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Table of Contents income tax expense, depreciation and amortization expense, and the compensation expense related to the 100k Milestone Gift. EBITDA margin ex-Gift is EBITDA ex-Gift as a percentage of total revenues. We use EBITDA ex-Gift to measure the operating performance of our business and EBITDA Margin ex-Gift to measure our operating performance relative to our total revenues. We believe that EBITDA ex-Gift and EBITDA margin ex-Gift are useful measures to us and to our investors because they exclude certain financial and capital structure items and the expense associated with the 100k Milestone Gift that we do not believe directly reflect our core operations and may not be indicative of our recurring operations, in part because they may vary widely across time and within our industry independent of the performance of our core operations. In particular, we expect the 100k Milestone Gift to be a one-time award program for which we will recognize varying amounts of expense beginning in the second half of 2018 and continuing through the first half of 2020, and therefore we believe the related expense does not reflect our core operations, is not included in our past operations, and may not be indicative of our future operations. Additionally, the shares issued to settle the 100k Milestone Gift are offset by share contributions from Mr. Garcia to Carvana; therefore, we expect the impact on shares outstanding to be nearly zero. We believe that excluding these items enables us to more effectively evaluate our performance period-over-period and relative to our competitors. EBITDA ex-Gift and EBITDA margin ex-Gift may not be comparable to similarly titled measures provided by other companies due to potential differences in methods of calculations. A reconciliation of EBITDA ex-Gift to net loss which includes 100k Milestone Gift expense and is the most directly comparable GAAP measure, and calculation of EBITDA margin ex-Gift is as follows (dollars in thousands): YEARS ENDED DECEMBER 31, 2018 2017 2016 2015 2014 Net loss $(254,745) $(164,316) $(93,112) $(36,780) $(15,238) Depreciation and amortization expense 23,539 11,568 4,658 2,800 1,706 Interest expense 25,018 7,659 3,587 1,412 108 100k Milestone Gift 11,821 — — — — EBITDA ex-Gift $(194,367) $(145,089) $(84,867) $(32,568) $(13,424) Total revenues $1,955,467 $858,870 $365,148 $130,392 $41,679 Net Loss Margin (13.0)% (19.1)% (25.5)% (28.2)% (36.6)% EBITDA Margin ex-Gift (9.9)% (16.9)% (23.2)% (25.0)% (32.2)% -62- HOUSE_OVERSIGHT_024371