
2024		27,022
2025		27,022
2026		21,979
2027		21,882
Thereafter		33,983
	$	158,910

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
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-Paragraph 1
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Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
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Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

+ Details

Stock-based Compensation - Summary of Weighted Average Assumptions Used in Calculation of Fair Value Using Black-Scholes Option (Details) - $ / shares	May 20, 2022	May 09, 2022
Share-Based Payment Arrangement [Abstract]
Fair value of common stock (per share)	$ 1.14	$ 0.83
Expected term (in years)	10 years	10 years
Risk-free interest rate	2.78%	3.05%
Expected volatility	100.00%	100.00%

Subsequent Events - Additional Information (Details) $ in Thousands		1 Months Ended	12 Months Ended
	Jan. 18, 2023 Position	Jan. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Mar. 31, 2023 USD ($)
Subsequent Event [Line Items]
Aggregate principal amount			$ 93,730
Debt instrument aggregate principal amount			82,556
Forecast
Subsequent Event [Line Items]
Expected cost				$ 4,000
UACC
Subsequent Event [Line Items]
Net proceeds from securitization			582,900
UACC \| Asset-backed Securities
Subsequent Event [Line Items]
Securitization transaction			$ 523,700
Subsequent Events
Subsequent Event [Line Items]
Number of reduction position \| Position	275
Subsequent Events \| UACC
Subsequent Event [Line Items]
Securitization transaction		$ 238,700
Collateralized finance receivable		326,400
Net proceeds from securitization		$ 237,800

Warehouse Credit Facilities of Consolidated VIEs (Tables)

12 Months Ended

Dec. 31, 2022

Line of Credit Facility [Abstract]

Schedule of Terms of the Warehouse Credit Facilities

UACC has four senior secured warehouse facility agreements (the “Warehouse Credit Facilities”) with banking institutions as of December 31, 2022, including the new senior secured warehouse facility agreement entered into in November 2022 to fund near-prime assets. The Warehouse Credit Facilities are collateralized by eligible finance receivables and available borrowings are computed based on a percentage of eligible finance receivables. As of December 31, 2022, the Company had excess borrowing capacity of $105.8 million on UACC's Warehouse Credit Facilities. The terms of the Warehouse Credit Facilities include the following:


	Facility One		Facility Two		Facility Three		Facility Four
Execution date	May 30, 2012		November 19, 2013		July 11, 2019		November 18, 2022
Maturity date	July 20, 2024		September 27, 2024		May 24, 2024		December 12, 2024
Aggregate borrowings limit (in thousands)	$	200,000	$	200,000	$	200,000	$	250,000
Aggregate principal Balance of Finance Receivables Pledged as Collateral as of December 31, 2022 (in thousands)	$	143,919	$	142,503	$	126,636	$	—
Outstanding Balance as of December 31, 2022 (in thousands)	$	110,602	$	19,615	$	101,435	$	—
Restricted cash as of December 31, 2022 (in thousands)	$	8,110	$	2,007	$	5,537	$	—

Warehouse Credit Facilities of Consolidated VIEs

12 Months Ended

Dec. 31, 2022

Line of Credit Facility [Abstract]

Warehouse Credit Facilities of Consolidated VIEs

11. Warehouse Credit Facilities of Consolidated VIEs


	Facility One		Facility Two		Facility Three		Facility Four
Execution date	May 30, 2012		November 19, 2013		July 11, 2019		November 18, 2022
Maturity date	July 20, 2024		September 27, 2024		May 24, 2024		December 12, 2024
Aggregate borrowings limit (in thousands)	$	200,000	$	200,000	$	200,000	$	250,000
Aggregate principal Balance of Finance Receivables Pledged as Collateral as of December 31, 2022 (in thousands)	$	143,919	$	142,503	$	126,636	$	—
Outstanding Balance as of December 31, 2022 (in thousands)	$	110,602	$	19,615	$	101,435	$	—
Restricted cash as of December 31, 2022 (in thousands)	$	8,110	$	2,007	$	5,537	$	—

As of December 31, 2022, the Company's weighted average interest rate on the Warehouse Credit Facilities borrowings was approximately 6.19%.

The Company's ability to utilize its Warehouse Credit Facilities is primarily conditioned on the satisfaction of certain legal, operating, administrative and financial covenants contained within the agreements. These include covenants that require the Company to maintain a minimum tangible net worth, minimum liquidity levels, specified leverage ratios and certain indebtedness levels. Failure to satisfy these and or any other requirements contained within the agreements would restrict access to the Warehouse Credit Facilities. Certain breaches of covenants may also result in acceleration of the repayment of borrowings prior to the scheduled maturity. As of December 31, 2022, the Company was in compliance with all covenants related to the Warehouse Credit Facilities.

Revenue Recognition

12 Months Ended

Dec. 31, 2022

Revenue from Contract with Customer [Abstract]

Revenue Recognition

3. Revenue Recognition

The Company recognizes revenue upon transfer of control of goods or services to customers, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company may collect sales taxes and other taxes and government fees from customers on behalf of governmental authorities at the time of sale as required. These taxes are accounted for on a net basis and are not included in revenues or cost of sales.

The Company’s revenue is disaggregated within the consolidated statements of operations and is generated from customers throughout the United States.

Retail Vehicle Revenue

The Company sells used vehicles to its retail customers through its ecommerce platform and TDA retail location. The transaction price for used vehicles is a fixed amount as set forth within the customer contract at the time of sale. Customers frequently trade-in their existing vehicle to apply toward the transaction price of a used vehicle. Trade-in vehicles represent non-cash consideration which the Company measures at fair value based on external and internal market data for each specific vehicle. The Company satisfies its performance obligation and recognizes revenue for used vehicle sales generally at a point in time when the vehicles are delivered to the customer for ecommerce sales or picked up by the customer for TDA sales. The revenue recognized by the Company includes the agreed upon transaction price, including any delivery charges and document fees stated within the customer contract. Revenue excludes any sales taxes, title and registration fees, and other government fees that are collected from customers.

The Company receives payment for used vehicle sales directly from the customer at the time of sale or arranges financing within a short period of time following the sale. Payments received prior to delivery or pick-up at the TDA retail location of used vehicles are recorded as “Deferred revenue” within the consolidated balance sheets.

The Company offers a return program for used vehicle sales and establishes a provision for estimated returns based on historical information and current trends. The reserve for estimated returns is presented gross on the consolidated balance sheets, with an asset recorded in “Prepaid expenses and other current assets” and a refund liability recorded in “Other current liabilities.”

Wholesale Vehicle Revenue

The Company sells vehicles that do not meet its retail sales criteria through wholesale channels. Vehicles sold through wholesale channels are acquired from customers who trade-in their vehicles when making a purchase from the Company, from customers who sell their vehicles to the Company in direct-buy transactions, and from liquidation of vehicles previously listed for retail sale. The transaction price for wholesale vehicles is a fixed amount. The Company satisfies its performance obligation and recognizes revenue for wholesale vehicle sales at a point in time when the vehicle is sold. The transaction price is typically due and collected within a short period of time following the vehicle sales.

Product Revenue

The Company’s product revenue consists of fees earned on selling third-party financing, financing vehicle sales through UACC, and sales of value-added products, such as vehicle service contracts, guaranteed asset protection (“GAP”) and tire and wheel coverage.

The Company sells third-party financing and value-added products pursuant to arrangements with the third parties that provide these products and are responsible for their fulfillment. The Company concluded that it is an agent for these transactions because it does not control the products before they are transferred to the customer. The Company recognizes product revenues on a net basis when the customer enters into an arrangement for the products, which is typically at the time of a used vehicle sale.

Customers may enter into a retail installment sales contract to finance the purchase of used vehicles. The Company sells these contracts on a non-recourse basis to various financial institutions. The Company receives a fee from the financial institution based on the difference between the interest rate charged to the customer that purchased the used vehicle and the interest rate set by the financial institution. These fees are recognized upon sale and assignment of the installment sales contract to the financial institution, which occurs concurrently at the time of a used vehicle sale.

A portion of the fees earned on third-party financing and value-added products is subject to chargebacks in the event of early termination, default, or prepayment of the contracts by end-customers. The Company’s exposure for these events is limited to the fees that it receives. An estimated refund liability for chargebacks against the revenue recognized from sales of these products is recorded in the period in which the related revenue is recognized and is based primarily on the Company’s historical chargeback experience. The Company updates its estimates at each reporting date. As of December 31, 2022 and December 31, 2021, the Company’s reserve for chargebacks was $8.2 million and $9.6 million, respectively, of which $4.4 million and $5.5 million, respectively, are included within “Accrued expenses” and $3.8 million and $4.1 million, respectively, are included in “Other long-term liabilities.”

The Company also is contractually entitled to receive profit-sharing revenues based on the performance of the vehicle service policies once a required claims period has passed. The Company recognizes profit-sharing revenues to the extent it is probable that it will not result in a significant revenue reversal. The Company estimates the revenue based on historical claims and cancellation data from its customers, as well as other qualitative assumptions. The Company reassesses the estimate at each reporting period with any changes reflected as an adjustment to revenues in the period identified. As of December 31, 2022 and December 31, 2021, the Company recognized $22.5 million and $17.9 million, respectively, related to cumulative profit-sharing payments to which it expects to be entitled, of which $1.6 million and $0.9 million, respectively, are included within “Prepaid expenses and other current assets” and $20.9 million and $17.0 million, respectively, are included within “Other assets.”

As a result of the UACC Acquisition (as defined below), the Company also generates ecommerce product revenue by providing Vroom customers with automotive financing solutions through its captive financing operation. The Company earns interest income on finance receivables before they are sold and proceeds from the sale of finance receivables originated by UACC for Vroom customers in securitization transactions. Refer to Note 4 – Variable Interest Entities and Securitizations.

Finance Revenue

The Company’s finance revenue consists of gain on the sales of finance receivables acquired by UACC from its network of third-party dealership customers, interest income earned on finance receivables held for sale, as well as interest income earned on finance receivables held in consolidated VIEs related to UACC securitization transactions consummated prior to the Acquisition Date. Refer to Note 4 – Variable Interest Entities and Securitizations.

Interest income deemed uncollectible is reversed at the time the finance receivable is charged off. An account is considered delinquent if a scheduled payment has not been received by the date such payment was contractually due. Finance receivables over 90 days delinquent are considered nonaccrual finance receivables. Income is subsequently recognized only to the extent cash payments are received until the borrower is able to make periodic interest and principal payments in accordance with the finance receivable terms. Late charges and other fees are calculated at predetermined amounts or percentages of overdue finance receivable balances and are recorded on a cash basis.

Servicing income represents the annual fees earned on the outstanding principal balance of the finance receivables serviced. Fees are earned monthly at an annual rate of approximately 4% for the United Auto Credit 2022-1 securitization transaction and 3.25% for the 2022-2 securitization transaction of the outstanding principal balance of the finance receivables serviced.

Contract Costs

The Company has elected, as a practical expedient, to expense sales commissions when incurred because the amortization period would have been less than one year. These costs are recorded within “Selling, general and administrative expenses” in the consolidated statements of operations.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Segment Information - Additional Information (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Jun. 30, 2022 Segment	Dec. 31, 2022 USD ($) Segment
Segment Reporting [Abstract]
Number of reportable segments	3	3
Number of operating segments		3
Segment assets \| $		$ 0

Vehicle Floorplan Facility

12 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Vehicle Floorplan Facility

10. Vehicle Floorplan Facility

In November 2022, the Company amended the 2020 Vehicle Floorplan Facility to, among other things, decrease the line of credit from $700.0 million to $500.0 million and extend the maturity date to March 31, 2024 (as amended, the “2022 Vehicle Floorplan Facility”).

In addition, the amendment modifies the amount of credit available to the Company on a monthly basis to the product of (1) the greater of five times the aggregate number of retail units sold during the most recent month for which information is available or the aggregate number of retail units sold during the five most recent months for which information is available and (2) the greater of the average outstanding floorplan balance of all vehicles on the floorplan as of the immediately preceding month-end or the average monthly outstanding floorplan balance of all vehicles on the floorplan as of month-end for the immediately preceding five months. As of December 31, 2022, the borrowing capacity of the 2022 Vehicle Floorplan Facility was $343.9 million, of which $66.9 million was unutilized.

The amendment also provides that the Company may elect to increase its monthly credit line availability by an additional $25.0 million during any four months in the period from November 1, 2022 through March 31, 2024, subject to the maximum $500.0 million credit limit. The 2022 Vehicle Floorplan Facility will allow for more flexibility in the Company's borrowing capacity. Consistent with the terms of the 2020 Vehicle Floorplan Facility, the Company and Vroom Automotive, LLC have provided Ally with a guaranty of payment of all amounts owed under the 2022 Vehicle Floorplan Facility as well as a security interest in all or substantially all tangible, intangible, and other personal property of Vroom, Inc., to secure obligations under the 2022 Vehicle Floorplan Facility.

The 2022 Vehicle Floorplan Facility bears interest at a rate equal to the Prime Rate, announced per annum by Ally Bank, plus 175 basis points. Additionally, the Company is subject to amended covenants and events of default. The Company is required to maintain a certain level of equity in the vehicles that are financed, to maintain at least 20.0% of the credit line in cash and cash equivalents, and to maintain a minimum required balance with Ally of at least 12.5% of the daily floorplan principal balance outstanding through December 31, 2022 and 15.0% effective January 1, 2023. The Company was required to pay a commitment fee upon execution of the 2022 Vehicle Floorplan Facility.

The Company previously entered into a vehicle floorplan facility (the "2020 Vehicle Floorplan Facility") with Ally Bank and Ally Financial in March 2020, as subsequently amended. The 2020 Vehicle Floorplan provided a committed credit line of up to $700.0 million. The amount of credit available was determined on a monthly basis based on a calculation that considered average outstanding borrowings and vehicle units paid off by the Company within the immediately preceding three-month period.

Outstanding borrowings related to the 2020 Vehicle Floorplan Facility were due as the vehicles financed were sold, or in any event, on the maturity date. The 2020 Vehicle Floorplan Facility bore interest at a rate equal the Prime Rate, announced per annum by Ally Bank, plus 105 basis points. The 2020 Vehicle Floorplan Facility was collateralized by the Company’s vehicle inventory and certain other assets and the Company was subject to covenants that required it to maintain a certain level of equity in the vehicles that were financed, to maintain at least 7.5% of the credit line in cash and cash equivalents, and to maintain 10% of the daily floorplan principal balance outstanding on deposit with Ally Bank. The Company was required to pay an availability fee each quarter on the average unused capacity from the prior quarter if it was greater than 50% of the calculated floorplan allowance, as defined.

As of December 31, 2022 and 2021, outstanding borrowings on the vehicle floorplan facilities were $277.0 million and $512.8 million, respectively. Cash deposits required under the vehicle floorplan facilities of $34.6 million and $50.6 million are classified as "Restricted cash" within the consolidated balance sheets as of December 31, 2022 and 2021, respectively.

Interest expense incurred by the Company for the vehicle floorplan facilities was $26.8 million, $17.7 million and $9.7 million for the years ended December 31, 2022, 2021, and 2020, respectively, which are recorded within “Interest expense” in the consolidated statements of operations. The weighted average interest rate on the vehicle floorplan borrowings was 9.25% and 4.30% as of December 31, 2022 and 2021, respectively.

As of December 31, 2022 and 2021, the Company was in compliance with all covenants related to the vehicle floorplan facilities.

In connection with the vehicle floorplan facilities, the Company entered into credit balance agreements with Ally Bank and Ally Financial that permit the Company to deposit cash with the bank for the purpose of reducing the amount of interest payable for borrowings. Interest credits earned by the Company were $15.9 million, $10.1 million, and $5.4 million for the years ended December 31, 2022, 2021, and 2020, respectively, which are recorded within “Interest income” in the consolidated statements of operations.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI https://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Financial Instruments and Fair Value Measurements - Summary of Other Relevant Data Related to Debt of Securitized VIEs Carried at Fair Value (Details) - Securitization Debt of Consolidated VIEs $ in Thousands	Dec. 31, 2022 USD ($)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Aggregate unpaid principal balance of debt of securitized VIEs	$ 82,556
Aggregate fair value of debt of securitized VIEs	$ 79,829

Income Taxes - Schedule of Components of Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Current:
Federal	$ 0	$ 0	$ 0
State and local	4,083	679	84
Foreign	92	75	0
Total current tax expense	4,175	754	84
Deferred tax (benefit):
Federal	(20,472)	0	0
State and local	(3,383)	0	0
Foreign	0	0	0
Total deferred tax (benefit)	(23,855)	0	0
(Benefit) provision for income taxes	$ (19,680)	$ 754	$ 84

Acquisition - Summary of Fair Value of Consideration Transferred (Details) - Vast Holdings, Inc. (“d/b/a CarStory”) $ in Thousands	Jan. 07, 2021 USD ($)
Business Acquisition [Line Items]
Cash	$ 76,740
Common stock issued	38,811
Fair value of unvested stock options assumed	1,017
Total	$ 116,568

Acquisition (Tables)

12 Months Ended

Dec. 31, 2022

UACC

Business Acquisition [Line Items]

Summary of Fair Value of Identified Assets Acquired and Liabilities Assumed

The following table summarizes the fair value of the identified assets acquired and liabilities assumed as of the Acquisition Date, inclusive of immaterial measurement period adjustments (in thousands):


	Fair Value
Cash and cash equivalents	$	5,294
Restricted cash		42,631
Finance receivables at fair value		296,927
Finance receivables, held for sale		263,393
Intangible assets		156,000
Goodwill		42,886
Other assets		25,934
Total assets acquired	$	833,065
Warehouse credit facilities		(178,067	)
Long term debt		(285,704	)
Deferred tax liability		(23,855	)
Other liabilities		(30,026	)
Total liabilities assumed	$	(517,652	)
Net assets acquired	$	315,413

Summary of Final Identifiable Intangible Assets Acquired and their Estimated Weighted Average Useful Life

The following table summarizes the identifiable intangible assets acquired and their estimated weighted average useful life at the date of acquisition (in thousands):

Summary of Pro Forma Information

The pro forma information for the years ended December 31, 2022 and 2021 is as follows:


	Year ended December 31,
	2022			2021
Total revenue	$	1,964,372		$	3,356,786
Net loss	$	(464,101	)	$	(280,614	)

Vast Holdings, Inc. (“d/b/a CarStory”)

Business Acquisition [Line Items]

Summary of Fair Value of Consideration Transferred

The fair value of the consideration transferred was approximately $116.6 million, inclusive of immaterial measurement period adjustments, and consisted of the following (in thousands):


	Fair Value
Cash	$	76,740
Common stock issued(1)		38,811
Fair value of unvested stock options assumed(2)		1,017
Total	$	116,568

(1)

The Company issued 1,066,444 shares of common stock, net of 5,673 shares cancelled to satisfy working capital adjustment,. The fair value of common stock was determined based on the closing market price on the date of acquisition discounted for a lack of marketability of 10.0% to account for the 180 day lock up period.

The fair value of the unvested stock options assumed by the Company was determined using the Black-Scholes option pricing model. The share conversion ratio of 0.0392 was applied to convert CarStory’s outstanding equity awards for CarStory's common stock into equity awards for shares of the Company's common stock.

Summary of Fair Value of Identified Assets Acquired and Liabilities Assumed

The following table summarizes the fair value of the identified assets acquired and liabilities assumed as of the acquisition date, inclusive of immaterial measurement period adjustments which were finalized in the year ended December 31, 2021 (in thousands):


	Fair Value
Cash and cash equivalents	$	865
Accounts receivable, prepaid expenses and other current assets		1,330
Property and equipment and other assets		371
Intangible Assets		34,300
Goodwill		80,645
Current liabilities		(943	)
Net assets acquired	$	116,568

Summary of Final Identifiable Intangible Assets Acquired and their Estimated Weighted Average Useful Life

The following table summarizes the final identifiable intangible assets acquired and their estimated weighted average useful life at the date of acquisition (in thousands):


	Fair Value		Weighted Average Useful Life
Developed technology	$	25,700	5
Trademarks		5,200	8
Customer relationships		3,400	8
Total intangible assets subject to amortization	$	34,300

Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Deferred tax assets:
Net operating loss carryforwards	$ 265,927	$ 203,170
Inventory reserves	9,395	12,278
Stock-based compensation	3,067	3,617
Accrued Expense	0	75
Right of Use Asset	7,086	3,821
Unrealized Gains/Losses	10,549	0
Allowance for Doubtful Accounts	8,342	2,592
Other	2,612	1,905
Total deferred tax assets	306,978	227,458
Less: valuation allowance	(258,796)	(216,017)	$ (121,900)	$ (75,000)
Net deferred tax assets	48,182	11,441
Deferred tax liabilities:
Intangible amortization	(37,377)	(6,793)
Depreciation	(3,017)	(1,088)
Repo Expenses	(2,194)	0
Lease Liability	(5,594)	(3,560)
Net deferred tax liabilities	(48,182)	(11,441)
Net deferred income taxes	$ 0	$ 0

Long Term Debt - Schedule of Aggregate Principal Balance and Fair Value of Finance Receivables Pledged to Securitization Debt (Details) $ in Thousands	Dec. 31, 2022 USD ($)
Asset Pledged as Collateral without Right
Debt Instrument [Line Items]
Aggregate Principal Balance	$ 84,477
Asset Pledged as Collateral with Right
Debt Instrument [Line Items]
Fair Value	77,904
United Auto Credit 2021-1 \| Asset Pledged as Collateral without Right
Debt Instrument [Line Items]
Aggregate Principal Balance	84,477
United Auto Credit 2021-1 \| Asset Pledged as Collateral with Right
Debt Instrument [Line Items]
Fair Value	$ 77,904

Net Loss Per Share - Summary of Calculation of Diluted Shares Outstanding (Details) - shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Potentially dilutive shares not included in calculation of diluted shares outstanding	18,049,363	17,088,414	7,485,228
Stock Options
Potentially dilutive shares not included in calculation of diluted shares outstanding	2,857,176	4,076,542	5,617,568
Restricted Stock Units
Potentially dilutive shares not included in calculation of diluted shares outstanding	8,661,425	1,853,150	1,867,660
Convertible Senior Notes
Potentially dilutive shares not included in calculation of diluted shares outstanding	6,530,762	11,158,722

Stock-based Compensation - Summary of Stock Option Activity (Details) - $ / shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Share-Based Payment Arrangement [Abstract]
Shares, Outstanding, Beginning balance	4,076,542
Shares, Granted	1,275,000
Shares, Forfeited / cancelled	(2,494,366)
Shares, Outstanding, Ending balance	2,857,176	4,076,542
Shares, Vested and exercisable	1,319,498	2,964,534
Weighted Average Exercise Price, Outstanding, Beginning balance	$ 4.39
Weighted Average Exercise Price, Granted	7.50
Weighted Average Exercise Price, Forfeited / cancelled	4.20
Weighted Average Exercise Price, Outstanding, Ending balance	5.94	$ 4.39
Weighted Average Exercise Price, Vested and exercisable	$ 4.73	$ 4.04
Weighted Average Remaining Contractual Life, Outstanding	7 years 3 months 25 days	6 years 2 months 26 days
Weighted Average Remaining Contractual Life, Vested and exercisable	5 years 8 months 15 days	5 years 9 months 21 days

Stock-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions						12 Months Ended
	Jul. 25, 2022	May 20, 2022	May 09, 2022	Feb. 28, 2022	May 28, 2020	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Company's common stock shares reserved for issuance				5,483,716
Number of shares granted						1,275,000
Forfeited shares						1,849,130
Exercise of stock options (in shares)						0
2020 Incentive Award Plan
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares available for future issuance						2,535,711
2020 Incentive Award Plan \| Maximum
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares authorized for issuance					3,019,108
Percentage annual increase in shares available for issuance as award in each year beginning					4.00%
Inducement Award Plan
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Company's common stock shares reserved for issuance		3,000,000
Shares available for future issuance						2,430,646
Stock Options
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense						$ 1.5	$ 2.2	$ 2.2
Unrecognized stock-based compensation expense						$ 1.6	$ 2.5
Unrecognized stock-based compensation weighted-average period						1 year 10 months 24 days	1 year 8 months 12 days
Forfeited shares						75,000
Stock Options \| CEO
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted			600,000
Fair value per share			$ 0.83
Exercise price per share			$ 7.50
Stock Options \| Management Team
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted		650,000
Fair value per share		$ 1.14
Exercise price per share		$ 7.50
RSUs
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award acceleration period						12 months
Stock-based compensation expense						$ 10.5	$ 11.2	$ 10.9
Unrecognized stock-based compensation expense						$ 18.2	$ 21.7
Unrecognized stock-based compensation weighted-average period						1 year 10 months 24 days	2 years 1 month 6 days
Forfeited shares						355,000
Vesting period						3 years
RSUs \| Share-Based Payment Arrangement, Tranche One [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Listing price of share						$ 7.50
Number of consecutive trading days						20 days
Vesting description						The vesting of RSUs will accelerate in one-third increments if the Company's common stock achieves a closing price at or above $7.50 per share for twenty consecutive trading days during the three-year vesting period; a closing price at or above $15.00 per share for twenty consecutive trading days in the second or third years of the vesting period; and a closing price at or above $21.00 per share for twenty consecutive trading days during the third year of the vesting period
RSUs \| Share-Based Payment Arrangement, Tranche Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Listing price of share						$ 15.00
Number of consecutive trading days						20 days
RSUs \| Share-Based Payment Arrangement, Tranche Three [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Listing price of share						$ 21.00
Number of consecutive trading days						20 days
RSUs \| CEO
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted			1,200,000
Fair value per share			$ 1.08
RSUs \| Management Team
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted	140,000	3,190,000
Fair value per share	$ 1.64	$ 1.45

Property and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2022

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):


	December 31,
	2022			2021
Equipment	$	3,357		$	1,011
Furniture and fixtures		1,896			2,244
Logistics fleet		32,468			22,810
Leasehold improvements		6,577			7,161
Internal-use software		30,725			18,423
Other		8,081			5,811
		83,104			57,460
Accumulated depreciation and amortization		(32,903	)		(20,418	)
Property and equipment, net	$	50,201		$	37,042

Vehicle Floorplan Facility - Additional Information (Details) - USD ($) $ in Thousands		1 Months Ended	12 Months Ended
	Jan. 01, 2023	Nov. 30, 2022	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Line Of Credit Facility [Line Items]
Restricted cash			$ 73,095	$ 82,450
2020 Vehicle Floorplan Facility
Line Of Credit Facility [Line Items]
Debt instrument, covenant compliance			As of December 31, 2022 and 2021, the Company was in compliance with all covenants related to the vehicle floorplan facilities.
Vehicle Floorplan Facility
Line Of Credit Facility [Line Items]
Outstanding borrowings			$ 277,000	512,800
Interest expense			$ 26,800	$ 17,700	$ 9,700
Weighted average interest rate			9.25%	4.30%
Vehicle Floorplan Facility \| Credit Balance Agreements
Line Of Credit Facility [Line Items]
Interest credits earned			$ 15,900	$ 10,100	$ 5,400
Vehicle Floorplan Facility \| Cash Deposits
Line Of Credit Facility [Line Items]
Restricted cash			$ 34,600	$ 50,600
Ally Bank and Ally Financial \| Line Of Credit \| 2020 Vehicle Floorplan Facility
Line Of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity						$ 700,000
Line of credit facility, description			The amount of credit available was determined on a monthly basis based on a calculation that considered average outstanding borrowings and vehicle units paid off by the Company within the immediately preceding three-month period.
Debt instrument, covenant description			The 2020 Vehicle Floorplan Facility was collateralized by the Company’s vehicle inventory and certain other assets and the Company was subject to covenants that required it to maintain a certain level of equity in the vehicles that were financed, to maintain at least 7.5% of the credit line in cash and cash equivalents, and to maintain 10% of the daily floorplan principal balance outstanding on deposit with Ally Bank.
Debt instrument covenant to maintain minimum percentage of credit line in cash and cash equivalents			7.50%
Availability fee payable each quarter on average unused capacity from prior quarter floorplan allowance percentage			50.00%
Debt instrument covenant to maintain principal balance outstanding			10.00%
Ally Bank and Ally Financial \| Line Of Credit \| 2020 Vehicle Floorplan Facility \| Prime Rate
Line Of Credit Facility [Line Items]
Basis points			1.05%
Ally Bank and Ally Financial \| Line Of Credit \| 2022 Vehicle Floorplan Facility
Line Of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity		$ 500,000
Line of credit facility, description			The amendment also provides that the Company may elect to increase its monthly credit line availability by an additional $25.0 million during any four months in the period from November 1, 2022 through March 31, 2024, subject to the maximum $500.0 million credit limit. The 2022 Vehicle Floorplan Facility will allow for more flexibility in the Company's borrowing capacity. Consistent with the terms of the 2020 Vehicle Floorplan Facility, the Company and Vroom Automotive, LLC have provided Ally with a guaranty of payment of all amounts owed under the 2022 Vehicle Floorplan Facility as well as a security interest in all or substantially all tangible, intangible, and other personal property of Vroom, Inc., to secure obligations under the 2022 Vehicle Floorplan Facility.
Line of credit facility, current borrowing capacity			$ 343,900
Line of credit facility, unutilized borrowing capacity			$ 66,900
Debt instrument, covenant description			The 2022 Vehicle Floorplan Facility bears interest at a rate equal to the Prime Rate, announced per annum by Ally Bank, plus 175 basis points. Additionally, the Company is subject to amended covenants and events of default. The Company is required to maintain a certain level of equity in the vehicles that are financed, to maintain at least 20.0% of the credit line in cash and cash equivalents, and to maintain a minimum required balance with Ally of at least 12.5% of the daily floorplan principal balance outstanding through December 31, 2022 and 15.0% effective January 1, 2023. The Company was required to pay a commitment fee upon execution of the 2022 Vehicle Floorplan Facility.
Maturity Date		Mar. 31, 2024
Additional availability line of credit facility any four months during the maturity period		$ 25,000
Ally Bank and Ally Financial \| Line Of Credit \| 2022 Vehicle Floorplan Facility \| Prime Rate
Line Of Credit Facility [Line Items]
Basis points		175.00%
Ally Bank and Ally Financial \| Line Of Credit \| 2022 Vehicle Floorplan Facility \| Prime Rate \| Minimum
Line Of Credit Facility [Line Items]
Debt instrument covenant to maintain minimum percentage of credit line in cash and cash equivalents		20.00%
Debt instrument covenant to maintain principal balance outstanding		12.50%
Ally Bank and Ally Financial \| Line Of Credit \| 2022 Vehicle Floorplan Facility \| Subsequent Events
Line Of Credit Facility [Line Items]
Debt instrument covenant to maintain principal balance outstanding	15.00%

Warehouse Credit Facilities of Consolidated VIEs - Additional Information (Details) - Warehouse Credit Facility $ in Millions	Dec. 31, 2022 USD ($)
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity	$ 105.8
Weighted average interest rate	6.19%

Subsequent Events

12 Months Ended

Dec. 31, 2022

Subsequent Events [Abstract]

Subsequent Events

23. Subsequent Events

On January 18, 2023, the Company executed a reduction in force as part of the continued focus on reducing variable and fixed costs. The Company reduced Vroom’s headcount by approximately 275 employees based on our assessment of the Company's business needs, key initiatives, and long-term success and profitable growth. In the first quarter of 2023, the Company expects to incur expenses of approximately $4.0 million, primarily consisting of severance.

In January 2023, UACC sold approximately $238.7 million of rated asset-backed securities in an auto loan securitization transaction from a securitization trust, established and sponsored by UACC for proceeds of $237.8 million. The trust is collateralized by finance receivables with an aggregate principal balance of $326.4 million. These finance receivables are serviced by UACC. As a result of current market conditions, which led to unfavorable pricing, the Company retained the non-investment grade securities and residual interests, which will require the Company to account for the 2023-1 securitization as secured borrowings and remain on balance sheet pending the sale of such retained interests.

Long Term Debt - Schedule of Debt Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Current portion of securitization debt of consolidated VIEs	$ 47,239
Long term debt, net of current portion	402,154	$ 610,618
Total debt	449,393	610,618
Convertible Senior Notes
Debt Instrument [Line Items]
Long term debt, net of current portion	359,254	$ 610,618
Securitization Debt of Consolidated VIEs
Debt Instrument [Line Items]
Long term debt, net of current portion	32,590
Junior Subordinated Debentures
Debt Instrument [Line Items]
Long term debt, net of current portion	$ 10,310

- Definition

Amount, excluding unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

Variable Interest Entities and Securitizations - Summary of Total Assets and Total Liabilities Associated With Variable Interests in Consolidated VIEs (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Current Assets:
Restricted cash	$ 73,095	$ 82,450
Finance receivables at fair value, current	12,939
Finance receivables held for sale, net	321,626
Total current assets	1,220,109	2,102,292
Finance receivables at fair value, noncurrent	140,235
Total assets	1,619,027	2,366,750
Current Liabilities:
Current portion of securitization debt	47,239
Warehouse credit facilities	229,518
Total current liabilities	703,320	827,256
Securitization debt, net of current portion	402,154	610,618
Other liabilities	18,183	4,090
Total liabilities	1,143,786	1,451,556
Securitization Vehicles
Current Assets:
Restricted cash	9,023
Finance receivables at fair value, current	5,336
Other assets	797
Total current assets	15,156
Finance receivables at fair value, noncurrent	72,568
Total assets	87,724
Current Liabilities:
Current portion of securitization debt	47,239
Total current liabilities	47,239
Securitization debt, net of current portion	32,590
Other liabilities	90
Total liabilities	79,919
Warehouse Facilities
Current Assets:
Restricted cash	15,654
Finance receivables at fair value, current	6,156
Finance receivables held for sale, net	305,917
Other assets	1,561
Total current assets	329,288
Finance receivables at fair value, noncurrent	47,024
Total assets	376,312
Current Liabilities:
Warehouse credit facilities	229,518
Total current liabilities	229,518
Other liabilities	1,316
Total liabilities	230,834
Consolidated VIEs
Current Assets:
Restricted cash	24,677	0
Finance receivables at fair value, current	11,492	0
Finance receivables held for sale, net	305,917	0
Other assets	2,358
Total current assets	344,444
Finance receivables at fair value, noncurrent	119,592	$ 0
Total assets	464,036
Current Liabilities:
Current portion of securitization debt	47,239
Warehouse credit facilities	229,518
Total current liabilities	276,757
Securitization debt, net of current portion	32,590
Other liabilities	1,406
Total liabilities	$ 310,753

Acquisition

12 Months Ended

Dec. 31, 2022

Business Combinations [Abstract]

Acquisition

5. Acquisitions

UACC Acquisition

On February 1, 2022, the Company completed the acquisition (the "UACC Acquisition") of 100% of Unitas Holdings Corp., a Delaware corporation, including its wholly owned subsidiaries United PanAm Financial Corp. and UACC. Unitas Holdings Corp. (now known as Vroom Finance Corporation), United PanAm Financial Corp. (now known as Vroom Automotive Financial Corporation) and UACC, as well as their other subsidiaries, are now wholly owned subsidiaries of the Company. This acquisition accelerates the Company's strategy of establishing a captive financing arm and underwriting vehicle financing for its customers, the results of which are included within the Ecommerce reporting segment. UACC will also continue its current operations with its network of third-party dealership customers, including the purchases and servicing of vehicle installment contracts, which constitutes the separate Retail Financing reporting segment. The cash consideration transferred was approximately $315.4 million at the Acquisition Date, inclusive of immaterial measurement period adjustments.


	Fair Value
Cash and cash equivalents	$	5,294
Restricted cash		42,631
Finance receivables at fair value		296,927
Finance receivables, held for sale		263,393
Intangible assets		156,000
Goodwill		42,886
Other assets		25,934
Total assets acquired	$	833,065
Warehouse credit facilities		(178,067	)
Long term debt		(285,704	)
Deferred tax liability		(23,855	)
Other liabilities		(30,026	)
Total liabilities assumed	$	(517,652	)
Net assets acquired	$	315,413

The estimated fair value of the finance receivables that were designated as held for sale were determined using the discounted cash flow method under the income approach. The Company determined the fair value of these finance receivables utilizing sales prices based on an estimated securitization transaction, adjusted for transaction costs, risk and

a normal profit margin associated with securitization transactions. The significant assumptions used in the valuation were discount rate, prepayment rate, cumulative net losses, weighted average interest rate and recovery rate. Such fair value measurement of finance receivables held for sale is considered Level 3 of the fair value hierarchy.

The Company acquired two types of finance receivables that are accounted for under the fair value option: (i) those that were sold in one of the securitization transactions that UACC completed in 2019, 2020 or 2021, and (ii) those that were not eligible to be sold in future securitization transactions. The estimated fair value of the finance receivables that were previously sold were valued using the measurement alternative by reference to the fair value of the securitization debt. See Note 17 – Financial Instruments and Fair Value Measurements for more information regarding the measurement alternative and the fair value of these finance receivables. The fair value of the ineligible finance receivables was determined using a discounted cash flow method under the income approach. The significant assumptions used in the valuation were discount rate and recovery rate. Such fair value measurement of finance receivables accounted for under the fair value option is considered Level 3 of the fair value hierarchy.

The estimated fair value of the securitization debt of consolidated VIEs was determined using the discounted cash flow method under the income approach. The significant assumption used in the valuation was the yield. Such fair value measurement of securitization debt is considered Level 3 of the fair value hierarchy.

The estimated fair value of the warehouse credit facilities of consolidated VIEs approximated its carrying value due to the proximity of the Acquisition Date to the payoff date. These notes were acquired on February 1, 2022, as part of the UACC Acquisition and were paid off with the proceeds from the 2022-1 securitization that UACC completed on February 16, 2022.

The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill which is not deductible for tax purposes. Goodwill is primarily attributable to the workforce of the acquired business as well as benefits related to integrating UACC’s financing operations to establish a captive financing arm and underwrite vehicle financing for the Company's customers. All of the goodwill was assigned to the Ecommerce reporting unit.

The following table summarizes the identifiable intangible assets acquired and their estimated weighted average useful life at the date of acquisition (in thousands):

Purchased technology represents the fair value of UACC’s proprietary technology used to support all aspects of their business including underwriting, servicing, and risk management. The estimated fair value of the purchased technology was determined using a relief-from-royalty method under the income approach. The significant assumptions used in the relief-from-royalty method include estimates about future expected cash flows from the purchased technology, including the revenue growth rates, the royalty rate, the obsolescence factor and the discount rate.

Customer relationships represents UACC's relationship with its network of dealer customers. UACC has expertise in the non-prime credit dealer market serving as the key link between independent dealerships and consumers. UACC has developed expertise and robust relationships in the independent dealer market as demonstrated by its active dealership network. The estimated fair value of the customer relationships was determined using a multi-period excess earnings method under the income approach. The significant assumptions used in the multi-period excess earnings method include estimates about future expected cash flows from the customer relationships, including pre-tax income margins and the discount rate.

Trade name represents the value of the UACC trade name. The UACC brand is an important factor in the marketing of UACC’s services to prospective dealership customers. The fair value of the trade name acquired was determined using a relief-from-royalty method under the income approach. The significant assumptions used in the relief-from-royalty method include future expected cash flows from the trade name, the royalty rate, and the discount rate.

The fair values assigned to assets acquired and liabilities assumed are based on management’s estimates and assumptions. The allocation of the total consideration transferred to the assets acquired, including intangible assets and goodwill, as well as the liabilities assumed is final as of December 31, 2022.

The transaction costs associated with the UACC Acquisition were $5.7 million for the year ended December 31, 2022 and $5.1 for the year ended December 31, 2021, and are included within "Selling, general and administrative expenses" in the consolidated statement of operations.

The aggregate revenue and net income of UACC consolidated into the Company’s financial statements from the date of the acquisition was $167.8 million and $26.7 million for the year ended December 31, 2022, respectively.

Unaudited Pro Forma Information

The unaudited pro forma financial information in the table below summarizes the combined results of the Company and UACC, as though the companies had been combined on January 1, 2021. The pro forma adjustments include incremental amortization of intangible assets, adjustments to reflect non-recurring acquisition-related costs of $5.7 million as of the beginning of the 2021 annual reporting period, a non-recurring tax adjustment of $24.1 million for the year ended December 31, 2022, and a non-recurring tax benefit of $34.9 million for the year ended December 31, 2021. The pro forma information is presented for informational purposes only and may not be indicative of the results of operations that would have been achieved if the acquisition had taken place on January 1, 2021 or that may occur in the future, and does not reflect future synergies, integration costs, or other such costs or savings. The pro forma information for the years ended December 31, 2022 and 2021 is as follows:


	Year ended December 31,
	2022			2021
Total revenue	$	1,964,372		$	3,356,786
Net loss	$	(464,101	)	$	(280,614	)

CarStory Acquisition

On January 7, 2021, the Company completed the acquisition of 100% of Vast Holdings, Inc. (d/b/a CarStory), a leader in AI-powered analytics and digital services for automotive retail. Leveraging its machine learning, CarStory brings predictive market data to the Company’s national ecommerce and vehicle operations platform. CarStory continues to offer its digital retailing services to dealers, automotive financial services companies and others in the automotive industry. The financial results of CarStory were included in the consolidated financial statements from the date of acquisition. The transaction costs associated with its acquisition were not material for the year ended December 31, 2021. Pro forma results of operations have not been presented as the effect of this acquisition was not material to the consolidated financial statements.

The fair value of the consideration transferred was approximately $116.6 million, inclusive of immaterial measurement period adjustments, and consisted of the following (in thousands):


	Fair Value
Cash	$	76,740
Common stock issued(1)		38,811
Fair value of unvested stock options assumed(2)		1,017
Total	$	116,568

(1)

(2)


	Fair Value
Cash and cash equivalents	$	865
Accounts receivable, prepaid expenses and other current assets		1,330
Property and equipment and other assets		371
Intangible Assets		34,300
Goodwill		80,645
Current liabilities		(943	)
Net assets acquired	$	116,568

The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill which is not deductible for tax purposes. Goodwill is primarily attributable to the workforce of the acquired business and benefits related to expanded market opportunities from integrating CarStory's technology with the Company's ecommerce offerings. All of the goodwill was assigned to the ecommerce reporting unit.

The following table summarizes the final identifiable intangible assets acquired and their estimated weighted average useful life at the date of acquisition (in thousands):


	Fair Value		Weighted Average Useful Life
Developed technology	$	25,700	5
Trademarks		5,200	8
Customer relationships		3,400	8
Total intangible assets subject to amortization	$	34,300

Developed technology, most of which is protected by a patent portfolio, represents the fair value of CarStory’s industry-specific AI powered analytics software. Trademarks represent the CarStory trademarks, trade names and domain names.

The fair values assigned to tangible and intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions. The estimated fair value of the intangible assets acquired was determined using a discounted cash flow method under the income approach. Under this approach, the Company estimates future cash flows and discounts these cash flows at a rate of return that reflects the Company’s relative risk.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Millions	12 Months Ended
	Dec. 31, 2022 USD ($)
Statement of Cash Flows [Abstract]
Cash acquired from acquisition	$ 47.9

Accrued Expenses and Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2022

Accrued Liabilities and Other Liabilities [Abstract]

Schedule of Accrued Expenses

The Company’s accrued expenses consisted of the following (in thousands):


	December 31,
	2022		2021
Accrued marketing expenses	$	2,093	$	17,546
Vehicle related expenses		14,789		36,459
Sales taxes		5,983		39,163
Accrued compensation and benefits		28,276		16,150
Accrued professional services		3,488		4,225
Accrued legal settlements(1)		7,383		—
Interest payable		3,990		1,718
Other		10,793		6,247
Total accrued expenses	$	76,795	$	121,508

Other Current Liabilities

The Company’s other current liabilities consisted of the following (in thousands):


	December 31,
	2022		2021
Vehicle payable	$	3,617	$	30,647
Reserve for estimated returns		3,919		26,522
Insurance payable		4,551		-
State income tax payable		4,041		420
Other		1,565		15
Total other current liabilities	$	17,693	$	57,604

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Restricted cash	$ 73,095	$ 82,450
Accounts receivable, net of allowance	21,500	$ 8,900
Finance receivables at fair value, current	12,939
Finance receivables at fair value, noncurrent	140,235
Finance receivables held for sale, net	321,626
Securitization debt noncurrent	$ 79,829
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	138,201,903	137,092,891
Common stock, shares outstanding	138,201,903	137,092,891
Consolidated VIEs
Restricted cash	$ 24,677	$ 0
Finance receivables at fair value, current	11,492	0
Finance receivables at fair value, noncurrent	119,592	0
Finance receivables held for sale, net	305,917	0
Securitization debt noncurrent	$ 32,600	$ 0

Segment Information - Summary of Reportable Segments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Segment Reporting Information [Line Items]
Revenues from external customers	$ 1,948,901	$ 3,184,255	$ 1,357,700
Gross profit	244,787	202,099	71,545
Ecommerce
Segment Reporting Information [Line Items]
Revenues from external customers	1,364,195	2,442,369	915,451
Gross profit	99,973	164,746	60,861
Wholesale
Segment Reporting Information [Line Items]
Revenues from external customers	293,528	498,981	245,580
Gross profit	(10,620)	18,120	(1,432)
Retail Financing
Segment Reporting Information [Line Items]
Revenues from external customers	152,542
Gross profit	138,381
All Other
Segment Reporting Information [Line Items]
Revenues from external customers	138,636	242,905	196,669
Gross profit	$ 17,053	$ 19,233	$ 12,116

- Definition

Aggregate revenue less cost of goods and services sold or operating expenses directly attributable to the revenue generation activity.

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Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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Preferred Stock and Stockholders' Equity

12 Months Ended

Dec. 31, 2022

Equity [Abstract]

Preferred Stock and Stockholders' Equity

15. Preferred Stock and Stockholders’ Equity

Preferred Stock

On June 11, 2020, the Company amended its certificate of incorporation to authorize the issuance of up to 10,000,000 shares of Preferred Stock. As of December 31, 2022, there was no preferred stock issued or outstanding.

Common Stock

On June 11, 2020, the Company amended its certificate of incorporation to effect a 2-for-1 forward stock split of shares of the Company’s outstanding common stock, such that each share of common stock, $0.001 par value became two shares of common stock, $0.001 par value per share. The shares of common stock authorized for issuance was increased to 500,000,000. Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

Stock-based Compensation (Tables)

12 Months Ended

Dec. 31, 2022

Share-Based Payment Arrangement [Abstract]

Summary of Weighted Average Assumptions Used in Calculation of Fair Value Using Black-Scholes Option Pricing Model


	May 20, 2022			May 9, 2022
Fair value of common stock (per share)	$	1.14		$	0.83
Expected term (in years)	10			10
Risk-free interest rate		2.78	%		3.05	%
Expected volatility		100.00	%		100.00	%
Dividend yield	—%			—%

Summary of Stock Option Activity

The following table summarizes stock option activity for the year ended December 31, 2022:


	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Outstanding as of December 31, 2021		4,076,542		$	4.39		6.24
Granted		1,275,000			7.50
Exercised		—			—
Forfeited / cancelled		(2,494,366	)		4.20
Outstanding as of December 31, 2022		2,857,176		$	5.94		7.32
Vested and exercisable as of December 31, 2021		2,964,534		$	4.04		5.81
Vested and exercisable as of December 31, 2022		1,319,498		$	4.73		5.71

Summary of Activity for Restricted Stock Units

The following table summarizes restricted stock unit ("RSUs") activity for the year ended December 31, 2022:


	Shares			Weighted Average Grant Date Fair Value per Share
Unvested and outstanding as of December 31, 2021		2,269,813		$	24.69
Granted		9,349,754			2.28
Vested		(1,109,012	)		13.09
Forfeited / cancelled		(1,849,130	)		18.68
Unvested and outstanding as of December 31, 2022		8,661,425		$	3.29

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2022

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Use of Estimates

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenue, and expenses and related disclosures. On an ongoing basis, the Company evaluates its estimates, including, among others, those related to income taxes, the realizability of inventory, stock-based compensation, contingencies, revenue-related reserves, fair value measurements, goodwill, and useful lives of property and equipment and intangible assets. The Company bases its estimates on historical experience, market conditions, and on various other assumptions that are believed to be reasonable. Actual results may differ from these estimates.

Comprehensive Loss

The Company did not have any other comprehensive income or loss for the years ended December 31, 2022, 2021, and 2020. Accordingly, net loss and comprehensive loss are the same for the periods presented.

Revenue Recognition

Revenue consists of retail used vehicle sales, wholesale used vehicle sales, financing vehicle sales through UACC, fees earned on sales of third-party financing and value-added products to customers in connection with vehicles sales, and other revenues. Refer to Note 3 – Revenue Recognition for a discussion of the Company’s significant accounting policies related to revenue recognition.

Cost of sales

Cost of sales primarily includes the cost to acquire used vehicles, inbound transportation costs and direct and indirect reconditioning costs associated with preparing vehicles for resale. Reconditioning costs include parts, labor and third-party reconditioning costs directly attributable to the vehicle and allocated overhead costs. Cost of sales also includes any necessary adjustments to reflect vehicle inventory at the lower of cost or net realizable value. As a result of the acquisition of Unitas Holding Corp, cost of sales also includes interest expense incurred on securitization debt and collection expenses related to servicing finance receivables originated by UACC.

Cash and Cash Equivalents

Cash and cash equivalents include cash deposits at financial institutions and highly liquid investments with original maturities of three months or less. Outstanding checks that are in excess of the cash balances at certain financial institutions are included in “Accounts payable” in the consolidated balance sheets and changes in these amounts are reflected in operating cash flows in the consolidated statements of cash flows.

Restricted Cash

Restricted cash includes cash deposits required under the Company’s 2022 Vehicle Floorplan Facility as explained in Note 10 – Vehicle Floorplan Facility, and cash deposits of $12.5 million required under cash collateral agreements with certain of the Company's lenders. Additionally, starting in the first quarter of 2022, restricted cash also includes UACC restricted cash. UACC collects and services all receivables under the securitizations and warehouse credit facilities. These collections are restricted for use until properly remitted each month under the terms of the servicing agreement. Refer to Note 11 — Warehouse Credit Facilities of Consolidated VIEs and Note 13 — Long Term Debt for further detail.

Accounts Receivable, Net

Accounts receivable, net of an allowance for doubtful accounts, includes amounts due from customers and from third-party financial institutions related to vehicle purchases. The allowance for doubtful accounts is estimated based upon historical experience, age of the balances, current economic conditions and other factors and is evaluated as of each reporting date. Increases and decreases in the allowance for doubtful accounts are recorded in “Selling, general and administrative expenses” in the consolidated statements of operations.

Finance Receivables

Finance receivables consist of installment contracts the Company originates through UACC to finance the vehicles it sells, as well as installment contracts acquired by UACC from its existing network of third-party dealership customers.

The Company's finance receivables are generally secured by the vehicles being financed.

Finance receivables over 90 days delinquent are considered nonaccrual finance receivables. Interest income is subsequently recognized only to the extent cash payments are received. Finance receivables may be restored to accrual status when a customer settles all delinquency balances and future interest and principal payments are reasonably assured.

Finance Receivables Held for Sale, Net

Finance receivables that the Company intends to sell and not hold to maturity are classified as held-for-sale. The Company intends to sell finance receivables either through securitization transactions or forward flow arrangements. Finance receivables classified as held for sale are recorded at the lower of cost or fair value. Deferred acquisition costs and any discounts or premiums are deferred until the finance receivables are sold and are then recognized as part of the total gain or loss on sale and recorded in “Finance Revenue” and "Product, net" in the consolidated statements of operations.

The Company records a valuation allowance to report finance receivables at the lower of amortized cost basis or fair value. For purposes of determining the valuation allowance, finance receivables are evaluated collectively to determine the valuation allowance as they represent a large group of smaller-balance homogeneous loans. To the extent that actual experience differs from estimates, significant adjustments to the Company's valuation allowance may be needed. Fair value adjustments are recorded in "Other loss (income), net" in the consolidated statements of operations. Principal balances of finance receivables are charged-off when the Company is unable to sell the finance receivable and the related vehicle has been repossessed and liquidated or the receivable has otherwise been deemed uncollectible. As of December 31, 2022, the valuation allowance for finance receivables classified as held for sale was $10.5 million. Refer to Note 17 – Financial Instruments and Fair Value Measurements.

Finance Receivables at Fair Value

Finance receivables at fair value represent finance receivables for which the Company elected the fair value option on February 1, 2022 and primarily consists of the finance receivables that were underwritten prior to the Acquisition Date. From time to time, the Company accounts for certain finance receivables under the fair value designation. Fair value

adjustments are recorded in "Other loss (income), net" in the consolidated statements of operations. Refer to Note 17 – Financial Instruments and Fair Value Measurements.

Consolidated CFEs

The Company elected the fair value option for the initial recognition of the assets and liabilities of its consolidated VIEs related to the 2020 and 2021 UACC historical securitizations. These VIEs are consolidated collateralized financing entities (CFEs) and are accounted for using the measurement alternative in accordance with ASU 2014-13, Measuring the Financial Assets and Liabilities of a Consolidated Collateralized Financing Entity (“ASU 2014-13"). Interest income, interest expense and other loss or income associated with these CFEs are presented on the consolidated statements of operations, within the “Finance revenue”, “Finance cost of sales” and “Other loss (income), net” line items, respectively. The assets and liabilities of the CFEs are presented as part of the current and noncurrent “Finance receivables at fair value”, “Current portion of securitization debt of consolidated VIEs at fair value”, and "Long term debt, net of current portion", respectively, on the consolidated balance sheets.

During the year ended December 31, 2022, the Company recognized interest income of $40.9 million, interest expense of $3.4 million, and other net gains and losses due to changes in fair value of $21.0 million. Refer to Note 17 – Financial Instruments and Fair Value Measurements for further details.

Inventory

Inventory consists primarily of used vehicles and parts and accessories and is stated at the lower of cost or net realizable value. Inventory cost is determined by specific identification and includes acquisition cost, direct and indirect reconditioning costs and inbound transportation expenses. Net realizable value represents the estimated selling price less costs to complete, dispose and transport the vehicles. The Company recognizes any necessary adjustments to reflect inventory at the lower of cost or net realizable value through adjustments to “Cost of sales” in the consolidated statements of operations.

Property and Equipment, Net

Property and equipment are recorded at cost less accumulated depreciation and amortization. Charges for repairs and maintenance that do not improve or extend the life of the respective assets are expensed as incurred. When assets are retired or otherwise disposed of, their costs and related accumulated depreciation are written off and any resulting gains or losses are recorded during the period.

Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives of the assets:


Equipment	3 to 15 years
Furniture and fixtures	3 to 15 years
Logistics fleet	5 to 7 years
Leasehold improvements	Lesser of useful life or lease term
Internal-use software	1 to 10 years

The Company capitalizes direct costs of materials and services utilized in developing or obtaining internal-use software. The Company also capitalizes payroll and payroll-related costs for employees who are directly associated with and who devote time to the development of software products for internal use, to the extent of the time spent directly on the project. Capitalization of costs begins during the application development stage and ends when the software is available for general use. Costs incurred during the preliminary project and post-implementation stages are charged to expense as incurred.

Additionally, the Company capitalizes implementation costs incurred in a cloud computing arrangement that is a service contract. The capitalized implementation costs related to a cloud computing arrangement are amortized over the term of the arrangement. Capitalized implementation costs are included in “Other assets” in the consolidated balance sheet and are amortized over the terms of the arrangements, which range between 1 and 10 years.

Goodwill and Intangible Assets

Goodwill represents the excess of the consideration transferred over the fair value of the identifiable assets acquired and liabilities assumed in business combinations. Goodwill is tested for impairment annually as of October 1 or whenever events or changes in circumstances indicate that an impairment may exist.

The Company has three reporting units: Ecommerce, Wholesale and Retail Financing. In performing its goodwill impairment test, the Company first reviews qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing qualitative factors, the Company determines that it is more likely than not that the fair value of a reporting unit is more than its carrying amount, then performing the quantitative test is unnecessary and the Company’s goodwill is not considered to be impaired. However, if based on the qualitative assessment the Company concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, or if the Company elects to bypass the optional qualitative assessment as provided for under U.S. GAAP, the Company proceeds with performing the quantitative impairment test. Refer to Note 8 — Goodwill and Intangible Assets for further details on the impairment tests performed.

The Company's intangible assets are amortized on a straight-line basis over the following estimated weighted average useful lives:


Developed technology	7 years
Trademarks	9 years
Customer relationships	8 years

The Company periodically reassesses the useful lives of its definite-lived intangible assets when events or circumstances indicate that useful lives have significantly changed from the previous estimate.

Vehicle Floorplan

The vehicle floorplan payable (the “Vehicle Floorplan Facility”) reflects amounts borrowed to finance the purchase of specific vehicle inventories. Portions of the Vehicle Floorplan Facility are settled on a daily basis depending on the Company’s sales and purchasing activity. The Vehicle Floorplan Facility is collateralized by vehicle inventories and certain other assets of the Company. Borrowings and repayments are presented separately and classified as financing activities within the consolidated statements of cash flows.

Income Taxes

The Company accounts for income taxes under the asset and liability method. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as for operating loss and tax credit carry forwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which the Company expects to recover or settle those temporary differences. The Company recognizes the effect of a change in tax rates on deferred tax assets and liabilities in the results of operations in the period that includes the enactment date. The Company reduces the measurement of a deferred tax asset, if necessary, by a valuation allowance if it is more likely than not that the Company will not realize some or all of the deferred tax asset. The Company accounts for uncertain tax positions by recognizing the financial statement effects of a tax position only when, based upon technical merits, it is more likely than not that the position will be sustained upon examination. Potential interest and penalties associated with unrecognized tax positions are recognized in income tax expense.

Stock-Based Compensation

The Company recognizes the cost of employee services received in exchange for stock awards based on the fair value of those awards at the date of grant over the requisite service period. The Company accounts for forfeitures as they occur. For awards earned based on performance or upon occurrence of a contingent event, if the award is deemed probable of being earned, related compensation expense is recorded over the estimated service period. If an award is not considered probable of being earned, no amount of stock-based compensation is recognized. To the extent the estimate

of awards considered probable of being earned changes, the amount of stock-based compensation recognized will also change.

The Company uses the Black-Scholes-Merton (“Black-Scholes”) option pricing model to determine the fair value of its stock options. Estimating the fair value of stock options requires the input of subjective assumptions, including the estimated fair value of the Company’s common stock, the expected life of the options, stock price volatility, which is determined based on the historical volatilities of several publicly listed peer companies as the Company has only a short trading history for its common stock, the risk-free interest rate and expected dividends. The assumptions used in the Company’s Black-Scholes option-pricing model represent management’s best estimates and involve a number of variables, uncertainties and assumptions and the application of management’s judgment, as they are inherently subjective.

Business Combinations

The Company uses its best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. The Company’s estimates are inherently uncertain and subject to refinement. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. The Company will continue to collect information and reevaluate these estimates and assumptions quarterly and record any adjustments to the Company’s preliminary estimates to goodwill provided that the Company is within the measurement period. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments will be recorded to the Company’s consolidated statement of operations.

Advertising

Advertising costs are expensed as incurred and are included within “Selling, general and administrative expenses” in the consolidated statements of operations. Advertising expenses were $79.7 million, $125.5 million, and $62.4 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Shipping and Handling

Logistics costs related to inbound transportation from the point of acquisition to the relevant reconditioning facility are included in cost of sales when the related used vehicle is sold. Logistics costs not included in cost of sales are accounted for as costs to fulfill contracts with customers and are included in “Selling, general and administrative expenses” in the consolidated statements of operations and were $39.0 million, $85.8 million, and $30.3 million for the years ended December 31, 2022, 2021, and 2020, respectively.

Concentration of Credit Risk and Significant Customers

The Company’s principal financial instruments subject to potential concentration of credit risk are cash and cash equivalents and accounts receivable, which are unsecured. The Company’s cash balances are maintained at various large, reputable financial institutions. Deposits held with financial institutions may at times exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and, therefore, management believes they bear minimal risk. The Company’s cash equivalents primarily consist of money market funds that hold investments in highly liquid U.S. treasury securities and commercial paper investments. Concentration of credit risk with respect to accounts receivable is generally mitigated by a large customer base.

For the years ended December 31, 2022, 2021, and 2020, no customer represented 10% or more of the Company’s revenues and no customer represented more than 10% of the Company’s accounts receivable as of December 31, 2022 and 2021.

Liquidity

The Company has had negative cash flows and generated losses from operations since inception and has historically had to rely on debt and equity financing to fund its operations. Further, the Company expects to incur additional losses in the future.

On May 5, 2022, the Company approved the Realignment Plan and long-term roadmap, which was designed to position the Company for long-term profitable growth by prioritizing unit economics, reducing operating expenses and maximizing liquidity. Refer to Note 18 – Restructuring Activities for further discussion.

As of December 31, 2022, the Company has cash and cash equivalents of $398.9 million and restricted cash of $73.1 million. The primary source of liquidity is cash generated through financing activities.

In June 2021, the Company issued $625.0 million aggregate principal amount of 0.75% unsecured Convertible Senior Notes due 2026. In 2022, the Company repurchased $254.3 million in aggregate principal amount of the Notes (as defined in Note 13), net of deferred issuance costs of $4.9 million, for $90.2 million in open-market transactions. The Company recognized a gain on extinguishment of debt of $164.7 million for the year ended December 31, 2022. Refer to Note 13 – Long Term Debt for further discussion.

The Company has a 2022 Vehicle Floorplan Facility (as defined in Note 10) with a borrowing capacity of $343.9 million as of December 31, 2022, of which $66.9 million was unutilized. The 2022 Vehicle Floorplan Facility provides a committed credit line of up to $500.0 million which is scheduled to mature on March 31, 2024. Refer to Note 10 – Vehicle Floorplan Facility for further discussion.

In 2022, UACC sold $523.7 million of rated asset-backed securities and $49.6 million of residual certificates in auto loan securitization offerings for proceeds of $582.9 million. Refer to Note 4 – Variable Interest Entities and Securitizations for further discussion.

UACC has four warehouse credit facilities with an aggregate borrowing limit of $850.0 million as of December 31, 2022. As of December 31, 2022, outstanding borrowings related to the Warehouse Credit Facilities were $229.5 million and excess borrowing capacity of $105.8 million. Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further discussion.

The Company anticipates that the existing cash and cash equivalents, the 2022 Vehicle Floorplan Facility and UACC credit facilities will be sufficient to support its operations for at least the next twelve months from the date of issuance of the consolidated financial statements.

Net Loss Per Share Attributable to Common Stockholders

Basic and diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. Under the two-class method, net loss is attributed to common stockholders and participating securities based on their participation rights. The Company considers all series of its redeemable convertible preferred stock to be participating securities. Under the two-class method, the net loss attributable to common stockholders is not allocated to the redeemable convertible preferred stock as the holders of the Company’s redeemable convertible preferred stock do not have a contractual obligation to share in the Company’s losses. Under the two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. For periods in which the Company reports net losses, diluted net loss per common share attributable to common stockholders is the same as basic net loss per common share attributable to common stockholders because potentially dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Accounting Standards Adopted

In February 2016, the FASB issued, ASU 2016-02, Leases (Topic 842), which amends the accounting guidance on leases. The new standard requires a lessee to recognize right-of-use assets and lease obligations on the balance sheet for most lease agreements. The Company adopted Topic 842 as of January 1, 2020 using the modified

retrospective approach with a cumulative-effect adjustment to opening retained earnings (accumulated deficit) with no restatement of comparative periods. Upon adoption, the Company recognized $18.4 million of operating lease liabilities and $17.4 million of operating lease right-of-use assets. The adoption of Topic 842 did not result in a cumulative effect adjustment to accumulated deficit.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement, related to updated requirements over the disclosures of fair value measurements. Under ASU 2018-13, certain disclosure requirements for fair value measurements were eliminated, modified or added to facilitate better disclosure regarding recurring and non-recurring fair value measurements. The Company adopted the guidance on January 1, 2020 which did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In June 2016, the FASB issued ASU 2016-13, Financial instruments, Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends the guidance on the impairment of financial instruments by requiring measurement and recognition of expected credit losses for most financial assets, including trade receivables, and other instruments that are not measured at fair value through net income. The Company adopted the guidance on January 1, 2020 which did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which enhances and simplifies various aspects of the income tax accounting guidance including the elimination of certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The Company adopted the guidance on January 1, 2021 which did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the issuer’s accounting for convertible debt instruments and amended certain guidance related to the computation of earnings per share for convertible instruments and contracts in an entity’s own equity. The Company early adopted the new guidance effective January 1, 2021. There was no impact on the date of adoption. During the year ended December 31, 2021, the Company issued convertible notes. Refer to Note 13 – Long Term Debt for further discussion.

Accounting Standards Issued But Not Yet Adopted

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires contract assets and contract liabilities acquired in a business combination to be recognized in accordance with Topic 606 as if the acquirer had originated the contracts. The guidance will be effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, with early adoption permitted. The adoption of ASU 2021-08 will not result in a material change to the Company’s consolidated financial statements and related disclosures.

Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Intangible Assets (Details)	12 Months Ended
	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Estimated useful lives of intangible assets	8 years
Trademarks
Finite-Lived Intangible Assets [Line Items]
Estimated useful lives of intangible assets	9 years
Customer Relationships
Finite-Lived Intangible Assets [Line Items]
Estimated useful lives of intangible assets	7 years

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2022	Feb. 28, 2023	Jun. 30, 2022
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Trading Symbol	VRM
Entity Registrant Name	VROOM, INC.
Entity Central Index Key	0001580864
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Shell Company	false
Entity Small Business	true
Entity Emerging Growth Company	false
Title of 12(b) Security	Common Stock, $0.001 par value
Security Exchange Name	NASDAQ
Entity File Number	001-39315
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	90-1112566
Entity Address, Address Line One	3600 W Sam Houston Pkwy S
Entity Address, Address Line Two	Floor 4
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77042
City Area Code	518
Local Phone Number	535-9125
Document Annual Report	true
Document Transition Report	false
Entity Common Stock, Shares Outstanding		138,537,183
Entity Public Float			$ 158.9
ICFR Auditor Attestation Flag	true
Documents Incorporated by Reference	Certain portions of the information required to be furnished pursuant to Part III of this Annual Report on Form 10-K will be set forth in, and incorporated by reference from, the registrant’s definitive proxy statement for the annual meeting of stockholders which will be filed with the Securities and Exchange Commission no later than 120 days after the end of the fiscal year ended December 31, 2022.
Auditor Name	PricewaterhouseCoopers LLP
Auditor Firm ID	238
Auditor Location	New York, New York

Acquisition - Additional Information (Details) - USD ($) $ in Thousands			12 Months Ended
	Feb. 01, 2022	Jan. 07, 2021	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Business Acquisition [Line Items]
Net income (loss)			$ (451,910)	$ (370,911)	$ (202,799)
Acquisition-related cost			5,700
Non-recurring tax adjustment (benefit)			24,100	(34,900)
Vast Holdings, Inc. (“d/b/a CarStory”)
Business Acquisition [Line Items]
Business acquisition, date of acquisition		Jan. 07, 2021
Percentage of business acquisition rate		100.00%
Fair value of consideration transferred		$ 116,568
UACC
Business Acquisition [Line Items]
Business acquisition, date of acquisition	Feb. 01, 2022
Revenues			167,800
Net income (loss)			26,700
Transaction costs			$ 5,700	$ 5,100
Percentage of business acquisition rate	100.00%
Fair value of consideration transferred	$ 315,400

Segment Information - Schedule of Reconciliation Between Reportable Segment Gross Profit to Consolidated Loss Before Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Reconciliation to consolidated total revenue
Total revenue	$ 1,948,901	$ 3,184,255	$ 1,357,700
Reconciliation to consolidated loss before provision for income taxes
Gross Profit	244,787	202,099	71,545
Selling, general and administrative expenses	566,387	547,823	245,546
Depreciation and amortization	38,290	12,891	4,598
Impairment charges	211,873
Gain on debt extinguishment	(164,684)
Interest expense	40,693	21,948	9,656
Interest income	(19,363)	(10,341)	(5,896)
Revaluation of preferred stock warrant			20,470
Other loss (income), net	43,181	(65)	(114)
Loss before provision for income taxes	(471,590)	(370,157)	(202,715)
All Other
Reconciliation to consolidated total revenue
Total revenue	138,636	242,905	196,669
Reconciliation to consolidated loss before provision for income taxes
Gross Profit	17,053	19,233	12,116
Reportable Segments
Reconciliation to consolidated total revenue
Total revenue	1,810,265	2,941,350	1,161,031
Reconciliation to consolidated loss before provision for income taxes
Gross Profit	$ 227,734	$ 182,866	$ 59,429

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	IPO	Follow-On Public Offering	Common Stock	Common Stock Restricted Stock Units	Common Stock IPO	Common Stock Follow-On Public Offering	Additional Paid-in Capital	Additional Paid-in Capital IPO	Additional Paid-in Capital Follow-On Public Offering	Accumulated Deficit	Redeemable Convertible Preferred Stock
Temporary Equity, Balance at Dec. 31, 2019												$ 874,332
Temporary Equity, Balance (in shares) at Dec. 31, 2019												83,568,628
Balance at Dec. 31, 2019	$ (573,852)			$ 8							$ (573,860)
Balance (in shares) at Dec. 31, 2019				8,650,922
Issuance of common stock, net of offering costs	2,127	$ 496,510	$ 567,952			$ 24	$ 11	$ 2,127	$ 496,486	$ 567,941
Issuance of common stock, net of offering costs (in shares)				183,870		24,437,500	10,800,000
Issuance of Series H redeemable convertible preferred stock, net of issuance costs												$ 26,714
Issuance of Series H redeemable convertible preferred stock, net of issuance costs (in shares)												1,964,766
Temporary equity, Conversion of redeemable convertible preferred stock to common stock												$ (901,046)
Temporary equity, Conversion of redeemable convertible preferred stock to common stock (in shares)												(85,533,394)
Conversion of redeemable convertible preferred stock to common stock	901,046			$ 86				900,960
Conversion of redeemable convertible preferred stock to common stock (in shares)				85,533,394
Conversion of redeemable convertible preferred stock warrant to common stock warrant	21,873							21,873
Repurchase of common stock	(1,818)							(606)			(1,212)
Repurchase of common stock (in shares)				(200,000)
Stock-based compensation	13,254							13,254
Exercise of stock options	2,341			$ 1				2,340
Exercise of stock options (in shares)				598,406
Exercise of common stock warrants (in shares)				636,112
Vesting of restricted stock units	3,383			$ 2				3,381
Vesting of restricted stock awards/units (in shares)				3,249,346	237,334
Common stock shares withheld to satisfy employee tax withholding obligations	(2,915)							(2,915)
Common stock shares withheld to satisfy employee tax withholding obligations (in shares)				(82,915)
Net loss	(202,799)										(202,799)
Balance at Dec. 31, 2020	1,227,102			$ 132				2,004,841			(777,871)
Balance (in shares) at Dec. 31, 2020				134,043,969
Issuance of common stock for CarStory acquisition	38,811			$ 1				38,810
Issuance of common stock for CarStory acquisition (in shares)				1,066,444
Fair value of unvested stock options assumed in CarStory acquisition	1,017							1,017
Stock-based compensation	13,409							13,409
Exercise of stock options	5,766			$ 2				5,764
Exercise of stock options (in shares)				1,409,004
Vesting of restricted stock awards/units (in shares)					573,474
Net loss	(370,911)										(370,911)
Balance at Dec. 31, 2021	915,194			$ 135				2,063,841			(1,148,782)
Balance (in shares) at Dec. 31, 2021				137,092,891
Stock-based compensation	$ 11,957							11,957
Exercise of stock options (in shares)	0
Vesting of restricted stock awards/units (in shares)				752,294
Restricted stock units issued in accordance with purchase agreement				356,718
Net loss	$ (451,910)										(451,910)
Balance at Dec. 31, 2022	$ 475,241			$ 135				$ 2,075,798			$ (1,600,692)
Balance (in shares) at Dec. 31, 2022				138,201,903

Segment Information (Tables)

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Summary of Reportable Segments

Information about the Company’s reportable segments are as follows (in thousands):


	Year Ended December 31, 2022
	Ecommerce		Wholesale			Retail Financing		All Other		Total
Revenues from external customers	$	1,364,195	$	293,528		$	152,542	$	138,636	$	1,948,901
Gross profit	$	99,973	$	(10,620	)	$	138,381	$	17,053	$	244,787

	Year Ended December 31, 2021
	Ecommerce		Wholesale			Retail Financing		All Other(1)		Total
Revenues from external customers	$	2,442,369	$	498,981		$	—	$	242,905	$	3,184,255
Gross profit	$	164,746	$	18,120		$	—	$	19,233	$	202,099

	Year Ended December 31, 2020
	Ecommerce		Wholesale			Retail Financing		All Other(1)		Total
Revenues from external customers	$	915,451	$	245,580		$	—	$	196,669	$	1,357,700
Gross profit	$	60,861	$	(1,432	)	$	—	$	12,116	$	71,545

(1)

The Company reclassified TDA revenue and TDA gross profit from the TDA reportable segment to the “All Other” category to conform to current year presentation.

Schedule of Reconciliation Between Reportable Segment Gross Profit to Consolidated Loss Before Provision for Income Taxes

The reconciliation between reportable segment gross profit to consolidated loss before provision for income taxes is as follows (in thousands):


	Year Ended December 31,
	2022			2021			2020
Reconciliation to consolidated total revenue
Total reportable segment revenue	$	1,810,265		$	2,941,350		$	1,161,031
All Other revenues		138,636			242,905			196,669
Consolidated total revenue	$	1,948,901		$	3,184,255		$	1,357,700
Reconciliation to consolidated loss before provision for income taxes
Total reportable segment gross profit	$	227,734		$	182,866		$	59,429
All Other gross profit		17,053			19,233			12,116
Selling, general and administrative expenses		566,387			547,823			245,546
Depreciation and amortization		38,290			12,891			4,598
Impairment charges		211,873			—			—
Gain on debt extinguishment		(164,684	)		—			—
Interest expense		40,693			21,948			9,656
Interest Income		(19,363	)		(10,341	)		(5,896	)
Revaluation of preferred stock warrant		—			—			20,470
Other loss (income), net		43,181			(65	)		(114	)
Consolidated loss before provision for income taxes	$	(471,590	)	$	(370,157	)	$	(202,715	)

Financial Instruments and Fair Value Measurements

12 Months Ended

Dec. 31, 2022

Fair Value Disclosures [Abstract]

Financial Instruments and Fair Value Measurements

17. Financial Instruments and Fair Value Measurements

U.S. GAAP defines fair value as the price that would be received from selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. These estimates are subjective in nature and involve uncertainties and matters of judgment, and therefore cannot be determined with precision. U.S. GAAP establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value and establishes the following three levels of inputs that may be used to measure fair value:

Level 1—Quoted prices in active markets for identical assets or liabilities

Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted market prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities

Items Measured at Fair Value on a Recurring Basis

The Company holds certain financial assets that are required to be measured at fair value on a recurring basis. Additionally, the Company elected the fair value option for the financial assets and liabilities of UACC’s consolidated CFEs, beneficial interests in the 2022-1 and 2022-2 securitizations, certain of UACC’s finance receivables that are ineligible to be sold as of the acquisition date, and certain other finance receivables. Under the fair value option allowable under ASC 825, “Financial Instruments” (“ASC 825”), the Company may elect to measure at fair value financial assets and liabilities that are not otherwise required to be carried at fair value. Subsequent changes in fair value for designated items are reported in earnings.

The following tables present the Company’s financial assets and liabilities measured at fair value on a recurring basis (in thousands):


	As of December 31, 2022
	Level 1		Level 2		Level 3		Total
Financial Assets
Cash and cash equivalents:
Money market funds	$	182,687	$	—	$	—	$	182,687
CFE assets:
Finance receivables		—		—		77,904		77,904
Finance receivables at fair value		—		—		75,270		75,270
Beneficial interests in securitizations		—		20,592		—		20,592
Total financial assets	$	182,687	$	20,592	$	153,174	$	356,453
Financial Liabilities
CFE liabilities:
Securitization debt of consolidated VIEs		—		79,829		—		79,829
Total financial liabilities	$	—	$	79,829	$	—	$	79,829

	As of December 31, 2021
	Level 1		Level 2		Level 3		Total
Financial Assets
Cash and cash equivalents:
Money market funds	$	601,807	$	—	$	—	$	601,807
Commercial paper		—		149,974		—		149,974
Total financial assets	$	601,807	$	149,974	$	—	$	751,781

Valuation Methodologies of Financial Instruments Measured at Fair Value on a Recurring Basis

The following is a description of the valuation methodologies used for financial instruments carried at fair value. These methodologies are applied to financial assets and liabilities across the fair value levels discussed above, and it is the observability of the inputs used that determines the appropriate level in the fair value hierarchy for the respective asset or liability.

Money Market Funds: Money market funds primarily consist of investments in highly liquid U.S. treasury securities, with original maturities of three months or less and are classified as Level 1. The Company determines the fair value of cash equivalents based on quoted prices in active markets.

Commercial Paper: Commercial paper consists of unsecured promissory notes issued by companies, with original maturities of three months or less and is classified as Level 2. Commercial paper is issued at a discount to face value and is priced to reflect prevailing market interest rates.

Financial assets and liabilities of CFEs: In connection with the UACC Acquisition, as described in Note 5– Acquisitions, the Company acquired certain financial assets and liabilities of consolidated VIE subsidiaries related to securitization transactions that were deemed to be CFEs. The Company elected the fair value option for the assets and liabilities of its consolidated VIEs related to the 2020 and 2021 historical securitizations acquired from UACC.

As of the Acquisition Date, in accordance with ASC 825, the Company has elected the fair value option, for the eligible financial assets and liabilities of these consolidated CFEs in order to mitigate potential accounting mismatches between the carrying value of the financial assets and liabilities. To eliminate potential measurement differences, the Company elected the measurement alternative included in ASU 2014-13, allowing the Company to measure both the financial assets and liabilities of a qualifying CFE using the fair value of either the CFE’s financial assets or liabilities, whichever is more observable. Under the measurement alternative prescribed by ASU 2014-13, the Company recognizes changes in the CFE’s net assets, including changes in fair value adjustments and net interest earned, in its consolidated statements of operations.

The Company is required to determine whether the fair value of the financial assets or the fair value of the financial liabilities of the eligible CFEs are more observable, but in either case, the methodology results in the fair value of the financial assets of the securitization trust being equal to the fair value of their liabilities The Company determined that the fair value of the liabilities of the securitization CFEs are more observable, since market prices of their liabilities are based on non-binding quoted prices provided by broker dealers who make markets in similar financial instruments. The assets of the securitization CFEs are not readily marketable, and their fair value measurement requires information that may be limited in availability.

In determining the fair value of the securitization debt of consolidated CFEs, the broker dealers consider contractual cash payments and yields expected by market participants. Broker dealers also incorporate common market pricing methods, including a spread measurement to the treasury curve or interest rate swap curve as well as underlying characteristics of the particular security including ratings, coupon, collateral type and seasoning or age of the security. When the Company obtains prices from multiple broker dealers for the same security and has a consensus among them, it deems these fair values to be based on observable valuation inputs and classified as Level 2 of the fair value hierarchy. Where a third-party broker dealer quote is not available, an internal model is utilized using unobservable inputs or if the Company has multiple quotes that are not within determined range, it classified the securitization debt as Level 3 of the fair value hierarchy.

The financial assets of the consolidated CFEs are an aggregate value derived from the fair value of the CFEs liabilities. The Company determined that CFEs finance receivables in their entirety should be classified as Level 3 of the fair value hierarchy.

Finance receivables at fair value: In connection with the UACC Acquisition as described in Note 5 – Acquisitions, the Company acquired certain finance receivables for which it elected the fair value option in accordance with ASC 825. These receivables primarily relate to finance receivables that are not eligible to be sold in the immediate future due to various factors such as: delinquencies, bankruptcy, etc. The Company estimates the fair value of these receivables using

a discounted cash flow model and incorporates key inputs that include performance rate, default rate, recovery rate, and weighted average coupon rates, as well as certain macroeconomics events the Company believes market participants would consider relevant.

Beneficial interests in securitization: Beneficial interests in securitization relate to the United Auto Credit 2022-1 securitization completed in February 2022 and the 2022-2 securitization completed in July 2022 and include rated notes as well as certificates. Refer to Note 4 – Variable Interest Entities and Securitizations. The Company elected the fair value option on its beneficial interests in securitization.

Beneficial interests may initially be classified as Level 2 if the transactions occur within close proximity to the end of each respective reporting period. Subsequently, similar to the securitization debt described above, fair value is determined by requesting a non-binding quote from broker dealers, or by utilizing market acceptable valuation models, such as discounted cash flows. Broker dealer quotes may be based on an income approach, which converts expected future cash flows to a single present value amount, with specific consideration of inputs relevant to particular security types. Such inputs may include ratings, collateral types, geographic concentrations, underlying loan vintages, delinquencies and defaults, loss severity assumptions, prepayments, and weighted average coupons and maturities. When the volume or level of market activity for a security is limited, certain inputs used to determine fair value may not be observable in the market. Broker dealer quotes may also be based on a market approach that considers recent transactions involving identical or similar securities. When the Company obtains prices from multiple broker dealers for the same security and has a consensus among them, it deems these fair values to be based on observable valuation inputs and classified as Level 2 of the fair value hierarchy. Where a third-party broker dealer quote is not available, the Company utilizes an internally developed model using unobservable inputs. If internally developed models are utilized or if the Company has multiple quotes that are not within a consensus range of each other, the Company deems these securities to be classified as Level 3 of the fair value hierarchy.

Changes in Level 3 Recurring Fair Value Measurements

The following table presents a reconciliation of the financial assets, which were measured at fair value on a recurring basis using Level 3 inputs (in thousands):


	Finance Receivables of Consolidated CFEs			Finance Receivables at Fair Value			Securitization Debt of Consolidated CFEs
Fair value as of January 1, 2022	$	—		$	—		$	—
Acquired in business combination		262,644			34,283			275,394
Transfer out of Level 3		—			—			(275,394	)
Transfer within Level 3 categories		(51,330	)		51,330			—
Losses included in other income		(29,825	)		(14,388	)		—
Issuances, net of discount		—			56,484			—
Sales		(24,312	)		(14,114	)		—
Paydowns		(90,410	)		(41,980	)		—
Other		11,137			3,655			—
Fair value as of December 31, 2022	$	77,904		$	75,270		$	—

Transfers out of Level 3

The Company's transfers between levels of the fair value hierarchy are assumed to have occurred at the beginning of the reporting period on a quarterly basis, except for assets and liabilities acquired during the period as described below. There were no transfers into Level 3 during the year ended December 31, 2022.

During the year ended December 31, 2022, transfers out of Level 3 liabilities related to securitization debt of consolidated CFEs. The transfer out of Level 3 was the result of achieving consensus pricing from third-party broker dealers who utilize market observable inputs to price the liabilities. Upon acquisition, the Company utilized unobservable pricing information and an internal discounted cash flows model to value the CFEs liabilities. The Company obtained consensus broker dealers quotes as of December 31, 2022. For the CFEs liabilities acquired during the period, the transfer was presumed to occur immediately after the Acquisition Date.

As of December 31, 2021, there were no financial assets or liabilities measured using Level 3 inputs on a recurring basis.

Other Relevant Data for Financial Assets and Liabilities for which FVO Was Elected

The following table presents the gains or losses recorded in "Other loss (income), net" in the consolidated statements of operations related to the eligible financial instruments for which the fair value option was elected (in thousands):


	Year Ended December 31, 2022
Financial Assets
Finance receivables of CFEs	$	24,231
Finance receivables at fair value		11,624
Beneficial interests in securitizations		1,149
Financial Liabilities
Debt of securitized VIEs		(2,727	)
Total net loss included in other income	$	34,277

The following table presents other relevant data related to the finance receivables carried at fair value (in thousands):


As of December 31, 2022	Finance Receivables of CFEs at Fair Value		Finance Receivables at Fair Value
Aggregate unpaid principal balance included within finance receivables that are reported at fair value	$	84,477	$	89,068
Aggregate fair value of finance receivables that are reported at fair value	$	77,904	$	75,270
Unpaid principal balance of receivables within finance receivables that are reported at fair value and are on nonaccrual status (90 days or more past due)	$	1,097	$	1,499
Aggregate fair value of receivables carried at fair value that are on nonaccrual status (90 days or more past due)	$	985	$	1,311

All finance receivables of CFEs are pledged to the CFEs trusts.

The following table presents other relevant data related to securitization debt of consolidated VIEs carried at fair value (in thousands):


As of December 31, 2022	Securitization debt of consolidated VIEs at Fair Value
Aggregate unpaid principal balance of debt of securitized VIEs	$	82,556
Aggregate fair value of debt of securitized VIEs	$	79,829

As of December 31, 2021, there were no financial assets or liabilities for which the fair value option was elected.

Fair Value of Financial Instruments Not Carried at Fair Value

The carrying amounts of restricted cash, accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short-term nature. The carrying value of the 2022 Vehicle Floorplan Facility and the Warehouse Credit Facilities was determined to approximate fair value due to its short-term duration and variable interest rate that approximates prevailing interest rates as of each reporting period.

Finance receivables held for sale, net: For finance receivables eligible to be sold, the Company determines the fair value of finance receivables utilizing sales prices based on estimated securitization transactions, adjusted for transformation costs, risk and a normal profit margin associated with securitization transactions. Such fair value measurement of finance receivables held for sale, net is considered Level 3 of the fair value hierarchy. The carrying value and fair value of the finance receivables held for sale, net were as follows (in thousands):


	December 31,
	2022
Carrying value	$	299,235
Fair value	$	299,925

As of December 31, 2021, the Company did not have any finance receivables held for sale.

Convertible Senior Notes: The fair value of the Notes, which are not carried at fair value on the accompanying consolidated balance sheets, was determined utilizing actual bids and offer prices of the Notes in markets that are not active and are classified within Level 2 of the fair value hierarchy.


	December 31,
	2022		2021
Carrying value	$	359,254	$	610,618
Fair value	$	128,026	$	386,100

Junior Subordinated Debentures: The fair value of the junior subordinated debentures, which are not carried at fair value on the accompanying consolidated balance sheets, approximated their carrying value as of December 31, 2022 and are classified within Level 3 of the fair value hierarchy.

Fair Value of Financial Instruments on a Nonrecurring Basis

Assets and liabilities acquired as part of a business combination and goodwill attributable to each of the Company's reporting units are recorded at fair value on a nonrecurring basis. Refer to Note 5 – Acquisitions and Note 8 – Goodwill and Intangible Assets for additional information.

From time to time the Company may mark certain receivables classified as held for sale to fair value and classified as financial instruments recorded at fair value on a non-recurring basis. As of December 31, 2022, there were $22.4 million of finance receivables that were marked to fair value on a non-recurring basis. These are finance receivables that became delinquent and no longer meet the expected sales criteria. The Company uses a discounted cash flow model to estimate the present value of future recoveries for finance receivables. Such fair value measurement of finance receivables held for sale, net is considered Level 3 of the fair value hierarchy.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Variable Interest Entities and Securitizations - Summary of Unconsolidated Variable Interest Entity (Details) - Variable Interest Entity Not Primary Beneficiary $ in Thousands	Dec. 31, 2022 USD ($)
Variable Interest Entity [Line Items]
Aggregate Principal Balance	$ 19,543
Carrying Value	20,902
Total Exposure	20,902
Rated Notes
Variable Interest Entity [Line Items]
Aggregate Principal Balance	19,233
Carrying Value	18,664
Total Exposure	18,664
Certificates
Variable Interest Entity [Line Items]
Carrying Value	1,928
Total Exposure	1,928
Other Assets
Variable Interest Entity [Line Items]
Aggregate Principal Balance	310
Carrying Value	310
Total Exposure	$ 310

Goodwill and Intangible Assets - Schedule of Estimated Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
2023	$ 27,022
2024	27,022
2025	27,022
2026	21,979
2027	21,882
Thereafter	33,983
Carrying Value	$ 158,910	$ 28,207

Restructuring Activities - Reconciliation of Beginning and Ending Restructuring Liability (Details) - Realignment Plan $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Restructuring Cost and Reserve [Line Items]
Balance as of December 31, 2021	$ 0
Accrual and accrual adjustments	7,941
Cash payments	(7,131)
Balance as of December 31, 2022	$ 810

Acquisition - Summary of Pro Forma Information (Details) - UACC - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Business Acquisition [Line Items]
Total revenue	$ 1,964,372	$ 3,356,786
Net loss	$ (464,101)	$ (280,614)

Financial Instruments and Fair Value Measurements - Summary of Gains or Losses Recorded Related to Eligible Financial Instruments (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items]
Total net loss included in other income	$ 34,277
Fair Value, Asset (Liability), Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)
Debt of securitized VIEs
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items]
Financial Liabilities Gain (Loss)	$ (2,727)
Finance Receivables of CFEs
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items]
Financial Assets Gain (Loss)	24,231
Finance Receivables at Fair Value
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items]
Financial Assets Gain (Loss)	11,624
Beneficial Interests in Securitizations
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items]
Financial Assets Gain (Loss)	$ 1,149

Long Term Debt - Schedule of Securitization Debt of Consolidated VIEs (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Debt Instrument [Line Items]
Initial Principal	$ 93,730
Outstanding Principal	82,556
Fair Value	$ 79,829
United Auto Credit 2021-1-C
Debt Instrument [Line Items]
Final Scheduled Payment Date	Jun. 10, 2026
Initial Principal	$ 29,640
Contractual Interest Rate	0.84%
Outstanding Principal	$ 18,466
Fair Value	$ 18,322
United Auto Credit 2021-1-D
Debt Instrument [Line Items]
Final Scheduled Payment Date	Jun. 10, 2026
Initial Principal	$ 29,380
Contractual Interest Rate	1.14%
Outstanding Principal	$ 29,380
Fair Value	$ 28,481
United Auto Credit 2021-1-E
Debt Instrument [Line Items]
Final Scheduled Payment Date	Jun. 10, 2026
Initial Principal	$ 20,800
Contractual Interest Rate	2.58%
Outstanding Principal	$ 20,800
Fair Value	$ 19,685
United Auto Credit 2021-1-F
Debt Instrument [Line Items]
Final Scheduled Payment Date	Sep. 10, 2027
Initial Principal	$ 13,910
Contractual Interest Rate	4.30%
Outstanding Principal	$ 13,910
Fair Value	$ 13,341

Inventory - Schedule of Inventory (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Inventory Disclosure [Abstract]
Vehicles	$ 317,994	$ 724,542
Parts and accessories	2,654	1,842
Total inventory	$ 320,648	$ 726,384

Acquisition - Summary of Final Identifiable Intangible Assets Acquired and their Estimated Weighted Average Useful (Details) - USD ($) $ in Thousands	Feb. 01, 2022	Jan. 07, 2021
UACC
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 156,000
UACC \| Trade Name
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 7,000
Weighted Average Useful Life	10 years
UACC \| Purchased Technology
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 83,000
Weighted Average Useful Life	7 years
UACC \| Customer Relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value	$ 66,000
Weighted Average Useful Life	8 years
Vast Holdings, Inc. (“d/b/a CarStory”)
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value		$ 34,300
Vast Holdings, Inc. (“d/b/a CarStory”) \| Developed Technology
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value		$ 25,700
Weighted Average Useful Life		5 years
Vast Holdings, Inc. (“d/b/a CarStory”) \| Trademarks
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value		$ 5,200
Weighted Average Useful Life		8 years
Vast Holdings, Inc. (“d/b/a CarStory”) \| Customer Relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Fair Value		$ 3,400
Weighted Average Useful Life		8 years

Restructuring Activities (Tables)

12 Months Ended

Dec. 31, 2022

Restructuring and Related Activities [Abstract]

Components of Restructuring Charges

The following table summarizes the components of the restructuring charges:


	Year ended December 31,
	2022

Charges by Activity:
Severance and termination benefits (1)	$	7,358
Impairment of operating lease right-of-use assets (2)		6,491
Other costs (3)		1,176
Total Restructuring and Related Charges	$	15,025

(1) Severance and termination costs consist of severance costs provided to employees who have been terminated as well outplacement costs and COBRA benefits.

Reconciliation of Beginning and Ending Restructuring Liability

The following table is a reconciliation of the beginning and ending restructuring liability for the year ended December 31, 2022:


Balance as of December 31, 2021	$	—
Accrual and accrual adjustments		7,941
Cash payments		(7,131	)
Balance as of December 31, 2022	$	810

Inventory (Tables)

12 Months Ended

Dec. 31, 2022

Inventory Disclosure [Abstract]

Schedule of Inventory

Inventory consisted of the following (in thousands):


	December 31,
	2022		2021
Vehicles	$	317,994	$	724,542
Parts and accessories		2,654		1,842
Total inventory	$	320,648	$	726,384

Property and Equipment, Net

12 Months Ended

Dec. 31, 2022

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

7. Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):


	December 31,
	2022			2021
Equipment	$	3,357		$	1,011
Furniture and fixtures		1,896			2,244
Logistics fleet		32,468			22,810
Leasehold improvements		6,577			7,161
Internal-use software		30,725			18,423
Other		8,081			5,811
		83,104			57,460
Accumulated depreciation and amortization		(32,903	)		(20,418	)
Property and equipment, net	$	50,201		$	37,042

Depreciation and amortization expense was $13.4 million, $7.1 million and $4.1 million for the years ended December 31, 2022, 2021 and 2020, respectively. Depreciation and amortization expense included within “Cost of sales” in the consolidated statements of operations was $0.4 million, $0.3 million, and $0.1 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Implementation costs capitalized and accumulated amortization related to the Company’s cloud computing arrangements were $7.7 million and $4.6 million as of December 31, 2022, respectively, and $8.1 million and $2.4 million as of December 31, 2021, respectively, and were included within “Other assets” in the consolidated balance sheets. Amortization expense of $2.3 million, $1.4 million, and $0.7 million was included within “Selling, general and administrative expenses” in the consolidated statements of operations for the years ended December 31, 2022, 2021, and 2020, respectively.

The Company incurred impairment charges related to "Property and equipment, net" and "Other assets" of $0.3 million and $3.4 million, respectively, for the year ended December 31, 2022 and are included in "Impairment charges" in the consolidated statements of operations. These charges consist of costs capitalized related to the Company's internal-use software and implementation costs for cloud computing arrangements that are no longer in use.

Acquisition - Summary of Fair Value of Consideration Transferred (Parenthetical) (Details) - Vast Holdings, Inc. (“d/b/a CarStory”)	Jan. 07, 2021 shares
Business Acquisition [Line Items]
Business acquisition discounted marketability percentage	10.00%
Business acquisition lock up period	180 days
Share conversion ratio	0.0392
Business acquisition shares cancelled to satisfy working capital adjustment	5,673
Common Stock
Business Acquisition [Line Items]
Business acquisition, number of shares issued	1,066,444

Preferred Stock and Stockholders' Equity - Additional Information (Details)		1 Months Ended	12 Months Ended
	Jun. 11, 2020 $ / shares shares	Jun. 30, 2020	Dec. 31, 2022 $ / shares shares	Dec. 31, 2021 $ / shares shares
Stockholders' Equity Note [Abstract]
Preferred stock, authorized	10,000,000
Preferred stock, issued			0
Preferred Stock, outstanding			0
Forward stock split	2	2
Common stock, par value \| $ / shares	$ 0.001		$ 0.001	$ 0.001
Common stock, voting rights			one vote
Stock split, description		2-for-1	On June 11, 2020, the Company amended its certificate of incorporation to effect a 2-for-1 forward stock split of shares of the Company’s outstanding common stock, such that each share of common stock, $0.001 par value became two shares of common stock, $0.001 par value per share.
Common stock, shares authorized	500,000,000		500,000,000	500,000,000

Restructuring Activities - Components of Restructuring Charges (Details) - Realignment Plan $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Restructuring Cost and Reserve [Line Items]
Severance and termination benefits	$ 7,358
Impairment of operating lease right-of-use assets	6,491
Other costs	1,176
Total Restructuring and Related Charges	$ 15,025

Net Loss Per Share - Summary of Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Earnings Per Share [Abstract]
Net loss	$ (451,910)	$ (370,911)	$ (202,799)
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic	137,907,444	136,429,791	73,345,569
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, diluted	137,907,444	136,429,791	73,345,569
Net loss per share attributable to common stockholders, basic	$ (3.28)	$ (2.72)	$ (2.76)
Net loss per share attributable to common stockholders, diluted	$ (3.28)	$ (2.72)	$ (2.76)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

Accrued Expenses and Other Current Liabilities - Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Accrued Liabilities and Other Liabilities [Abstract]
Vehicle payable	$ 3,617	$ 30,647
Reserve for estimated returns	3,919	26,522
Insurance payable	4,551
State income tax payable	4,041	420
Other	1,565	15
Total other current liabilities	$ 17,693	$ 57,604

Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Income taxes at statutory rate	$ (99,034)	$ (77,733)	$ (42,570)
State income taxes, net of federal benefit	(3,529)	(8,251)	(5,417)
Foreign Rate Differential	(129)	(26)	0
Permanent differences	1,510	(4,800)	1,264
Goodwill impairment	41,241	0	0
Deferred tax adjustment for acquisition of business	(23,855)	0	0
Change in valuation allowance	66,634	94,158	46,901
Other	(2,518)	(2,594)	(94)
(Benefit) provision for income taxes	$ (19,680)	$ 754	$ 84

Stock-based Compensation - - Summary of Activity for Restricted Stock Units (Details)	12 Months Ended
	Dec. 31, 2022 $ / shares shares
Share-Based Payment Arrangement [Abstract]
Shares, Unvested and outstanding, Beginning balance \| shares	2,269,813
Shares, Granted \|shares \| shares	9,349,754
Shares, Vested \|shares \| shares	(1,109,012)
Shares, Forfeited / cancelled \|shares \| shares	(1,849,130)
Shares, Unvested and outstanding, Ending balance \|shares \| shares	8,661,425
Weighted Average Grant Date Fair Value per Share, Unvested and outstanding, Beginning balance \| $ / shares \| $ / shares	$ 24.69
Weighted Average Grant Date Fair Value per Share, Granted \| shares \| $ / shares	2.28
Weighted Average Grant Date Fair Value per Share, Vested \| $ / shares \| $ / shares	13.09
Weighted Average Grant Date Fair Value per Share, Forfeited / cancelled \| $ / shares \| $ / shares	18.68
Weighted Average Grant Date Fair Value per Share, Unvested and outstanding, Ending balance \| $ / share \| $ / shares	$ 3.29

Related Party Transactions

12 Months Ended

Dec. 31, 2022

Related Party Transactions

22. Related Party Transactions

Management Services Agreement

In July 2015, the Company entered into a management services agreement (“MSA”) with Catterton Management Company, L.L.C. (“Catterton Management”), an affiliate of L Catterton (“Catterton”), a holder of more than 5% of the Company’s outstanding capital stock, pursuant to which Catterton Management agreed to provide consulting services on certain business and financial matters. Under the MSA, the Company agreed to pay Catterton Management an annual fee of $0.3 million until the expiration of the MSA upon the earlier of (i) termination by mutual consent of the parties and (ii) such time that Catterton and/or its affiliates cease to be one of the Company’s stockholders. For the year ended December 31, 2020, payment of the annual fee was waived. In May 2020, the MSA was terminated.

AutoNation Reconditioning Agreement

In January 2019, the Company entered into a vendor agreement (“Vendor Agreement”) with AutoNation, Inc. (“AutoNation”), an affiliate of Auto Holdings, Inc., a holder of more than 5% of the Company’s outstanding capital stock, pursuant to which AutoNation agreed to provide certain reconditioning and repair services for vehicles owned by the Company. Amounts due under the Vendor Agreement for parts supplied and services performed by AutoNation become due and payable as they accrued. The Vendor Agreement was terminated in February 2020.

Leases (Tables)

12 Months Ended

Dec. 31, 2022

Leases [Abstract]

Summary of Lease Costs and Activity

The Company’s lease costs and activity for the years ended December 31, 2022, 2021 and 2020 were as follows (in thousands):


	Year Ended December 31,
	2022			2021			2020
Lease Cost
Operating lease cost	$	8,402		$	6,919		$	5,503
Short-term lease cost		690			1,660			350
Variable lease cost		3,810			2,921			1,915
Sublease income		(72	)		(196	)		(445	)
Net lease cost	$	12,830		$	11,304		$	7,323

	Year Ended December 31,
	2022			2021			2020
Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	9,322		$	6,806		$	5,524
Right-of-use assets obtained in exchange for operating lease liabilities	$	19,896		$	1,599		$	4,600

Summary of Maturity of Lease Liabilities on Undiscounted Cash Flow Basis and Reconciliation

The maturity of the Company’s lease liabilities on an undiscounted cash flow basis and a reconciliation to the operating lease liabilities recognized on the Company’s consolidated balance sheet as of December 31, 2022 were as follows (in thousands):


2023		11,306
2024		8,533
2025		4,290
2026		3,232
2027		2,787
Thereafter		4,308
Total lease payments		34,456
Less: interest		(4,597	)
Present value of lease liabilities	$	29,859

Operating lease liabilities, current	$	9,730
Operating lease liabilities, noncurrent		20,129
Total operating lease liabilities	$	29,859

Variable Interest Entities and Securitizations - Additional Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($) Facility
Variable Interest Entity [Line Items]
Beneficial interests in securitizations	$ 20,592
Asset-backed Securities
Variable Interest Entity [Line Items]
Securitization transaction	$ 523,700
UACC
Variable Interest Entity [Line Items]
Risk retention rules percentage	5.00%
Number of senior secured warehouse credit facilities \| Facility	4
Beneficial interests in securitizations	$ 20,600
Recognized a gain on sale	45,600
UACC \| Residual Interest, 2022-1 and 2022-2 Securitization
Variable Interest Entity [Line Items]
Securitization transaction	$ 49,600

Description of Business and Basis of Presentation

12 Months Ended

Dec. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business and Basis of Presentation

1. Description of Business and Basis of Presentation

Description of Business and Organization

Vroom, Inc., and its wholly owned subsidiaries (collectively, “the Company”) is an innovative, end-to-end ecommerce platform that is transforming the used vehicle industry by offering a better way to buy and a better way to sell used vehicles.

In December 2015, the Company acquired Houston-based Left Gate Property Holding, LLC (d/b/a Texas Direct Auto and Vroom). The acquisition included the Company's proprietary vehicle reconditioning center, the Texas Direct Auto ("TDA") dealership, and Sell Us Your Car® centers. Left Gate Property Holding, LLC was renamed Vroom Automotive, LLC in March 2021, and is the primary operating entity for the Company's purchases and sales of used vehicles. In January 2021, the Company acquired Vast Holdings, Inc. (d/b/a CarStory). On February 1, 2022, the ("Acquisition Date"), the Company completed the acquisition of Unitas Holdings Corp. (now known as Vroom Finance Corporation), including its wholly owned subsidiaries United PanAm Financial Corp.(now known as Vroom Automotive Financial Corporation) and United Auto Credit Corporation ("UACC").

As part of the Company's previously announced Business Realignment Plan ("Realignment Plan"), initiated in the second quarter of 2022, the Company streamlined TDA's operations and closed its service center. The Company also reevaluated its reporting segments based on relative revenue and gross profit and significance in the Company's long term strategy. As a result of the quantitative analysis, the Company determined to no longer report TDA as a separate segment. Starting in the three months ended June 30, 2022, the Company is organized into three reportable segments: Ecommerce, Wholesale, and Retail Financing. The Company reclassified TDA revenue and TDA gross profit for the comparative period from the TDA reportable segment to the “All Other” category to conform to current year presentation. The Ecommerce reportable segment represents retail sales of used vehicles through the Company’s ecommerce platform, fees earned on sales of value-added products associated with those vehicles sales. Starting in 2022, the Ecommerce segment also includes interest income earned on finance receivables from Vroom customers that we originate through UACC to finance the vehicles we sell and gain on sales of those finance receivables once sold in a securitization transaction or forward flow arrangement that qualify for sales accounting treatment. The Wholesale reportable segment represents sales of used vehicles through wholesale channels. The Retail Financing reportable segment represents UACC’s operations with its network of third-party dealership customers, which primarily consists of the purchases and servicing of vehicle installment contracts, but excluding financing of vehicle sales to Vroom customers.

The Company was incorporated in Delaware on January 31, 2012 under the name BCM Partners III, Corp. On June 25, 2013, the Company changed its name to Auto America, Inc. and on July 9, 2015, the Company changed its name to Vroom, Inc.

Stock Split

In connection with the closing of the Company’s initial public offering (“IPO”) on June 11, 2020, the Company effected a 2-for-1 forward stock split of the Company’s common stock, which became effective immediately prior to the consummation of the IPO. All shares of the Company’s common stock, stock-based instruments, and per-share data included in these consolidated financial statements have been retroactively adjusted as though the stock split has been effected prior to all periods presented.

Initial Public Offering

The Company closed its IPO on June 11, 2020 in which it sold 24,437,500 shares of common stock at the public offering price of $22.00 per share, including 3,187,500 shares sold pursuant to exercise by the underwriters of their option to purchase additional shares. The Company received proceeds of $504.0 million from the IPO, net of the underwriting discount and before deducting offering expenses of $7.5 million. In addition, in accordance with their terms and consistent with the conversion rates discussed in Note 15 - Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit), all shares of the Company’s outstanding redeemable convertible preferred stock were automatically converted into common stock upon the closing of the IPO.

Follow-on Public Offering

The Company closed its follow-on public offering on September 15, 2020 in which it sold 10,800,000 shares of common stock at the public offering price of $54.50 per share. The Company received proceeds of $569.5 million from the offering, net of the underwriting discount and before deducting offering expenses of $1.5 million.

Basis of Presentation

The consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Certain prior year amounts have been reclassified to conform to the current year presentation.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Financial Instruments and Fair Value Measurements - Schedule of Reconciliation of Financial Assets Measured at Fair Value on a Recurring Basis Using Level 3 Inputs (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Finance Receivables of Consolidated CFEs
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Net realized and unrealized gains (losses) included in income	$ 24,231
Finance Receivables of Consolidated CFEs \| Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Acquired in business combination	262,644
Transfer within Level 3 categories	(51,330)
Net realized and unrealized gains (losses) included in income	(29,825)
Sales	(24,312)
Paydowns	(90,410)
Other	11,137
Fair Value, Ending Balance	77,904
Finance Receivables at Fair Value
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Net realized and unrealized gains (losses) included in income	11,624
Finance Receivables at Fair Value \| Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Acquired in business combination	34,283
Transfer within Level 3 categories	51,330
Net realized and unrealized gains (losses) included in income	(14,388)
Issuances, net of discount	56,484
Sales	(14,114)
Paydowns	(41,980)
Other	3,655
Fair Value, Ending Balance	75,270
Securitization Debt of Consolidated CFEs \| Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Acquired in business combination	275,394
Transfer out of Level 3	$ (275,394)

Restructuring Activities - Components of Restructuring Charges (Details) (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Restructuring Cost and Reserve [Line Items]
SubleaseIncome	$ 72	$ 196	$ 445
Realignment Plan
Restructuring Cost and Reserve [Line Items]
Costs associated with planned facility closures	8,600
SubleaseIncome	2,100
Legal fees	600
Acceleration of depreciation of property and equipment	$ 600

Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Accrued Liabilities and Other Liabilities [Abstract]
Accrued marketing expenses	$ 2,093	$ 17,546
Vehicle related expenses	14,789	36,459
Sales taxes	5,983	39,163
Accrued compensation and benefits	28,276	16,150
Accrued professional services	3,488	4,225
Accrued legal settlements	7,383
Interest payable	3,990	1,718
Other	10,793	6,247
Total accrued expenses	$ 76,795	$ 121,508

Income Taxes - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Taxes [Line Items]
Effective tax rate	4.17%	(0.20%)	(0.04%)
Decrease of valuation allowance result from acquisition	$ 66,634,000	$ 94,158,000	$ 46,901,000
Valuation allowance	258,796,000	216,017,000	$ 121,900,000	$ 75,000,000.0
Uncertain tax positions	0	$ 0
Interest accrued in relation to uncertain tax positions	0
Penalties accrued in relation to uncertain tax positions	0
Domestic Tax Authority
Income Taxes [Line Items]
Net operating loss carryforwards for tax purposes	$ 1,143,400,000
Operating loss carryforwards earliest expiration year	2028
Operating loss carryforwards latest expiration year	2042
Net operating loss carryforwards expiring in indefinite period for tax purposes	$ 950,700,000
Domestic Tax Authority \| Tax Period Expire from 2028 through 2042
Income Taxes [Line Items]
Net operating loss carryforwards for tax purposes	$ 168,500,000
State and Local Jurisdiction
Income Taxes [Line Items]
Operating loss carryforwards earliest expiration year	2034
Operating loss carryforwards latest expiration year	2041
State and Local Jurisdiction \| Tax Period Expire from 2034 through 2041
Income Taxes [Line Items]
Net operating loss carryforwards for tax purposes	$ 500,500,000
Unitas Holdings Corp.
Income Taxes [Line Items]
Decrease of valuation allowance result from acquisition	$ 23,900,000

Income Taxes - Schedule of Domestic and Foreign Pretax Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Domestic	$ (472,203)	$ (370,640)	$ (202,715)
Foreign	613	483	0
Loss before provision for income taxes	$ (471,590)	$ (370,157)	$ (202,715)

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

Net Loss Per Share

12 Months Ended

Dec. 31, 2022

Earnings Per Share [Abstract]

Net Loss Per Share

21. Net Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders:


	Year Ended December 31,
(in thousands, except share and per share amounts)	2022			2021			2020
Net loss	$	(451,910	)	$	(370,911	)	$	(202,799	)
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted		137,907,444			136,429,791			73,345,569
Net loss per share attributable to common stockholders, basic and diluted	$	(3.28	)	$	(2.72	)	$	(2.76	)

The following potentially dilutive shares were not included in the calculation of diluted shares outstanding for the periods presented as the effect would have been anti-dilutive:


	As of December 31,
	2022		2021		2020
Convertible senior notes		6,530,762		11,158,722		—
Stock options		2,857,176		4,076,542		5,617,568
Restricted stock units		8,661,425		1,853,150		1,867,660
Total		18,049,363		17,088,414		7,485,228

Leases - Summary of Maturity of Lease Liabilities on Undiscounted Cash Flow Basis and Reconciliation (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Jan. 01, 2020
Leases [Abstract]
2023	$ 11,306
2024	8,533
2025	4,290
2026	3,232
2027	2,787
Thereafter	4,308
Total lease payments	34,456
Less: interest	(4,597)
Present value of lease liabilities	29,859		$ 18,400
Operating lease liabilities, current	9,730	$ 6,889
Operating Lease Liability Noncurrent	20,129	$ 9,592
Total operating lease liabilities	$ 29,859		$ 18,400

Summary of Significant Accounting Policies - Additional Information (Details)	1 Months Ended	12 Months Ended
	Jun. 30, 2021 USD ($)	Dec. 31, 2022 USD ($) Facility	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Nov. 30, 2022 USD ($)	Jan. 01, 2020 USD ($)
Accounting Policies [Line Items]
Other comprehensive income (loss)		$ 0	$ 0	$ 0
Cash deposits included in restricted cash		73,095,000	82,450,000
Interest income		19,363,000	10,341,000	5,896,000
Interest expense		40,693,000	21,948,000	9,656,000
Valuation allowance for finance receivables classified as held for sale		10,500,000
Debt instrument aggregate principal amount		82,556,000
Aggregate principal amount		93,730,000
Cash and cash equivalents		398,915,000	1,132,325,000
Restricted Cash		73,100,000
Gain on debt extinguishment		$ 164,684,000
Business combination, measurement period		1 year
Operating lease liabilities		$ 29,859,000				$ 18,400,000
Operating lease right-of-use assets		$ 23,568,000	15,359,000			$ 17,400,000
ASU 2016-02
Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		true
Change in accounting principle, accounting standards update, adoption date		Jan. 01, 2020
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
ASU 2018-13
Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		true
Change in accounting principle, accounting standards update, adoption date		Jan. 01, 2020
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
ASU 2016-13
Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		true
Change in accounting principle, accounting standards update, adoption date		Jan. 01, 2020
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
ASU 2019-12
Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		true
Change in accounting principle, accounting standards update, adoption date		Jan. 01, 2021
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
ASU 2020-06
Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		true
Change in accounting principle, accounting standards update, adoption date		Jan. 01, 2021
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
Change in Accounting Principle, Accounting Standards Update, Early Adoption [true false]		true
Maximum
Accounting Policies [Line Items]
Amortization term		10 years
Minimum
Accounting Policies [Line Items]
Amortization term		1 year
0.75% Unsecured Convertible Senior Notes Due 2026
Accounting Policies [Line Items]
Debt instrument aggregate principal amount	$ 625,000,000.0
Aggregate principal amount		$ 254,300,000
Deferred issuance costs		4,900,000
Repurchase of notes in open-market transaction		90,200,000
Gain on debt extinguishment		164,700,000
Debt instrument interest rate	0.75%
Debt instrument maturity year	2026
Warehouse Credit Facility
Accounting Policies [Line Items]
Cash deposits included in restricted cash		15,654,000
Increased borrowing capacity		105,800,000
Selling, General and Administrative Expenses
Accounting Policies [Line Items]
Advertising expense		79,700,000	125,500,000	62,400,000
Selling, General and Administrative Expenses \| Shipping and Handling
Accounting Policies [Line Items]
Shipping and handling expenses		39,000,000.0	$ 85,800,000	$ 30,300,000
Other Loss (Income), Net
Accounting Policies [Line Items]
Other net losses due to changes in fair value		21,000,000.0
Finance [Member]
Accounting Policies [Line Items]
Interest income		40,900,000
Interest expense		3,400,000
UACC
Accounting Policies [Line Items]
Net proceeds from securitization		$ 582,900,000
Number of warehouse credit facilities \| Facility		4
UACC \| Warehouse Credit Facility
Accounting Policies [Line Items]
Aggregate borrowing limit		$ 850,000,000.0
Increased borrowing capacity		105,800,000
Outstanding borrowings		229,500,000
Asset-backed Securities \| UACC
Accounting Policies [Line Items]
Securitization transaction		523,700,000
Residual Interest, 2022-1 Securitization \| UACC
Accounting Policies [Line Items]
Securitization transaction		49,600,000
Vehicle Floorplan Facility \| Line Of Credit
Accounting Policies [Line Items]
Increased borrowing capacity		343,900,000
2022 Vehicle Floorplan Facility \| Line Of Credit
Accounting Policies [Line Items]
Increased borrowing capacity					$ 500,000,000.0
Line of credit facility, unutilized borrowing capacity		66,900
Lenders \| Cash Deposits
Accounting Policies [Line Items]
Cash deposits included in restricted cash		$ 12,500,000

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2022

Accounting Policies [Abstract]

Schedule of Estimated Useful Lives of Assets

Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives of the assets:


Equipment	3 to 15 years
Furniture and fixtures	3 to 15 years
Logistics fleet	5 to 7 years
Leasehold improvements	Lesser of useful life or lease term
Internal-use software	1 to 10 years

Schedule of Estimated Useful Lives of Intangible Assets

The Company's intangible assets are amortized on a straight-line basis over the following estimated weighted average useful lives:


Developed technology	7 years
Trademarks	9 years
Customer relationships	8 years

Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Impairment charges	$ 201,703	$ 0	$ 0
Amortization expense for intangible assets	$ 25,300	$ 6,100	$ 500

Leases

12 Months Ended

Dec. 31, 2022

Leases [Abstract]

Leases

12. Leases

The Company’s leasing activities primarily consist of real estate leases for its operations, including office space, the Company’s reconditioning facility, the Company’s Sell Us Your Car centers, parking lots, other facilities and equipment used in the normal course of business. The real estate leases have terms ranging from three months to nine years. The Company assesses whether each lease is an operating or finance lease at the lease commencement date. The Company does not have any material leases, individually or in the aggregate, classified as a finance leasing arrangement.

The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of December 31, 2022, the Company had additional operating leases that have not yet commenced with future lease payments of approximately $16.4 million. The leases are expected to commence over the next 12 months with initial lease terms of approximately 7 years.

The Company’s real estate leases often require it to make payments for maintenance in addition to rent as well as payments for real estate taxes and insurance. Maintenance, real estate taxes, and insurance payments are generally variable costs which are based on actual expenses incurred by the lessor. Therefore, these amounts are not included in the consideration of the contract when determining the right-of-use asset and lease liability but are reflected as variable lease expenses.

Leases with an initial term of 12 months or less are not recorded on the Company’s consolidated balance sheet and expense for these leases are recognized on a straight-line basis over the lease term.

Options to extend or terminate leases

Certain of the Company’s real estate leases include one or more options to renew, with renewal terms that can extend the lease term from one to five years. The exercise of lease renewal options is at the Company’s sole discretion. If it is reasonably certain that the Company will exercise such options, the periods covered by such options are included in the lease term and are recognized as part of the Company’s right-of-use assets and lease liabilities. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

Lease term and discount rate

The weighted-average remaining lease term and discount rate for the Company’s operating leases, excluding short-term operating leases, were 4.2 years and 5.8% as of December 31, 2022, respectively, 2.7 years and 3.4% as of December 31, 2021, respectively, and 3.5 years and 3.4% as of December 31, 2020, respectively.

As the rate implicit in the lease is generally not readily determinable for the Company’s operating leases, the discount rates used to determine the present value of the Company’s lease liabilities are based on the Company’s incremental borrowing rate at the lease commencement date and commensurate with the remaining lease term. The incremental borrowing rate for a lease is the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments in a similar economic environment. The Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

Lease costs and activity

The Company’s lease costs and activity for the years ended December 31, 2022, 2021 and 2020 were as follows (in thousands):


	Year Ended December 31,
	2022			2021			2020
Lease Cost
Operating lease cost	$	8,402		$	6,919		$	5,503
Short-term lease cost		690			1,660			350
Variable lease cost		3,810			2,921			1,915
Sublease income		(72	)		(196	)		(445	)
Net lease cost	$	12,830		$	11,304		$	7,323

	Year Ended December 31,
	2022			2021			2020
Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	9,322		$	6,806		$	5,524
Right-of-use assets obtained in exchange for operating lease liabilities	$	19,896		$	1,599		$	4,600

As a result of the Realignment Plan beginning in the second quarter of 2022, the Company incurred impairment charges related to operating lease right-of-use assets of $6.5 million for the year ended December 31, 2022. These charges consist of costs associated with planned facility closures that will continue to be incurred under the contract for its remaining term without economic benefit to the Company. Refer to Note 18 — Restructuring Activities for further detail.

Maturity of Lease Liabilities


2023		11,306
2024		8,533
2025		4,290
2026		3,232
2027		2,787
Thereafter		4,308
Total lease payments		34,456
Less: interest		(4,597	)
Present value of lease liabilities	$	29,859

Operating lease liabilities, current	$	9,730
Operating lease liabilities, noncurrent		20,129
Total operating lease liabilities	$	29,859

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Current Assets:
Cash and cash equivalents	$ 398,915	$ 1,132,325
Restricted cash (including restricted cash of consolidated VIEs of $24.7 million and $0 million, respectively)	73,095	82,450
Accounts receivable, net of allowance of $21.5million and $8.9 million, respectively	13,967	105,433
Finance receivables at fair value (including finance receivables of consolidated VIEs of $11.5 million and $0 million, respectively)	12,939
Finance receivables held for sale, net (including finance receivables of consolidated VIEs of $305.9 million and $0 million, respectively)	321,626
Inventory	320,648	726,384
Beneficial interests in securitizations	20,592
Prepaid expenses and other current assets	58,327	55,700
Total current assets	1,220,109	2,102,292
Finance receivables at fair value (including finance receivables of consolidated VIEs of $119.6 million and $0 million, respectively)	140,235
Property and equipment, net	50,201	37,042
Intangible assets, net	158,910	28,207
Goodwill	0	158,817
Operating lease right-of-use assets	23,568	15,359
Other assets	26,004	25,033
Total assets	1,619,027	2,366,750
Current Liabilities:
Accounts payable	34,702	52,651
Accrued expenses	76,795	121,508
Vehicle floorplan	276,988	512,801
Warehouse credit facilities of consolidated VIEs	229,518
Current portion of securitization debt of consolidated VIEs at fair value	47,239
Deferred revenue	10,655	75,803
Operating lease liabilities, current	9,730	6,889
Other current liabilities	17,693	57,604
Total current liabilities	703,320	827,256
Long term debt, net of current portion (including securitization debt of consolidated VIEs of $32.6 million and $0 million at fair value, respectively)	402,154	610,618
Operating lease liabilities, excluding current portion	20,129	9,592
Other long-term liabilities	18,183	4,090
Total liabilities	1,143,786	1,451,556
Commitments and contingencies (Note 14)
Stockholders' equity:
Common stock, $0.001 par value; 500,000,000 shares authorized as of December 31, 2022 and December 31, 2021; 138,201,903 and 137,092,891 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively	135	135
Additional paid-in-capital	2,075,798	2,063,841
Accumulated deficit	(1,600,692)	(1,148,782)
Total stockholders' equity	475,241	915,194
Total liabilities and stockholders' equity	$ 1,619,027	$ 2,366,750

Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Property Plant And Equipment [Line Items]
Depreciation and amortization	$ 38,290	$ 12,891	$ 4,598
Depreciation and amortization expense included within Cost of sales	400	300	100
Impairment charges incurred	211,873
Selling, General and Administrative Expenses
Property Plant And Equipment [Line Items]
Amortization of cloud computing assets	2,300	1,400	700
Other Assets
Property Plant And Equipment [Line Items]
Impairment charges incurred	3,400
Property and Equipment, Net
Property Plant And Equipment [Line Items]
Depreciation and amortization	13,400	7,100	$ 4,100
Impairment charges incurred	300
Cloud Computing Arrangements \| Other Assets
Property Plant And Equipment [Line Items]
Implementation costs capitalized	7,700	8,100
Implementation costs capitalized, accumulated amortization	$ 4,600	$ 2,400

Warehouse Credit Facilities of Consolidated VIEs - Schedule of Terms of the Warehouse Credit Facilities (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Line of Credit Facility [Line Items]
Restricted Cash as of June 30, 2022 (in thousands)	$ 73,095
Facility One
Line of Credit Facility [Line Items]
Execution Date	May 30, 2012
Maturity Date	Jul. 20, 2024
Aggregate Borrowings Limit (in thousands)	$ 200,000
Aggregate Principal Balance of Finance Receivables Pledged As Collateral	143,919
Outstanding Balance as of June 30, 2022 (in thousands)	110,602
Restricted Cash as of June 30, 2022 (in thousands)	$ 8,110
Facility Two
Line of Credit Facility [Line Items]
Execution Date	Nov. 19, 2013
Maturity Date	Sep. 27, 2024
Aggregate Borrowings Limit (in thousands)	$ 200,000
Aggregate Principal Balance of Finance Receivables Pledged As Collateral	142,503
Outstanding Balance as of June 30, 2022 (in thousands)	19,615
Restricted Cash as of June 30, 2022 (in thousands)	$ 2,007
Facility Three
Line of Credit Facility [Line Items]
Execution Date	Jul. 11, 2019
Maturity Date	May 24, 2024
Aggregate Borrowings Limit (in thousands)	$ 200,000
Aggregate Principal Balance of Finance Receivables Pledged As Collateral	126,636
Outstanding Balance as of June 30, 2022 (in thousands)	101,435
Restricted Cash as of June 30, 2022 (in thousands)	$ 5,537
Facility Four
Line of Credit Facility [Line Items]
Execution Date	Nov. 18, 2022
Maturity Date	Dec. 12, 2024
Aggregate Borrowings Limit (in thousands)	$ 250,000

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2022

Accounting Policies [Abstract]

Stock Split

Initial Public Offering

Follow-on Public Offering

Basis of Presentation

Principles of Consolidation

Cost of sales

Cash and Cash Equivalents

Restricted Cash

Accounts Receivable, Net

Finance Receivables

The Company's finance receivables are generally secured by the vehicles being financed.

Finance Receivables Held for Sale, Net

Finance Receivables at Fair Value

adjustments are recorded in "Other loss (income), net" in the consolidated statements of operations. Refer to Note 17 – Financial Instruments and Fair Value Measurements.

Consolidated CFEs

Inventory

Property and Equipment, Net

Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives of the assets:


Equipment	3 to 15 years
Furniture and fixtures	3 to 15 years
Logistics fleet	5 to 7 years
Leasehold improvements	Lesser of useful life or lease term
Internal-use software	1 to 10 years

Goodwill and Intangible Assets

The Company's intangible assets are amortized on a straight-line basis over the following estimated weighted average useful lives:


Developed technology	7 years
Trademarks	9 years
Customer relationships	8 years

Vehicle Floorplan

Income Taxes

Stock-Based Compensation

of awards considered probable of being earned changes, the amount of stock-based compensation recognized will also change.

Business Combinations

Advertising

Shipping and Handling

Concentration of Credit Risk and Significant Customers

Liquidity

Net Loss Per Share Attributable to Common Stockholders

Accounting Standards Issued But Not Yet Adopted

Accounting Standards Adopted

Accounting Standards Issued But Not Yet Adopted

Inventory - Additional Information (Details) - USD ($) $ in Millions	Dec. 31, 2022	Dec. 31, 2021
Inventory Disclosure [Abstract]
Inventory valuation reserves	$ 24.2	$ 22.4

Description of Business and Basis of Presentation - Additional Information (Details) $ / shares in Units, $ in Thousands			1 Months Ended	3 Months Ended	12 Months Ended
	Sep. 15, 2020 USD ($) $ / shares shares	Jun. 11, 2020 USD ($) $ / shares shares	Jun. 30, 2020	Jun. 30, 2022 Segment	Dec. 31, 2022 Segment	Dec. 31, 2020 USD ($)
Description of Business and Basis of Presentation [Line Items]
Number of reportable segments \| Segment				3	3
Forward stock split		2	2
Stock split, description			2-for-1		On June 11, 2020, the Company amended its certificate of incorporation to effect a 2-for-1 forward stock split of shares of the Company’s outstanding common stock, such that each share of common stock, $0.001 par value became two shares of common stock, $0.001 par value per share.
Stock issued during period shares \| shares	10,800,000
Sale of stock, price per share \| $ / shares	$ 54.50
Proceeds from the issuance of common stock in connection with IPO, net of underwriting discount and issuance costs						$ 497,233
Stock offering expenses	$ 1,500
Proceeds from offering, net	$ 569,500					$ 567,952
Initial Public Offering
Description of Business and Basis of Presentation [Line Items]
Stock issued during period shares \| shares		24,437,500
Sale of stock, price per share \| $ / shares		$ 22.00
Proceeds from the issuance of common stock in connection with IPO, net of underwriting discount and issuance costs		$ 504,000
Stock offering expenses		$ 7,500
Underwriters
Description of Business and Basis of Presentation [Line Items]
Stock issued during period shares \| shares		3,187,500

Long Term Debt

12 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Long Term Debt

13. Long Term Debt

Debt instruments, excluding the 2022 Vehicle Floorplan Facility, which is discussed in Note 10 — Vehicle Floorplan Facility, and warehouse credit facilities of consolidated VIEs, which are discussed in Note 11 — Warehouse Credit Facilities of Consolidated VIEs, consisted of the following (in thousands):


	December 31,
	2022		2021
Current portion of securitization debt of consolidated VIEs	$	47,239	$	—
Convertible senior notes		359,254		610,618
Securitization debt of consolidated VIEs, net of current portion		32,590		—
Junior subordinated debentures		10,310		—
Long term debt, net of current portion	$	402,154	$	610,618
Total debt	$	449,393	$	610,618

Convertible Senior Notes

On June 18, 2021, the Company issued $625.0 million aggregate principal amount of 0.75% unsecured Convertible Senior Notes due 2026 (the “Notes”), including $75.0 million aggregate principal amount of such notes pursuant to the exercise in full of the overallotment option granted to the initial purchasers. The Notes were issued pursuant to an indenture (the “Indenture”), between the Company and U.S. Bank National Association, as trustee.

The Notes bear interest at a rate of 0.75% per annum, payable semiannually in arrears on January 1 and July 1 of each year, beginning on January 1, 2022. The Notes will mature on July 1, 2026, subject to earlier repurchase, redemption or conversion. The total net proceeds from the offering, after deducting commissions paid to the initial purchasers and debt issuance costs paid to third-parties, were approximately $608.9 million.

Each $1,000 principal amount of the Notes will initially be convertible into 17.8527 shares of the Company’s common stock, which is equivalent to an initial conversion price of approximately $56.01 per share, subject to adjustment upon the occurrence of specified events. The Notes are convertible, at the option of the noteholders, on or after April 1, 2026. Prior to April 1, 2026, the Notes are convertible only under the following circumstances:

•

During any fiscal quarter commencing after the fiscal quarter ending on September 30, 2021 (and only during such fiscal quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price of the Notes on each applicable trading day;

•

During the five consecutive business day period after any ten consecutive trading day period in which the trading price per $1,000 principal amount of the Notes for each day of that ten consecutive trading day period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate of the Notes on such trading day;

•

If the Company calls any or all of the Notes for redemption; or

•

Upon the occurrence of specific corporate events such as a change in control or certain beneficial distributions to common stockholders (as set forth in the Indenture).

The Company may settle conversions by paying or delivering, as applicable, cash, shares of its common stock or a combination of cash and shares of its common stock, at the Company’s election.

The Company may not redeem the Notes prior to July 6, 2024. On or after July 6, 2024, the Company may redeem all or any portion of the Notes for cash equal to 100% of the principal amount of the Notes being redeemed plus any accrued and unpaid interest if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period.

If the Company undergoes a fundamental change (as defined in the Indenture), subject to certain conditions, holders of the Notes may require the Company to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes plus any accrued and unpaid interest. In addition, if specific corporate events occur prior to the maturity date or if the Company issues a notice of redemption, the Company will increase the conversion rate by pre-defined amounts for a holder who elects to convert their Notes in connection with such a corporate event. During the years ended December 31, 2022 and 2021, the conditions allowing holders of the Notes to convert were not met.

In 2022, the Company repurchased $254.3 million in aggregate principal amount of the Notes, net of deferred issuance costs of $4.9 million, for $90.2 million in open-market transactions. The Company recognized a gain on extinguishment of debt of $164.7 million for the year ended December 31, 2022.

The Company accounts for the Notes as a single liability-classified instrument measured at amortized cost. As of December 31, 2022, the unamortized debt discount and debt issuance costs was $6.5 million and the net carrying value was $359.3 million. As of December 31, 2021, the unamortized debt discount and debt issuance costs was $14.4 million and the net carrying value was $610.6 million.

The Notes were issued at par value and fees associated with the issuance of these Notes are amortized to interest expense using the effective interest method over the contractual term of the Notes. The interest expense for the years ended December 31, 2022 and 2021 were $7.2 million and $4.3 million, respectively. The effective interest rate of the Notes is 1.3%.

Securitization Debt of Consolidated VIEs

The securitization debt was issued under UACC's pre-acquisition securitization program. The Company elected to account for the securitization debt under the fair value option on February 1, 2022 using the measurement alternative. Fair value adjustments are recorded in "Other loss (income), net" in the consolidated statements of operations. Refer to Note 17 – Financial Instruments and Fair Value Measurements. For all securitization transactions consummated prior to the Acquisition Date, the Company consolidated VIEs and accounted for these transactions as secured borrowings. Refer to Note 4 – Variable Interest Entities and Securitizations for further discussion.

UACC retained the servicing rights for the finance receivables that were securitized; therefore, is responsible for the administration and collection of the amounts owed under the contracts. The securitization agreements also require certain funds to be held in restricted cash accounts to provide additional collateral for the borrowings or to be applied to make payments on the securitization debt. Restricted cash under the various agreements totaled approximately $9.0 million as of December 31, 2022.

Upon the issuance of the securitization debt, UACC retained the right to receive excess cash flows over time from the underlying pool of securitized transactions. The wholly owned bankruptcy remote subsidiaries of UACC were formed to facilitate the above asset-backed financing transactions. Bankruptcy remote refers to a legal structure in which it is expected that the applicable entity would not be included in any bankruptcy filing by its parent or affiliates. All of the assets of these subsidiaries have been pledged as collateral for the related debt. None of the assets of these subsidiaries are available to pay other creditors of the Company or its affiliates.

The securitization debt issued is included in “Current portion of securitization debt of consolidated VIEs at fair value” and "Long term debt, net of current portion" on the consolidated balance sheet. The securitization debt of consolidated VIEs consisted of the following (in thousands):


As of December 31, 2022
Series	Final Scheduled Payment Date	Initial Principal		Contractual Interest Rate		Outstanding Principal		Fair Value
United Auto Credit 2021-1-C	June 10, 2026	$	29,640	0.84	%	$	18,466	$	18,322
United Auto Credit 2021-1-D	June 10, 2026		29,380	1.14	%		29,380		28,481
United Auto Credit 2021-1-E	June 10, 2026		20,800	2.58	%		20,800		19,685
United Auto Credit 2021-1-F	September 10, 2027		13,910	4.30	%		13,910		13,341
		$	93,730			$	82,556	$	79,829

In September 2022, UACC exercised its option to repurchase the 2020-1 securitization debt for a total redemption price of $46.9 million. The final scheduled payment date represents final legal maturity of the remaining balance sheet securitization debt. Securitization debt is expected to become due and to be paid prior to those dates, based on amortization of the finance receivables pledged to the Trusts. Expected payments, which will depend on the performance of such receivables, as to which there can be no assurance, are $41.7 million in 2023, $26.7 million in 2024, $12.6 million in 2025 and $1.5 million in 2026.

The aggregate principal balance and the fair value of finance receivables pledged to the securitization debt consists of the following (in thousands):


	As of December 31, 2022
	Aggregate Principal Balance		Fair Value
United Auto Credit 2021-1	$	84,477	$	77,904
Total finance receivables of CFEs	$	84,477	$	77,904

Junior Subordinated Debentures

On July 31, 2003, UACC issued junior subordinated debentures (trust preferred securities) of $10.0 million through a subsidiary, UPFC Trust I. The trust issuer is a 100 percent owned finance subsidiary and the securities are fully and unconditionally guaranteed by UACC. The interest is paid quarterly at a variable rate, equal to the three-month LIBOR plus 3.05 percent. The final maturity of these securities is on October 7, 2033; however, they can be called at par any time at the Company’s discretion.

Financial Instruments and Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2022

Fair Value Disclosures [Abstract]

Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables present the Company’s financial assets and liabilities measured at fair value on a recurring basis (in thousands):


	As of December 31, 2022
	Level 1		Level 2		Level 3		Total
Financial Assets
Cash and cash equivalents:
Money market funds	$	182,687	$	—	$	—	$	182,687
CFE assets:
Finance receivables		—		—		77,904		77,904
Finance receivables at fair value		—		—		75,270		75,270
Beneficial interests in securitizations		—		20,592		—		20,592
Total financial assets	$	182,687	$	20,592	$	153,174	$	356,453
Financial Liabilities
CFE liabilities:
Securitization debt of consolidated VIEs		—		79,829		—		79,829
Total financial liabilities	$	—	$	79,829	$	—	$	79,829

	As of December 31, 2021
	Level 1		Level 2		Level 3		Total
Financial Assets
Cash and cash equivalents:
Money market funds	$	601,807	$	—	$	—	$	601,807
Commercial paper		—		149,974		—		149,974
Total financial assets	$	601,807	$	149,974	$	—	$	751,781

Schedule of Reconciliation of Financial Assets Measured at Fair Value on a Recurring Basis Using Level 3 Inputs

The following table presents a reconciliation of the financial assets, which were measured at fair value on a recurring basis using Level 3 inputs (in thousands):


	Finance Receivables of Consolidated CFEs			Finance Receivables at Fair Value			Securitization Debt of Consolidated CFEs
Fair value as of January 1, 2022	$	—		$	—		$	—
Acquired in business combination		262,644			34,283			275,394
Transfer out of Level 3		—			—			(275,394	)
Transfer within Level 3 categories		(51,330	)		51,330			—
Losses included in other income		(29,825	)		(14,388	)		—
Issuances, net of discount		—			56,484			—
Sales		(24,312	)		(14,114	)		—
Paydowns		(90,410	)		(41,980	)		—
Other		11,137			3,655			—
Fair value as of December 31, 2022	$	77,904		$	75,270		$	—

Summary of Gains or Losses Recorded Related to Eligible Financial Instruments


	Year Ended December 31, 2022
Financial Assets
Finance receivables of CFEs	$	24,231
Finance receivables at fair value		11,624
Beneficial interests in securitizations		1,149
Financial Liabilities
Debt of securitized VIEs		(2,727	)
Total net loss included in other income	$	34,277

Summary of Other Relevant Data Related to Finance Receivables Carried at Fair Value

The following table presents other relevant data related to the finance receivables carried at fair value (in thousands):


As of December 31, 2022	Finance Receivables of CFEs at Fair Value		Finance Receivables at Fair Value
Aggregate unpaid principal balance included within finance receivables that are reported at fair value	$	84,477	$	89,068
Aggregate fair value of finance receivables that are reported at fair value	$	77,904	$	75,270
Unpaid principal balance of receivables within finance receivables that are reported at fair value and are on nonaccrual status (90 days or more past due)	$	1,097	$	1,499
Aggregate fair value of receivables carried at fair value that are on nonaccrual status (90 days or more past due)	$	985	$	1,311

Summary of Other Relevant Data Related to Debt of Securitized VIEs Carried at Fair Value

The following table presents other relevant data related to securitization debt of consolidated VIEs carried at fair value (in thousands):


As of December 31, 2022	Securitization debt of consolidated VIEs at Fair Value
Aggregate unpaid principal balance of debt of securitized VIEs	$	82,556
Aggregate fair value of debt of securitized VIEs	$	79,829

Summary of Fair Value of Financial Instruments Not Carried at Fair Value

The carrying value and fair value of the finance receivables held for sale, net were as follows (in thousands):


	December 31,
	2022
Carrying value	$	299,235
Fair value	$	299,925

The fair value of the Notes, which are not carried at fair value on the accompanying consolidated balance sheets, was determined utilizing actual bids and offer prices of the Notes in markets that are not active and are classified within Level 2 of the fair value hierarchy.


	December 31,
	2022		2021
Carrying value	$	359,254	$	610,618
Fair value	$	128,026	$	386,100

Long Term Debt - Additional Information (Details)		1 Months Ended		6 Months Ended	12 Months Ended
Long Term Debt - Additional Information (Details)	Jun. 18, 2021 USD ($) d $ / shares shares	Sep. 30, 2022 USD ($)	Jul. 31, 2003 USD ($)	Jun. 30, 2022	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Debt Instrument [Line Items]
Debt instrument aggregate principal amount					$ 82,556,000
Net proceeds from offering, after deducting commissions paid to initial purchasers and debt issuance costs paid to third-parties						$ 625,000,000
Aggregate principal amount					93,730,000
Gain on debt extinguishment					164,684,000
Estimated fair value of notes					79,829,000
Restricted cash					73,095,000	82,450,000
Expected payments, 2023					41,700,000
Expected payments, 2024					26,700,000
Expected payments, 2025					12,600,000
Expected payments, 2026					1,500,000
Redemption price					192,839,000
Junior subordinated debentures			$ 10,000,000.0
Junior Subordinated Debentures
Debt Instrument [Line Items]
Long-term debt, maturity date			Oct. 07, 2033
Percentage of owned finance subsidiary			100.00%
LIBOR \| Junior Subordinated Debentures
Debt Instrument [Line Items]
Period of LIBOR measurement			3 months
Variable interest rate			3.05%
Securitization Debt of Consolidated VIEs
Debt Instrument [Line Items]
Restricted cash					9,000,000.0
Redemption price		$ 46,900,000
0.75% Unsecured Convertible Senior Notes Due 2026
Debt Instrument [Line Items]
Debt instrument aggregate principal amount	$ 625,000,000.0
Debt instrument interest rate	0.75%
Aggregate principal amount exercise in overallotment option granted to initial purchasers	$ 75,000,000.0
Long-term debt, frequency of periodic payment				semiannually
Long-term debt, beginning date of payment	Jan. 01, 2022
Long-term debt, maturity date	Jul. 01, 2026
Long-term debt payment terms				The Notes bear interest at a rate of 0.75% per annum, payable semiannually in arrears on January 1 and July 1 of each year, beginning on January 1, 2022.
Net proceeds from offering, after deducting commissions paid to initial purchasers and debt issuance costs paid to third-parties	$ 608,900,000
Debt conversion, each principal amount initially be convertible	$ 1,000
Initial conversion price per share \| $ / shares	$ 56.01
Debt instrument conversion date	Apr. 01, 2026
Aggregate principal amount					254,300,000
Deferred issuance costs					4,900,000
Repurchase of notes in open-market transaction					90,200,000
Gain on debt extinguishment					164,700,000
Unamortized debt discount and debt issuance costs					6,500,000	14,400,000
Net carrying value of debt					359,300,000	610,600,000
Interest expense					$ 7,200,000	$ 4,300,000
Effective interest rate					1.30%
0.75% Unsecured Convertible Senior Notes Due 2026 \| During any Fiscal Quarter Commencing After Fiscal Quarter Ending on September 30, 2021
Debt Instrument [Line Items]
Consecutive trading days \| d	30
0.75% Unsecured Convertible Senior Notes Due 2026 \| During any Fiscal Quarter Commencing After Fiscal Quarter Ending on September 30, 2021 \| Minimum
Debt Instrument [Line Items]
Trading days \| d	20
Conversion price	130.00%
0.75% Unsecured Convertible Senior Notes Due 2026 \| During Five Consecutive Business Day Period After any Ten Consecutive Trading Day Period
Debt Instrument [Line Items]
Debt conversion, each principal amount initially be convertible	$ 1,000
Consecutive trading days \| d	10
0.75% Unsecured Convertible Senior Notes Due 2026 \| During Five Consecutive Business Day Period After any Ten Consecutive Trading Day Period \| Maximum
Debt Instrument [Line Items]
Conversion price	98.00%
0.75% Unsecured Convertible Senior Notes Due 2026 \| Company May Redeem On or after July 6, 2024
Debt Instrument [Line Items]
Consecutive trading days \| d	30
Redemption percentage of principal amount	100.00%
0.75% Unsecured Convertible Senior Notes Due 2026 \| Company May Redeem On or after July 6, 2024 \| Minimum
Debt Instrument [Line Items]
Trading days \| d	20
Conversion price	130.00%
0.75% Unsecured Convertible Senior Notes Due 2026 \| Common Stock
Debt Instrument [Line Items]
Debt conversion, for each principal amount conversion to shares \| shares	17.8527

Income Taxes

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

. Income Taxes

Income Tax Provision

Domestic and foreign pretax income (loss) are as follows for the years ended December 31, 2022, 2021, and 2020 (in thousands):


	Year Ended December 31,
	2022			2021			2020
Domestic	$	(472,203	)	$	(370,640	)	$	(202,715	)
Foreign		613			483			—
Total	$	(471,590	)	$	(370,157	)	$	(202,715	)

The components of the provision for income taxes are as follows (in thousands):


	Year Ended December 31,
	2022			2021		2020
Current:
Federal	$	—		$	—	$	—
State and local		4,083			679		84
Foreign		92			75		—
Total current tax expense		4,175			754		84
Deferred tax (benefit):
Federal		(20,472	)		—		—
State and local		(3,383	)		—		—
Foreign		—			—		—
Total deferred tax (benefit)		(23,855	)		—		—
(Benefit) provision for income taxes	$	(19,680	)	$	754	$	84

On August 16, 2022, the Inflation Reduction Act of 2022 ("IRA") was signed into law. The IRA includes implementation of a new alternative minimum tax, an excise tax on stock buybacks, and significant tax incentives for energy and climate initiatives, among other provisions. The Company is evaluating the provisions included under the IRA and does not expect the provisions to have a material impact to the Company's consolidated financial statements.

Tax Rate Reconciliation

The Company’s effective tax rate for the years ended December 31, 2022, 2021, and 2020 was 4.17%, (0.20)%, and (0.04)%, respectively. The increase in effective tax rate for the year ended December 31, 2022 was primarily driven by a deferred tax benefit recorded for the decrease of Valuation Allowance resulting from the acquisition of Unitas Holdings Corp. (now known as Vroom Finance Corporation) that occurred during the period, of $23.9 million.

A reconciliation of the provision for income taxes at the statutory rate to the amount reflected in the consolidated statements of operations is as follows (in thousands):


	Year Ended December 31,
	2022			2021			2020
Income taxes at statutory rate	$	(99,034	)	$	(77,733	)	$	(42,570	)
State income taxes, net of federal benefit		(3,529	)		(8,251	)		(5,417	)
Foreign Rate Differential		(129	)		(26	)		—
Permanent differences		1,510			(4,800	)		1,264
Goodwill impairment		41,241			—			—
Deferred tax adjustment for acquisition of business		(23,855	)		—			—
Change in valuation allowance		66,634			94,158			46,901
Other		(2,518	)		(2,594	)		(94	)
(Benefit) provision for income taxes	$	(19,680	)	$	754		$	84

Deferred Tax Assets (Liabilities)

The Company computes income taxes using the liability method. This method requires recognition of deferred tax assets and liabilities, measured by enacted rates, attributable to temporary differences between the financial statements and the income tax basis of assets and liabilities. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that certain deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in those specific jurisdictions prior to the dates on which such net operating losses expire. The Company maintained a full valuation allowance against its net deferred tax assets for December 31, 2022 and 2021 because the Company has determined that is it more likely than not that these assets will not be fully realized based on a current evaluation of expected future taxable income and the Company is in a cumulative loss position. As of December 31, 2022, 2021, 2020 and 2019 the valuation allowance balance was $258.8 million, $216.0 million, $121.9 million and $75.0 million, respectively.

Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands):


	As of December 31,
	2022			2021
Deferred tax assets:
Net operating loss carryforwards	$	265,927		$	203,170
Inventory reserves		9,395			12,278
Stock-based compensation		3,067			3,617
Accrued Expense		—			75
Right of Use Asset		7,086			3,821
Unrealized Gains/Losses		10,549			—
Allowance for Doubtful Accounts		8,342			2,592
Other		2,612			1,905
Total deferred tax assets		306,978			227,458
Less: valuation allowance		(258,796	)		(216,017	)
Net deferred tax assets		48,182			11,441
Deferred tax liabilities:
Intangible amortization		(37,377	)		(6,793	)
Depreciation		(3,017	)		(1,088	)
Repo Expenses		(2,194	)		—
Lease Liability		(5,594	)		(3,560	)
Net deferred tax liabilities		(48,182	)		(11,441	)
Net deferred income taxes	$	—		$	—

Net Operating Losses

As of December 31, 2022, the Company had total net operating loss carryforwards for U.S. federal income tax purposes of $1,143.4 million, of which $168.5 million expire from 2028 through 2042 and $950.7 million do not expire. The Company has net operating loss carryforwards for state income tax purposes of $500.5 million, which expire from 2034 through 2041.

The Company is subject to tax in the United States and many state and local jurisdictions. The Company, with certain exceptions, is no longer subject to income tax examinations by U.S. federal, state and local for tax years 2016 and prior. The company is not currently under audit for any US federal or state income tax audits.

The Internal Revenue Code (IRC) Section 382 provides for a limitation of the annual use of net operating loss and tax credit carryforwards following certain ownership changes (as defined by the IRC Section 382) that limits the Company’s ability to utilize these carryforwards. The Company completed a Section 382 study to determine the applicable limitation, if any. It was determined that the Company has undergone four ownership changes the most recent of which was April 2021. These changes will substantially limit the use of the net operating losses generated before the change in control.

The Company acquired Unitas Holdings Corp. (now known as Vroom Finance Corporation) on February 1, 2022 in a stock acquisition and Vast Holdings, Inc. on January 7, 2021 in a stock acquisition, refer to Note 5 – Acquisitions for additional information. The NOLs and other tax attributes acquired will be subject to Section 382 limitations. The Company is in the process of determining the amount of attributes that will be available for use.

Uncertain Tax Positions

The Company has not identified any uncertain tax positions as of December 31, 2022 or 2021. Any interest and penalties related to uncertain tax positions shall be recorded as a component of income tax expense. To date, no interest or penalties have been accrued in relation to uncertain tax positions.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Revenue:
Total revenue	$ 1,948,901	$ 3,184,255	$ 1,357,700
Cost of sales	1,704,114	2,982,156	1,286,155
Total gross profit	244,787	202,099	71,545
Selling, general and administrative expenses	566,387	547,823	245,546
Depreciation and amortization	38,290	12,891	4,598
Impairment charges	211,873
Loss from operations	(571,763)	(358,615)	(178,599)
Gain on debt extinguishment	(164,684)
Interest expense	40,693	21,948	9,656
Interest income	(19,363)	(10,341)	(5,896)
Revaluation of preferred stock warrant			20,470
Other loss (income), net	43,181	(65)	(114)
Loss before provision for income taxes	(471,590)	(370,157)	(202,715)
Provision (benefit) for income taxes	(19,680)	754	84
Net loss	$ (451,910)	$ (370,911)	$ (202,799)
Net loss per share attributable to common stockholders, basic	$ (3.28)	$ (2.72)	$ (2.76)
Net loss per share attributable to common stockholders, diluted	$ (3.28)	$ (2.72)	$ (2.76)
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic	137,907,444	136,429,791	73,345,569
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, diluted	137,907,444	136,429,791	73,345,569
Retail vehicle, net
Revenue:
Total revenue	$ 1,425,842	$ 2,583,417	$ 1,072,551
Cost of sales	1,382,005	2,495,587	1,038,209
Wholesale vehicle
Revenue:
Total revenue	293,528	498,981	245,580
Cost of sales	304,148	480,861	247,012
Product, net
Revenue:
Total revenue	62,747	88,824	38,195
Finance
Revenue:
Total revenue	152,542
Cost of sales	14,161
Other
Revenue:
Total revenue	14,242	13,033	1,374
Cost of sales	$ 3,800	$ 5,708	$ 934

Goodwill and Intangible Assets - Summary of Activity in Carrying Value of Goodwill by Reporting Unit (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Goodwill [Line Items]
Beginning Balance	$ 158,817	$ 78,172
Acquisition	42,886	80,645
Goodwill impairment charge	(201,703)	0	$ 0
Ending Balance	0	158,817	78,172
Ecommerce
Goodwill [Line Items]
Beginning Balance	152,876	72,231
Acquisition	42,886	80,645
Goodwill impairment charge	(195,762)
Ending Balance	0	152,876	72,231
Wholesale
Goodwill [Line Items]
Beginning Balance	1,720	1,720
Acquisition	0	0
Goodwill impairment charge	(1,720)
Ending Balance	0	1,720	1,720
TDA
Goodwill [Line Items]
Beginning Balance	4,221	4,221
Acquisition	0	0
Goodwill impairment charge	(4,221)
Ending Balance	$ 0	$ 4,221	$ 4,221

- Definition

Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.

+ References + Details

Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Assets (Details)	12 Months Ended
	Dec. 31, 2022
Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	15 years
Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	3 years
Furniture and Fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	15 years
Furniture and Fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	3 years
Logistics Fleet \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	7 years
Logistics Fleet \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	5 years
Leasehold Improvements
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	Lesser of useful life or lease term
Internal-use Software \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	10 years
Internal-use Software \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of assets	1 year

Long Term Debt (Tables)

12 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Schedule of Debt Instruments


	December 31,
	2022		2021
Current portion of securitization debt of consolidated VIEs	$	47,239	$	—
Convertible senior notes		359,254		610,618
Securitization debt of consolidated VIEs, net of current portion		32,590		—
Junior subordinated debentures		10,310		—
Long term debt, net of current portion	$	402,154	$	610,618
Total debt	$	449,393	$	610,618

Schedule of Securitization Debt of Consolidated VIEs


As of December 31, 2022
Series	Final Scheduled Payment Date	Initial Principal		Contractual Interest Rate		Outstanding Principal		Fair Value
United Auto Credit 2021-1-C	June 10, 2026	$	29,640	0.84	%	$	18,466	$	18,322
United Auto Credit 2021-1-D	June 10, 2026		29,380	1.14	%		29,380		28,481
United Auto Credit 2021-1-E	June 10, 2026		20,800	2.58	%		20,800		19,685
United Auto Credit 2021-1-F	September 10, 2027		13,910	4.30	%		13,910		13,341
		$	93,730			$	82,556	$	79,829

Schedule of Aggregate Principal Balance and Fair Value of Finance Receivables Pledged to Securitization Debt

The aggregate principal balance and the fair value of finance receivables pledged to the securitization debt consists of the following (in thousands):


	As of December 31, 2022
	Aggregate Principal Balance		Fair Value
United Auto Credit 2021-1	$	84,477	$	77,904
Total finance receivables of CFEs	$	84,477	$	77,904

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

Revenue Recognition - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Disaggregation Of Revenue [Line Items]
Reserve for chargebacks	$ 8.2	$ 9.6
Cumulative profit sharing payment recognized	$ 22.5	17.9
Revenue, practical expedient, incremental cost of obtaining contract	true
Accrued Expenses
Disaggregation Of Revenue [Line Items]
Reserve for chargebacks	$ 4.4	5.5
Residual Interest, 2022-1 Securitization
Disaggregation Of Revenue [Line Items]
Percentage of servicing fees earned on outstanding principal balance of finance receivable	4.00%
Residual Interest, 2022-2 Securitization
Disaggregation Of Revenue [Line Items]
Percentage of servicing fees earned on outstanding principal balance of finance receivable	3.25%
Other Long-term Liabilities
Disaggregation Of Revenue [Line Items]
Reserve for chargebacks	$ 3.8	4.1
Prepaid Expenses and Other Current Assets
Disaggregation Of Revenue [Line Items]
Cumulative profit sharing payment recognized	1.6	0.9
Other Assets
Disaggregation Of Revenue [Line Items]
Cumulative profit sharing payment recognized	$ 20.9	$ 17.0