CarMax Q3 Earnings Surpass Expectations, Revenues Decline Y/Y

Core Insights - CarMax Inc. reported third-quarter fiscal 2026 adjusted earnings per share of 51 cents, exceeding the Zacks Consensus Estimate of 32 cents, but down from 81 cents in the same quarter last year. Revenues reached $5.8 billion, surpassing the Zacks Consensus Estimate of $5.7 billion, although sales declined by 6.9% year over year [1][9]. Segment Performance - Used-vehicle net sales for CarMax totaled $4.54 billion, a decrease of 7% year over year, attributed to an 8% decline in unit sales, totaling 169,557 vehicles, which was below the forecast of 191,402 units. The average selling price (ASP) of used vehicles increased by 0.9% to $26,383, exceeding the projection of $25,578 [3]. - Comparable store used-vehicle units decreased by 9%, with revenues falling by 8.1% from the prior year. The gross profit per unit (GPU) for used vehicles was $2,235, down from $2,306 in the previous year but above the estimate of $1,978.2 [4]. - Wholesale vehicle revenues decreased by 6.3% year over year to $1,095.1 million, which was above the projection of $1,069.4 million. Units sold fell by 6.2% to 127,603, below the forecast of 139,339. The ASP for wholesale vehicles declined by 0.5% to $8,137, surpassing the estimate of $7,675. Wholesale GPU was $899, down from $1,015 in the prior year but above the estimate of $840.6 [5]. - Other sales and revenues decreased by 9.2% year over year to $150.6 million, missing the estimate of $170.3 million. CarMax Auto Finance's income rose by 9.3% year over year to $174.7 million [6]. Financial Overview - Selling, general, and administrative expenses increased by 1% year over year to $581.4 million. As of November 30, 2025, CarMax had cash and cash equivalents of $204.9 million and long-term debt of $1.17 billion. During the fiscal third quarter, the company repurchased shares worth $201.6 million, with $1.36 billion remaining under the share repurchase authorization [7].