CarMax beats Q1 estimates as higher revenue, wholesale unit growth, and cost leverage support stronger earnings.
Stock Earnings Results
June 17, 2026
Table of Contents
June 17, 2026
CarMax, Inc. (NYSE: KMX) reported first-quarter fiscal 2027 results above expectations, supported by higher revenue, stronger wholesale unit sales, lower SG&A expenses, and improved cost leverage.
CarMax is a used vehicle retailer that sells cars through stores and online, buys vehicles from consumers and dealers, operates wholesale auctions, and provides auto financing through CarMax Auto Finance.
The company reported EPS of $1.31, above estimates of $0.94, representing a 39.4% earnings surprise. Revenue came in at $8.01 billion, above estimates of $7.54 billion, with revenue growth of 6.2%.
Net revenues increased 6.2% to $8.0 billion. Combined retail and wholesale unit sales increased 3.3% to 392,357 vehicles.
Retail used unit sales were roughly flat at 230,293 units, while comparable store used unit sales declined 0.8%. Retail used vehicle revenue increased 4.7%, helped by a 4.5% increase in average retail selling price.
Wholesale unit sales increased 8.4% to 162,064 vehicles, while wholesale revenue rose 14.0%. Wholesale gross profit per unit was $1,046, roughly in line with last year.
Total gross profit declined 4.4% to $854.4 million. Retail used vehicle gross profit per unit fell to $2,177 from last year’s record level of $2,407, reflecting pricing actions meant to support better sales trends.
Net earnings were $185.6 million, down from $210.4 million a year earlier. EPS fell to $1.31 from $1.38, though it still beat analyst expectations.
SG&A expenses decreased 3.7% to $635.2 million. SG&A per total unit improved 6.8% to $1,619, helped by cost reduction efforts and higher total unit sales.
CarMax Auto Finance income was $140.2 million, down 1.0%. CAF penetration expanded to 43.3% from 41.8%, reflecting the company’s full-spectrum growth strategy.
The company bought 322,000 vehicles from consumers and dealers, down 4.4% from the prior-year quarter.
CarMax also said its digital capabilities supported 84% of retail unit sales. Omni-channel sales represented 70% of retail unit sales, while online retail sales accounted for 14%.
New CEO Keith Barr outlined a four-pillar strategy focused on improving the customer offer, simplifying the buying experience, increasing profit per transaction, and running a leaner cost structure.
The company said it is on track to achieve $200 million in targeted SG&A exit-rate savings by the end of fiscal 2027.
CarMax did not repurchase shares during the quarter, but had $1.31 billion remaining under its authorization and said it intends to resume buybacks when appropriate.
CarMax delivered a better-than-expected quarter, but the details were mixed.
Revenue beat estimates, wholesale sales grew, SG&A improved, and EPS came in well above expectations. Still, retail comps declined, gross profit per retail unit fell, and net earnings were lower than last year.
The key question is whether CarMax’s pricing actions, cost reductions, finance expansion, and new strategic framework can turn modest unit growth into stronger long-term earnings momentum.
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