Shares of on-line used-car retailer Carvana surged Thursday after the corporate mentioned its second-quarter outcomes would probably are available in forward of its earlier expectations as cost-reduction measures take maintain.

Shares gained 56% in the course of the buying and selling session.

The corporate mentioned it now expects to report adjusted earnings earlier than curiosity, tax, depreciation and amortization, or EBITDA, of greater than $50 million within the second quarter of 2023. Wall Road analysts surveyed by FactSet had anticipated the corporate to roughly break even on that foundation.

Carvana mentioned it additionally expects its gross revenue per unit, or GPU, to be above $6,000 within the second quarter. That may be a brand new firm document and a rise of greater than 60% from the second quarter of 2022.

The corporate posted a GPU of $4,303 within the first quarter of 2023, up 52% from a yr earlier.

Carvana’s most up-to-date steerage in Might referred to as for a constructive adjusted EBITDA and adjusted gross revenue per unit of $5,000 within the second quarter.

The corporate’s shares loved a powerful run-up in the course of the pandemic as patrons turned to on-line sources for used automobiles. The corporate borrowed closely to maintain up with demand — nevertheless it discovered itself in a steep gap final yr, as rates of interest started rising and used-car costs softened. It responded with an aggressive cost-cutting effort.

Carvana’s inventory fell about 98% in 2022 however has recovered important floor in current months: Via Thursday’s shut, it is up greater than 400% because the begin of 2023.

“The group’s persistent deal with driving profitability has resulted in important financial savings and efficiencies, and this work will persist as we proceed to execute our plan,” CEO Ernie Garcia mentioned in a press release Thursday. “Our progress continues to positively affect the enterprise even quicker than anticipated.”