agent Entrepreneur logo
MenuMENU
SearchSEARCH

CarMax Earnings Surge as Financing Operations Rebound

June 23, 2010
2 min to read


CarMax Inc.'s profit nearly quadrupled on an improvement at its financing operations as used-vehicle sales climbed, The Wall Street Journal reported.


Shares jumped 9.8 percent premarket to $21.95 as results easily beat analysts' expectations. As of Tuesday's close, the stock had risen 45 percent in the past year.

Ad Loading...


The 9 percent same-store-sales increase "reflected the benefit of a continuing gradual rebound in customer traffic, as well as the easy year-over-year comparison," the company said.


Vehicle sellers had a horrific start to 2009 in the wake of the financial crisis, with industrywide sales at levels last seen in the 1970s. CarMax's business is used cars, which proved to be more recession-resistant as consumers opted to buy the less expensive used cars rather than new ones.


For the quarter ended May 31, CarMax reported earnings of $101.1 million, or 44 cents a share, up from $28.7 million, or 13 cents, a year earlier. The most-recent quarter included a 3-cent benefit because of the finance arm's loan-loss position, while the year-earlier quarter included a net reduction of 9 cents because of increased funding costs and other finance arm-related adjustments that were partially offset by a litigation settlement.


Revenue jumped 23 percent to $2.26 billion.


Analysts polled by Thomson Reuters had most recently forecast earnings of 33 cents on $2.09 billion in revenue.

Ad Loading...


Gross margin fell to 14.7 percent from 15.1 percent even as the average selling price on a used vehicle rose 8.9 percent to $17,964.


The company's auto-finance business swung to a profit of $57.5 million from a year-earlier loss of $21.6 million.

More Industry

The outside of a blue Gregg Young Chevrolet dealership.
Industry•by Lauren Lawrence•October 22, 2026

Nebraska Rooftop Changes Hands

The Gregg Young Automotive Group has sold its second dealership to Janssen Auto Group, both in Plattsmouth, Neb.

Read More →
Two white men's shaking hands
Industry•October 15, 2026

Penske Auto Group Deal a Record

The deal to take the dealership and transportation services company private sets a new pace for industry buy-sell transactions.

Read More →
Rows of cars parked in exterior lot
Industry•by Hannah Mitchell•October 8, 2026

War Toll a Damper on Used Auto Prices

Cox Automotive found wholesale depreciation to be elevated in September amid high fuel prices and this year's unusual hurricane season.

Read More →
Ad Loading...
Mechanic cleaning interior of engine
Industry•by Lauren Lawrence•October 8, 2026

Bridge the Maintenance Gap

With many drivers missing recommended maintenance, service departments offering transparency and efficiency have a better chance of reaching financially strained consumers.

Read More →
Ford F-150 truck rounding a curve
Industry•by Hannah Mitchell•October 1, 2026

California Store Has New Owner

The longtime dealership in the northern part of the state is known for robust fleet sales and has served the state capital for 115 years.

Read More →
crane lowering a pipeline into the ground
Industry•by Lauren Lawrence•October 1, 2026

BMW Plant Pursues Cleaner Energy

BMW Group Plant Leipzig has utilized hydrogen to help power its production since 2013, but a new pipeline is planned to take it to another level.

Read More →
Ad Loading...
Two dodge cars outside of dealership.
Industry•by Lauren Lawrence•September 17, 2026

Auto Affordability Inches Up

The latest Cox Automotive and Moody’s Analytics index shows a slight increase in new-vehicle affordability despite high prices.

Read More →
Five men smiling for photo in front of Honda car dealership.
Industry•by Lauren Lawrence•September 10, 2026

Ohio Auto Group Under New Ownership

After 79 years with the Schluter family, Mansfield Auto Group has been acquired by Missouri-based Clement Auto Group.

Read More →
Blue and white RV parked on beach facing the ocean.
Industry•by Lauren Lawrence•September 3, 2026

RV Group Expands Carolina Footprint

Blue Compass RV Columbia Northeast is the 13th RV dealership owned by Blue Compass in the Carolinas.

Read More →
Ad Loading...
Photo of two men and one woman on a discussion panel
Industry•by Hannah Mitchell•September 1, 2026

Agent Acumen

An Agent Summit panel of people who’ve been supporting auto dealers for years gave both timely and timeless advice for those starting out or mulling the prospect.

Read More →
Ad Loading...