BusinessJun 17, 2026
CarMax Revenue Climbs Amidst CEO's Digital Overhaul Plans
Rhea Lobo
CarMax posted $8.01B in net sales and operating revenues for its fiscal first quarter, a 6.2% increase year over year and ahead of the consensus Wall Street had expected.
Despite beating estimates on both the top and bottom line, shares fell.
Earnings per share came in at $1.31. Net earnings fell 11.8% year over year to $185.6M. The year-ago figure was $210.4M.
The volume growth was partly a product of price cuts, which squeezed margins across the business.
Combined retail and wholesale unit sales surged 3.3% year over year. Comparable sales slipped 0.8%. That was a shallower decline than the 2% analysts had projected.
Keith Barr took over as CEO on March 16, having previously led InterContinental Hotels Group. He used the earnings call to lay out the problems he intends to fix.
"Our digital experience is too complex and not seamlessly connected to the in-person experience," Barr told analysts, noting that friction in the buying journey has hurt conversion rates.
"We know exactly what needs to change, and we are moving forward with urgency," Barr said. The company has already made incremental website changes, including shifting to monthly payment displays and streamlining navigation toward prequalification and vehicle reservations.
The company is also integrating AI assistants into its digital experience to reduce the gap between online research and in-store purchase.
CarMax's stores reach 85% of the US population, which Barr cited as a core competitive asset the company has not fully leveraged.
Barr said he plans to release a fuller strategic plan in late fall, and that execution is expected to span multiple years.
The stock has lost nearly a quarter of its value over the past year. CarMax added two board members in April following engagement with activist investor Starboard Value.
CarMax also paused its share buyback program last quarter to preserve cash for the turnaround effort.
Shares are still up roughly 25% in 2026. That includes a 16% gain since Barr took the helm. Margin deterioration this quarter signals that volume alone may not be enough to satisfy investors watching for a durable profit recovery.
