(Bloomberg) -- Carvana Co. reported higher-than-expected results for the most recent quarter, as growing sales and cost cutting brought about stronger profits and a better outlook for the rest of the year.

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The online used-car retailer made $429 million in adjusted earnings before interest, taxes, depreciation and amortization in the three months ended Sept. 30, which was well above analysts’ expectations for $326.8 million and the $148 million it earned a year ago. Its revenue came to $3.66 billion, according to a statement Wednesday, also surpassing consensus estimates for $3.46 billion.

Arizona-based Carvana has been trying to slash costs and grow used-vehicle sales in a fragmented market. Operating and selling costs have come down while revenue soared by almost one-third, showing that profits look sustainable.

The company’s stock rose 22% in postmarket trading to $253.25 as of 5:02 p.m. in New York. Its shares already had nearly quadrupled this year as of the close of regular trading Wednesday.

‘Strong Performance’

Carvana’s operating improvements should be sustainable and could enable the company to get a credit upgrade next year, according to Bloomberg Intelligence analyst Joel Levington. If that happens, he added, the company could refinance its high-interest debt and slash its interest payments.

“They have put up several quarters of strong performance and shown that they can improve the business,” Levington said.

Carvana’s third consecutive quarter of profits is giving it momentum into the last three months of the year. It sold more than 108,000 vehicles, up 34% year-on-year, and said it expects volume gains in the current quarter.

The company forecast 2024 earnings “significantly above the high end” of its previous projection “as long as the environment remains stable.” It had earlier predicted full-year profit in a range between $1 billion to $1.2 billion.

Carvana said retail gross profit per vehicle sold came to a record $3,497 in the third quarter. It also said selling, general and administrative costs per retail unit sold were $1,030 per vehicle lower than the same quarter a year ago.

Carvana has $5.4 billion in long-term debt and paid $157 million in interest expense, which is greater than its net income. The car retailer is projected to pay $668 million in interest this year, Levington said — and could cut that in half if it pushes for an upgrade and goes to the capital markets to restructure debt.