CarMax Reports 6.1% Revenue Growth to $7.55 Billion in Q1 Fiscal 2026

CarMax, Inc. reported a significant increase in financial performance for the first quarter of fiscal 2026, ending May 31, 2025. The company achieved net sales and operating revenues of $7.55 billion, a 6.1% increase from $7.11 billion in the same period last year. This growth was primarily driven by a 9.0% rise in used vehicle sales, which reached $6.10 billion, compared to $5.68 billion in the prior year. Gross profit also saw a notable increase of 12.8%, totaling $893.6 million, up from $791.9 million, while net earnings rose by 38.0% to $210.4 million, resulting in a diluted earnings per share of $1.38, compared to $0.97 in the previous year.

In terms of operational metrics, CarMax sold 230,210 used vehicles during the quarter, reflecting a 9.0% increase in unit sales. The average gross profit per used vehicle sold increased to $2,407, a 2.6% rise from the previous year. The company also reported a slight decrease in wholesale vehicle sales, which totaled $1.25 billion, down from $1.26 billion, attributed to a 1.7% decline in average selling prices. The overall increase in revenues was supported by a 10.8% rise in extended protection plan revenues, which reached $131.7 million.

Strategically, CarMax continues to enhance its omni-channel experience, allowing customers to purchase vehicles online, in-store, or through a combination of both. The company operates 250 used car stores across 109 U.S. television markets, with plans to open six new stores and two additional reconditioning/auction centers in fiscal 2026. The company is also focusing on expanding its CarMax Auto Finance (CAF) operations, which financed 41.8% of retail used vehicle unit sales in the first quarter. CAF income, however, decreased by 3.6% to $141.7 million, primarily due to an increase in the provision for loan losses.

The company’s balance sheet remains strong, with total assets of $27.39 billion as of May 31, 2025, slightly down from $27.40 billion at the end of February 2025. Total liabilities decreased to $21.10 billion from $21.16 billion, while shareholders' equity increased to $6.29 billion. CarMax reported cash and cash equivalents of $262.8 million, up from $246.9 million, and a total inventory of $3.62 billion, reflecting a decrease of $310.3 million compared to the start of the fiscal year.

Looking ahead, CarMax aims to leverage its digital capabilities and enhance customer experiences while maintaining operational efficiencies. The company plans to accelerate its share repurchase program and expects to achieve low-single-digit gross profit growth to support its SG&A leverage goals. With a focus on expanding its market share and improving its omni-channel offerings, CarMax is positioned to continue driving sales and profitability in the coming quarters.