Key Takeaways
- CarMax posted an increase in retail unit sales in the second quarter, and earnings and revenue came in above estimates.
- Comparable store unit sales increased 4.3% year-over-year.
- CEO Bill Nash noted the positive results came even as the industry faced “auto loan loss pressure.”
CarMax (KMX) shares drove higher Thursday after the biggest U.S. used car retailer posted better-than-anticipated results on higher retail vehicle sales.
The company reported fiscal 2025 second-quarter earnings per share (EPS) of $0.85, $0.02 more than the estimate by analysts surveyed by Visible Alpha. Although revenue slipped 0.9% year-over-year to $7.01 billion, that also exceeded forecasts.
Retail Used Unit Sales Jump 5.1%
Retail used unit sales increased 5.1% to 211,020, while wholesale vehicle sales declined 0.3% to 141,458. Comparable store unit sales gained 4.3%.
Gross profit per retail unit was $2,269 and $975 per wholesale unit. Both were in line with last year’s second quarter.
The company bought 300,000 vehicles in the period, a 2.9% increase, driven by a 61.4% jump in purchases from dealers. Purchases from consumers dropped 1.2%.
CEO Says Managing Through ‘Auto Loan Loss Pressure’
Chief Executive Officer (CEO) Bill Nash explained that CarMax was pleased with the “continued improvement of the business” while managing through “industry-wide auto loan loss pressure.”
CarMax shares advanced about 6% in late-morning trading Thursday to move into positive territory for 2024.