Vroom’s fourth quarter (VRM) had a flat tire or two.
Shares of the online used car seller plunged more than 14% in early trading Thursday after the company missed analyst estimates across the board and provided slight first-quarter guidance Wednesday night. The performance put a little pressure on the actions of Vroom’s rival Carvana.
The focus around the sell-off made Vroom’s stock in the top 30 most visited tickers on Yahoo Finance before the opening bell.
For Vroom – which had a wild debut in public markets in June 2020 – the mixed quarter could be reduced to execution missteps.
“The demand came as expected, but due to the constraints of the sales staff and sales support staff, we were unable to convert and process the sales associated with that demand. The result is that our inventory has aged. That aged inventory had to be discounted to go through our retail channels or liquidated in our wholesale channels. Put another way, we bought more inventory than we could actually process and that excess inventory needed to be moved in the fourth quarter and will continue to be moved in the first quarter, “Vroom CEO Paul Hennessy told analysts. in an earnings call.
To this end, the average …
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