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Carvana Crashes After Earnings Outlook Disappoints Wall Street

Carvana shares plunged in premarket trading after the online used-car retailer issued full-year earnings guidance that may fall short of Wall Street expectations, as vehicle sales growth slowed and profit per car declined. The outlook raises questions about whether Carvana's rapid expansion can justify its high stock valuation.

Carvana reported a record second-quarter adjusted EBITDA of $769 million, narrowly beating the $766.2 million consensus estimate among analysts tracked by Bloomberg, as vehicle sales rose 38% to more than 197,300. Still, sales growth slowed to its weakest quarter since 3Q24, while gross profit per unit declined, suggesting margin pressures remain a major problem.

"This marks 10 straight quarters of being the fastest-growing and most profitable automotive retailer — achieving both by large margins," CEO Ernest Garcia wrote in a letter to shareholders. "We have said that we believe the biggest driver of our results for the foreseeable future will be our execution, and we still believe it."

The online used-car retailer forecasted full-year adjusted EBITDA of $2.7 billion to $3 billion, with the midpoint below the Bloomberg Consensus estimate of $2.99 billion.

Barclays auto analyst John Babcock commented on the earnings:

2Q26 Review: Guidance not as hoped, but we think there is more upside risk

CVNA 2Q26 adj. EBITDA below Barclays, just above Street. 2026 EBITDA guidance ($2.7-$3.0bn) in-line to below Street forecasts and likely disappointed investors seeking upside levers. However, we think there is more upside risk to our forecasts. We maintain OW rating with new PT of $93.

Carvana shares fell about 8% in premarket trading. The year-to-date decline through Wednesday's close stands at around 21.5%. The stock has remained range-bound for 13 months, repeatedly bouncing between resistance near $80 and support around $60.

Here is what other Wall Street desks are saying, courtesy of Bloomberg:

Bloomberg Intelligence

• "Carvana is likely to favor market-share gains over near-term margin expansion in 2H as management prioritizes scale, inventory and customer reach"
• "Lower customer financing rates are supporting demand but weighing on near-term economics before inventory fully catches up and conversion improves"

Morgan Stanley (overweight, PT to $90 from $102)

• Following results, trimming estimates on lighter financing gross profit per unit (GPU)
• "Every GPU-specific question was met with directional color, and management declined to offer quarter-specific or line-item- specific guidance"

JPMorgan (overweight, PT $100)

• Carvana reported a mixed quarter, with 2H forecast looking conservative with operational constraints easing.
• Shares are lower as "the company cycles past a combination of internal, external, and tougher y/y comparisons that have impacted the y/y margin profile"

Tyler Durden Thu, 07/30/2026 - 10:30

DeepSeek Pauses Fundraising After Founder's Remarks Leaked

Authored by Arthur Zhang via The Epoch Times,

Chinese artificial intelligence (AI) startup DeepSeek has paused a second fundraising round after founder Liang Wenfeng’s remarks at a conference circulated online, including a statement that the company could obtain some processors he described as “noncompliant.”

Liang made the remarks during a May 20 closed-door investor meeting on why DeepSeek was receiving fewer Huawei processors than China’s major internet companies. The transcript of the meeting was shared online and posted on GitHub on July 22.

“For us, we can buy some noncompliant cards,” he said.

He did not identify the chips, suppliers, purchasing route, or rules he was referring to.

DeepSeek has not publicly confirmed the transcript. Chinese state media National Business Daily reported that institutions involved in investing in the company confirmed that the meeting occurred and the transcript’s content was accurate.

Bloomberg reported on July 25 that DeepSeek representatives verbally told some prospective investors they would not be signing agreements in the coming days. Discussions continued, and the company could resume the fundraising process later, they said.

DeepSeek was seeking a valuation of about 500 billion yuan ($74 billion) after raising approximately $7.4 billion in its first outside financing round. The pause was driven partly by Liang’s frustration over online reports about his comments to investors, according to Bloomberg.

Chip Access

Liang described advanced processors as DeepSeek’s most valuable use of capital.

He said the company would be willing to turn all available funding into Nvidia chips and pay a premium if enough hardware could be obtained.

“The best thing would be to turn all the money into cards,” he said, using an industry term for graphics processing units (GPUs), the processors used to train and run advanced artificial intelligence models.

Liang said spending 20 billion yuan ($2.8 billion) on processors during the year would represent an exceptional performance by DeepSeek’s purchasing team. Nvidia B200 processors would be worth buying in any available quantity at a reasonable price, he added.

The remarks come as Washington continues to examine how DeepSeek obtained its computing hardware.

In April 2025, the House Select Committee on the Chinese Communist Party said DeepSeek appeared to use tens of thousands of Nvidia processors that are restricted from export to China.

The committee separately asked Nvidia CEO Jensen Huang for records concerning DeepSeek’s acquisition of export-controlled chips, including communications with customers in China and Southeast Asia.

The committee’s findings did not establish that the processors Liang called “noncompliant” were Nvidia products or identify how DeepSeek obtained them.

U.S. controls have continued to evolve. In guidance issued on May 31, the Commerce Department’s Bureau of Industry and Security said a license is required to export covered advanced computing items to companies headquartered in China or whose parent companies are based there—even when the immediate recipient is located in another country.

Compute Gap

DeepSeek drew global attention in January 2025 after releasing lower-cost models that appeared to challenge assumptions about how much computing power companies needed to compete with leading U.S. developers.

Investor concern that less expensive models could reduce demand for costly data centers and processors drove Nvidia shares down nearly 17 percent in one trading session, wiping almost $594 billion from the company’s market value.

Liang’s private account described limits that DeepSeek’s engineering efficiencies had not eliminated.

He said the company possessed computing power equivalent to approximately 20,000 Nvidia H-series processors. Liang did not specify which H-series model he used for the comparison and said much of the equipment had arrived recently or was still awaiting installation.

Even if DeepSeek spent 50 billion yuan ($7 billion), it could not train a model at the scale of the largest U.S. systems, he said.

Liang estimated that such a training run would require approximately 50,000 Nvidia GB300 processors or 200,000 Huawei Ascend 950 processors. That figure did not include the numerous experiments needed before a final model-training run, he said.

He put Chinese developers one to two years behind their U.S. competitors while operating with about a 20th of the computing resources.

Chinese companies could outperform U.S. rivals in selected tasks through engineering efficiency, Liang said, but could not achieve broad superiority while the hardware gap remained so large.

Hardware is not DeepSeek’s only constraint.

Liang said roughly half of the company’s core researchers were working on data annotation—the process of reviewing and correcting material used to refine an artificial intelligence model after its initial training.

He said U.S. developers OpenAI and Anthropic had accumulated an advantage in high-quality post-training data that additional funding could not quickly erase.

Huawei’s Limits

Huawei has become central to Beijing’s effort to reduce China’s dependence on Nvidia and other U.S. semiconductor companies.

Liang said Huawei was allocating DeepSeek about 16,000 Ascend 950 processors, while major Chinese internet companies were receiving allocations in the hundreds of thousands.

DeepSeek’s allocation would provide computing power equivalent to about 4,000 Nvidia B-series processors, by Liang’s estimate.

That would be enough for DeepSeek’s current model generation but not its next one, he said.

Liang said four Huawei processors were needed to match the computing capacity of one Nvidia processor. He also estimated that Nvidia hardware could remain economically useful for about five years, compared with no more than three years for Huawei processors.

Huawei systems would become more expensive to operate as they aged because of their electricity consumption, he said.

Production capacity posed another problem. Huawei could not provide enough processors to satisfy demand from both DeepSeek and China’s major internet companies, according to Liang.

He said DeepSeek was purchasing the Huawei processors partly to help Huawei improve its chip and software ecosystem, even though the allocation was too small to train DeepSeek’s next model.

DeepSeek was also developing software intended to make its models easier to move among Nvidia, Huawei, and other processors. Nvidia’s Compute Unified Device Architecture, its widely adopted programming platform, has made switching hardware costly because developers have built years of software and expertise around it.

Liang also described lower prices as a way for Chinese developers to compete despite their hardware disadvantage. DeepSeek could accept smaller margins than U.S. rivals, he said, while companies trying to operate its publicly released models independently would struggle to match its costs.

Before the May meeting opened to investor questions, the moderator said Liang had disclosed sensitive information and instructed participants not to circulate figures—including processor quantities—or share recordings and screenshots outside the meeting.

Tyler Durden Thu, 07/30/2026 - 10:15

US Grows Only 1.5% In Q2, Badly Missing Estimates, Despite Strong Spending, Investment

The US economy grew at a far weaker than expected pace in the second quarter despite a pickup in consumer spending and solid business investment. According to the BEA, GDP (inflation adjusted) rose just 1.5% in the period, according to the first estimate issued Thursday by the Bureau of Economic Analysis. This was well below the 2.0% median estimate. 

The contributors to the increase in real GDP in the second quarter were increases in consumer spending, investment, and exports that were partly offset by a decrease in government spending. A decline in volatile net exports masked strength in underlying demand as imports, which are a subtraction in the calculation of GDP, increased. Consumer spending, which comprises about two-thirds of economic activity, rose at a 3.2% rate. Business investment continued to boom amid a debt-fueled rush to invest in artificial intelligence.

A closer look at the underlying data:

• Business investment remained a key driver of growth in the second quarter. The massive AI investment push continued to play a critical role as did demand for industrial and transportation equipment. After the Fed decided to keep interest rates unchanged on Wednesday, Chairman Kevin Warsh described the economy’s resilience as “impressive” but noted its “most striking” feature is the strength of business investment. 

  • The GDP report showed nonresidential fixed investment rose at an 8.4% pace. Investment in industrial equipment surged by the most since 2011, and outlays for transportation equipment jumped by the most in two years. Information processing equipment and software outlays rose at a strong, albeit slower rate. 

• Net exports subtracted a percentage point from the calculation of GDP in the second quarter. That likely reflected a mix of factors, including efforts to get goods into the country before a new wave of tariffs and the rapid pace of capital investment. 
• Inventories stripped an additional 0.67% from GDP, suggesting many businesses drew down their inventories during the war.
• Federal government outlays declined, reflecting sales of crude oil from the Strategic Petroleum Reserve, according to the report. But because sales of the oil are reflected in other components of GDP, there is “no direct effect” on GDP. Even so, spending on national defense increased amid the war with Iran. 

Meanwhile, the strength in household outlays was fueled by spending on durable goods like furnishings and motor vehicles. Within services, consumers ramped up outlays on discretionary categories like recreation and food services and accommodation. 

Because swings in trade can distort GDP, economists pay close attention to a narrower metric of underlying demand known as final sales to private domestic purchasers that excludes net exports, changes in inventories and government spending. This measure climbed 3.9% in the second quarter, more than double the first quarter pace and the strongest since early 2023.

As Bloomberg notes, the latest data highlight an economy that’s so far powering through the fallout of the Iran war, while getting the benefit of a historic credit-fueled spending spree behind AI spending. While the conflict has pushed prices higher and weighed on sentiment, a slide in gasoline costs at the end of the quarter alongside higher-than-usual tax refunds and sales promotions helped support household spending.

As reported earlier, more up to date data released on Thursday showed inflation-adjusted consumer spending climbed a robust 0.4% in June, matching the strongest since July 2025. The Federal Reserve’s preferred measure of inflation - the personal consumption expenditures price index - fell 0.1% last month. Excluding food and energy, the index rose less than forecast. 

Looking ahead, Bloomberg notes that the recent flare-up in the Middle East and President Donald Trump’s new tariffs underscore the uncertainty around the outlook. Though the US central bank opted to keep rates unchanged on Wednesday, three policymakers voted to raise borrowing costs amid above-target inflation.

But with layoffs limited, economists generally expect consumer spending to stabilize in the second half of the year. Executives at companies like JPMorgan Chase & Co. and Levi Strauss & Co. have underscored shoppers’ resilience, even as some like PepsiCo Inc. and General Mills Inc. have noted that Americans are growing more discerning in their spending.

Tyler Durden Thu, 07/30/2026 - 10:00

The tea is piping hot as “Virtual Reali-Tea” co-hosts Danny Murphy and Evan Real are recapping “Next Gen NYC” season 2, episode 6, and the explosive midseason trailer. Ariana Biermann’s love “rectangle” was exposed, as VRT exclusively received confirmation about her hook-up with Charlie Zakkour. Emira D’Spain gives Charlie a second chance and Gia Giudice...

The tea is piping hot as “Virtual Reali-Tea” co-hosts Danny Murphy and Evan Real are recapping “Next Gen NYC” season 2, episode 6, and the explosive midseason trailer. Ariana Biermann’s love “rectangle” was exposed, as VRT exclusively received confirmation about her hook-up with Charlie Zakkour. Emira D’Spain gives Charlie a second chance and Gia Giudice...

Leto's agency WME is standing by him following a BBC documentary where multiple women accused him of sexual misconduct, which he denied.

Hollywood studios are increasingly giving preferential treatment to non-journalists with large social media followings.

Senate Minority Leader Chuck Schumer made it crystal clear that he wants maverick Sen. John Fetterman to remain a Democrat even though progressives have been howling over him.

Hormuz Ship Traffic Edges Higher, But Kpler Warns Gulf Crude Exports Remain Impaired

Shipping traffic through the Strait of Hormuz slightly increased as US-Iran negotiations remained ongoing in an effort to restore peace after the memorandum of understanding collapsed amid two weeks of tit-for-tat strikes, according to Pakistan's Foreign Ministry spokesperson Tahir Andrabi, who provided no further details.

Still, the security situation in the Gulf deteriorated overnight after the US launched a new wave of strikes on Iran following attacks on US forces in Jordan. Additionally, reports emerged that a US-owned LNG vessel was struck at an Egyptian port.

Bloomberg cited Kpler data showing that fourteen commodity vessels transited the Hormuz chokepoint in both directions on Wednesday, up from single digits the previous week.

Kpler wrote on X:

Hormuz shipping bottleneck endures

A four-day pause in US strikes on Iran has done little to restore Middle East Gulf crude exports. Confirmed clearance remained close to recent lows, while Gulf loading activity fell by more than half for the first time in six weeks. The crude backlog has shifted between the Gulf and the Gulf of Oman rather than disappeared. Persistent maritime security risks, war risk insurance costs and Iranian interdiction now appear to be the main barriers. Offshore ship to ship transfers are helping manage inventories, but not expanding export capacity. For energy markets, physical shipping data remain a clearer measure of supply conditions than geopolitical headlines.

Hormuz shipping bottleneck endures

A four day pause in US strikes on Iran has done little to restore Middle East Gulf crude exports. Confirmed clearance remained close to recent lows, while Gulf loading activity fell by more than half for the first time in six weeks. The crude… pic.twitter.com/e9aZ5cfGCP

— Kpler (@Kpler) July 30, 2026

Qatar's Al Areesh exited the Persian Gulf carrying the country's first LNG shipment in three weeks, while a supertanker was provisionally booked at nearly $500,000 a day to load Gulf crude for China.

US Energy Secretary Chris Wright said about 6.5 million barrels of oil a day moved through the strait over the past week with US support.

"We are using the United States military to escort out oil and gas out of the Strait of Hormuz,” Wright told Bloomberg Radio, saying about 6.5 million barrels of oil a day exited the Gulf via the strait over the past week. "We are restoring supplies of global oil and refined products to the world out of that region."

Maritime Chokepoint Developments:

Strait of Hormuz

• A Norwegian-flagged products tanker appears to be preparing to exit
• Two Iran-linked Suezmaxes, Chloe and Kariz, sailed into the strait and are now idling off Iran's Bandar Abbas
• Very large crude carrier Jamaica Prosperity was provisionally fixed by the shipping unit of a Chinese charterer to pick up a Persian Gulf cargo on Aug. 3 at 465 Worldscale points, or nearly $500,000 per day

Southern Red Sea

• Twenty-one commodity vessels crossed the Bab el-Mandeb strait in either direction on Wednesday, compared to 38 a day earlier: Kpler
• Only Russian crude left via the chokepoint, totaling about 3.5 million barrels, although some vessels may have transited with transponders off
• South Korean-controlled VLCC V Glory seen approaching Gulf of Aden recently before going dark; Saudi-flagged Samha seen doing so on Thursday
• On Wednesday, some ships were provisionally booked to load from Yanbu in August, with the option of exiting via Bab el- Mandeb to reach South Korea

Northern Red Sea

• Two LNG carriers were struck late Wednesday at Egypt's Damietta port near the mouth of the Suez Canal; no one has claimed responsibility yet
• Japanese-flagged VLCC Takamatsu Maru is the latest to divert to Egypt's Sidi Kerir on the Mediterranean coast as a destination from US previously; ship is currently southeast of Africa
• Bidbid and VL Prosperity have arrived at and loading from Sidi Kerir, with previously reported destinations in Asia
• Three VLCCs — Olympic Luck, DHT Gazelle and DHT Mustang — that departed Yanbu are currently idling off Sidi Kerir with no clear destination

Tyler Durden Thu, 07/30/2026 - 09:30

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'Coordinated Cyberattack' Hits More Than 30 Minnesota Water Systems

Authored by Owen Evans via The Epoch Times,

A “coordinated cyberattack” targeted more than 30 community water systems ‌in Minnesota on July 26 and July 27, the state’s information technology agency said in a statement.

Minnesota IT Services (MNIT) stated on July 28 that it activated its incident response capabilities immediately after learning of the attack. MNIT stated that an investigation remains active, and responders continue to “assess affected systems.”

“At this time, they are not aware of any active requests from Minnesota cities to have their residents modify their drinking water usage,” the agency stated.

John Israel, MNIT assistant commissioner and Minnesota chief information security officer, said such attacks require “a coordinated, whole-of-government response.”

“[The agency] is working side by side with our partners to share intelligence, support affected communities, and help utilities restore operations safely while strengthening defenses against future attacks,” he said.

Emily Zimmer, a spokesperson for the agency, told Reuters in an email that while the investigation remains ongoing, “the timing, methods of access, and targeted infrastructure share characteristics with other coordinated cyber incidents our federal partners have observed involving critical infrastructure.”

Zimmer said the agency could not yet discuss formal attribution or specifics of the incidents. She noted that ‌the agency used the term “attack“ to describe the situation ”because investigators identified unauthorized access with malicious intent directed at these systems.”

The FBI said in a statement that it ‌was ⁠aware of the incident and was in contact with the victims “to resolve the matter.”

In a June 16 article about safeguarding critical water infrastructure, Microsoft stated that while cyberattacks typically “wreak havoc” on digital systems, at a water utility, a network breach “can move quickly into the physical realm.”

“Online systems can give an attacker access to operational technology—physical equipment like pumps, sensors, and chemical treatment systems,” it stated.

It stated that local utilities make prime targets because of their size and that most U.S. water utilities are tiny operations.

According to the Environmental Protection Agency (EPA), 97 percent of the nation’s 156,000 public water systems serve fewer than 10,000 customers.

While it is not yet clear who is responsible for the attacks, Iranian-linked hackers have, for years, targeted U.S. water systems to varying levels of success.

Handala Warning

Iran’s state-run Press TV, which the U.S. Treasury has sanctioned for acting as a propaganda arm of the Islamic Revolutionary Guard Corps, reported on July 23 that the Handala hacking group warned that it will continue targeting U.S. industrial control systems.

Handala is one of several public personas used by a hacking unit operating ​under the Iranian Ministry of Intelligence and Security (MOIS) as part of the agency’s psychological ⁠operations, according to the U.S. Department of Justice.

An April 7 U.S. Cybersecurity and Infrastructure Security Agency (CISA) ​advisory warned that Iranian-affiliated ​hackers were attacking internet-facing ⁠programmable logic controllers, computer devices used to interact with machinery and other critical infrastructure networks, manufactured by Rockwell Automation.

The group said on July 23 that attacks targeting programmable logic controllers and supervisory control and data acquisition systems represented only a portion of its capabilities and warned that wider campaigns could target sectors including water, electricity, and transportation networks, Press TV reported.

A July 22 update to the advisory expanded the ​scope of the targeting to include devices manufactured by Schneider Electric, Siemens, and ​potentially other manufacturers.

CISA stated in its advisory that some hacking activity resembles operations previously attributed to CyberAv3ngers, also known as the Shahid Kaveh Group, which is affiliated with the Cyber Electronic Command of Iran’s Islamic Revolutionary Guard Corps.

CISA acting Director Nick Andersen told The Epoch Times by email: “CISA is aware of multiple potential incidents affecting local water utilities and is coordinating with the EPA and other government and industry partners to understand the scope and provide any information or technical support to help critical infrastructure owners and operators protect their systems.”

On June 11, the cybersecurity company Dataminr issued an alert about Handala, stating that the hacking group had claimed to have compromised California Water Service (Cal Water), one of the largest investor-owned water utilities in the United States, serving approximately 2 million customers across 100 California communities. The hackers published 5 gigabytes of data.

“CISA’s ⁠updated reporting shows a worrying expansion in Iran-linked critical infrastructure targeting focused on the United States,” Joe Slowik, director of threat research and cyber engineering at Dataminr, said in a July 27 blog post on the company’s ⁠website.

CyberAv3ngers struck a small water utility in Aliquippa, Pa., in November 2023, gaining control of a device at the Municipal Water Authority, according to a 2025 report by the Maryland Cybersecurity Council.

Cyberattacks on Water Systems

According to Xylem, a global water technology provider, there’s “no lack of examples” of cyberattacks involving water systems.

In October 2024, New Jersey-based American Water, the largest regulated water and wastewater utility company in the United States, which serves more than 14 million people in 14 states and on 18 military installations, had to shut down computer systems due to a cyberattack.

In January 2024, the Russian hacktivist group Cyber Army of Russia Reborn claimed responsibility for attacks on water facilities in the United States and Poland. In Muleshoe, Texas, one breach resulted in the loss of tens of thousands of gallons of water.

Authorities have assessed that a Chinese Communist Party state-sponsored cyber group known as Volt Typhoon is seeking to pre-position itself on IT networks for disruptive or destructive cyberattacks against U.S. critical infrastructure.

In a 2024 statement, CISA said that Volt Typhoon uses hacking techniques that avoid installing malware, which can be relatively easily detected, and instead rely on built-in tools that are harder to spot.

This means that they exploit weak admin passwords, factory-default logins, and unpatched internet-connected devices

In a January report from the Congressional Research Service, Chris Jaikaran, a specialist in cybersecurity policy, said that the U.S. Intelligence Community assesses that China is “the most active and persistent cyber threat” to U.S. institutions.

Tyler Durden Thu, 07/30/2026 - 09:10

Elizabeth “Liz” Waddell, 44, was on a three-week vacation with her pal in the picturesque beach resort neighborhood of Grand Anse when she suddenly vanished last Wednesday.

Get up to $1,500 in Bonuses + $50 BetMGM Reward Points with the BetMGM bonus code NYPMAX1550 for Mets vs. Marlins.

The 2025 season was one of redemption for Seahawks quarterback Sam Darnold. Going into the start of last year, skepticism remained about his ability to play at a high level at the quarterback position. After failing with the Jets and Panthers, then becoming a backup with the 49ers, he finally had a breakout season at...