Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 04, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | VRM | |
Entity Registrant Name | VROOM, INC. | |
Entity Central Index Key | 0001580864 | |
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, $0.001 par value | |
Security Exchange Name | NASDAQ | |
Entity File Number | 001-39315 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 90-1112566 | |
Entity Address, Address Line One | 3600 W Sam Houston Pkwy S | |
Entity Address, Address Line Two | Floor 4 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77042 | |
City Area Code | 518 | |
Local Phone Number | 535-9125 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 139,663,524 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 237,925 | $ 398,915 |
Restricted cash (including restricted cash of consolidated VIEs of $44.9 million and $24.7 million, respectively) | 66,306 | 73,095 |
Accounts receivable, net of allowance of $9.9 million and $21.5 million, respectively | 9,565 | 13,967 |
Finance receivables at fair value (including finance receivables of consolidated VIEs of $12.4 million and $11.5 million, respectively) | 13,117 | 12,939 |
Finance receivables held for sale, net (including finance receivables of consolidated VIEs of $204.4 million and $305.9 million, respectively) | 290,015 | 321,626 |
Inventory | 208,871 | 320,648 |
Beneficial interests in securitizations | 6,553 | 20,592 |
Prepaid expenses and other current assets (including other current assets of consolidated VIEs of $20.9 million and $11.7 million, respectively) | 57,221 | 58,327 |
Total current assets | 889,573 | 1,220,109 |
Finance receivables at fair value (including finance receivables of consolidated VIEs of $442.4 million and $119.6 million, respectively) | 454,580 | 140,235 |
Property and equipment, net | 50,689 | 50,201 |
Intangible assets, net | 145,399 | 158,910 |
Operating lease right-of-use assets | 26,837 | 23,568 |
Other assets | 24,791 | 26,004 |
Total assets | 1,591,869 | 1,619,027 |
Current Liabilities: | ||
Accounts payable | 29,345 | 34,702 |
Accrued expenses | 58,307 | 76,795 |
Vehicle floorplan | 132,480 | 276,988 |
Warehouse credit facilities of consolidated VIEs | 177,864 | 229,518 |
Current portion of long term debt (including current portion of securitization debt of consolidated VIEs at fair value of $219.4 million and $47.2 million, respectively) | 231,471 | 47,239 |
Deferred revenue | 16,717 | 10,655 |
Operating lease liabilities, current | 9,267 | 9,730 |
Other current liabilities (including other current liabilities of consolidated VIEs of $2.8 million and $1.5 million, respectively) | 11,912 | 17,693 |
Total current liabilities | 667,363 | 703,320 |
Long term debt, net of current portion (including securitization debt of consolidated VIEs of $197.6 million and $32.6 million at fair value, respectively) | 544,931 | 402,154 |
Operating lease liabilities, excluding current portion | 23,929 | 20,129 |
Other long-term liabilities (including other long-term liabilities of consolidated VIEs of $9.2 million and $7.4 million, respectively) | 17,410 | 18,183 |
Total liabilities | 1,253,633 | 1,143,786 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity: | ||
Common stock, $0.001 par value; 500,000,000 shares authorized as of June 30, 2023 and December 31, 2022; 139,649,290 and 138,201,903 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively | 135 | 135 |
Additional paid-in-capital | 2,080,155 | 2,075,798 |
Accumulated deficit | (1,742,054) | (1,600,692) |
Total stockholders' equity | 338,236 | 475,241 |
Total liabilities and stockholders' equity | $ 1,591,869 | $ 1,619,027 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Restricted cash | $ 66,306 | $ 73,095 |
Accounts receivable, net of allowance | 9,900 | 21,500 |
Finance receivables at fair value, current | 13,117 | 12,939 |
Finance receivables at fair value, noncurrent | 454,580 | 140,235 |
Finance receivables held for sale, net | 290,015 | 321,626 |
Securitization debt, current | 231,471 | 47,239 |
Other current liabilities | 11,912 | 17,693 |
Securitization debt noncurrent | 416,975 | 79,829 |
Other long-term liabilities | $ 17,410 | $ 18,183 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 139,649,290 | 138,201,903 |
Common stock, shares outstanding | 139,649,290 | 138,201,903 |
Consolidated VIEs | ||
Restricted cash | $ 44,907 | $ 24,677 |
Finance receivables at fair value, current | 12,360 | 11,492 |
Finance receivables at fair value, noncurrent | 442,448 | 119,592 |
Finance receivables held for sale, net | 204,420 | 305,917 |
Securitization debt, current | 219,391 | 47,239 |
Other current assets | 20,877 | 11,734 |
Other current liabilities | 2,800 | 1,529 |
Securitization debt noncurrent | 197,600 | 32,600 |
Other long-term liabilities | $ 9,247 | $ 7,410 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenue: | ||||
Total revenue | $ 225,178 | $ 475,437 | $ 421,645 | $ 1,399,212 |
Cost of sales | 179,177 | 409,080 | 336,839 | 1,251,215 |
Total gross profit | 46,001 | 66,357 | 84,806 | 147,997 |
Selling, general and administrative expenses | 86,955 | 152,990 | 183,492 | 340,984 |
Depreciation and amortization | 10,304 | 10,039 | 20,835 | 17,895 |
Impairment charges | 1,353 | 3,407 | 1,353 | 205,110 |
Loss from operations | (52,611) | (100,079) | (120,874) | (415,992) |
Gain on debt extinguishment | (10,931) | (19,640) | ||
Interest expense | 8,938 | 9,533 | 18,857 | 18,913 |
Interest income | (4,921) | (3,935) | (10,863) | (7,887) |
Other loss, net | 20,236 | 9,156 | 31,476 | 21,514 |
Loss before provision (benefit) for income taxes | (65,933) | (114,833) | (140,704) | (448,532) |
Provision (benefit) for income taxes | 385 | 256 | 658 | (22,984) |
Net loss | $ (66,318) | $ (115,089) | $ (141,362) | $ (425,548) |
Net loss per share attributable to common stockholders, basic | $ (0.48) | $ (0.83) | $ (1.02) | $ (3.09) |
Net loss per share attributable to common stockholders, diluted | $ (0.48) | $ (0.83) | $ (1.02) | $ (3.09) |
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic | 139,146,848 | 138,075,210 | 138,838,866 | 137,667,419 |
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, diluted | 139,146,848 | 138,075,210 | 138,838,866 | 137,667,419 |
Retail vehicle, net | ||||
Revenue: | ||||
Total revenue | $ 136,568 | $ 341,724 | $ 271,838 | $ 1,048,910 |
Cost of sales | 134,539 | 319,903 | 270,263 | 1,015,412 |
Wholesale vehicle | ||||
Revenue: | ||||
Total revenue | 30,800 | 82,901 | 44,695 | 222,885 |
Cost of sales | 34,793 | 84,834 | 48,626 | 227,571 |
Product, net | ||||
Revenue: | ||||
Total revenue | 11,924 | 14,324 | 23,424 | 38,773 |
Cost of sales | 704 | 1,601 | ||
Finance | ||||
Revenue: | ||||
Total revenue | 42,128 | 32,121 | 74,116 | 79,808 |
Cost of sales | 8,060 | 3,402 | 14,274 | 6,126 |
Other | ||||
Revenue: | ||||
Total revenue | 3,758 | 4,367 | 7,572 | 8,836 |
Cost of sales | $ 1,081 | $ 941 | $ 2,075 | $ 2,106 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Common Stock Restricted Stock Units | Additional Paid-in Capital | Accumulated Deficit |
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 | 3,629 | 3,629 | |||
Vesting of restricted stock units (in shares) | 602,630 | ||||
Net loss | (310,459) | (310,459) | |||
Balance at Mar. 31, 2022 | 608,364 | $ 135 | 2,067,470 | (1,459,241) | |
Balance (in shares) at Mar. 31, 2022 | 137,695,521 | ||||
Balance at Dec. 31, 2021 | 915,194 | $ 135 | 2,063,841 | (1,148,782) | |
Balance (in shares) at Dec. 31, 2021 | 137,092,891 | ||||
Net loss | (425,548) | ||||
Balance at Jun. 30, 2022 | 495,051 | $ 135 | 2,069,246 | (1,574,330) | |
Balance (in shares) at Jun. 30, 2022 | 138,102,755 | ||||
Balance at Mar. 31, 2022 | 608,364 | $ 135 | 2,067,470 | (1,459,241) | |
Balance (in shares) at Mar. 31, 2022 | 137,695,521 | ||||
Stock-based compensation | 1,776 | 1,776 | |||
Vesting of restricted stock units (in shares) | 50,516 | ||||
Issuance of restricted stock purchase agreement | 356,718 | ||||
Net loss | (115,089) | (115,089) | |||
Balance at Jun. 30, 2022 | 495,051 | $ 135 | 2,069,246 | (1,574,330) | |
Balance (in shares) at Jun. 30, 2022 | 138,102,755 | ||||
Balance at Dec. 31, 2022 | 475,241 | $ 135 | 2,075,798 | (1,600,692) | |
Balance (in shares) at Dec. 31, 2022 | 138,201,903 | ||||
Stock-based compensation | 2,041 | 2,041 | |||
Vesting of restricted stock units (in shares) | 600,108 | ||||
Net loss | (75,044) | (75,044) | |||
Balance at Mar. 31, 2023 | 402,238 | $ 135 | 2,077,839 | (1,675,736) | |
Balance (in shares) at Mar. 31, 2023 | 138,802,011 | ||||
Balance at Dec. 31, 2022 | 475,241 | $ 135 | 2,075,798 | (1,600,692) | |
Balance (in shares) at Dec. 31, 2022 | 138,201,903 | ||||
Net loss | (141,362) | ||||
Balance at Jun. 30, 2023 | 338,236 | $ 135 | 2,080,155 | (1,742,054) | |
Balance (in shares) at Jun. 30, 2023 | 139,649,290 | ||||
Balance at Mar. 31, 2023 | 402,238 | $ 135 | 2,077,839 | (1,675,736) | |
Balance (in shares) at Mar. 31, 2023 | 138,802,011 | ||||
Stock-based compensation | 2,316 | 2,316 | |||
Vesting of restricted stock units (in shares) | 847,279 | ||||
Net loss | (66,318) | (66,318) | |||
Balance at Jun. 30, 2023 | $ 338,236 | $ 135 | $ 2,080,155 | $ (1,742,054) | |
Balance (in shares) at Jun. 30, 2023 | 139,649,290 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Operating activities | ||
Net loss | $ (141,362) | $ (425,548) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Impairment charges | 1,353 | 205,110 |
Gain on debt extinguishment | (19,640) | |
Depreciation and amortization | 21,173 | 18,010 |
Amortization of debt issuance costs | 2,248 | 2,523 |
Realized gains on securitization transactions | (29,617) | |
Deferred taxes | (23,855) | |
Losses on finance receivables and securitization debt, net | 42,532 | 29,457 |
Stock-based compensation expense | 4,357 | 5,405 |
Provision to record inventory at lower of cost or net realizable value | (11,811) | (2,006) |
Provision for bad debt | 529 | 11,119 |
Provision to record finance receivables held for sale at lower of cost or fair value | 1,651 | 1,986 |
Amortization of unearned discounts on finance receivables at fair value | (13,414) | (8,788) |
Other, net | (7,579) | (851) |
Changes in operating assets and liabilities: | ||
Originations of finance receivables held for sale | (274,707) | (319,314) |
Principal payments received on finance receivables held for sale | 42,862 | 23,179 |
Proceeds from sale of finance receivables held for sale, net | 271,820 | |
Other | 505 | (4,011) |
Accounts receivable | 3,873 | 34,192 |
Inventory | 123,588 | 192,618 |
Prepaid expenses and other current assets | 16,611 | 13,513 |
Other assets | 1,213 | (1,670) |
Accounts payable | (5,357) | (15,352) |
Accrued expenses | (19,042) | (23,832) |
Deferred revenue | 6,062 | (58,003) |
Other liabilities | (7,770) | (33,604) |
Net cash used in operating activities | (232,125) | (137,519) |
Investing activities | ||
Purchases of finance receivables at fair value | (3,392) | (49,475) |
Principal payments received on finance receivables at fair value | 91,892 | 74,690 |
Proceeds from sale of finance receivables at fair value, net | 29,026 | |
Consolidation of VIEs | 11,409 | |
Principal payments received on beneficial interests | 3,306 | 2,720 |
Purchase of property and equipment | (8,521) | (16,046) |
Acquisition of business, net of cash acquired | (267,488) | |
Net cash provided by (used in) investing activities | 94,694 | (226,573) |
Financing activities | ||
Proceeds from borrowings under secured financing agreements | 261,991 | |
Principal repayment under secured financing agreements | (103,980) | (105,563) |
Proceeds from financing of beneficial interests in securitizations | 24,506 | |
Principal repayments of financing of beneficial interests in securitizations | (2,304) | |
Proceeds from vehicle floorplan | 182,734 | 1,074,184 |
Repayments of vehicle floorplan | (327,242) | (1,164,533) |
Proceeds from warehouse credit facilities | 211,400 | 261,700 |
Repayments of warehouse credit facilities | (263,216) | (228,744) |
Repurchases of convertible senior notes | (13,194) | |
Other financing activities | (1,043) | (1,344) |
Net cash used in financing activities | (30,348) | (164,300) |
Net decrease in cash, cash equivalents and restricted cash | (167,779) | (528,392) |
Cash, cash equivalents and restricted cash at the beginning of period | 472,010 | 1,214,775 |
Cash, cash equivalents and restricted cash at the end of period | 304,231 | 686,383 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 25,983 | 16,299 |
Cash paid for income taxes | 3,682 | 2,062 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Finance receivables from consolidation of 2022-2 securitization transaction | 180,706 | |
Elimination of beneficial interest from the consolidation of 2022-2 securitization transaction | 9,811 | |
Securitization debt from consolidation of 2022-2 securitization transaction | 186,386 | |
Reclassification of finance receivables held for sale to finance receivables at fair value, net | $ 248,081 | |
Fair value of beneficial interests received in securitization transactions | $ 16,473 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Millions | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Statement of Cash Flows [Abstract] | |
Cash acquired from acquisition | $ 47.9 |
Description of Business and Bas
Description of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2023 | |
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"). The Company is organized into three reportable segments: Ecommerce, Wholesale, and Retail Financing. 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, 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. Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC") regarding interim financial reporting. The condensed consolidated balance sheet as of December 31, 2022, included herein, was derived from the audited consolidated financial statements as of that date. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2022. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, which consist of only normal recurring adjustments necessary for the fair statement of the Company’s condensed consolidated balance sheet as of June 30, 2023 and its results of operations for the three and six months ended June 30, 2023 and 2022. The results for the three and six months ended June 30, 2023 are not necessarily indicative of the results expected for the current fiscal year or any other future periods. Certain prior year amounts have been reclassified to conform to the current year presentation. Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of condensed 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, 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 no t have any other comprehensive income or loss for the three and six months ended June 30, 2023 and 2022 . Accordingly, net loss and comprehensive loss are the same for the periods presented. 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 UACC restricted cash. UACC collects and services receivables under the securitization transactions 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 12 — Long Term Debt for further detail. 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 condensed consolidated statements of operations. Refer to Note 3 – Revenue Recognition. The Company records a valuation allowance to report finance receivables at the lower of amortized cost basis or fair value. To determine the valuation allowance, finance receivables are evaluated collectively 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, net" in the condensed 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 June 30, 2023 and December 31, 2022, the valuation allowance for finance receivables classified as held for sale was $ 10.2 million and $ 10.5 million, respectively. Refer to No te 16 – Financial Instruments and Fair Value Measurements . Finance Receivables at Fair Value Finance receivables at fair value represent finance receivables that the Company does not intend to sell in the immediate future and for which the fair value option was elected. Fair value adjustments are recorded in "Other loss, net" in the condensed consolidated statements of operations. Refer to Note 16 – Financial Instruments and Fair Value Measurements. Consolidated CFEs The Company elected the fair value option upon consolidation of the assets and liabilities of its variable interest entities ("VIEs") related to the 2021-1, 2022-2, and 2023-1 securitization transactions. Refer to Note 4 – Variable Interest Entities and 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"). During the three and six months ended June 30, 2023 and 2022, the Company recognized the following revenue and expenses associated with these CFEs in the condensed consolidated statements of operations: Three Months Ended Six Months Ended 2023 2022 2023 2022 Finance revenue $ 24,849 $ 14,156 $ 39,768 $ 25,040 Product revenue $ 3,644 $ — $ 5,975 $ — Finance cost of sales $ ( 5,330 ) $ ( 1,159 ) $ ( 8,829 ) $ ( 2,005 ) Product cost of sales $ ( 703 ) $ — $ ( 1,601 ) $ — Other loss, net $ ( 15,534 ) $ ( 311 ) $ ( 24,209 ) $ ( 12,319 ) 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 condensed consolidated balance sheets. Refer to Note 4 – Variable Interest Entities and Securitizations and Note 16 – Financial Instruments and Fair Value Measurements for further details. 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 condensed consolidated statement of operations. Advertising Advertising costs are expensed as incurred and are included within “Selling, general and administrative expenses” in the condensed consolidated statements of operations. Advertising expenses were $ 15.0 million and $ 21.1 million for the three months ended June 30, 2023 and 2022, respectively, and $ 26.4 million and $ 54.9 million for the six months ended June 30, 2023 and 2022 , 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 condensed consolidated statements of operations and were $ 2.0 million and $ 8.2 million for the three months ended June 30, 2023 and 2022, respectively, and $ 4.0 million and $ 35.0 million for the six months ended June 30, 2023 and 2022 , 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 three and six months ended June 30, 2023 and 2022, 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 June 30, 2023 and December 31, 2022 . 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 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. On January 18, 2023, the Company executed a reduction in force as part of the continued focus on reducing variable and fixed costs. Additionally, on April 26, 2023, as part of the Company’s ongoing reexamination of all facets of the business, the Company implemented an organizational restructuring that included a reduction in force. Refer to Note 17 – Restructuring Activities for further discussion. As of June 30, 2023, the Company had cash and cash equivalents of $ 237.9 million and restricted cash of $ 66.3 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 . For the three and six months ended June 30, 2023 , the Company repurchased approximately $ 18.2 million and $ 32.8 million in aggregate principal amount of the Notes (as defined in Note 12), net of deferred issuance costs, for $ 7.3 million and $ 13.2 million, respectively, in open-market transactions. The Company recognized a gain on extinguishment of debt of $ 10.9 million and $ 19.6 million for the three and six months ended June 30, 2023, respectively. As of June 30, 2023 , $ 327.4 million aggregate principal amount of the Notes remain outstanding, net of deferred issuance costs of $ 5.1 million. Refer to Note 12 – Long Term Debt for further discussion. The Company has a 2022 Vehicle Floorplan Facility (as defined in Note 10) with a borrowing capacity of $ 171.6 million as of June 30, 2023, of which $ 39.1 million was unutilized. The 2022 Vehicle Floorplan Facility provides a committed credit line of up to $ 500.0 million w hich is scheduled to mature on March 31, 2024. Refer to Note 10 – Vehicle Floorplan Facility for further discussion. 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. I n April 2023, UACC sold the non-investment grade securities related to the 2023-1 securitization transaction for $ 23.1 million. UACC still retains the residual interests related to the 2023-1 securitization transaction. 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 June 30, 2023. As of June 30, 2023 , outstanding borrowings related to the Warehouse Credit Facilities were $ 177.9 million and excess borrowing capacity was $ 93.0 million. Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further discussion. The Company anticipates that its 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 condensed consolidated financial statements. Accounting Standards 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 Company adopted the guidance on January 1, 2023 , which did not have a material impact on the Company's condensed consolidated financial statements and related disclosures. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2023 | |
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 condensed 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 condensed 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 condensed 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 income from financing vehicle sales for Vroom customers through UACC and fees earned on selling third-party financing and value-added products, such as vehicle service contracts, guaranteed asset protection (“GAP”) and tire and wheel coverage. As a result of the UACC Acquisition (as defined below), the Company 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, interest income on finance receivables held in consolidated VIEs, and gains on the sale of finance receivables. Refer to Note 4 – Variable Interest Entities and Securitizations. The Company also 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 June 30, 2023 and December 31, 2022, the Company’s reserve for chargebacks was $ 7.0 million and $ 8.2 million, respectively, of which $ 3.7 million and $ 4.4 million, respectively, are included within “Accrued expenses” and $ 3.3 million and $ 3.8 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 June 30, 2023 and December 31, 2022, the Company recognized $ 21.4 million and $ 22.5 million, respectively, related to cumulative profit-sharing payments to which it expects to be entitled, of which $ 2.0 million and $ 1.6 million, respectively, are included within “Prepaid expenses and other current assets” and $ 19.4 million and $ 20.9 million, respectively, are included within “Other assets.” Finance Revenue The Company’s finance revenue is related to finance receivables originated by UACC for its network of third-party dealership customers and consists of interest income earned on finance receivables before they are sold, interest income earned on finance receivables held in consolidated VIEs, and gains on the sale of finance receivables. 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 2022-1 securitization transaction and 3.25 % for the 2022-2 and 2023-1 securitization transactions of the outstanding principal balance of the finance receivables serviced. From January to March 2023, UACC waived the monthly servicing fees related to the 2022-2 securitization transaction, which resulted in consolidation of the 2022-2 VIE. Refer to Note 4 – Variable Interest Entities and Securitizations. 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 condensed consolidated statements of operations. |
Variable Interest Entities and
Variable Interest Entities and Securitizations | 6 Months Ended |
Jun. 30, 2023 | |
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. In February and July 2022, UACC completed the 2022-1 and 2022-2 securitization transactions, respectively, and in January 2023, UACC completed the 2023-1 securitization transaction. 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. 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. In January 2023, UACC completed the 2023-1 securitization transaction, in which it sold approximately $ 238.7 million of rated asset-backed securities, for proceeds of $ 237.8 million. In April 2023, UACC sold the non-investment grade securities related to the 2023-1 securitization transaction for $ 23.1 million. UACC still retains the residual interests related to the 2023-1 securitization transaction. The trust is collateralized by finance receivables with an aggregate principal balance of $ 326.4 million. These finance receivables are serviced by UACC. The Company consolidated the 2023-1 VIE and accounted for this transaction as a secured borrowing. UACC is the primary beneficiary of the 2021-1 and 2023-1 securitization trusts, 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 and 2023-1 asset-backed securitization transactions, 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 12 – Long Term Debt for further details. In July 2022, UACC sold a pool of finance receivables in the 2022-2 securitization transaction. UACC retained the servicing rights to these finance receivables and receives an "at market" servicing fee. UACC retained an insignificant amount of the asset-backed securities issued in the securitization in order to comply with risk retention rules. Originally, the Company concluded that it is not the primary beneficiary of the 2022-2 securitization trust because UACC retained interests in the VIE are insignificant. Therefore, the Company did not originally consolidate the 2022-2 trust. From January to March 2023, although not contractually required, UACC elected to waive its servicing fee on the 2022-2 securitization, due to higher-than-expected losses, which transferred more than an insignificant portion of the corresponding risk of loss from the VIE to the Company. Since UACC has the power to direct the significant activities of the VIE, as it is the servicer, and additionally it absorbs the risk of loss, the Company concluded that it is the primary beneficiary of the VIE. In March 2023, the Company accounted for the transaction as secured borrowings and consolidated the 2022-2 securitization trust. The beneficial interest was then eliminated. 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, 2022-2, and 2023-1 securitization trusts consolidated by UACC meet the definition of a CFE, therefore, the Company has elected to apply the measurement alternative when consolidating these VIEs. Refer to Note 16 – 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 in the condensed consolidated balance sheets (in thousands): As of June 30, 2023 Securitization Vehicles Warehouse 1 Total Current Assets: Restricted cash $ 34,764 $ 10,143 $ 44,907 Finance receivables at fair value 11,431 929 12,360 Finance receivables held for sale — 204,420 204,420 Other current assets 15,681 5,196 20,877 Total Current Assets 61,876 220,688 282,564 Finance receivables at fair value 418,591 23,857 442,448 Total Assets $ 480,467 $ 244,545 $ 725,012 Current Liabilities: Current portion of securitization debt $ 219,391 $ — $ 219,391 Warehouse credit facilities — 177,864 177,864 Other current liabilities 1,570 1,230 2,800 Total Current Liabilities 220,961 179,094 400,055 Securitization debt, net of current portion 197,584 — 197,584 Other liabilities 5,696 3,551 9,247 Total Liabilities $ 424,241 $ 182,645 $ 606,886 As of December 31, 2022 Securitization Vehicles Warehouse 1 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 current assets 2,730 9,004 11,734 Total Current Assets 17,089 336,731 353,820 Finance receivables at fair value 72,568 47,024 119,592 Total Assets $ 89,657 $ 383,755 $ 473,412 Current Liabilities: Current portion of securitization debt $ 47,239 $ — $ 47,239 Warehouse credit facilities — 229,518 229,518 Other current liabilities 90 1,439 1,529 Total Current Liabilities 47,329 230,957 278,286 Securitization debt, net of current portion 32,590 — 32,590 Other liabilities 686 6,724 7,410 Total Liabilities $ 80,605 $ 237,681 $ 318,286 1 Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further details of the warehouse facilities. 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 if it determines it qualifies for sale accounting treatment and it is not the primary beneficiary of the VIE. On February 16, 2022, UACC sold a pool of finance receivables in the 2022-1 securitization transaction. UACC retained the servicing rights to these finance receivables and receives an "at market" servicing fee. UACC retained an insignificant amount of the asset-backed securities issued in the securitization in order to comply with risk retention rules. The 2022-1 securitization trust is a VIE 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 2022-1 securitization trust because UACC retained interests in the VIE are insignificant. The beneficial interest retained by UACC included rated notes and unrated residual certificates issued by the 2022-1 securitization trust. During the six months ended June 30, 2022, the Company sold $ 281.4 million of rated asset-backed securities and $ 32.3 million of residual certificates through securitization transactions. The total gain related to finance receivables sold pursuant to the 2022-1 securitization transactions was $ 29.6 million for the six months ended June 30, 2022. As of June 30, 2023 and December 31, 2022, the assets UACC retains in the unconsolidated VIEs were approximately $ 6.6 million and $ 20.6 million, respectively, and are included in "Beneficial interests in securitizations" in the Company's condensed 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. In the three months ended June 30, 2023, the Company entered into a Risk Retention Financing Facility to finance the majority of its retained beneficial interests in securitizations. Refer to Note 12 – Long Term Debt for further detail. 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 June 30, 2023 As of December 31, 2022 Aggregate Principal Balance Carrying Value Total Exposure Aggregate Principal Balance Carrying Value Total Exposure Rated notes $ 6,368 $ 6,056 $ 6,056 $ 19,233 $ 18,664 $ 18,664 Certificates — 497 497 — 1,928 1,928 Other assets 310 310 310 310 310 310 Total unconsolidated VIEs $ 6,678 $ 6,863 $ 6,863 $ 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. |
Acquisition
Acquisition | 6 Months Ended |
Jun. 30, 2023 | |
Business Combinations [Abstract] | |
Acquisition | 5. Acquisition 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. 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 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 16 – 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 transaction 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): Fair Value Weighted Average Useful Life Purchased technology $ 83,000 7 Customer relationships 66,000 8 Trade name 7,000 10 $ 156,000 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 was final as of December 31, 2022. The transaction costs associated with the UACC Acquisition were not material for the three months ended June 30, 2022 and were $ 5.7 million for the six months ended June 30, 2022, and are included within "Selling, general and administrative expenses" in the condensed 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 $ 37.0 million and $ 1.0 million for the three months ended June 30, 2022 , respectively and $ 86.0 million and $ 20.2 million for the six months ended June 30, 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 and a non-recurring tax adjustment of $ 24.1 million for the six months ended June 30, 2022 . 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 six months ended June 30, 2022 is as follows: Six Months Ended June 30, 2022 Total revenue $ 1,414,683 Net loss $ ( 437,739 ) |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventory | 6. Inventory Inventory consisted of the following (in thousands): June 30, December 31, 2023 2022 Vehicles $ 207,135 $ 317,994 Parts and accessories 1,736 2,654 Total inventory $ 208,871 $ 320,648 As of June 30, 2023 and December 31, 2022, “Inventory” includes an adjustment of $ 12.4 million and $ 24.2 million, respectively, to record the balances at the lower of cost or net realizable value. |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 7. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): June 30, December 31, 2023 2022 Equipment $ 3,636 $ 3,357 Furniture and fixtures 1,898 1,896 Logistics fleet 32,544 32,468 Leasehold improvements 7,595 6,577 Internal-use software 36,981 30,725 Other 8,569 8,081 91,223 83,104 Accumulated depreciation and amortization ( 40,534 ) ( 32,903 ) Property and equipment, net $ 50,689 $ 50,201 Depreciation and amortization expense was $ 3.8 million and $ 3.4 million for the three months ended June 30, 2023 and 2022, respectively, and $ 7.7 million and $ 6.2 million for the six months ended June 30, 2023 and 2022, respectively. Depreciation and amortization expense included within “Cost of sales” in the condensed consolidated statements of operations was not material for the three and six months ended June 30, 2023 and 2022, respectively. Implementation costs capitalized and accumulated amortization related to the Company’s cloud computing arrangements were $ 8.6 million and $ 5.4 million as of June 30, 2023 , respectively, and $ 7.7 million and $ 4.6 million as of December 31, 2022, respectively, and were included within “Other assets” in the condensed consolidated balance sheets. Amortization expense of $ 0.3 million and $ 0.6 million was included within “Selling, general and administrative expenses” in the condensed consolidated statements of operations for the three months ended June 30, 2023 and 2022, respectively, and $ 0.7 million and $ 1.1 million for the six months ended June 30, 2023 and 2022 , respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2023 | |
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 six months ended June 30, 2022 (in thousands): Ecommerce Wholesale TDA Total 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 June 30, 2022 $ — $ — $ — $ — There was no goodwill as of June 30, 2023. 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 condensed consolidated statements of operations for the six months ended June 30, 2022. Refer to Note 5 – Acquisition for more information related to the acquisition that occurred in the six months ended June 30, 2022. Intangible Assets Intangible assets, net consisted of the following (in thousands): June 30, 2023 December 31, 2022 Gross Carrying Value Accumulated Amortization Carrying Value Gross Carrying Value Accumulated Amortization Carrying Value Developed and purchased technology $ 108,700 $ ( 29,552 ) $ 79,148 $ 108,700 $ ( 21,053 ) $ 87,647 Customer relationships 69,400 ( 12,999 ) 56,401 69,400 ( 8,661 ) 60,739 Trademarks and trade names 12,200 ( 2,350 ) 9,850 12,200 ( 1,676 ) 10,524 Total intangible assets $ 190,300 $ ( 44,901 ) $ 145,399 $ 190,300 $ ( 31,390 ) $ 158,910 Refer to Note 5 – Acquisition for more information related to the acquisition that occurred in the six months ended June 30, 2022. Amortization expense for intangible assets was $ 6.8 million and $ 6.8 million for the three months ended June 30, 2023 and 2022, respectively, and $ 13.5 million and $ 11.8 million for the six months ended June 30, 2023 and 2022, respectively. The estimated amortization expense for intangible assets subsequent to June 30, 2023, consists of the following (in thousands): Year Ending December 31: For remainder of 2023 $ 13,511 2024 27,022 2025 27,022 2026 21,979 2027 21,882 Thereafter 33,983 $ 145,399 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 6 Months Ended |
Jun. 30, 2023 | |
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): June 30, December 31, 2023 2022 Accrued marketing expenses $ 7,365 $ 2,093 Vehicle related expenses 11,015 14,789 Sales taxes 5,014 5,983 Accrued compensation and benefits 17,765 28,276 Accrued professional services 1,703 3,488 Accrued legal settlements (1) 4,306 7,383 Interest payable 4,121 3,990 Other 7,018 10,793 Total accrued expenses $ 58,307 $ 76,795 (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): June 30, December 31, 2023 2022 Vehicle payable $ 5,897 $ 3,617 Reserve for estimated returns 2,384 3,919 Insurance payable 632 4,551 Other 2,999 5,606 Total other current liabilities $ 11,912 $ 17,693 |
Vehicle Floorplan Facility
Vehicle Floorplan Facility | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Vehicle Floorplan Facility | 10. Vehicle Floorplan Facility In November 2022, the Company amended its floorplan facility with Ally Bank and Ally Financial (the “2022 Vehicle Floorplan Facility”). 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 . The amount of credit available to the Company on a monthly basis equals 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 June 30, 2023, the borrowing capacity of the 2022 Vehicle Floorplan Facility was $ 171.6 million, of which $ 39.1 million was unutilized. 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. Additionally, 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 allows 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 15.0 % of the daily floorplan principal balance outstanding. The Company was required to pay a commitment fee upon execution of the 2022 Vehicle Floorplan Facility. As of June 30, 2023 and December 31, 2022, outstanding borrowings on the vehicle floorplan facilities were $ 132.5 million and $ 277.0 million, respectively. Cash deposits required under the vehicle floorplan facilities of $ 19.9 million and $ 34.6 million are classified as "Restricted cash" within the condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022, respectively. Interest expense incurred by the Company for the vehicle floorplan facilities was $ 3.7 million and $ 6.3 million for the three months ended June 30, 2023 and 2022, respectively, and $ 9.2 million and $ 13.3 million for the six months ended June 30, 2023 and 2022 , respectively, which are recorded within “Interest expense” in the condensed consolidated statements of operations. The weighted average interest rate on the vehicle floorplan borrowings was 10.00 % and 9.25 % as of June 30, 2023 and December 31, 2022, respectively. As of June 30, 2023 and December 31, 2022 , 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 $ 2.3 million and $ 3.6 million for the three months ended June 30, 2023 and 2022, respectively, and $ 5.8 million and $ 7.5 million for the six months ended June 30, 2023 and 2022, respectively, which are recorded within “Interest income” in the condensed consolidated statements of operations. In August 2023, the Company amended its 2022 Vehicle Floorplan Facility to modify certain terms, and also amended the credit balance agreements to modify the minimum required credit balance calculation. |
Warehouse Credit Facilities of
Warehouse Credit Facilities of Consolidated VIEs | 6 Months Ended |
Jun. 30, 2023 | |
Line of Credit Facility [Abstract] | |
Warehouse Credit Facilities of Consolidated VIEs | 11. Warehouse Credit Facilities of Consolidated VIEs UACC has four senior secured warehouse facility agreements (the “Warehouse Credit Facilities”) with banking institutions as of June 30, 2023. 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 June 30, 2023 and December 31, 2022, the Company had excess borrowing capacity of $ 93.0 million and $ 105.8 million on UACC's Warehouse Credit Facilities, respectively. 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 June 2, 2025 May 24, 2024 December 12, 2024 Aggregate borrowings limit (in thousands) $ 200,000 $ 200,000 $ 200,000 $ 250,000 As of June 30, 2023 Aggregate principal balance of finance receivables pledged as collateral (in thousands) $ 137,062 $ 24,516 $ 95,058 $ — Outstanding balance (in thousands) $ 87,100 $ 18,735 $ 74,000 $ — Restricted cash (in thousands) $ 4,805 $ 1,291 $ 4,047 $ — As of December 31, 2022 Aggregate principal balance of finance receivables pledged as collateral (in thousands) $ 143,919 $ 142,503 $ 126,636 $ — Outstanding balance (in thousands) $ 110,602 $ 19,615 $ 101,435 $ — Restricted cash (in thousands) $ 8,110 $ 2,007 $ 5,537 $ — As of June 30, 2023 and December 31, 2022, the Company's weighted average interest rate on the Warehouse Credit Facilities borrowings was approximately 7.00 % and 6.19 %, respectively. 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 UACC 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 June 30, 2023 and December 31, 2022, the Company was in compliance with all covenants related to the Warehouse Credit Facilities. |
Long Term Debt
Long Term Debt | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Long Term Debt | 12. 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): June 30, December 31, 2023 2022 Current portion of securitization debt of consolidated VIEs $ 219,391 $ 47,239 Current portion of financing of beneficial interest in securitizations 12,080 — Total current portion of long term debt $ 231,471 $ 47,239 Convertible senior notes $ 327,408 $ 359,254 Securitization debt of consolidated VIEs, net of current portion 197,584 32,590 Financing of beneficial interest in securitizations 9,629 — Junior subordinated debentures 10,310 10,310 Long term debt, net of current portion $ 544,931 $ 402,154 Total debt $ 776,402 $ 449,393 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 three and six months ended June 30, 2023, the conditions allowing holders of the Notes to convert were not met. During the three and six months ended June 30, 2023 , the Company repurchased $ 18.2 million and $ 32.8 million in aggregate principal amount of the Notes , net of deferred issuance costs, for $ 7.3 million and $ 13.2 million, respectively, in open-market transactions. The Company recognized a gain on extinguishment of debt of $ 10.9 and $ 19.6 million for the three and six months ended June 30, 2023, respectively. The Company accounts for the Notes as a single liability-classified instrument measured at amortized cost. As of June 30, 2023 , the unamortized debt discount and debt issuance costs was $ 5.1 million and the net carrying value was $ 327.4 million. A s 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. 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 was $ 1.1 million and $ 2.0 million for the three months ended June 30, 2023 and 2022 , respectively, and $ 2.2 million and $ 4.0 million for the six months ended June 30, 2023 and 2022 , respectively. The effective interest rate of the Notes is 1.3 %. Securitization Debt of Consolidated VIEs The securitization debt was issued under UACC's securitization program. The Company elected to account for the securitization debt under the fair value option using the measurement alternative. Fair value adjustments are recorded in "Other loss, net" in the condensed consolidated statements of operations. Refer to Note 16 – Financial Instruments and Fair Value Measurements. For the 2021-1, 2022-2, and 2023-1 securitization transactions, the Company consolidated the VIEs and accounted for these transactions as secured borrowings. Refer to Note 4 – Variable Interest Entities and Securitizations for further discussion. Upon the issuance of the securitization debt for the 2021-1 and 2023-1 securitization transactions, UACC retained the residual interests. UACC also retains the servicing rights for all finance receivables that were securitized; therefore, it is responsible for the administration and collection of the amounts owed under the contracts. In Q1 2023, UACC waived its servicing fees related to the 2022-2 securitization and subsequently consolidated the 2022-2 trust. 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 $ 34.8 million and $ 9.0 million as of June 30, 2023 and December 31, 2022, respectively. 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 condensed consolidated balance sheet. The securitization debt of consolidated VIEs consisted of the following (in thousands): As of June 30, 2023 Series Final Scheduled Payment Date Initial Principal Contractual Interest Rate Outstanding Principal Fair Value United Auto Credit 2021-1-D June 10, 2026 $ 29,380 1.14 % $ 21,686 $ 21,393 United Auto Credit 2021-1-E June 10, 2026 20,800 2.58 % 20,800 20,170 United Auto Credit 2021-1-F September 10, 2027 13,910 4.30 % 13,910 13,539 United Auto Credit 2022-2-A April 10, 2025 119,139 4.39 % 31,173 31,120 United Auto Credit 2022-2-B December 10, 2025 30,324 5.41 % 30,324 30,003 United Auto Credit 2022-2-C May 10, 2027 26,533 5.81 % 26,533 26,148 United Auto Credit 2022-2-D January 10, 2028 32,889 6.84 % 32,889 32,297 United Auto Credit 2022-2-E April 10, 2029 33,440 10.00 % 33,440 30,420 United Auto Credit 2023-1-A July 10, 2025 118,598 5.57 % 68,433 68,296 United Auto Credit 2023-1-B July 10, 2028 51,157 5.91 % 51,157 50,661 United Auto Credit 2023-1-C July 10, 2028 33,326 6.28 % 33,326 32,996 United Auto Credit 2023-1-D July 10, 2028 35,653 8.00 % 35,653 36,152 United Auto Credit 2023-1-E September 10, 2029 23,256 10.98 % 23,256 23,465 Total rated notes $ 568,405 $ 422,580 $ 416,660 United Auto Credit 2022-2-R n/a n/a n/a n/a 315 Total rated notes and residual $ 568,405 $ 422,580 $ 416,975 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 The final scheduled payment date represents 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 ass urance, are $ 106.7 million in 2023, $ 160.9 million in 2024, $ 91.3 million in 2025, $ 42.6 million in 2026 and $ 21.1 million in 2027. The aggregate principal balance and the fair value of finance receivables pledged to the securitization debt consists of the following (in thousands): As of June 30, As of December 31, 2023 2022 Aggregate Principal Balance Fair Value Aggregate Principal Balance Fair Value United Auto Credit 2021-1 $ 57,829 $ 54,464 $ 84,477 $ 77,904 United Auto Credit 2022-2 170,368 143,263 — — United Auto Credit 2023-1 262,299 232,295 — — Total finance receivables of CFEs $ 490,496 $ 430,022 $ 84,477 $ 77,904 Financing of Beneficial Interests in Securitizations On May 3, 2023, UACC entered into a Risk Retention Financing Facility enabling it to finance asset-backed securities issued in its securitization transactions and held by UACC pursuant to applicable risk retention rules. Under this facility, UACC sells such retained interests and agrees to repurchase them on a future date. In its initial transaction under this facility, UACC pledged $ 24.5 million of its retained beneficial interests as collateral, and received proceeds of $ 24.1 million, with expected repurchase dates ranging from March 2025 to September 2029 . The securitization trusts will distribute payments related to UACC's pledged beneficial interests in securitizations directly to the lender, which will reduce the beneficial interests in securitizations and the related debt balance. Pledged collateral levels are monitored and are generally maintained at an agreed-upon percentage of the fair value of the amounts borrowed during the life of the transactions. In the event of a decline in the fair value of the pledged collateral, UACC may be required to transfer cash or additional securities as pledged under this facility. At the termination of this agreement, UACC is obligated to return the amounts borrowed. The outstanding balance of this facility, net of unamortized debt issuance costs, was $ 21.7 million as of June 30, 2023, with $ 12.1 million included in "Current portion of long-term debt" and $ 9.6 million included in "Long-term debt, net of current portion" on the condensed consolidated balance sheet. As of June 30, 2023, the fair value of the collateral pledged under this facility was $ 22.0 million. 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 Vroom Automotive Finance Corporation. The interest is paid quarterly at a variable rate, equal to SOFR + 3.05 %. 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. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 13. 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. Nasdaq Notice On June 23, 2023, the Company received written notice from The Nasdaq Stock Market LLC (“Nasdaq”) informing the Company that it has regained compliance with Nasdaq Listing Rule 5450(a)(1), which requires that companies listed on the Nasdaq Global Select Market maintain a minimum bid price of $ 1.00 per share. As previously reported, on April 14, 2023, the Company received a letter from Nasdaq indicating that, for the preceding 30 consecutive business days, the bid price for the Company’s common stock had closed below the $ 1.00 per share minimum bid price requirement for continued inclusion on the Nasdaq Global Select Market pursuant to Nasdaq Listing Rule 5450(a)(1) (the “Minimum Bid Price Requirement”). In accordance with Nasdaq Listing Rule 5810(c)(3)(C), the Company had been provided an initial period of 180 calendar days from the Nasdaq notification, or until October 11, 2023, to regain compliance. To regain compliance, the Company was required to maintain the Minimum Bid Price Requirement for a minimum of ten consecutive business days. In its June 23, 2023 notice, Nasdaq notified the Company that the closing bid price of its common stock had been at $ 1.00 per share or greater for 11 consecutive business days, from June 8, 2023 to June 22, 2023. Accordingly, the Company regained compliance with the Minimum Bid Price Requirement and the matter was closed. 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. |
Preferred Stock and Stockholder
Preferred Stock and Stockholders' Equity | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
Preferred Stock and Stockholders' Equity | 14. 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 June 30, 2023 , 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. |
Stock-based Compensation
Stock-based Compensation | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | 15. 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) an annual increase on the first day of each year beginning on January 1, 2022 and ending on January 1, 2030 of up to 4 % of the shares of common stock outstanding on an as-converted basis on the last day of the immediately preceding fiscal year , 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. As of June 30, 2023, the Company has registered an additional 11,011,780 shares of the Company's common stock to be issued pursuant to the 2020 Plan. As of June 30, 2023 , there were 1,212,450 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 June 30, 2023 , there were 2,542,963 shares available for future issuance under the Inducement Award Plan. RSUs The Company recognized $ 2.1 million and $ 1.4 million of stock-based compensation expense related to RSUs for the three months ended June 30, 2023 and 2022 , respectively, and $ 3.9 million and $ 4.6 million for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and December 31, 2022 , the Company had $ 17.7 million and $ 18.2 million, respectively, of unrecognized stock-based compensation expense that is expected to be recognized over a weighted-average period of 1.9 and 1.9 years, respectively. On May 9, 2022, 1,200,000 RSUs having a grant date fair value of $ 1.08 per share were granted to the CEO and on May, 20, 2022, 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 the 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 . As of June 30, 2023, 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. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments and Fair Value Measurements | 16. 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 securitization transaction, 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 June 30, 2023 Level 1 Level 2 Level 3 Total Financial Assets Cash and cash equivalents: Money market funds $ 123,238 $ — $ — $ 123,238 CFE assets: Finance receivables — — 430,022 430,022 Finance receivables at fair value — — 37,675 37,675 Beneficial interests in securitizations — 6,553 — 6,553 Total financial assets $ 123,238 $ 6,553 $ 467,697 $ 597,488 Financial Liabilities CFE liabilities: Securitization debt of consolidated VIEs — 416,975 — 416,975 Total financial liabilities $ — $ 416,975 $ — $ 416,975 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 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. Financial assets and liabilities of CFEs: The Company elected the fair value option for the assets and liabilities of its consolidated VIEs related to securitization transactions that were deemed to be CFEs. In accordance with ASC 825, the Company has elected the fair value option, for the eligible financial assets and liabilities of the 2021-1, 2022-2, and 2023-1 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 condensed 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: Finance receivables at fair value represent finance receivables for which the Company elected the fair value option in accordance with ASC 825. These receivables primarily relate to finance receivables that the Company does not intend to sell 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 2022-1 securitization completed in February 2022 and include rated notes as well as certificates. The beneficial interests in the 2022-2 securitization completed in July 2022 were eliminated upon consolidation of the VIE in March 2023. 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 Fair value as of January 1, 2023 $ 77,904 $ 75,270 Reclassification of finance receivables held for sale to finance receivables at fair value, net 248,081 — Transfer within Level 3 categories 25,718 ( 25,718 ) Consolidation of VIEs 180,706 — Losses included in other income ( 37,890 ) ( 1,396 ) Issuances, net of discount — 3,392 Paydowns ( 77,007 ) ( 14,883 ) Other 12,510 1,010 Fair value as of June 30, 2023 $ 430,022 $ 37,675 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 ( 10,904 ) 10,904 — Losses included in other income ( 18,279 ) ( 10,163 ) — Issuances, net of discount — 49,475 Sales ( 24,312 ) — — Paydowns ( 56,749 ) ( 17,941 ) — Other 6,977 1,849 — Fair value as of June 30, 2022 $ 159,377 $ 68,407 $ — During the six months ended June 30, 2023, $ 180.7 million of finance receivables related to the 2022-2 securitization transaction were consolidated and classified as Level 3 and $ 248.1 million of finance receivables held for sale related to the 2023-1 securitization transaction were reclassified to Level 3 finance receivables of consolidated CFEs. 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 prior period as described below. During the six months ended June 30, 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 June 30, 2022. For the CFEs liabilities acquired during the period, the transfer was presumed to occur immediately after the Acquisition Date. 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, net" in the condensed consolidated statements of operations related to the eligible financial instruments for which the fair value option was elected (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Financial Assets Finance receivables of CFEs $ 21,988 $ 924 $ 31,885 $ 15,295 Finance receivables at fair value ( 10 ) 8,865 ( 1,422 ) 8,252 Beneficial interests in securitizations 261 165 922 321 Financial Liabilities Debt of securitized VIEs ( 6,029 ) ( 352 ) ( 7,251 ) ( 2,716 ) Total net loss included in other income $ 16,210 $ 9,602 $ 24,134 $ 21,152 The following table presents other relevant data related to the finance receivables carried at fair value (in thousands): As of June 30, 2023 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 $ 490,496 $ 44,898 Aggregate fair value of finance receivables that are reported at fair value $ 430,022 $ 37,675 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) $ 6,306 $ 548 Aggregate fair value of receivables carried at fair value that are on nonaccrual status (90 days or more past due) $ 5,535 $ 394 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 June 30, 2023 Securitization debt of consolidated VIEs at Fair Value Aggregate unpaid principal balance of rated notes of securitized VIEs $ 422,580 Aggregate fair value of rated notes of securitized VIEs $ 416,660 Aggregate fair value of residual of securitized VIEs $ 315 As of December 31, 2022 Securitization debt of consolidated VIEs at Fair Value Aggregate unpaid principal balance of rated notes of securitized VIEs $ 82,556 Aggregate fair value of rated notes of securitized VIEs $ 79,829 F air 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): June 30, December 31, 2023 2022 Carrying value $ 273,817 $ 299,235 Fair value $ 275,755 $ 299,925 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 June 30, 2023 and December 31, 2022, there were $ 16.2 million and $ 22.4 million of finance receivables that were marked to fair value on a non-recurring basis, respectively. 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. Convertible Senior Notes: The fair value of the Notes, which are not carried at fair value on the accompanying condensed 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. June 30, December 31, 2023 2022 Carrying value $ 327,408 $ 359,254 Fair value $ 131,333 $ 128,026 Financing of beneficial interests in securitizations: The fair value of the financing of beneficial interests in securitizations, which are not carried at fair value on the accompanying condensed consolidated balance sheets, approximated their carrying value as of June 30, 2023 and are classified within Level 3 of the fair value hierarchy. Junior Subordinated Debentures: The fair value of the junior subordinated debentures, which are not carried at fair value on the accompanying condensed consolidated balance sheets, approximated their carrying value as of June 30, 2023 and 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. |
Restructuring Activities
Restructuring Activities | 6 Months Ended |
Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Activities | 17. 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. O n 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 the assessment of the Company's business needs, key initiatives, and long-term success and profitable growth. For the six months ended June 30, 2023, the Company incurred expenses of approximately $ 4.1 million, primarily consisting of severance. On April 26, 2023, as part of the Company’s ongoing reexamination of all facets of the business, the Company implemented an organizational restructuring that included a reduction in force. The Company reduced Vroom’s headcount by approximately 120 employees and incurred total expenses of approximately $ 2.3 million for the three and six months ended June 30, 2023, primarily consisting of severance costs, as a result of this reduction in force. The following table summarizes the components of the restructuring and related charges: Three months ended June 30, Six months ended June 30, Total Charges Incurred to Date 2023 2022 2023 2022 Charges by activity: Severance and termination benefits (1) $ 2,277 $ 4,946 $ 6,381 $ 4,946 $ 13,739 Impairment of operating lease right-of-use assets (2) — 3,407 — 3,407 6,491 Other costs (3) — 1,176 — 1,176 1,176 Total restructuring and related charges $ 2,277 $ 9,529 $ 6,381 $ 9,529 $ 21,406 (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 that will continue to be incurred under the contract for its remaining term without economic benefit to the Company. (3) Other costs incurred to date consist of legal expenses incurred in connection with the Realignment Plan and acceleration of depreciation of property and equipment related to the planned facility closures. Severance and termination benefits and other costs are included in "Selling, general, and administrative expenses" in the condensed consolidated statements of operations for the three and six months ended June 30, 2023 and 2022. The following table is a reconciliation of the beginning and ending restructuring liability for the six months ended June 30, 2023 and 2022: Balance as of December 31, 2022 $ 810 Accrual and accrual adjustments 6,381 Cash payments ( 6,237 ) Balance as of June 30, 2023 $ 954 Balance as of December 31, 2021 $ — Accrual and accrual adjustments 5,529 Cash payments ( 2,435 ) Balance as of June 30, 2022 $ 3,094 The restructuring liability for severance and termination benefits is reflected in "Accrued Expenses" in the condensed consolidated balance sheet as of June 30, 2023 and December 31, 2022. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | 18. Segment Information The Company has three reportable segments: Ecommerce, Wholesale, and Retail Financing. 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 no t report segment asset information. As of June 30, 2023 and December 31, 2022, 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): Three Months Ended June 30, 2023 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 138,225 $ 30,800 $ 42,128 $ 14,025 $ 225,178 Gross profit $ 12,189 $ ( 3,993 ) $ 34,068 $ 3,737 $ 46,001 Three Months Ended June 30, 2022 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 321,632 $ 82,901 $ 32,121 $ 38,783 $ 475,437 Gross profit $ 33,509 $ ( 1,934 ) $ 28,720 $ 6,062 $ 66,357 Six Months Ended June 30, 2023 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 273,858 $ 44,695 $ 74,116 $ 28,976 $ 421,645 Gross profit $ 22,223 $ ( 3,931 ) $ 59,842 $ 6,672 $ 84,806 Six Months Ended June 30, 2022 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 996,995 $ 222,885 $ 79,808 $ 99,524 $ 1,399,212 Gross profit $ 67,828 $ ( 4,686 ) $ 73,682 $ 11,173 $ 147,997 The reconciliation between reportable segment gross profit to consolidated loss before provision (benefit) for income taxes is as follows (in thousands): Three Months Ended Six Months Ended 2023 2022 2023 2022 Reconciliation to consolidated total revenue Total reportable segment revenue $ 211,153 $ 436,654 $ 392,669 $ 1,299,688 All Other revenues 14,025 38,783 28,976 99,524 Consolidated total revenue $ 225,178 $ 475,437 $ 421,645 $ 1,399,212 Reconciliation to consolidated loss before (benefit) provision for income taxes Total reportable segment gross profit $ 42,264 $ 60,295 $ 78,134 $ 136,824 All Other gross profit 3,737 6,062 6,672 11,173 Selling, general and administrative expenses 86,955 152,990 183,492 340,984 Depreciation and amortization 10,304 10,039 20,835 17,895 Impairment charges 1,353 3,407 1,353 205,110 Gain on debt extinguishment ( 10,931 ) — ( 19,640 ) — Interest expense 8,938 9,533 18,857 18,913 Interest Income ( 4,921 ) ( 3,935 ) ( 10,863 ) ( 7,887 ) Other loss, net 20,236 9,156 31,476 21,514 Consolidated loss before provision (benefit) for income taxes $ ( 65,933 ) $ ( 114,833 ) $ ( 140,704 ) $ ( 448,532 ) |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 19. Income Taxes 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 because the Company has determined that it is 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 being in a cumulative 3-year loss position. The Company’s effective tax rate for the three months ended June 30, 2023 and 2022 was ( 0.58 )% and ( 0.22 )%, respectively. The Company’s effective tax rate for the six months ended June 30, 2023 and 2022 was ( 0.47 )% and 5.12 %, respectively. The effective tax rate for the six months ended June 30, 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 six months ended June 30, 2022 of $ 23.9 million. 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, 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 . The Company has no t identified any uncertain tax positions as of June 30, 2023 or December 31, 2022 . 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. 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 condensed consolidated financial statements. |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 20. Net Loss Per Share The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders: Three Months Ended Six Months Ended (in thousands, except share and per share amounts) 2023 2022 2023 2022 Net loss $ ( 66,318 ) $ ( 115,089 ) $ ( 141,362 ) $ ( 425,548 ) Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted 139,146,848 138,075,210 138,838,866 137,667,419 Net loss per share attributable to common stockholders, basic and diluted $ ( 0.48 ) $ ( 0.83 ) $ ( 1.02 ) $ ( 3.09 ) 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 June 30, 2023 2022 Convertible senior notes 5,936,226 11,158,722 Stock options 2,563,207 4,920,028 Restricted stock units 14,251,567 9,145,799 Total 22,751,000 25,224,549 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission ("SEC") regarding interim financial reporting. The condensed consolidated balance sheet as of December 31, 2022, included herein, was derived from the audited consolidated financial statements as of that date. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2022. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, which consist of only normal recurring adjustments necessary for the fair statement of the Company’s condensed consolidated balance sheet as of June 30, 2023 and its results of operations for the three and six months ended June 30, 2023 and 2022. The results for the three and six months ended June 30, 2023 are not necessarily indicative of the results expected for the current fiscal year or any other future periods. Certain prior year amounts have been reclassified to conform to the current year presentation. |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed 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, 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 | Comprehensive Loss The Company did no t have any other comprehensive income or loss for the three and six months ended June 30, 2023 and 2022 . Accordingly, net loss and comprehensive loss are the same for the periods presented. |
Restricted Cash | 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 UACC restricted cash. UACC collects and services receivables under the securitization transactions 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 12 — Long Term Debt for further detail. |
Finance Receivables | 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 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 condensed consolidated statements of operations. Refer to Note 3 – Revenue Recognition. The Company records a valuation allowance to report finance receivables at the lower of amortized cost basis or fair value. To determine the valuation allowance, finance receivables are evaluated collectively 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, net" in the condensed 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 June 30, 2023 and December 31, 2022, the valuation allowance for finance receivables classified as held for sale was $ 10.2 million and $ 10.5 million, respectively. Refer to No te 16 – Financial Instruments and Fair Value Measurements . |
Finance Receivables at Fair Value | Finance Receivables at Fair Value Finance receivables at fair value represent finance receivables that the Company does not intend to sell in the immediate future and for which the fair value option was elected. Fair value adjustments are recorded in "Other loss, net" in the condensed consolidated statements of operations. Refer to Note 16 – Financial Instruments and Fair Value Measurements. |
Consolidated CFEs | Consolidated CFEs The Company elected the fair value option upon consolidation of the assets and liabilities of its variable interest entities ("VIEs") related to the 2021-1, 2022-2, and 2023-1 securitization transactions. Refer to Note 4 – Variable Interest Entities and 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"). During the three and six months ended June 30, 2023 and 2022, the Company recognized the following revenue and expenses associated with these CFEs in the condensed consolidated statements of operations: Three Months Ended Six Months Ended 2023 2022 2023 2022 Finance revenue $ 24,849 $ 14,156 $ 39,768 $ 25,040 Product revenue $ 3,644 $ — $ 5,975 $ — Finance cost of sales $ ( 5,330 ) $ ( 1,159 ) $ ( 8,829 ) $ ( 2,005 ) Product cost of sales $ ( 703 ) $ — $ ( 1,601 ) $ — Other loss, net $ ( 15,534 ) $ ( 311 ) $ ( 24,209 ) $ ( 12,319 ) 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 condensed consolidated balance sheets. Refer to Note 4 – Variable Interest Entities and Securitizations and Note 16 – Financial Instruments and Fair Value Measurements for further details. |
Business Combinations | 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 condensed consolidated statement of operations. |
Advertising | Advertising Advertising costs are expensed as incurred and are included within “Selling, general and administrative expenses” in the condensed consolidated statements of operations. Advertising expenses were $ 15.0 million and $ 21.1 million for the three months ended June 30, 2023 and 2022, respectively, and $ 26.4 million and $ 54.9 million for the six months ended June 30, 2023 and 2022 , respectively. |
Shipping and Handling | 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 condensed consolidated statements of operations and were $ 2.0 million and $ 8.2 million for the three months ended June 30, 2023 and 2022, respectively, and $ 4.0 million and $ 35.0 million for the six months ended June 30, 2023 and 2022 , respectively. |
Concentration of Credit Risk and Significant Customers | 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 three and six months ended June 30, 2023 and 2022, 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 June 30, 2023 and December 31, 2022 . |
Liquidity | 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 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. On January 18, 2023, the Company executed a reduction in force as part of the continued focus on reducing variable and fixed costs. Additionally, on April 26, 2023, as part of the Company’s ongoing reexamination of all facets of the business, the Company implemented an organizational restructuring that included a reduction in force. Refer to Note 17 – Restructuring Activities for further discussion. As of June 30, 2023, the Company had cash and cash equivalents of $ 237.9 million and restricted cash of $ 66.3 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 . For the three and six months ended June 30, 2023 , the Company repurchased approximately $ 18.2 million and $ 32.8 million in aggregate principal amount of the Notes (as defined in Note 12), net of deferred issuance costs, for $ 7.3 million and $ 13.2 million, respectively, in open-market transactions. The Company recognized a gain on extinguishment of debt of $ 10.9 million and $ 19.6 million for the three and six months ended June 30, 2023, respectively. As of June 30, 2023 , $ 327.4 million aggregate principal amount of the Notes remain outstanding, net of deferred issuance costs of $ 5.1 million. Refer to Note 12 – Long Term Debt for further discussion. The Company has a 2022 Vehicle Floorplan Facility (as defined in Note 10) with a borrowing capacity of $ 171.6 million as of June 30, 2023, of which $ 39.1 million was unutilized. The 2022 Vehicle Floorplan Facility provides a committed credit line of up to $ 500.0 million w hich is scheduled to mature on March 31, 2024. Refer to Note 10 – Vehicle Floorplan Facility for further discussion. 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. I n April 2023, UACC sold the non-investment grade securities related to the 2023-1 securitization transaction for $ 23.1 million. UACC still retains the residual interests related to the 2023-1 securitization transaction. 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 June 30, 2023. As of June 30, 2023 , outstanding borrowings related to the Warehouse Credit Facilities were $ 177.9 million and excess borrowing capacity was $ 93.0 million. Refer to Note 11 – Warehouse Credit Facilities of Consolidated VIEs for further discussion. The Company anticipates that its 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 condensed consolidated financial statements. |
Accounting Standards Adopted | Accounting Standards 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 Company adopted the guidance on January 1, 2023 , which did not have a material impact on the Company's condensed consolidated financial statements and related disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Company Recognized Revenue and Expense Associated with CFEs in Condensed Consolidated Statements of Operations | During the three and six months ended June 30, 2023 and 2022, the Company recognized the following revenue and expenses associated with these CFEs in the condensed consolidated statements of operations: Three Months Ended Six Months Ended 2023 2022 2023 2022 Finance revenue $ 24,849 $ 14,156 $ 39,768 $ 25,040 Product revenue $ 3,644 $ — $ 5,975 $ — Finance cost of sales $ ( 5,330 ) $ ( 1,159 ) $ ( 8,829 ) $ ( 2,005 ) Product cost of sales $ ( 703 ) $ — $ ( 1,601 ) $ — Other loss, net $ ( 15,534 ) $ ( 311 ) $ ( 24,209 ) $ ( 12,319 ) |
Variable Interest Entities an_2
Variable Interest Entities and Securitizations (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
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 in the condensed consolidated balance sheets (in thousands): As of June 30, 2023 Securitization Vehicles Warehouse 1 Total Current Assets: Restricted cash $ 34,764 $ 10,143 $ 44,907 Finance receivables at fair value 11,431 929 12,360 Finance receivables held for sale — 204,420 204,420 Other current assets 15,681 5,196 20,877 Total Current Assets 61,876 220,688 282,564 Finance receivables at fair value 418,591 23,857 442,448 Total Assets $ 480,467 $ 244,545 $ 725,012 Current Liabilities: Current portion of securitization debt $ 219,391 $ — $ 219,391 Warehouse credit facilities — 177,864 177,864 Other current liabilities 1,570 1,230 2,800 Total Current Liabilities 220,961 179,094 400,055 Securitization debt, net of current portion 197,584 — 197,584 Other liabilities 5,696 3,551 9,247 Total Liabilities $ 424,241 $ 182,645 $ 606,886 As of December 31, 2022 Securitization Vehicles Warehouse 1 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 current assets 2,730 9,004 11,734 Total Current Assets 17,089 336,731 353,820 Finance receivables at fair value 72,568 47,024 119,592 Total Assets $ 89,657 $ 383,755 $ 473,412 Current Liabilities: Current portion of securitization debt $ 47,239 $ — $ 47,239 Warehouse credit facilities — 229,518 229,518 Other current liabilities 90 1,439 1,529 Total Current Liabilities 47,329 230,957 278,286 Securitization debt, net of current portion 32,590 — 32,590 Other liabilities 686 6,724 7,410 Total Liabilities $ 80,605 $ 237,681 $ 318,286 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 June 30, 2023 As of December 31, 2022 Aggregate Principal Balance Carrying Value Total Exposure Aggregate Principal Balance Carrying Value Total Exposure Rated notes $ 6,368 $ 6,056 $ 6,056 $ 19,233 $ 18,664 $ 18,664 Certificates — 497 497 — 1,928 1,928 Other assets 310 310 310 310 310 310 Total unconsolidated VIEs $ 6,678 $ 6,863 $ 6,863 $ 19,543 $ 20,902 $ 20,902 |
Acquisition (Tables)
Acquisition (Tables) - UACC | 6 Months Ended |
Jun. 30, 2023 | |
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): Fair Value Weighted Average Useful Life Purchased technology $ 83,000 7 Customer relationships 66,000 8 Trade name 7,000 10 $ 156,000 |
Summary of Pro Forma Information | The pro forma information for the six months ended June 30, 2022 is as follows: Six Months Ended June 30, 2022 Total revenue $ 1,414,683 Net loss $ ( 437,739 ) |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consisted of the following (in thousands): June 30, December 31, 2023 2022 Vehicles $ 207,135 $ 317,994 Parts and accessories 1,736 2,654 Total inventory $ 208,871 $ 320,648 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): June 30, December 31, 2023 2022 Equipment $ 3,636 $ 3,357 Furniture and fixtures 1,898 1,896 Logistics fleet 32,544 32,468 Leasehold improvements 7,595 6,577 Internal-use software 36,981 30,725 Other 8,569 8,081 91,223 83,104 Accumulated depreciation and amortization ( 40,534 ) ( 32,903 ) Property and equipment, net $ 50,689 $ 50,201 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
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 six months ended June 30, 2022 (in thousands): Ecommerce Wholesale TDA Total 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 June 30, 2022 $ — $ — $ — $ — |
Schedule of Intangible Assets, Net | Intangible assets, net consisted of the following (in thousands): June 30, 2023 December 31, 2022 Gross Carrying Value Accumulated Amortization Carrying Value Gross Carrying Value Accumulated Amortization Carrying Value Developed and purchased technology $ 108,700 $ ( 29,552 ) $ 79,148 $ 108,700 $ ( 21,053 ) $ 87,647 Customer relationships 69,400 ( 12,999 ) 56,401 69,400 ( 8,661 ) 60,739 Trademarks and trade names 12,200 ( 2,350 ) 9,850 12,200 ( 1,676 ) 10,524 Total intangible assets $ 190,300 $ ( 44,901 ) $ 145,399 $ 190,300 $ ( 31,390 ) $ 158,910 |
Schedule of Estimated Amortization Expense for Intangible Assets | The estimated amortization expense for intangible assets subsequent to June 30, 2023, consists of the following (in thousands): Year Ending December 31: For remainder of 2023 $ 13,511 2024 27,022 2025 27,022 2026 21,979 2027 21,882 Thereafter 33,983 $ 145,399 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Schedule of Accrued Expenses | The Company’s accrued expenses consisted of the following (in thousands): June 30, December 31, 2023 2022 Accrued marketing expenses $ 7,365 $ 2,093 Vehicle related expenses 11,015 14,789 Sales taxes 5,014 5,983 Accrued compensation and benefits 17,765 28,276 Accrued professional services 1,703 3,488 Accrued legal settlements (1) 4,306 7,383 Interest payable 4,121 3,990 Other 7,018 10,793 Total accrued expenses $ 58,307 $ 76,795 (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. |
Other Current Liabilities | The Company’s other current liabilities consisted of the following (in thousands): June 30, December 31, 2023 2022 Vehicle payable $ 5,897 $ 3,617 Reserve for estimated returns 2,384 3,919 Insurance payable 632 4,551 Other 2,999 5,606 Total other current liabilities $ 11,912 $ 17,693 |
Warehouse Credit Facilities o_2
Warehouse Credit Facilities of Consolidated VIEs (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
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 June 30, 2023. 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 June 30, 2023 and December 31, 2022, the Company had excess borrowing capacity of $ 93.0 million and $ 105.8 million on UACC's Warehouse Credit Facilities, respectively. 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 June 2, 2025 May 24, 2024 December 12, 2024 Aggregate borrowings limit (in thousands) $ 200,000 $ 200,000 $ 200,000 $ 250,000 As of June 30, 2023 Aggregate principal balance of finance receivables pledged as collateral (in thousands) $ 137,062 $ 24,516 $ 95,058 $ — Outstanding balance (in thousands) $ 87,100 $ 18,735 $ 74,000 $ — Restricted cash (in thousands) $ 4,805 $ 1,291 $ 4,047 $ — As of December 31, 2022 Aggregate principal balance of finance receivables pledged as collateral (in thousands) $ 143,919 $ 142,503 $ 126,636 $ — Outstanding balance (in thousands) $ 110,602 $ 19,615 $ 101,435 $ — Restricted cash (in thousands) $ 8,110 $ 2,007 $ 5,537 $ — |
Long Term Debt (Tables)
Long Term Debt (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Instruments | 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): June 30, December 31, 2023 2022 Current portion of securitization debt of consolidated VIEs $ 219,391 $ 47,239 Current portion of financing of beneficial interest in securitizations 12,080 — Total current portion of long term debt $ 231,471 $ 47,239 Convertible senior notes $ 327,408 $ 359,254 Securitization debt of consolidated VIEs, net of current portion 197,584 32,590 Financing of beneficial interest in securitizations 9,629 — Junior subordinated debentures 10,310 10,310 Long term debt, net of current portion $ 544,931 $ 402,154 Total debt $ 776,402 $ 449,393 |
Schedule of Securitization Debt of Consolidated VIEs | 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 condensed consolidated balance sheet. The securitization debt of consolidated VIEs consisted of the following (in thousands): As of June 30, 2023 Series Final Scheduled Payment Date Initial Principal Contractual Interest Rate Outstanding Principal Fair Value United Auto Credit 2021-1-D June 10, 2026 $ 29,380 1.14 % $ 21,686 $ 21,393 United Auto Credit 2021-1-E June 10, 2026 20,800 2.58 % 20,800 20,170 United Auto Credit 2021-1-F September 10, 2027 13,910 4.30 % 13,910 13,539 United Auto Credit 2022-2-A April 10, 2025 119,139 4.39 % 31,173 31,120 United Auto Credit 2022-2-B December 10, 2025 30,324 5.41 % 30,324 30,003 United Auto Credit 2022-2-C May 10, 2027 26,533 5.81 % 26,533 26,148 United Auto Credit 2022-2-D January 10, 2028 32,889 6.84 % 32,889 32,297 United Auto Credit 2022-2-E April 10, 2029 33,440 10.00 % 33,440 30,420 United Auto Credit 2023-1-A July 10, 2025 118,598 5.57 % 68,433 68,296 United Auto Credit 2023-1-B July 10, 2028 51,157 5.91 % 51,157 50,661 United Auto Credit 2023-1-C July 10, 2028 33,326 6.28 % 33,326 32,996 United Auto Credit 2023-1-D July 10, 2028 35,653 8.00 % 35,653 36,152 United Auto Credit 2023-1-E September 10, 2029 23,256 10.98 % 23,256 23,465 Total rated notes $ 568,405 $ 422,580 $ 416,660 United Auto Credit 2022-2-R n/a n/a n/a n/a 315 Total rated notes and residual $ 568,405 $ 422,580 $ 416,975 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 June 30, As of December 31, 2023 2022 Aggregate Principal Balance Fair Value Aggregate Principal Balance Fair Value United Auto Credit 2021-1 $ 57,829 $ 54,464 $ 84,477 $ 77,904 United Auto Credit 2022-2 170,368 143,263 — — United Auto Credit 2023-1 262,299 232,295 — — Total finance receivables of CFEs $ 490,496 $ 430,022 $ 84,477 $ 77,904 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
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 June 30, 2023 Level 1 Level 2 Level 3 Total Financial Assets Cash and cash equivalents: Money market funds $ 123,238 $ — $ — $ 123,238 CFE assets: Finance receivables — — 430,022 430,022 Finance receivables at fair value — — 37,675 37,675 Beneficial interests in securitizations — 6,553 — 6,553 Total financial assets $ 123,238 $ 6,553 $ 467,697 $ 597,488 Financial Liabilities CFE liabilities: Securitization debt of consolidated VIEs — 416,975 — 416,975 Total financial liabilities $ — $ 416,975 $ — $ 416,975 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 |
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 Fair value as of January 1, 2023 $ 77,904 $ 75,270 Reclassification of finance receivables held for sale to finance receivables at fair value, net 248,081 — Transfer within Level 3 categories 25,718 ( 25,718 ) Consolidation of VIEs 180,706 — Losses included in other income ( 37,890 ) ( 1,396 ) Issuances, net of discount — 3,392 Paydowns ( 77,007 ) ( 14,883 ) Other 12,510 1,010 Fair value as of June 30, 2023 $ 430,022 $ 37,675 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 ( 10,904 ) 10,904 — Losses included in other income ( 18,279 ) ( 10,163 ) — Issuances, net of discount — 49,475 Sales ( 24,312 ) — — Paydowns ( 56,749 ) ( 17,941 ) — Other 6,977 1,849 — Fair value as of June 30, 2022 $ 159,377 $ 68,407 $ — |
Summary of Gains or Losses Recorded Related to Eligible Financial Instruments | The following table presents the gains or losses recorded in "Other loss, net" in the condensed consolidated statements of operations related to the eligible financial instruments for which the fair value option was elected (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Financial Assets Finance receivables of CFEs $ 21,988 $ 924 $ 31,885 $ 15,295 Finance receivables at fair value ( 10 ) 8,865 ( 1,422 ) 8,252 Beneficial interests in securitizations 261 165 922 321 Financial Liabilities Debt of securitized VIEs ( 6,029 ) ( 352 ) ( 7,251 ) ( 2,716 ) Total net loss included in other income $ 16,210 $ 9,602 $ 24,134 $ 21,152 |
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 June 30, 2023 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 $ 490,496 $ 44,898 Aggregate fair value of finance receivables that are reported at fair value $ 430,022 $ 37,675 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) $ 6,306 $ 548 Aggregate fair value of receivables carried at fair value that are on nonaccrual status (90 days or more past due) $ 5,535 $ 394 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 June 30, 2023 Securitization debt of consolidated VIEs at Fair Value Aggregate unpaid principal balance of rated notes of securitized VIEs $ 422,580 Aggregate fair value of rated notes of securitized VIEs $ 416,660 Aggregate fair value of residual of securitized VIEs $ 315 As of December 31, 2022 Securitization debt of consolidated VIEs at Fair Value Aggregate unpaid principal balance of rated notes of securitized VIEs $ 82,556 Aggregate fair value of rated notes of securitized VIEs $ 79,829 F |
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): June 30, December 31, 2023 2022 Carrying value $ 273,817 $ 299,235 Fair value $ 275,755 $ 299,925 The fair value of the Notes, which are not carried at fair value on the accompanying condensed 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. June 30, December 31, 2023 2022 Carrying value $ 327,408 $ 359,254 Fair value $ 131,333 $ 128,026 |
Restructuring Activities (Table
Restructuring Activities (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Components of Restructuring and Related Charges | The following table summarizes the components of the restructuring and related charges: Three months ended June 30, Six months ended June 30, Total Charges Incurred to Date 2023 2022 2023 2022 Charges by activity: Severance and termination benefits (1) $ 2,277 $ 4,946 $ 6,381 $ 4,946 $ 13,739 Impairment of operating lease right-of-use assets (2) — 3,407 — 3,407 6,491 Other costs (3) — 1,176 — 1,176 1,176 Total restructuring and related charges $ 2,277 $ 9,529 $ 6,381 $ 9,529 $ 21,406 (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 that will continue to be incurred under the contract for its remaining term without economic benefit to the Company. (3) Other costs incurred to date consist of legal expenses incurred in connection with the Realignment Plan and acceleration of depreciation of property and equipment related to the planned facility closures. |
Reconciliation of Beginning and Ending Restructuring Liability | The following table is a reconciliation of the beginning and ending restructuring liability for the six months ended June 30, 2023 and 2022: Balance as of December 31, 2022 $ 810 Accrual and accrual adjustments 6,381 Cash payments ( 6,237 ) Balance as of June 30, 2023 $ 954 Balance as of December 31, 2021 $ — Accrual and accrual adjustments 5,529 Cash payments ( 2,435 ) Balance as of June 30, 2022 $ 3,094 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Summary of Reportable Segments | Information about the Company’s reportable segments are as follows (in thousands): Three Months Ended June 30, 2023 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 138,225 $ 30,800 $ 42,128 $ 14,025 $ 225,178 Gross profit $ 12,189 $ ( 3,993 ) $ 34,068 $ 3,737 $ 46,001 Three Months Ended June 30, 2022 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 321,632 $ 82,901 $ 32,121 $ 38,783 $ 475,437 Gross profit $ 33,509 $ ( 1,934 ) $ 28,720 $ 6,062 $ 66,357 Six Months Ended June 30, 2023 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 273,858 $ 44,695 $ 74,116 $ 28,976 $ 421,645 Gross profit $ 22,223 $ ( 3,931 ) $ 59,842 $ 6,672 $ 84,806 Six Months Ended June 30, 2022 Ecommerce Wholesale Retail Financing All Other Total Revenues from external customers $ 996,995 $ 222,885 $ 79,808 $ 99,524 $ 1,399,212 Gross profit $ 67,828 $ ( 4,686 ) $ 73,682 $ 11,173 $ 147,997 |
Schedule of Reconciliation Between Reportable Segment Gross Profit to Consolidated Loss Before Provision (Benefit) for Income Taxes | The reconciliation between reportable segment gross profit to consolidated loss before provision (benefit) for income taxes is as follows (in thousands): Three Months Ended Six Months Ended 2023 2022 2023 2022 Reconciliation to consolidated total revenue Total reportable segment revenue $ 211,153 $ 436,654 $ 392,669 $ 1,299,688 All Other revenues 14,025 38,783 28,976 99,524 Consolidated total revenue $ 225,178 $ 475,437 $ 421,645 $ 1,399,212 Reconciliation to consolidated loss before (benefit) provision for income taxes Total reportable segment gross profit $ 42,264 $ 60,295 $ 78,134 $ 136,824 All Other gross profit 3,737 6,062 6,672 11,173 Selling, general and administrative expenses 86,955 152,990 183,492 340,984 Depreciation and amortization 10,304 10,039 20,835 17,895 Impairment charges 1,353 3,407 1,353 205,110 Gain on debt extinguishment ( 10,931 ) — ( 19,640 ) — Interest expense 8,938 9,533 18,857 18,913 Interest Income ( 4,921 ) ( 3,935 ) ( 10,863 ) ( 7,887 ) Other loss, net 20,236 9,156 31,476 21,514 Consolidated loss before provision (benefit) for income taxes $ ( 65,933 ) $ ( 114,833 ) $ ( 140,704 ) $ ( 448,532 ) |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
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: Three Months Ended Six Months Ended (in thousands, except share and per share amounts) 2023 2022 2023 2022 Net loss $ ( 66,318 ) $ ( 115,089 ) $ ( 141,362 ) $ ( 425,548 ) Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted 139,146,848 138,075,210 138,838,866 137,667,419 Net loss per share attributable to common stockholders, basic and diluted $ ( 0.48 ) $ ( 0.83 ) $ ( 1.02 ) $ ( 3.09 ) |
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 June 30, 2023 2022 Convertible senior notes 5,936,226 11,158,722 Stock options 2,563,207 4,920,028 Restricted stock units 14,251,567 9,145,799 Total 22,751,000 25,224,549 |
Description of Business and B_2
Description of Business and Basis of Presentation - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2023 Segment | |
Description of Business and Basis of Presentation [Line Items] | |
Number of reportable segments | 3 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Apr. 30, 2023 USD ($) | Jan. 31, 2023 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) Facility | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Nov. 30, 2022 USD ($) | |
Accounting Policies [Line Items] | |||||||||
Other comprehensive income (loss) | $ 0 | $ 0 | $ 0 | $ 0 | |||||
Valuation allowance for finance receivables classified as held for sale | 10,200,000 | 10,200,000 | $ 10,500,000 | ||||||
Debt instrument aggregate principal amount | 422,580,000 | 422,580,000 | 82,556,000 | ||||||
Repurchases of convertible senior notes | 13,194,000 | ||||||||
Cash and cash equivalents | 237,925,000 | 237,925,000 | 398,915,000 | ||||||
Restricted Cash | 66,300,000 | 66,300,000 | |||||||
Gain on debt extinguishment | $ 10,931,000 | $ 19,640,000 | |||||||
Business combination, measurement period | 1 year | ||||||||
ASU 2021-08 | |||||||||
Accounting Policies [Line Items] | |||||||||
Change in accounting principle, accounting standards update, adopted [true false] | true | true | |||||||
Change in accounting principle, accounting standards update, adoption date | Jan. 01, 2023 | Jan. 01, 2023 | |||||||
Change in accounting principle, accounting standards update, immaterial effect [true false] | true | true | |||||||
0.75% Unsecured Convertible Senior Notes Due 2026 | |||||||||
Accounting Policies [Line Items] | |||||||||
Debt instrument aggregate principal amount | $ 625,000,000 | ||||||||
Aggregate principal amount | $ 18,200,000 | $ 32,800,000 | |||||||
Repurchases of convertible senior notes | 7,300,000 | 13,200,000 | |||||||
Gain on debt extinguishment | 10,900,000 | 19,600,000 | |||||||
Debt instrument interest rate | 0.75% | ||||||||
Debt instrument maturity year | 2026 | ||||||||
Unamortized debt discount and debt issuance costs | 5,100,000 | 5,100,000 | |||||||
Net carrying value of debt | 327,400,000 | 327,400,000 | |||||||
Warehouse Credit Facility | |||||||||
Accounting Policies [Line Items] | |||||||||
Increased borrowing capacity | 93,000,000 | 93,000,000 | $ 105,800,000 | ||||||
Selling, General and Administrative Expenses | |||||||||
Accounting Policies [Line Items] | |||||||||
Advertising expense | 15,000,000 | 21,100,000 | 26,400,000 | 54,900,000 | |||||
Selling, General and Administrative Expenses | Shipping and Handling | |||||||||
Accounting Policies [Line Items] | |||||||||
Shipping and handling expenses | 2,000,000 | $ 8,200,000 | $ 4,000,000 | $ 35,000,000 | |||||
UACC | |||||||||
Accounting Policies [Line Items] | |||||||||
Net proceeds from securitization | $ 23,100,000 | $ 237,800,000 | |||||||
Number of warehouse credit facilities | Facility | 4 | ||||||||
UACC | Warehouse Credit Facility | |||||||||
Accounting Policies [Line Items] | |||||||||
Aggregate borrowing limit | 850,000,000 | $ 850,000,000 | |||||||
Increased borrowing capacity | 93,000,000 | 93,000,000 | |||||||
Outstanding borrowings | 177,900,000 | 177,900,000 | |||||||
Asset-backed Securities | UACC | |||||||||
Accounting Policies [Line Items] | |||||||||
Securitization transaction | $ 238,700,000 | ||||||||
Vehicle Floorplan Facility | Line Of Credit | |||||||||
Accounting Policies [Line Items] | |||||||||
Increased borrowing capacity | 171,600,000 | 171,600,000 | |||||||
2022 Vehicle Floorplan Facility | Line Of Credit | |||||||||
Accounting Policies [Line Items] | |||||||||
Increased borrowing capacity | $ 500,000,000 | ||||||||
Line of credit facility, unutilized borrowing capacity | $ 39,100 | $ 39,100 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Company Recognized Revenue and Expense Associated with CFEs in Condensed Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Accounting Policy [Line Items] | ||||
Revenue | $ 225,178 | $ 475,437 | $ 421,645 | $ 1,399,212 |
Cost of sales | (179,177) | (409,080) | (336,839) | (1,251,215) |
Other loss, net | 20,236 | 9,156 | 31,476 | 21,514 |
Consolidated VIEs | ||||
Accounting Policy [Line Items] | ||||
Other loss, net | (15,534) | (311) | (24,209) | (12,319) |
Finance | ||||
Accounting Policy [Line Items] | ||||
Revenue | 42,128 | 32,121 | 74,116 | 79,808 |
Cost of sales | (8,060) | (3,402) | (14,274) | (6,126) |
Finance | Consolidated VIEs | ||||
Accounting Policy [Line Items] | ||||
Revenue | 24,849 | 14,156 | 39,768 | 25,040 |
Cost of sales | (5,330) | (1,159) | (8,829) | (2,005) |
Product | ||||
Accounting Policy [Line Items] | ||||
Revenue | 11,924 | $ 14,324 | 23,424 | $ 38,773 |
Cost of sales | (704) | (1,601) | ||
Product | Consolidated VIEs | ||||
Accounting Policy [Line Items] | ||||
Revenue | 3,644 | 5,975 | ||
Cost of sales | $ (703) | $ (1,601) |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Disaggregation Of Revenue [Line Items] | ||
Reserve for chargebacks | $ 7 | $ 8.2 |
Cumulative profit sharing payment recognized | $ 21.4 | 22.5 |
Revenue, practical expedient, incremental cost of obtaining contract | true | |
Accrued Expenses | ||
Disaggregation Of Revenue [Line Items] | ||
Reserve for chargebacks | $ 3.7 | 4.4 |
Residual Interest, 2022-1 Securitization | ||
Disaggregation Of Revenue [Line Items] | ||
Percentage of servicing fees earned on outstanding principal balance of finance receivable | 4% | |
Residual Interest, 2022-2 and 2023-1 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 | $ 3.3 | 3.8 |
Prepaid Expenses and Other Current Assets | ||
Disaggregation Of Revenue [Line Items] | ||
Cumulative profit sharing payment recognized | 2 | 1.6 |
Other Assets | ||
Disaggregation Of Revenue [Line Items] | ||
Cumulative profit sharing payment recognized | $ 19.4 | $ 20.9 |
Variable Interest Entities an_3
Variable Interest Entities and Securitizations - Additional Information (Details) $ in Thousands | 1 Months Ended | 6 Months Ended | |||
Apr. 30, 2023 USD ($) | Jan. 31, 2023 USD ($) | Jun. 30, 2023 USD ($) Facility | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Variable Interest Entity [Line Items] | |||||
Beneficial interests in securitizations | $ 6,553 | $ 20,592 | |||
Asset-backed Securities | |||||
Variable Interest Entity [Line Items] | |||||
Securitization transaction | $ 238,700 | $ 281,400 | |||
UACC | |||||
Variable Interest Entity [Line Items] | |||||
Risk retention rules percentage | 5% | ||||
Number of senior secured warehouse credit facilities | Facility | 4 | ||||
Beneficial interests in securitizations | $ 6,600 | $ 20,600 | |||
Net proceeds from securitization | $ 23,100 | $ 237,800 | |||
Recognized a gain on sale | 29,600 | ||||
Collateralized finance receivable | $ 326,400 | ||||
UACC | Residual Interest, 2022-1 and 2022-2 Securitization | |||||
Variable Interest Entity [Line Items] | |||||
Securitization transaction | $ 32,300 |
Variable Interest Entities an_4
Variable Interest Entities and Securitizations - Summary of Total Assets and Total Liabilities Associated With Variable Interests in Consolidated VIEs (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Restricted cash | $ 66,306 | $ 73,095 |
Finance receivables at fair value, current | 13,117 | 12,939 |
Finance receivables held for sale, net | 290,015 | 321,626 |
Total current assets | 889,573 | 1,220,109 |
Finance receivables at fair value, noncurrent | 454,580 | 140,235 |
Total assets | 1,591,869 | 1,619,027 |
Current Liabilities: | ||
Current portion of long term debt | 231,471 | 47,239 |
Warehouse credit facilities | 177,864 | 229,518 |
Other current liabilities | 11,912 | 17,693 |
Total current liabilities | 667,363 | 703,320 |
Securitization debt, net of current portion | 544,931 | 402,154 |
Other liabilities | 17,410 | 18,183 |
Total liabilities | 1,253,633 | 1,143,786 |
Securitization Vehicles | ||
Current Assets: | ||
Restricted cash | 34,764 | 9,023 |
Finance receivables at fair value, current | 11,431 | 5,336 |
Other current assets | 15,681 | 2,730 |
Total current assets | 61,876 | 17,089 |
Finance receivables at fair value, noncurrent | 418,591 | 72,568 |
Total assets | 480,467 | 89,657 |
Current Liabilities: | ||
Current portion of long term debt | 219,391 | 47,239 |
Other current liabilities | 1,570 | 90 |
Total current liabilities | 220,961 | 47,329 |
Securitization debt, net of current portion | 197,584 | 32,590 |
Other liabilities | 5,696 | 686 |
Total liabilities | 424,241 | 80,605 |
Warehouse Facilities | ||
Current Assets: | ||
Restricted cash | 10,143 | 15,654 |
Finance receivables at fair value, current | 929 | 6,156 |
Finance receivables held for sale, net | 204,420 | 305,917 |
Other current assets | 5,196 | 9,004 |
Total current assets | 220,688 | 336,731 |
Finance receivables at fair value, noncurrent | 23,857 | 47,024 |
Total assets | 244,545 | 383,755 |
Current Liabilities: | ||
Warehouse credit facilities | 177,864 | 229,518 |
Other current liabilities | 1,230 | 1,439 |
Total current liabilities | 179,094 | 230,957 |
Other liabilities | 3,551 | 6,724 |
Total liabilities | 182,645 | 237,681 |
Consolidated VIEs | ||
Current Assets: | ||
Restricted cash | 44,907 | 24,677 |
Finance receivables at fair value, current | 12,360 | 11,492 |
Finance receivables held for sale, net | 204,420 | 305,917 |
Other current assets | 20,877 | 11,734 |
Total current assets | 282,564 | 353,820 |
Finance receivables at fair value, noncurrent | 442,448 | 119,592 |
Total assets | 725,012 | 473,412 |
Current Liabilities: | ||
Current portion of long term debt | 219,391 | 47,239 |
Warehouse credit facilities | 177,864 | 229,518 |
Other current liabilities | 2,800 | 1,529 |
Total current liabilities | 400,055 | 278,286 |
Securitization debt, net of current portion | 197,584 | 32,590 |
Other liabilities | 9,247 | 7,410 |
Total liabilities | $ 606,886 | $ 318,286 |
Variable Interest Entities an_5
Variable Interest Entities and Securitizations - Summary of Unconsolidated Variable Interest Entity (Details) - Variable Interest Entity Not Primary Beneficiary - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Variable Interest Entity [Line Items] | ||
Aggregate Principal Balance | $ 6,678 | $ 19,543 |
Carrying Value | 6,863 | 20,902 |
Total Exposure | 6,863 | 20,902 |
Rated Notes | ||
Variable Interest Entity [Line Items] | ||
Aggregate Principal Balance | 6,368 | 19,233 |
Carrying Value | 6,056 | 18,664 |
Total Exposure | 6,056 | 18,664 |
Certificates | ||
Variable Interest Entity [Line Items] | ||
Carrying Value | 497 | 1,928 |
Total Exposure | 497 | 1,928 |
Other Assets | ||
Variable Interest Entity [Line Items] | ||
Aggregate Principal Balance | 310 | 310 |
Carrying Value | 310 | 310 |
Total Exposure | $ 310 | $ 310 |
Acquisition - Additional Inform
Acquisition - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Feb. 01, 2022 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Business Acquisition [Line Items] | |||||||
Net income (loss) | $ (66,318) | $ (75,044) | $ (115,089) | $ (310,459) | $ (141,362) | $ (425,548) | |
Non-recurring tax adjustment (benefit) | 24,100 | ||||||
UACC | |||||||
Business Acquisition [Line Items] | |||||||
Business acquisition, date of acquisition | Feb. 01, 2022 | ||||||
Revenues | 37,000 | 86,000 | |||||
Net income (loss) | $ 1,000 | 20,200 | |||||
Transaction costs | $ 5,700 | ||||||
Percentage of business acquisition rate | 100% | ||||||
Fair value of consideration transferred | $ 315,400 |
Acquisition - Summary of Fair V
Acquisition - Summary of Fair Value of Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 | Feb. 01, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 0 | $ 0 | $ 158,817,000 | |
UACC | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 5,294,000 | |||
Restricted cash | 42,631,000 | |||
Finance receivables at fair value | 296,927,000 | |||
Finance receivables, held for sale | 263,393,000 | |||
Intangible Assets | 156,000,000 | |||
Goodwill | 42,886,000 | |||
Other assets | 25,934,000 | |||
Total assets acquired | 833,065,000 | |||
Warehouse credit facilities | (178,067,000) | |||
Long term debt | (285,704,000) | |||
Deferred tax liability | (23,855,000) | |||
Other liabilities | (30,026,000) | |||
Total liabilities assumed | (517,652,000) | |||
Net assets acquired | $ 315,413,000 |
Acquisition - Summary of Final
Acquisition - Summary of Final Identifiable Intangible Assets Acquired and their Estimated Weighted Average Useful (Details) - UACC $ in Thousands | Feb. 01, 2022 USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 156,000 |
Purchased Technology | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 83,000 |
Weighted Average Useful Life | 7 years |
Customer Relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 66,000 |
Weighted Average Useful Life | 8 years |
Trade Name | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 7,000 |
Weighted Average Useful Life | 10 years |
Acquisition - Summary of Pro Fo
Acquisition - Summary of Pro Forma Information (Details) - UACC $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | |
Total revenue | $ 1,414,683 |
Net loss | $ (437,739) |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Vehicles | $ 207,135 | $ 317,994 |
Parts and accessories | 1,736 | 2,654 |
Total inventory | $ 208,871 | $ 320,648 |
Inventory - Additional Informat
Inventory - Additional Information (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Inventory valuation reserves | $ 12.4 | $ 24.2 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 91,223 | $ 83,104 |
Accumulated depreciation and amortization | (40,534) | (32,903) |
Property and equipment, net | 50,689 | 50,201 |
Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 3,636 | 3,357 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 1,898 | 1,896 |
Logistics fleet | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 32,544 | 32,468 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 7,595 | 6,577 |
Internal-use Software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 36,981 | 30,725 |
Other | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 8,569 | $ 8,081 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Property Plant And Equipment [Line Items] | |||||
Depreciation and amortization | $ 10,304 | $ 10,039 | $ 20,835 | $ 17,895 | |
Selling, General and Administrative Expenses | |||||
Property Plant And Equipment [Line Items] | |||||
Amortization of cloud computing assets | 300 | 600 | 700 | 1,100 | |
Property and Equipment, Net | |||||
Property Plant And Equipment [Line Items] | |||||
Depreciation and amortization | 3,800 | $ 3,400 | 7,700 | $ 6,200 | |
Cloud Computing Arrangements | Other Assets | |||||
Property Plant And Equipment [Line Items] | |||||
Implementation costs capitalized | 8,600 | 8,600 | $ 7,700 | ||
Implementation costs capitalized, accumulated amortization | $ 5,400 | $ 5,400 | $ 4,600 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Summary of Activity in Carrying Value of Goodwill by Reporting Unit (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Goodwill [Line Items] | |
Beginning Balance | $ 158,817 |
Acquisition | 42,886 |
Goodwill impairment charge | (201,703) |
Ending Balance | 0 |
Ecommerce | |
Goodwill [Line Items] | |
Beginning Balance | 152,876 |
Acquisition | 42,886 |
Goodwill impairment charge | (195,762) |
Ending Balance | 0 |
Wholesale | |
Goodwill [Line Items] | |
Beginning Balance | 1,720 |
Acquisition | 0 |
Goodwill impairment charge | (1,720) |
Ending Balance | 0 |
TDA | |
Goodwill [Line Items] | |
Beginning Balance | 4,221 |
Acquisition | 0 |
Goodwill impairment charge | (4,221) |
Ending Balance | $ 0 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Goodwill | $ 0 | $ 0 | $ 0 | $ 0 | $ 158,817,000 |
Impairment charges | 201,703,000 | ||||
Amortization expense for intangible assets | $ 6,800,000 | $ 6,800,000 | $ 13,500,000 | $ 11,800,000 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Intangible Assets, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 190,300 | $ 190,300 |
Accumulated Amortization | (44,901) | (31,390) |
Carrying Value | 145,399 | 158,910 |
Developed and Purchased Technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 108,700 | 108,700 |
Accumulated Amortization | (29,552) | (21,053) |
Carrying Value | 79,148 | 87,647 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 69,400 | 69,400 |
Accumulated Amortization | (12,999) | (8,661) |
Carrying Value | 56,401 | 60,739 |
Trademarks and Trade names | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 12,200 | 12,200 |
Accumulated Amortization | (2,350) | (1,676) |
Carrying Value | $ 9,850 | $ 10,524 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Estimated Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
For remainder of 2023 | $ 13,511 | |
2024 | 27,022 | |
2025 | 27,022 | |
2026 | 21,979 | |
2027 | 21,882 | |
Thereafter | 33,983 | |
Carrying Value | $ 145,399 | $ 158,910 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Accrued marketing expenses | $ 7,365 | $ 2,093 |
Vehicle related expenses | 11,015 | 14,789 |
Sales taxes | 5,014 | 5,983 |
Accrued compensation and benefits | 17,765 | 28,276 |
Accrued professional services | 1,703 | 3,488 |
Accrued legal settlements | 4,306 | 7,383 |
Interest payable | 4,121 | 3,990 |
Other | 7,018 | 10,793 |
Total accrued expenses | $ 58,307 | $ 76,795 |
Accrued Expenses and Other Cu_4
Accrued Expenses and Other Current Liabilities - Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Vehicle payable | $ 5,897 | $ 3,617 |
Reserve for estimated returns | 2,384 | 3,919 |
Insurance payable | 632 | 4,551 |
Other | 2,999 | 5,606 |
Total other current liabilities | $ 11,912 | $ 17,693 |
Vehicle Floorplan Facility - Ad
Vehicle Floorplan Facility - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Nov. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Line Of Credit Facility [Line Items] | ||||||
Restricted cash | $ 66,306 | $ 66,306 | $ 73,095 | |||
2020 Vehicle Floorplan Facility | ||||||
Line Of Credit Facility [Line Items] | ||||||
Debt instrument, covenant compliance | As of June 30, 2023 and December 31, 2022, 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 | 132,500 | $ 132,500 | $ 277,000 | |||
Interest expense | $ 3,700 | $ 6,300 | $ 9,200 | $ 13,300 | ||
Weighted average interest rate | 10% | 10% | 9.25% | |||
Vehicle Floorplan Facility | Credit Balance Agreements | ||||||
Line Of Credit Facility [Line Items] | ||||||
Interest credits earned | $ 2,300 | $ 3,600 | $ 5,800 | $ 7,500 | ||
Vehicle Floorplan Facility | Cash Deposits | ||||||
Line Of Credit Facility [Line Items] | ||||||
Restricted cash | 19,900 | $ 19,900 | $ 34,600 | |||
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 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 allows 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 | 171,600 | $ 171,600 | 343,900 | |||
Line of credit facility, unutilized borrowing capacity | $ 39,100 | $ 39,100 | $ 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 15.0% of the daily floorplan principal balance outstanding. 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% | |||||
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% | |||||
Debt instrument covenant to maintain principal balance outstanding | 15% |
Warehouse Credit Facilities o_3
Warehouse Credit Facilities of Consolidated VIEs - Additional Information (Details) - Warehouse Credit Facility - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Line of Credit Facility [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 93 | $ 105.8 |
Weighted average interest rate | 7% | 6.19% |
Warehouse Credit Facilities o_4
Warehouse Credit Facilities of Consolidated VIEs - Schedule of Terms of the Warehouse Credit Facilities (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Line of Credit Facility [Line Items] | ||
Restricted cash (in thousands) | $ 66,306 | $ 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 (in thousands) | 137,062 | 143,919 |
Outstanding balance (in thousands) | 87,100 | 110,602 |
Restricted cash (in thousands) | $ 4,805 | 8,110 |
Facility Two | ||
Line of Credit Facility [Line Items] | ||
Execution date | Nov. 19, 2013 | |
Maturity date | Jun. 02, 2025 | |
Aggregate borrowings limit (in thousands) | $ 200,000 | |
Aggregate principal balance of finance receivables pledged as collateral (in thousands) | 24,516 | 142,503 |
Outstanding balance (in thousands) | 18,735 | 19,615 |
Restricted cash (in thousands) | $ 1,291 | 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 (in thousands) | 95,058 | 126,636 |
Outstanding balance (in thousands) | 74,000 | 101,435 |
Restricted cash (in thousands) | $ 4,047 | $ 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 |
Long Term Debt - Schedule of De
Long Term Debt - Schedule of Debt Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Current portion of long term debt | $ 231,471 | $ 47,239 |
Long term debt, net of current portion | 544,931 | 402,154 |
Total debt | 776,402 | 449,393 |
Convertible Senior Notes | ||
Debt Instrument [Line Items] | ||
Long term debt, net of current portion | 327,408 | 359,254 |
Securitization Debt of Consolidated VIEs | ||
Debt Instrument [Line Items] | ||
Current portion of long term debt | 219,391 | 47,239 |
Long term debt, net of current portion | 197,584 | 32,590 |
Financing of Beneficial Interest in Securizations | ||
Debt Instrument [Line Items] | ||
Current portion of long term debt | 12,080 | |
Long term debt, net of current portion | 9,629 | |
Junior Subordinated Debentures | ||
Debt Instrument [Line Items] | ||
Long term debt, net of current portion | $ 10,310 | $ 10,310 |
Long Term Debt - Additional Inf
Long Term Debt - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
May 03, 2023 USD ($) | Apr. 14, 2023 BusinessDays $ / shares | Jun. 18, 2021 USD ($) d $ / shares shares | Jul. 31, 2003 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 23, 2023 $ / shares | Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||||||
Debt instrument aggregate principal amount | $ 422,580,000 | $ 422,580,000 | $ 82,556,000 | |||||||
Initial conversion price per share | $ / shares | $ 1 | $ 1 | ||||||||
Repurchases of convertible senior notes | 13,194,000 | |||||||||
Gain on debt extinguishment | 10,931,000 | 19,640,000 | ||||||||
Consecutive trading days | BusinessDays | 30 | |||||||||
Restricted cash (in thousands) | 66,306,000 | 66,306,000 | 73,095,000 | |||||||
Expected payments, 2023 | 106,700,000 | 106,700,000 | ||||||||
Expected payments, 2024 | 160,900,000 | 160,900,000 | ||||||||
Expected payments, 2025 | 91,300,000 | 91,300,000 | ||||||||
Expected payments, 2026 | 42,600,000 | 42,600,000 | ||||||||
Expected payments, 2027 | 21,100,000 | 21,100,000 | ||||||||
Outstanding balance | 776,402,000 | 776,402,000 | 449,393,000 | |||||||
Current portion of long term debt | 231,471,000 | 231,471,000 | 47,239,000 | |||||||
Long term debt, net of current portion | 544,931,000 | 544,931,000 | 402,154,000 | |||||||
Junior subordinated debentures | $ 10,000,000 | |||||||||
Junior Subordinated Debentures | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term debt, maturity date | Oct. 07, 2033 | |||||||||
Long term debt, net of current portion | 10,310,000 | 10,310,000 | 10,310,000 | |||||||
Percentage of owned finance subsidiary | 100% | |||||||||
Financing of Beneficial Interest in Securizations | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Current portion of long term debt | 12,080,000 | 12,080,000 | ||||||||
Long term debt, net of current portion | 9,629,000 | 9,629,000 | ||||||||
SOFR | Junior Subordinated Debentures | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Variable interest rate | 3.05% | |||||||||
Securitization Debt of Consolidated VIEs | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Restricted cash (in thousands) | 34,800,000 | 34,800,000 | 9,000,000 | |||||||
UACC | Repurchase Agreements | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Expected beneficial interests in securitizations pledged as collateral | $ 24,500,000 | |||||||||
Expected proceeds from beneficial interests in securitizations pledged as collateral | $ 24,100,000 | |||||||||
Expected repurchases period start, month and year | 2025-03 | |||||||||
Expected repurchases period end, month and year | 2029-09 | |||||||||
UACC | Financing of Beneficial Interest in Securizations | Repurchase Agreements | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Fair value of the collateral pledged amount | 22,000,000 | 22,000,000 | ||||||||
Outstanding balance | 21,700,000 | 21,700,000 | ||||||||
Current portion of long term debt | 12,100,000 | 12,100,000 | ||||||||
Long term debt, net of current portion | 9,600,000 | 9,600,000 | ||||||||
0.75% Unsecured Convertible Senior Notes Due 2026 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument aggregate principal amount | $ 625,000,000 | |||||||||
Debt instrument interest rate | 0.75% | |||||||||
Aggregate principal amount exercise in overallotment option granted to initial purchasers | $ 75,000,000 | |||||||||
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 | 18,200,000 | 32,800,000 | ||||||||
Repurchases of convertible senior notes | 7,300,000 | 13,200,000 | ||||||||
Gain on debt extinguishment | 10,900,000 | 19,600,000 | ||||||||
Unamortized debt discount and debt issuance costs | 5,100,000 | 5,100,000 | 6,500,000 | |||||||
Net carrying value of debt | 327,400,000 | 327,400,000 | $ 359,300,000 | |||||||
Interest expense | $ 1,100,000 | $ 2,000,000 | $ 2,200,000 | $ 4,000,000 | ||||||
Effective interest rate | 1.30% | 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% | |||||||||
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% | |||||||||
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% | |||||||||
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% | |||||||||
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 |
Long Term Debt - Schedule of Se
Long Term Debt - Schedule of Securitization Debt of Consolidated VIEs (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | ||
Initial Principal | $ 568,405 | $ 93,730 |
Outstanding Principal | 422,580 | 82,556 |
Fair Value | $ 416,975 | $ 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 | Jun. 10, 2026 |
Initial Principal | $ 29,380 | $ 29,380 |
Contractual Interest Rate | 1.14% | 1.14% |
Outstanding Principal | $ 21,686 | $ 29,380 |
Fair Value | $ 21,393 | $ 28,481 |
United Auto Credit 2021-1-E | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Jun. 10, 2026 | Jun. 10, 2026 |
Initial Principal | $ 20,800 | $ 20,800 |
Contractual Interest Rate | 2.58% | 2.58% |
Outstanding Principal | $ 20,800 | $ 20,800 |
Fair Value | $ 20,170 | $ 19,685 |
United Auto Credit 2021-1-F | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Sep. 10, 2027 | Sep. 10, 2027 |
Initial Principal | $ 13,910 | $ 13,910 |
Contractual Interest Rate | 4.30% | 4.30% |
Outstanding Principal | $ 13,910 | $ 13,910 |
Fair Value | $ 13,539 | $ 13,341 |
United Auto Credit 2022-2-A | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Apr. 10, 2025 | |
Initial Principal | $ 119,139 | |
Contractual Interest Rate | 4.39% | |
Outstanding Principal | $ 31,173 | |
Fair Value | $ 31,120 | |
United Auto Credit 2022-2-B | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Dec. 10, 2025 | |
Initial Principal | $ 30,324 | |
Contractual Interest Rate | 5.41% | |
Outstanding Principal | $ 30,324 | |
Fair Value | $ 30,003 | |
United Auto Credit 2022-2-C | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | May 10, 2027 | |
Initial Principal | $ 26,533 | |
Contractual Interest Rate | 5.81% | |
Outstanding Principal | $ 26,533 | |
Fair Value | $ 26,148 | |
United Auto Credit 2022-2-D | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Jan. 10, 2028 | |
Initial Principal | $ 32,889 | |
Contractual Interest Rate | 6.84% | |
Outstanding Principal | $ 32,889 | |
Fair Value | $ 32,297 | |
United Auto Credit 2022-2-E | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Apr. 10, 2029 | |
Initial Principal | $ 33,440 | |
Contractual Interest Rate | 10% | |
Outstanding Principal | $ 33,440 | |
Fair Value | $ 30,420 | |
United Auto Credit 2023-1-A | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Jul. 10, 2025 | |
Initial Principal | $ 118,598 | |
Contractual Interest Rate | 5.57% | |
Outstanding Principal | $ 68,433 | |
Fair Value | $ 68,296 | |
United Auto Credit 2023-1-B | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Jul. 10, 2028 | |
Initial Principal | $ 51,157 | |
Contractual Interest Rate | 5.91% | |
Outstanding Principal | $ 51,157 | |
Fair Value | $ 50,661 | |
United Auto Credit 2023-1-C | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Jul. 10, 2028 | |
Initial Principal | $ 33,326 | |
Contractual Interest Rate | 6.28% | |
Outstanding Principal | $ 33,326 | |
Fair Value | $ 32,996 | |
United Auto Credit 2023-1-D | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Jul. 10, 2028 | |
Initial Principal | $ 35,653 | |
Contractual Interest Rate | 8% | |
Outstanding Principal | $ 35,653 | |
Fair Value | $ 36,152 | |
United Auto Credit 2023-1-E | ||
Debt Instrument [Line Items] | ||
Final Scheduled Payment Date | Sep. 10, 2029 | |
Initial Principal | $ 23,256 | |
Contractual Interest Rate | 10.98% | |
Outstanding Principal | $ 23,256 | |
Fair Value | 23,465 | |
Total Rated Notes | ||
Debt Instrument [Line Items] | ||
Initial Principal | 568,405 | |
Outstanding Principal | 422,580 | |
Fair Value | 416,660 | |
United Auto Credit 2022-2-R | ||
Debt Instrument [Line Items] | ||
Fair Value | $ 315 |
Long Term Debt - Schedule of Ag
Long Term Debt - Schedule of Aggregate Principal Balance and Fair Value of Finance Receivables Pledged to Securitization Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Asset Pledged as Collateral without Right | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Balance | $ 490,496 | $ 84,477 |
Asset Pledged as Collateral with Right | ||
Debt Instrument [Line Items] | ||
Fair Value | 430,022 | 77,904 |
United Auto Credit 2021-1 | Asset Pledged as Collateral without Right | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Balance | 57,829 | 84,477 |
United Auto Credit 2021-1 | Asset Pledged as Collateral with Right | ||
Debt Instrument [Line Items] | ||
Fair Value | 54,464 | $ 77,904 |
United Auto Credit 2022-2 | Asset Pledged as Collateral without Right | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Balance | 170,368 | |
United Auto Credit 2022-2 | Asset Pledged as Collateral with Right | ||
Debt Instrument [Line Items] | ||
Fair Value | 143,263 | |
United Auto Credit 2023-1 | Asset Pledged as Collateral without Right | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Balance | 262,299 | |
United Auto Credit 2023-1 | Asset Pledged as Collateral with Right | ||
Debt Instrument [Line Items] | ||
Fair Value | $ 232,295 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | 1 Months Ended | ||
Apr. 14, 2023 BusinessDays $ / shares | Jun. 22, 2023 | Jun. 23, 2023 $ / shares | |
Commitments and Contingencies Disclosure [Abstract] | |||
Common stock bid price | $ / shares | $ 1 | $ 1 | |
Consecutive business days | 11 days | ||
Consecutive trading days | BusinessDays | 30 |
Preferred Stock and Stockhold_2
Preferred Stock and Stockholders' Equity - Additional Information (Details) | 6 Months Ended | ||
Jun. 11, 2020 $ / shares shares | Jun. 30, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares | |
Stockholders' Equity Note [Abstract] | |||
Preferred stock, authorized | 10,000,000 | ||
Preferred stock, issued | 0 | ||
Preferred Stock, outstanding | 0 | ||
Forward stock split | 2 | ||
Common stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, voting rights | one vote | ||
Stock split, description | 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, $0.001 par value per share. | ||
Common stock, shares authorized | 500,000,000 | 500,000,000 | 500,000,000 |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jul. 25, 2022 | May 20, 2022 | May 09, 2022 | May 28, 2020 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||||
Company's common stock shares reserved for issuance | 11,011,780 | ||||||||
2020 Incentive Award Plan | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||||
Shares available for future issuance | 1,212,450 | 1,212,450 | |||||||
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 of shares of common stock outstanding as-converted basis | 4% | ||||||||
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 | 2,542,963 | 2,542,963 | |||||||
RSUs | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||||
Award acceleration period | 12 months | ||||||||
Stock-based compensation expense | $ 2.1 | $ 1.4 | $ 3.9 | $ 4.6 | |||||
Unrecognized stock-based compensation expense | $ 17.7 | $ 17.7 | $ 18.2 | ||||||
Unrecognized stock-based compensation weighted-average period | 1 year 10 months 24 days | 1 year 10 months 24 days | |||||||
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 | $ 7.50 | |||||||
Number of consecutive trading days | 20 days | 20 days | |||||||
Vesting description | The vesting of the 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 | $ 15 | |||||||
Number of consecutive trading days | 20 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 | $ 21 | |||||||
Number of consecutive trading days | 20 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 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 597,488 | $ 356,453 |
Total financial liabilities | 416,975 | 79,829 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 123,238 | 182,687 |
Finance Receivables | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 430,022 | 77,904 |
Finance Receivables at Fair Value | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 37,675 | 75,270 |
Beneficial Interests in Securitizations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 6,553 | 20,592 |
Securitization Debt of Consolidated VIEs | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial liabilities | 416,975 | 79,829 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 123,238 | 182,687 |
Level 1 | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 123,238 | 182,687 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 6,553 | 20,592 |
Total financial liabilities | 416,975 | 79,829 |
Level 2 | Beneficial Interests in Securitizations | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 6,553 | 20,592 |
Level 2 | Securitization Debt of Consolidated VIEs | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial liabilities | 416,975 | 79,829 |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 467,697 | 153,174 |
Level 3 | Finance Receivables | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 430,022 | 77,904 |
Level 3 | Finance Receivables at Fair Value | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 37,675 | $ 75,270 |
Financial Instruments and Fai_4
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) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Finance Receivables of Consolidated CFEs | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Losses included in other income | $ 21,988 | $ 924 | $ 31,885 | $ 15,295 |
Finance Receivables of Consolidated CFEs | Level 3 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Fair Value, Beginning Balance | 77,904 | |||
Reclassification of finance receivables held for sale to finance receivables at fair value, net | 248,081 | |||
Acquired in business combination | 262,644 | |||
Transfer within Level 3 categories | 25,718 | (10,904) | ||
Consolidation of VIEs | 180,706 | |||
Losses included in other income | (37,890) | (18,279) | ||
Sales | (24,312) | |||
Paydowns | (77,007) | (56,749) | ||
Other | 12,510 | 6,977 | ||
Fair Value, Ending Balance | 430,022 | 159,377 | 430,022 | 159,377 |
Finance Receivables at Fair Value | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Losses included in other income | (10) | 8,865 | (1,422) | 8,252 |
Finance Receivables at Fair Value | Level 3 | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Fair Value, Beginning Balance | 75,270 | |||
Acquired in business combination | 34,283 | |||
Transfer within Level 3 categories | (25,718) | 10,904 | ||
Losses included in other income | (1,396) | (10,163) | ||
Issuances, net of discount | 3,392 | 49,475 | ||
Paydowns | (14,883) | (17,941) | ||
Other | 1,010 | 1,849 | ||
Fair Value, Ending Balance | $ 37,675 | $ 68,407 | $ 37,675 | 68,407 |
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) |
Financial Instruments and Fai_5
Financial Instruments and Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Finance receivable fair value on non-recurring basis | $ 16.2 | $ 22.4 |
Level 3 | 2022-2 Securitization Transaction | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Finance receivables | 180.7 | |
Level 3 | 2023-1 Securitization Transaction | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Finance receivables held for sale, Fair Value | $ 248.1 |
Financial Instruments and Fai_6
Financial Instruments and Fair Value Measurements - Summary of Gains or Losses Recorded Related to Eligible Financial Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items] | ||||
Total net loss included in other income | $ 16,210 | $ 9,602 | $ 24,134 | $ 21,152 |
Fair Value, Asset (Liability), Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | 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) | $ (6,029) | $ (352) | $ (7,251) | $ (2,716) |
Finance Receivables of CFEs | ||||
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items] | ||||
Financial Assets Gain (Loss) | 21,988 | 924 | 31,885 | 15,295 |
Finance Receivables at Fair Value | ||||
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items] | ||||
Financial Assets Gain (Loss) | (10) | 8,865 | (1,422) | 8,252 |
Beneficial Interests in Securitizations | ||||
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Line Items] | ||||
Financial Assets Gain (Loss) | $ 261 | $ 165 | $ 922 | $ 321 |
Financial Instruments and Fai_7
Financial Instruments and Fair Value Measurements - Summary of Other Relevant Data Related to Finance Receivables Carried at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
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 | $ 490,496 | $ 84,477 |
Aggregate fair value of finance receivables reported at fair value | 430,022 | 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 | 6,306 | 1,097 |
Aggregate fair value of receivables carried at fair value that are on nonaccrual status | 5,535 | 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 | 44,898 | 89,068 |
Aggregate fair value of finance receivables reported at fair value | 37,675 | 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 | 548 | 1,499 |
Aggregate fair value of receivables carried at fair value that are on nonaccrual status | $ 394 | $ 1,311 |
Financial Instruments and Fai_8
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 - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Rated Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Aggregate unpaid principal balance of rated notes of securitized VIEs | $ 422,580 | $ 82,556 |
Aggregate fair value of securitized VIEs | 416,660 | $ 79,829 |
Residual Securitized VIEs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Aggregate fair value of securitized VIEs | $ 315 |
Financial Instruments and Fai_9
Financial Instruments and Fair Value Measurements - Summary of Fair Value of Financial Instruments Not Carried at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Finance receivables held for sale, Carrying value | $ 290,015 | $ 321,626 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible Senior Notes, Carrying value | 327,408 | 359,254 |
Convertible Senior Notes, Fair value | 131,333 | 128,026 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Finance receivables held for sale, Carrying value | 273,817 | 299,235 |
Finance receivables held for sale, Fair Value | $ 275,755 | $ 299,925 |
Restructuring Activities - Addi
Restructuring Activities - Additional Information (Details) $ in Millions | Apr. 26, 2023 USD ($) Position | Jan. 18, 2023 Position | Jun. 30, 2023 USD ($) |
Restructuring and Related Activities [Abstract] | |||
Number of reduction position | Position | 120 | 275 | |
Expected cost | $ | $ 2.3 | $ 4.1 |
Restructuring Activities - Comp
Restructuring Activities - Components of Restructuring and Related Charges (Details) - Realignment Plan - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 14 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | |
Restructuring Cost and Reserve [Line Items] | |||||
Severance and termination benefits | $ 2,277 | $ 4,946 | $ 6,381 | $ 4,946 | $ 13,739 |
Impairment of operating lease right-of-use assets | 3,407 | 3,407 | 6,491 | ||
Other costs | 1,176 | 1,176 | 1,176 | ||
Total restructuring and related charges | $ 2,277 | $ 9,529 | $ 6,381 | $ 9,529 | $ 21,406 |
Restructuring Activities - Reco
Restructuring Activities - Reconciliation of Beginning and Ending Restructuring Liability (Details) - Realignment Plan - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||
Balance | $ 810 | |
Accrual and accrual adjustments | 6,381 | $ 5,529 |
Cash payments | (6,237) | (2,435) |
Balance | $ 954 | $ 3,094 |
Segment Information - Additiona
Segment Information - Additional Information (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2023 USD ($) Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Number of operating segments | 3 |
Segment assets | $ | $ 0 |
Segment Information - Summary o
Segment Information - Summary of Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||
Revenues from external customers | $ 225,178 | $ 475,437 | $ 421,645 | $ 1,399,212 |
Gross profit | 46,001 | 66,357 | 84,806 | 147,997 |
Ecommerce | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from external customers | 138,225 | 321,632 | 273,858 | 996,995 |
Gross profit | 12,189 | 33,509 | 22,223 | 67,828 |
Wholesale | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from external customers | 30,800 | 82,901 | 44,695 | 222,885 |
Gross profit | (3,993) | (1,934) | (3,931) | (4,686) |
Retail Financing | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from external customers | 42,128 | 32,121 | 74,116 | 79,808 |
Gross profit | 34,068 | 28,720 | 59,842 | 73,682 |
All Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues from external customers | 14,025 | 38,783 | 28,976 | 99,524 |
Gross profit | $ 3,737 | $ 6,062 | $ 6,672 | $ 11,173 |
Segment Information - Schedule
Segment Information - Schedule of Reconciliation Between Reportable Segment Gross Profit to Consolidated Loss Before Provision (Benefit) for Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Reconciliation to consolidated total revenue | ||||
Total revenue | $ 225,178 | $ 475,437 | $ 421,645 | $ 1,399,212 |
Reconciliation to consolidated loss before (benefit) provision for income taxes | ||||
Gross Profit | 46,001 | 66,357 | 84,806 | 147,997 |
Selling, general and administrative expenses | 86,955 | 152,990 | 183,492 | 340,984 |
Depreciation and amortization | 10,304 | 10,039 | 20,835 | 17,895 |
Impairment charges | 1,353 | 3,407 | 1,353 | 205,110 |
Gain on debt extinguishment | (10,931) | (19,640) | ||
Interest expense | 8,938 | 9,533 | 18,857 | 18,913 |
Interest Income | (4,921) | (3,935) | (10,863) | (7,887) |
Other loss, net | 20,236 | 9,156 | 31,476 | 21,514 |
Loss before provision (benefit) for income taxes | (65,933) | (114,833) | (140,704) | (448,532) |
All Other | ||||
Reconciliation to consolidated total revenue | ||||
Total revenue | 14,025 | 38,783 | 28,976 | 99,524 |
Reconciliation to consolidated loss before (benefit) provision for income taxes | ||||
Gross Profit | 3,737 | 6,062 | 6,672 | 11,173 |
Reportable Segments | ||||
Reconciliation to consolidated total revenue | ||||
Total revenue | 211,153 | 436,654 | 392,669 | 1,299,688 |
Reconciliation to consolidated loss before (benefit) provision for income taxes | ||||
Gross Profit | $ 42,264 | $ 60,295 | $ 78,134 | $ 136,824 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Income Taxes [Line Items] | |||||
Effective tax rate | (0.58%) | (0.22%) | (0.47%) | 5.12% | |
Uncertain tax positions | $ 0 | $ 0 | $ 0 | ||
Interest accrued in relation to uncertain tax positions | 0 | 0 | |||
Penalties accrued in relation to uncertain tax positions | $ 0 | $ 0 | |||
Unitas Holdings Corp. | |||||
Income Taxes [Line Items] | |||||
Decrease of valuation allowance result from acquisition | $ 23,900,000 |
Net Loss Per Share - Summary of
Net Loss Per Share - Summary of Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Earnings Per Share [Abstract] | ||||||
Net loss | $ (66,318) | $ (75,044) | $ (115,089) | $ (310,459) | $ (141,362) | $ (425,548) |
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic | 139,146,848 | 138,075,210 | 138,838,866 | 137,667,419 | ||
Weighted-average number of shares outstanding used to compute net loss per share attributable to common stockholders, diluted | 139,146,848 | 138,075,210 | 138,838,866 | 137,667,419 | ||
Net loss per share attributable to common stockholders, basic | $ (0.48) | $ (0.83) | $ (1.02) | $ (3.09) | ||
Net loss per share attributable to common stockholders, diluted | $ (0.48) | $ (0.83) | $ (1.02) | $ (3.09) |
Net Loss Per Share - Summary _2
Net Loss Per Share - Summary of Calculation of Diluted Shares Outstanding (Details) - shares | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Potentially dilutive shares not included in calculation of diluted shares outstanding | 22,751,000 | 25,224,549 |
Stock Options | ||
Potentially dilutive shares not included in calculation of diluted shares outstanding | 2,563,207 | 4,920,028 |
Restricted Stock Units | ||
Potentially dilutive shares not included in calculation of diluted shares outstanding | 14,251,567 | 9,145,799 |
Convertible Senior Notes | ||
Potentially dilutive shares not included in calculation of diluted shares outstanding | 5,936,226 | 11,158,722 |