After reporting robust earnings growth for the third quarter, CarMax, Inc. (NYSE: KMX) is preparing to publish Q4 results next week. Over the years, the company has fostered customer loyalty with strategic pricing and by offering a flexible buying experience that seamlessly integrates online and in-store options.
CarMax’s stock is recovering after slipping to a 9-month low in mid-March, closing the last session slightly above its 12-month average. It has been trading sideways since pulling back from the 2021 peak, with the value more than halving since then. Given the company’s resilient performance and the positive outlook on the used car market, KMX has the potential to rebound and reach new highs.
The used car dealer’s fourth-quarter 2025 earnings report is slated for release on Thursday, April 10, at 6:50 am ET. Wall Street analysts’ consensus estimates suggest that the company ended FY25 on a strong note. It is estimated that Q4 earnings more than doubled year-over-year to $0.66 per share, on revenues of $5.95 billion. In the comparable quarter of fiscal 2024, the company generated revenues of $5.63 billion.
The auto tariffs imposed by the Trump administration pose a threat to the industry in general, as higher costs and supply chain disruptions would negatively impact demand and vehicle delivery. At the same time, there will be an increase in the demand for used vehicles as new vehicles become more expensive, which bodes well for CarMax. However, used vehicle sellers might experience pricing pressures due to higher inventory costs and supply chain issues. CarMax’s omnichannel strategy gives it an edge when dealing with changing market conditions and customer preferences.
It is worth noting that the stocks of General Motors and Ford suffered losses after the auto tariffs were announced, while CarMax shares remained largely unaffected. The company has maintained dominance in the used vehicle market for quite some time, leveraging its diverse inventory and the finance division that offers vehicle loans directly to customers.
In Q3 2025, CarMax’ used vehicle sales edged up 1%, while wholesale vehicle sales remained unchanged year-over-year. As a result, total sales & operating revenue increased modestly to $6.22 billion in the November quarter. Comparable store used vehicle unit sales grew 4.3%, and comparable store used vehicle revenue moved up 0.5% during the three months. At $125.4 million, net income was up 53% in the third quarter. On a per-share basis, earnings jumped 56% YoY to $0.81. The results beat Wall Street’s expectations.
“Our best-in-class omnichannel experience, which is enabled by our great associates, physical footprint, technology, and digital capabilities all tied seamlessly together is a key differentiator that strengthens our competitive mode and we believe will be increasingly important to win consumers going forward. We’re excited to be in a position to pivot from building capabilities to leveraging and enhancing them to drive growth through better execution, innovation efforts, and experiences,” said CarMax CEO Bill Nash during his post-earnings interaction with analysts.
Shares of CarMax closed the last session at $77.92, almost matching its value from six months ago. The stock traded up 2.5% on Tuesday afternoon, extending the uptrend experienced last week.
The post CarMax (KMX) likely to report strong earnings growth for Q4 2025 first appeared on AlphaStreet.
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