Name: SHIFT TECHNOLOGIES, INC. Q2 2023 Earnings Call
Start: 2025-11-20 10:01:49.13987+00

Executive Summary

Q2 2023 revenue fell to $47.3M with 1,998 retail units; net loss improved sequentially to $(25.8)M (55% of revenue) and adjusted EBITDA loss narrowed to $(20.6)M (43.5% of revenue) .
Unit economics showed mixed progress: total GPU rose sequentially to $1,557 while adjusted GPU declined to $1,522; wholesale GPU burden improved sharply to $(12) per retail unit versus $(276) in Q1 .
Liquidity tightened; cash, cash equivalents and restricted cash totaled $32.2M at quarter-end, with long-term debt at $164.4M and stockholders’ deficit of $(130.8)M .
Strategic alternatives review remained the key near-term catalyst; new CEO emphasized operational efficiency, F&I attach, and reconditioning, and the company skipped Q&A on the call due to the ongoing process .

What Went Well and What Went Wrong

Sequential operating improvement: net loss and adjusted EBITDA loss narrowed (Q1 net loss $(48.1)M, adj. EBITDA $(24.0)M vs Q2 net loss $(25.8)M, adj. EBITDA $(20.6)M) .
Total GPU improved quarter over quarter to $1,557, driven by better wholesale GPU burden per retail unit (Q1 $(276) → Q2 $(12)) and stable other GPU .
New CEO outlined clear priorities: “expand GPU through operational efficiencies and improving F&I; optimize the customer experience to increase conversion; and drive unit sales through in-market penetration,” noting early steps to restructure and simplify operations .

Significant YoY contraction: revenue down 79% and retail units down 71% vs Q2 2022, with retail ASP down 24% YoY, pressuring scale and leverage .
Gross profit and adjusted gross profit fell YoY; adjusted GPU declined to $1,522 from $1,821 in Q2 2022, reflecting weaker operating leverage and lower ASPs .
Liquidity remains constrained with $32.2M in cash and restricted cash and a material stockholders’ deficit; long-term debt held roughly flat at $164.4M, raising financing and solvency concerns absent a successful strategic outcome .

Metric	Q4 2022	Q1 2023	Q2 2023
Revenue ($USD Millions)	$65.569	$57.693	$47.258
Net Income (Loss) ($USD Millions)	$13.014	$(48.097)	$(25.776)
EPS (Basic/Diluted) ($)	$1.26 / $1.25	$(2.84)	$(1.52)
Net Income (Loss) Margin (%)	20%	83%	54.5%
Adjusted EBITDA ($USD Millions)	$(25.538)	$(24.044)	$(20.568)
Adjusted EBITDA Margin (%)	(38.9)%	(41.7)%	(43.5)%

Segment revenue breakdown:

Revenue Component ($USD Millions)	Q4 2022	Q1 2023	Q2 2023
Retail Revenue, net	$57.579	$51.031	$43.223
Other Revenue, net	$3.201	$1.922	$1.729
Wholesale Vehicle Revenue	$4.789	$4.740	$2.306
Total Revenue	$65.569	$57.693	$47.258

KPIs:

KPI	Q4 2022	Q1 2023	Q2 2023
Retail Units	2,520	2,396	1,998
Wholesale Units	354	344	187
Total Units Sold	2,874	2,740	2,185
Retail ASP ($)	22,849	21,298	21,633
Wholesale ASP ($)	13,528	13,779	12,332
Retail GPU ($/retail unit)	203	951	704
Other GPU ($/retail unit)	1,270	802	865
Wholesale GPU ($/retail unit)	(578)	(276)	(12)
Total GPU ($/retail unit)	895	1,477	1,557
Avg Monthly Unique Visitors	531,592	543,911	356,268
Avg Days to Sale	80	78	73
Retail Vehicles Available for Sale	1,476	1,650	767

Non-GAAP reconciliation highlights (impact on profitability metrics):

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($M)	Q1 2023	$56–$58	Actual: $57.693	Achieved vs guidance
Adjusted GPU ($)	Q1 2023	$1,600–$1,800	Actual: $1,777	Achieved upper end
Adjusted EBITDA ($M)	Q1 2023	$(24)–$(26)	Actual: $(24.044)	In range
Ending Cash ($M)	Q1 2023	~ $70	Reported: $68	Slightly below
Adjusted SG&A (annualized, $M)	FY 2023	$85–$95	No update provided in Q2	Maintained/Not updated
Q2 2023 Guidance	Q2 2023	Not provided in Q4/Q1	None provided; strategic alternatives ongoing	N/A

Topic	Previous Mentions (Q4 2022, Q1 2023)	Current Period (Q2 2023)	Trend
Strategic Alternatives	Initiated review; focus on balance sheet and cost reductions	Process “remains ongoing”; no Q&A due to review	Ongoing; dominates narrative
Omnichannel Model	Transition completed; expected sequential improvement in 2023	Continued focus; tech-enabled omni-channel execution	Execution focus sustained
Unit Economics / GPU	Q1: adj. GPU improved; target $1.6–$1.8k	Priorities to expand GPU via F&I attach and reconditioning; total GPU up QoQ	Mixed: QoQ better total GPU, adj. GPU down
Marketplace / Tech Initiatives	Preparing to launch dealer marketplace in Q3 2023	Focus on customer experience and conversion improvements	Shift to execution over new launches
Nasdaq Compliance / Corporate	Regained minimum bid compliance in March	No new listing updates	Stable

“We have already taken steps to restructure the business and simplify the operations to drive the performance of the business by focusing on the fundamentals… I believe these are the right steps towards positive unit economics and, subsequently, profitability.” — CEO Ayman Moussa .
Strategic priorities on the call: “expand GPU through operational efficiencies and improving F&I; optimize the customer experience to increase conversion; and drive unit sales through in-market penetration.” — CEO Ayman Moussa .
“Because of our ongoing review of strategic alternatives, we will not be taking questions.” — Earnings call closing .

The company did not conduct Q&A due to the ongoing review of strategic alternatives, limiting guidance clarifications and near-term disclosures .

Wall Street consensus (S&P Global) for Q2 2023 EPS and revenue was unavailable due to missing CIQ mapping for SFTGQ; therefore, results could not be compared to S&P Global consensus and estimates-driven tables are omitted [SpgiEstimatesError returned by tool].

Near-term story hinges on strategic alternatives and liquidity: $32.2M cash and restricted cash vs $164.4M long-term debt and $(130.8)M stockholders’ deficit raise urgency for a transaction or financing solution .
Sequential operating progress is visible (narrowing losses, improved total GPU, sharply better wholesale GPU burden), but scale erosion (units/revenue) and lower ASPs challenge path to profitability without renewed unit growth .
Management’s operational focus (F&I attach, reconditioning, conversion) is appropriate; investors should watch for tangible KPI improvements (adj. GPU, conversion, days-to-sale) as leading indicators for margin expansion .
Absence of Q2 guidance and curtailed Q&A increases information risk; expect elevated volatility around future disclosures, including any strategic outcome announcements .
Q1 guidance execution was largely on-target (revenue, adj. GPU, adj. EBITDA), suggesting internal planning has credibility despite macro/scale headwinds; monitor whether similar discipline appears in H2 .
For trading: headlines on strategic alternatives (LOIs, asset sales, financings) are likely to be primary catalysts; operational prints (GPU, SG&A trajectory, cash burn) will shape medium-term risk/reward .
Medium-term thesis depends on successfully stabilizing unit volumes and sustaining GPU improvements while materially reducing adjusted SG&A toward the $85–$95M annualized target communicated earlier in 2023 .

Additional references: