Carvana rejoins fast lane with S&P 500 debut
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Tempe-based Carvana nearly fell into bankruptcy in 2022. In 2025, it joined the S&P 500. Photo: Jessica Boehm/Axios
Online used-car retailer Carvana joined the S&P 500 in December — three years after the Tempe-headquartered company almost fell into bankruptcy.
Why it matters: Inclusion in the premier stock market index boosts a company's credibility, signals profitability and stability, and can increase demand for its shares.
The intrigue: The financial milestone would be significant for any company, but Carvana's road to success had more than a few speed bumps.
Flashback: Carvana was founded in 2012, went public in 2017, and joined the Fortune 500 in 2021 — the third-fastest company to make the list.
- In 2022, Carvana's share price dropped 99% from its August 2021 peak of $379, bottoming out at $3.72 in December 2022.
- About 4,000 employees were laid off, per the Wall Street Journal, and Carvana ended 2022 with roughly $5.7 billion in long-term debt, according to company filings.
What happened: Christina Keiser, Carvana's executive vice president of strategy, told Axios the company invested heavily in expansion going into 2022, expecting another high-growth year.
- Instead, high interest rates and inflation tanked affordability and consumers pulled back from car buying.
Between the lines: The company immediately pivoted away from growth and hunkered down on profitability and efficiency, Keiser said. That looked like:
- Overhauling the website to make it easier for customers to buy and sell vehicles online. Today, 30% of buyers and 60% of sellers don't speak with a human until pickup or delivery, she said.
- Embedding technology in the company's 34 reconditioning centers to speed up the process and get more inventory available more quickly.
- Acquiring 56 ADESA U.S auction sites nationwide. This allowed Carvana to store vehicles closer to more customers, accelerating delivery times. About 40% of Phoenix customers now receive their vehicle the same day or the day after purchase, Keiser said.
By the numbers: Carvana's stock recently hit a new high, peaking at $486.89 last month.
- It ranked No. 314 on last year's Fortune 500 list, up 63 spots from the year prior, with $13.7 billion in reported revenue.
- It employed 17,400 people in 2025, according to Fortune, including 3,000 people in Arizona, Keiser said.
The bottom line: Keiser told us Carvana represents just 1% to 1.5% of the market, leaving plenty of room for continued growth.
- She added that joining the S&P 500 was "a great moment to rally the troops … for what's ahead."
What we're watching: Carvana stock dipped about 14% last week following a short-seller report from Gotham City Research that accused the company of overstating its earnings and maintaining an inappropriate relationship with DriveTime, the automotive company owned by Carvana CEO Ernest Garcia III's father, Ernest Garcia II.
- The elder Garcia is also a major Carvana shareholder.
- Carvana, in a written company statement, said, "This report is inaccurate and intentionally misleading. All of our related party transactions are accurately disclosed in our financial statements."
- Analysts with JPMorgan, Stephens and other financial firms have dismissed the short report and remain bullish on Carvana.
What's next: Carvana's 2025 earnings are scheduled for release on Feb. 18.