CarMax Shifts into High Gear: Record-Breaking Q2 Results Showcase Company's Resilience and Growth Strategy
CarMax, a leading used car retailer, has just released its second-quarter earnings results for fiscal year 2027. The company's impressive performance has been driven by the execution of its growth strategy, Shift into GEAR, which places the customer at the center of everything it does.
"I am proud of the progress we have made in strengthening the business," said Keith Barr, President and CEO of CarMax. "Our strong second-quarter results reflect solid execution and the initial benefits we are seeing as we deliver on the strategy."
Key highlights from the quarter include a 13% growth in used unit comps, driven largely by improved price competitiveness with total units across used and wholesale growing 15%. Earnings per share grew an impressive 81% year-over-year to $1.16, supported by robust comp growth, other gross profit expansion through the performance of Extended Protection Plan products, an increase in cash contribution, and continued SG&A leverage.
CarMax's Shift into GEAR strategy, which was introduced last quarter, has been rolled out across its corporate offices and entire field organization. The company's associates are highly engaged with the steps taken to strengthen its core operations, designed to deliver robust financial results over the years to come. As a result of this focus, CarMax has made significant progress across each of its four pillars: great offering, easy experience, transparent pricing, and seamless ownership.
Regarding the first pillar, great offering, CarMax further strengthened its price competitiveness by driving efficiencies and reconditioning, dynamically managing GPUs, and passing savings on to customers. The company also improved its pricing algorithms to ensure it remains more competitive across demand cycles, incorporating local market insights more granularly and expanding comparison points across a broader set of vehicles.
The second pillar, easy experience, aims to make it easy for customers to do business with CarMax, both online and in-store. This includes the continued development of its digital platform, which has seen significant improvements this quarter. Additionally, the company's extended protection plan products have seen growth in gross profit expansion.
"I want to thank all of our associates for their hard work," said Keith Barr. "Our improving performance has been driven by the speed and focus our teams have put into delivering our strategy."
These results demonstrate CarMax's commitment to innovation, customer satisfaction, and financial performance. As the company continues to execute its growth strategy, investors and customers alike can expect even more exciting developments in the future.
