RICHMOND, Virginia – CarMax Inc. . (NYSE:) saw its share price decline slightly, falling 1.9%, after reporting first-quarter earnings and revenue that missed Wall Street’s expectations.
The company reported earnings per share (EPS) of $0.97, slightly below analysts’ estimates of $0.98. Revenue also fell short of analysts’ forecasts, coming in at $7.11 billion versus the consensus estimate of $7.2 billion.
The company’s first-quarter results were marked by a 3.1% decline in retail used unit sales and a 3.8% decline in comparable store used unit sales compared to the same quarter last year. Wholesale sales also saw a decline of 8.3% compared to the previous year’s first quarter. Gross profit per used retail unit remained stable at $2,347, consistent with last year’s levels, while gross profit per used unit at wholesale increased to a record $1,064. CarMax Auto Finance (CAF) revenues showed positive growth, increasing 7.0% compared to the prior year’s first quarter to reach $147.0 million.
Bill Nash, President and Chief Executive Officer, commented on the results, stating, “I am encouraged by the trends we saw in the first quarter, including continued year-over-year price declines, improved vehicle cost stability and continued price increases for top-tier vehicles. demand funnel.” Nash highlighted the company’s strong gross profit per unit in retail, wholesale and extended protection plans (EPP), the purchase of a record 35,000 vehicles from dealers and the repurchase of more than $100 million of common stock.
Despite declining sales, CarMax managed to maintain strong profits and took steps to support future growth. The expansion of the company’s securitization program through a transaction to securitize non-standard government assets backed by government assets is expected to provide additional growth in financial earnings.
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