CarMax Reports Decline in Financial Performance for Fiscal Year Ending February 28, 2026

CarMax, Inc. reported a decline in financial performance for the fiscal year ending February 28, 2026, with net sales and operating revenues totaling $25.88 billion, a decrease of 1.8% from the previous year. The company's gross profit also fell by 3.2% to $2.81 billion, while net earnings dropped significantly by 50.6% to $247.3 million, resulting in a diluted earnings per share of $1.68, down from $3.21 in the prior year. The decline in profitability was attributed to a combination of reduced vehicle sales and increased operational costs, including a goodwill impairment charge of $141.3 million.

In terms of unit sales, CarMax sold 780,684 used vehicles, reflecting a 1.1% decrease compared to the previous fiscal year. The company also experienced a 2.0% decline in comparable store sales. The average gross profit per used vehicle sold decreased by 2.5% to $2,253, while wholesale gross profit per unit fell by 4.9% to $974. The company’s CarMax Auto Finance segment reported income of $562.7 million, down 3.3% from the previous year, primarily due to an increase in the provision for loan losses.

Strategically, CarMax has been focusing on enhancing its digital capabilities and expanding its omni-channel experience, which allows customers to purchase vehicles online, in-store, or through a combination of both. The company completed the acquisition of Edmunds Holding Company in June 2021, which has bolstered its digital presence. As of February 28, 2026, CarMax operated 256 used car stores across 110 U.S. television markets, with plans to open four additional stores and two stand-alone reconditioning/auction centers in fiscal 2027.

Operationally, CarMax reported that approximately 81% of customers utilized its digital capabilities during their transactions, with 68% of sales being classified as omni-channel. The company also purchased approximately 1.1 million vehicles from consumers and dealers during the fiscal year, with a significant portion of its inventory sourced directly from consumer appraisals. As of the end of the fiscal year, CarMax had a total employee headcount of 27,796, reflecting its commitment to maintaining a robust workforce to support its operations.

Looking ahead, CarMax aims to improve its sales and earnings by focusing on competitive pricing, enhancing customer experience, and leveraging technology to streamline operations. The company has set a goal to achieve $200 million in savings from selling, general, and administrative expenses by the end of fiscal 2027, while also planning to invest in digital enhancements and marketing strategies to drive customer acquisition. Despite the challenges faced in fiscal 2026, CarMax remains optimistic about its growth potential and the opportunities within the used vehicle market.