Online used-car retailer Carvana, known for its vehicle “vending machine” towers, filed Friday for an initial public offering of up to $100 million in Class A common stock.
According to a filing with the Securities and Exchange Commission, Carvana has hired banks — including Bank of America Merrill Lynch, Wells Fargo Securities, Deutsche Bank Securities and Citigroup — to underwrite the IPO, which is still subject to change. The filing did not say when the company plans to make the offering.
The move comes after years of rapid revenue growth for the company. The company reported annual revenue of $365 million in 2016, up exponentially from $4.6 million in 2013, when it began operating. It has sold about 27,500 vehicles through 2016, according to the SEC filing.
Carvana has operated at a loss during its entire history, the filing reveals. The company has racked up cumulative operating losses of $152.6 million, including a $93.1 million loss in 2016 alone.
The company said it expects to continue incurring losses in the near future as “we invest in and strive to grow our business,” Carvana wrote in the filing.
The IPO filing comes as a glut of used vehicles, driven by a wave of off-lease vehicles returning to market, is both encouraging used-car marketing startups and putting downward pressure on used-vehicle pricing.
The NADA Used Car Index dipped for the eighth consecutive month in February as concerns mount at companies including Ford Motor Co. and Ally Financial Inc. about the impact lower prices could have on earnings.
Carvana, of Phoenix, operates in 21 markets. Buyers who purchase a used-vehicle from the website can choose to either have their vehicle delivered to them or to pick it up at one of its glass-structured “vending machines” in markets such as Houston and Nashville.