CarMax significantly increased the number of vehicles it acquired from other dealers in its latest quarter, even as the number it bought directly from consumers remained flat.
The used-car retailer purchased 310,107 vehicles from consumers and dealers during its second quarter of fiscal 2026, up 5.9% from a year earlier. Dealer-sourced purchases rose 53.7% to 47,537 vehicles, while consumer purchases totaled 262,570, essentially unchanged year over year. The figures, reported by CarMax last week, offer a closer look at how one of the nation's largest used-vehicle retailers is replenishing its inventory as it works to improve sales and operational efficiency.
Dealer purchases accelerate
Although consumer purchases still accounted for the vast majority of CarMax's vehicle acquisitions, the growth in dealer-sourced vehicles stands out. The company bought approximately 16,600 more vehicles through dealer channels than it did in the same quarter last year. Consumer purchases, meanwhile, remained at roughly the same level.
CarMax does not break down the dealer purchases in its earnings release by source or explain what drove the increase. The figures therefore do not establish whether the company is buying more vehicles from franchise dealers, independent dealers, or particular wholesale channels. Still, the results show that dealer transactions made a larger contribution to CarMax's vehicle supply during the quarter.
Sales increase across retail and wholesale
CarMax also reported stronger sales in both its retail and wholesale operations for the three months ending Aug. 31. Retail used-vehicle sales increased 13.8% year over year to 227,391 units. Wholesale sales rose 15.9% to 160,344 vehicles.
Combined retail and wholesale unit sales reached 387,735, up 14.7% from the prior-year quarter. Total net revenue increased 19.5% to $7.9 billion. The higher sales volume came alongside continued pressure on retail vehicle margins. CarMax's retail gross profit per used vehicle fell $111 year over year to $2,105, which the company attributed to pricing actions intended to support its sales trend.
CarMax has identified inventory availability, pricing, customer experience and operating efficiency as key areas of focus. The company is also working to reduce selling, general and administrative expenses, targeting $200 million in annualized savings by the end of fiscal 2027.
CarMax plans to provide further details on its strategy and growth priorities during a virtual strategic update scheduled for Nov. 3.
For the independent used-car market, the latest results provide a measurable indication of CarMax's sourcing activity, but they do not establish whether its increased dealer purchases are drawing vehicles away from independent lots or changing competition at wholesale auctions.
The next strategic update may provide more detail on how CarMax intends to build inventory and improve vehicle availability as it pursues growth.
