CarMax, Inc. reported a decline in financial performance for the third quarter and first nine months of fiscal 2026, as detailed in its latest 10-Q filing. For the three months ended November 30, 2025, the company generated net sales and operating revenues of $5.79 billion, a decrease of 6.9% compared to $6.22 billion in the same period last year. The decline was attributed to an 8.0% drop in used vehicle unit sales, which totaled 169,557 units. Gross profit also fell by 12.9% to $590 million, while net earnings decreased significantly by 50.4% to $62.2 million, resulting in diluted earnings per share of $0.43, down from $0.81 a year earlier.
In the nine-month period ending November 30, 2025, CarMax reported total revenues of $19.94 billion, down 2.0% from $20.35 billion in the prior year. The decrease in revenues was primarily driven by a 1.1% decline in used vehicle unit sales, which totaled 599,496 units. The company also experienced a slight decrease in average selling prices for used vehicles, which fell by approximately $160. Despite these challenges, CarMax's Auto Finance (CAF) income increased by 9.3% to $174.7 million in the third quarter, largely due to a gain on the sale of auto loans.
Operationally, CarMax has been focusing on strategic initiatives to enhance its market position. The company opened five new stores and three stand-alone reconditioning/auction centers during the first nine months of fiscal 2026, expanding its footprint to 255 used car stores across 110 U.S. television markets. However, the company is also facing challenges, including a need to adjust pricing strategies to remain competitive in a changing market environment. In November 2025, CarMax announced a leadership change, with David McCreight stepping in as Interim President and CEO, as the company seeks to drive sales and improve operations.
The filing also highlighted key operational metrics, including a decrease in total vehicle purchases, which fell by 11.7% in the third quarter. The company reported a significant reduction in inventory levels, down $806.7 million to $3.13 billion, reflecting a strategic response to lower consumer demand. CarMax's liquidity remains strong, with net cash provided by operating activities totaling $2.34 billion for the first nine months of fiscal 2026, compared to $478.1 million in the prior year period.
Looking ahead, CarMax aims to enhance its omni-channel experience and improve customer engagement while managing costs. The company plans to lower margins to make its offerings more attractive and is committed to reducing selling, general, and administrative expenses by at least $150 million by the end of fiscal 2027. Despite the current pressures on earnings, CarMax remains optimistic about its long-term growth potential, particularly through its CAF segment and ancillary products.
About CARMAX INC
CarMax, Inc. is the largest U.S. retailer of used vehicles, offering a broad selection of quality, CarMax Quality Certified used cars through an omni-channel platform that integrates online and in-store buying. It operates retail sales, wholesale vehicle auctions, and a captive auto finance segment serving a wide credit spectrum. CarMax’s no-haggle pricing, extensive inventory, proprietary technology, and customer-centric approach differentiate its integrated vehicle retail and financing business model.
About 10-Q Filings
A 10-Q form is an important financial report that public companies in the United States must submit every three months. It gives a clear picture of a company's financial health and recent performance.
Key points about the 10-Q:
- Frequency: Companies file it three times a year, covering the first three quarters. The fourth quarter is covered in a more comprehensive annual report.
-
Content: It includes:
- Financial statements showing the company's current financial position
- Updates from management on the performance and projections of the business
- Information about potential risks the company faces
- Details on how the company is run internally
- Deadline: Must be filed within 40 or 45 days after the quarter ends, depending on the size of the company.
Our Methodology
AssetRoom is committed to providing timely summaries of news from public companies. We use AI to generate these summaries quickly, but they are not reviewed by human experts.
Our method:
- Data Collection: We continuously monitor for new filings (currently limited to US-listed stocks).
- AI-Powered Analysis: Our advanced AI system processes each filing, identifying key information and extracting relevant data.
- Summary Generation: The AI creates a concise, easy-to-understand summary of the filing, highlighting the most important points.
- Publication: The summary is immediately published on our platform, allowing users instant access to the latest information.
- Email users: We distribute round-up emails according to our users preferences, keeping them in the loop with the companies they follow.
Feedback & Corrections
Spot an error or have a suggestion? Contact us.