In October 2021, we issued Carvana eight tranches of warrants, comprised of three tranches of “short-term warrants” and five tranches of “long-term warrants,” with the opportunity to purchase a maximum of 7.2 million shares of Class A common stock. The short-term warrants expired unexercised on September 1, 2025, at which point the long-term warrants became probable of vesting; the long-term warrants have an expiration date of September 1, 2027.

We recognized compensation expense considering the probability of and progress toward achieving the long-term warrant policy origination milestones. For the three months ended June 30, 2026 and 2025, we recognized compensation expense of $1.6 million and zero, respectively. For the six months ended June 30, 2026 and 2025, we recognized compensation expense of $3.5 million and zero, respectively. Warrant compensation expense is recorded in other insurance expense in the condensed consolidated statements of operations and comprehensive income. All of these warrants are out-of-the-money and, therefore, have no intrinsic value as of June 30, 2026.

Based on the probability of achieving certain policy origination milestones, unrecognized compensation cost is approximately $4.3 million as of June 30, 2026. The weighted-average remaining compensation costs are expected to be recognized over a period of 0.75 years.



Warrants	Exercise Price		Shares Issued (in millions)	Unrecognized Compensation Costs (in millions)		Vesting Condition
Long-Term
Tranche 1	$	180.00	1.4	$	—	100,000 policy originations
Tranche 2	$	225.00	1.5	—		200,000 policy originations
Tranche 3	$	270.00	1.5	4.3		300,000 policy originations
Tranche 4	$	405.00	1.5	2.4		400,000 policy originations
Tranche 5	$	540.00	1.3	1.0		500,000 policy originations
Total Long-Term			7.2	$	7.7

We maintain an equity incentive plan, or the Plan, for the issuance and grant of equity awards (restricted stock, service-based restricted stock units, performance-based restricted stock units, market-based restricted stock units, and incentive and nonqualified stock options) to our officers, directors, employees, and certain advisors. As of June 30, 2026, we had 1.5 million common shares available for issuance under the Plan.


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
	(dollars in millions)
Share-based compensation expense:

Loss and loss adjustment expenses	$	0.7	$	0.8	$	1.9	$	1.4
Sales and marketing	0.4		0.3		0.7		0.5
Other insurance expense	0.5		0.2		0.9		0.5
Technology and development	2.6		1.5		4.8		2.8
General and administrative	0.8		5.6		7.7		9.6
Total share-based compensation expense	$	5.0	$	8.4	$	16.0	$	14.8

The unrecognized compensation cost and the remaining weighted-average period over which these costs are expected to be recognized for restricted stock units and unvested stock options as of June 30, 2026 is as follows:


	Service-based Restricted Stock Units	Performance-based Restricted Stock Units		Market-based Restricted Stock Units
		(dollars in millions)
Unrecognized compensation costs		$	27.9	$	20.3	$	0.2
Remaining weighted-average period cost is expected to be recognized (in years)		1.50		2.36		1.00

A summary of restricted stock units activity for the six months ended June 30, 2026 is as follows:


	Six Months Ended June 30, 2026
	Service-based Restricted Stock Units			Performance-based Restricted Stock Units			Market-based Restricted Stock Units
Restricted Stock Units	Number of Shares	Weighted-Average Grant Date Fair Value per Share		Number of Shares	Weighted-Average Grant Date Fair Value per Share		Number of Shares	Weighted-Average Grant Date Fair Value per Share
	(in millions, except per share amounts)
Unvested at January 1, 2026	0.6	$	47.81	0.4	$	93.78	0.3	$	5.43
Granted	0.4	45.54		0.4	44.33		—	—
Change due to performance criteria achievement	—	—		0.1	75.55		—	—
Vested	(0.3)	49.14		(0.1)	86.34		(0.1)	5.87
Forfeited, expired or canceled	—	63.20		—	—		—	—
Unvested at June 30, 2026	0.7	$	45.18	0.8	$	66.47	0.2	$	5.10


	Six Months Ended June 30,
	2026		2025
	(dollars in millions)
Service-based restricted stock units:
Total grant date fair value of awards granted	$	22.1	$	17.3
Total grant date fair value of awards vested	13.7		8.3
Total intrinsic value of awards vested	14.1		44.6

Performance-based restricted stock units:
Total grant date fair value of awards granted	$	18.1	$	17.3
Total grant date fair value of awards vested	11.1		—
Total intrinsic value of awards vested	7.8		—

Market-based restricted stock units:

Total grant date fair value of awards vested	0.7		0.5
Total intrinsic value of awards vested	5.1		10.1

A summary of option activity for the six months ended June 30, 2026 is as follows:


	Six Months Ended June 30, 2026
Options	Number of Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (in Years)	Aggregate Intrinsic Value
	(in millions, except exercise price and term amounts)
Outstanding and exercisable at January 1, 2026	0.1	$	34.80	2.28	$	5.1
Granted	—	—
Exercised	—	1.38			1.6
Forfeited, expired or canceled	—	145.62
Outstanding and exercisable at June 30, 2026	0.1	$	51.86	1.98	$	1.7