Near-Term Reset for Long-Term Flywheel: Reit. OW, PT to $90

Research evidence excerpt

Near-Term Reset for Long-Term Flywheel: Reit. OW, PT to $90

97bn, down 6% from our prior est. of §e == MorganConsensusStanleydataResearchis providedestimatesby Refinitiv Estimates

$3.16bn. Holding topline growth flat at ~35% in 2H ($15.2bn revenue), the implied Quarterly EPS ($)

Adj EBITDA margin on 2H EBITDA at the midpoint of the guide ($1.41bn) is ~9.3%, a 2026e 2026e 2027e 2027e

Quarter 2025 Prior Current Prior Current

110bps moderation from 1H. In refraining from specificity on what it expects to Q1 0.30 - 0.34a - -

drive the implied margin compression, mgmt. retains flexibility in building out Q2 0.26 - 0.42a - -

Q3 0.21 0.50 0.41 - -

'the machine' between retail unit mix and financing margin as it works through Q4 0.84 0.44 0.34 - -

rightsizing the reconditioning challenges and rebuilding inventory. e = Morgan Stanley Research estimates, a = Actual Company reported data

• Bears will point to a topline deceleration vs. tougher comps in 2H, persistent

reconditioning challenges that are perhaps structural to growth rather than

specific to 2026, and further discounting to variable benchmark rates to

maintain volume growth, introducing greater risk to financing margins and

EBITDA per unit.

• Bulls will point to CVNA's operational prowess underway on the recon side

with improved labor hours per unit as early evidence of execution, with 2H

offering an opportunity for a near-term proof point on GPU stability even as

mix shift moves back towards older used vehicles (lower ASPs).

… and where we stand. At this stage, we have no reason to believe volume growth

will meaningfully decelerate in 2H, even on a tough comp, or that there will be a Morgan Stanley does and seeks to do business with

companies covered in Morgan Stanley Research. As a result,