Earnings Call Transcript
Copart Inc (CPRT)
Earnings Call Transcript - CPRT Q2 2021
Operator, Operator
Good day everyone, and welcome to the Copart Incorporated Second Quarter Fiscal 2021 Earnings Call. Just a reminder, today's conference is being recorded. For opening remarks and introductions, I would like to turn the call over to Mr. John North, Chief Financial Officer of Copart Incorporated. Please go ahead, sir.
John North, CFO
Thanks. During today's call, we'll discuss certain non-GAAP measures, which include adjustments to reverse the effect of certain discrete income tax items, foreign currency-related gains, certain income tax benefits and payroll taxes related to accounting for stock option exercises. We've provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures on our Investor Relations website and in our press release issued yesterday. We believe these non-GAAP measures together with our corresponding GAAP measures are relevant in assessing our business trends and performance. In addition, our comments today include forward-looking statements within the meaning of federal securities laws, including management's current views with respect to trends, opportunities and uncertainties in our markets, including with respect to the COVID-19 pandemic. These forward-looking statements involve substantial risks and uncertainties. For more detail on the risks associated with our business, we refer you to the section titled Risk Factors in our Annual Report on Form 10-K for the year ended July 31, 2020, and each of our subsequent quarterly reports on Form 10-Q. Any forward-looking statements are made as of today, and we have no obligation to update or revise any forward-looking statements. And now that the disclaimer is out of the way, I'd like to turn the call over to Jeff.
Jeff Liaw, CEO
Thanks, John, and thank you for joining us, everyone, for our second quarter call here. We are very pleased with our results for the second quarter and look forward to discussing the trends in our business throughout today's discussion. As an appropriate cap to a bizarre 12 months, we are now experiencing a major weather system in the U.S., of course, including here at headquarters in Dallas, where four inches of snow qualifies as a snowstorm of epic proportions. So we start by extending our well wishes to our team, our customers and their families. And a special thanks this week to Copart's headquarters team, including our tech people, operations, finance and accounting, for keeping us in business to serve our customers and, in this case, our investors today as well without disruption. The natural questions today will, of course, focus on the pandemic. Since our last call in November, we have all experienced firsthand the holiday season and therefore, the accelerating and now decelerating caseloads across the world. We've seen new viral strains. And of course, we are observing the emerging logistics challenges of the global vaccine distribution phenomenon as well. And therefore, we've seen mobility modulate up and down over the course of that time as well. Throughout this time, we have remained honored to be recognized as an essential business in serving our customers and the communities in which we operate. The themes remain overwhelmingly consistent. We have observed reducing activity, offset by the substitution of driving for other forms of transit, including air travel, buses, trains and the like. We continue to observe frequency that remains higher than what would have historically been projected given recent driving trends. We have also observed higher total loss frequency in parts empowered by very strong returns at our auctions. If anything, our long-run views remain very much reinforced that the 40-year trend of rising total loss frequency remains the most important underlying driver of our business and has been a continuous trend despite some major macroeconomic disruptions over the course of the past 12 months. Pausing to reflect almost now a full year of pandemic life, I think we've remained incredibly true to our foundational principles. We continue to focus day-to-day on serving our customers exceptionally well in both good times and bad and snowstorms, and otherwise. We've been flexible in accommodating their workflows. We have also noted the importance of auction liquidity, that being the flywheel of our marketplace business. At a time when others may well be retrenching, we continue to invest very substantial resources in growing our global buyer base. We continue to believe that physical capacity is a key enabler of our business as well and have invested accordingly, including making some opportunistic purchases over the course of the past year or so. We certainly have seen the power of deploying technology in every corner of our business to make ourselves more efficient, our customers more efficient and to drive superior returns as well in our auctions, in our member recruitment and retention efforts, in customer integration, in reporting loan payoff tools, our vehicle valuation tools and on and on and on. There is no end to the power of technology, both past, present and future in Copart. Our people and culture have also been remarkably durable and essential despite the disruptions of various remote work requirements and quarantines for exposure to coronavirus. I think that the durability of Copart's culture has proven to be the strongest thread that keeps us together. We've invested substantial resources throughout the pandemic and all of the above in the face of massive economic disruption. We continue to make decisions all day, every day to support our customers for over 20 years. That remains our horizon as we make day-to-day decisions. On our business specifically, we certainly did observe volume declines in the second quarter due to reduced driving activity and high car prices, of course, which all else equal, would lead to fewer cars being totaled, offset by higher than expected accident frequency, very strong auction performance, and therefore total loss frequency as well. Our global unit sales decreased by 13% for the quarter with a U.S. unit decrease of 13% and an international unit decline of approximately 15%. We've observed a slightly more pronounced international decline as certain countries have implemented more severe shelter-in-place orders due to high COVID-19 case counts and population density as well. Within our U.S. non-insurance business, we continued the trend of seeing charities and wholesaler volumes contracting the most significantly, perhaps affected most directly by COVID-19. Excluding those two categories, our non-insurance volume continued its year-over-year growth trends. In fact, our dealer business grew 10% year-over-year in unit volume, compared to what we believe were significant declines for other whole car auction platforms. Every dealer car we earn the right to sell empowers us to serve our insurance customers still better with superior returns and vice versa. Our global inventory at the end of January decreased 1.1% versus a year ago, comprised of both a slight increase in U.S. inventory of 1% and a decline of 15% for international inventory, primarily driven by those countries where we have experienced more severe COVID-19 lockdowns. Our average selling prices remain robust with substantial increases year-over-year. ASPs worldwide grew 35% for the quarter, with U.S. up 36%. While there are various offsetting mix shift considerations for that U.S. number, our insurance ASPs are up 36% year-over-year in the U.S. as well. The natural question, of course, is how durable those are. We note that there are certainly favorable underlying drivers as well, including strong used car prices, with folks like Manheim and NADA citing increases in values of about 15%. Our selling prices have grown as a reflection of our ongoing marketing member recruitment capabilities and broad global reach. With the exception of the one quarter at the beginning of the pandemic last year, we've now experienced 16 straight quarters of ASP increases year-over-year. International buyers, after experiencing a slight decline in terms of the mix of vehicles purchased at the height of the pandemic, are now purchasing cars again at a greater rate than before the pandemic, despite logistics challenges and the headaches that might come with shipping cars in 2021, a reflection of the decades-long trends that we've discussed at great length previously. I think it's difficult to project any given month, any given quarter, or year, but the secular trends for ASPs, including our international buyer recruitment and retention, total loss frequency certainly as well remain durable. We are grateful for our very strong financial performance this quarter and excited to continue investing in our customers' future and our own. And with that, I'll turn it over to our CFO, John North, to discuss the second quarter financial results.
John North, CFO
Thanks, Jeff and good morning everybody. I'll make a few brief comments on our operational results to provide a little more color and then we'll open it up for some questions. Global revenue increased $41.9 million or 7.3%, including a $2.2 million benefit due to currency. Global service revenue increased $22.6 million or 4.4% primarily due to higher ASPs. The U.S. service revenue grew 4%, and international experienced an increase of 7.2%. Purchased vehicle sales increased $19.3 million or 29.7% due to higher ASPs and increased volumes, partially offset by lower international volumes. U.S. purchased vehicle revenue was up 48.3% over the prior year, and international grew by 7.5%. As a result, purchased vehicle gross profit, defined as vehicle sales less cost of vehicle sales, increased by $3.6 million overall. Global gross profit increased by $47.6 million or 18.3%. Our gross margin percentage improved by approximately 160 basis points to 49.8%. U.S. margins improved from 47.6% to 52.2%, and international margins increased from 32.8% to 37.6%. Both segments' margin was driven primarily through increased ASPs but was partially offset due to volume declines over fixed cost components, leading to higher costs per unit processed. I'll now move to the discussion of G&A excluding stock compensation and depreciation expenses. We continue to believe that we can achieve additional operating leverage over the long-term, and we encourage you to review trend lines rather than a single quarter metric for a more accurate view of the business, particularly given the impact of COVID. With that said, our G&A spend was down $3.2 million from $39.2 million a year ago to $36.0 million in 2021. As a result, our GAAP operating income increased by 23% from $209.9 million to $258.2 million. We delivered over 500 basis points of operating margin improvement due to revenue growth from strong fees outpacing the impact of a lower absolute volume of vehicles while controlling G&A costs. Net interest expense increased $400,000 or 8.6% year-over-year, due to reduced interest income on collected cash balances given the current interest rate environment and an increased issuance cost and unused line of credit fees due to the 2020 revolver upsizing and amendment. Q2 income tax expense was $59 million at a 23.4 effective tax rate, reflecting a $2.2 million benefit to the size of employee stock options, which has been adjusted out for purposes of non-GAAP earnings included in our earnings release. On a non-GAAP basis, our effective tax rate would have been 24.2%. In summary, GAAP net income increased 14.7% from $168.7 million last year to $193.4 million this year. Adjusted to remove the effects of currency and the tax benefit on the exercise of stock options, non-GAAP net income increased 24.8% from $153.5 million last year to $191.5 million in the second quarter of 2021. For the first six months of fiscal 2021, GAAP net income increased to $393.7 million. Non-GAAP net income increased 23.0% to $379.8 million. Now to briefly update our liquidity and cash flow highlights. As of January 31, 2021, we had $1.6 billion of liquidity, comprised of $616.4 million in cash and cash equivalents, and an undrawn revolving credit facility with capacity of over $1 billion. This is an increase of $138.7 million over July 31, 2020. Operating cash flow for the quarter decreased modestly by $10 million year-over-year to $134.5 million, primarily driven by working capital changes. Sequentially, operating cash flow decreased $124 million from the first quarter of 2021 due to seasonal factors that should reverse later in the year. We invested $136.1 million in capital expenditures for the quarter, and 85% of this amount was attributable to capacity expansion. This investment continues to ensure adequate capacity for additional business and creates an economic vote to potential market entrance, given the difficulty in sourcing appropriately zoned facilities. In conclusion, our conservative capital structure and strong and durable growth enable us to continue to make decisions for long-term interest to both our customers and our shareholders. That concludes our prepared remarks. Victor, we're happy to open it up for some questions.
Operator, Operator
Thank you. We will now move to the question-and-answer session. Our first question comes from Bob Labick with CJS Securities. Please go ahead with your question.
Bob Labick, Analyst
Congratulations on strong operating performance.
Jeff Liaw, CEO
Thanks, Bob.
Bob Labick, Analyst
I wanted to start with one of the comments you made, just to dig a little further, Jeff. You mentioned total loss frequency has been rising for 40 years. It's one of the keys to the investment thesis for the secular growth that you have. But there's also been a 30-plus percent ASP rise over the last nine months. Has total loss frequency risen proportionately? Do you think there's more to come? What's the correlation between those? How do you think it's going to play out going forward?
Jeff Liaw, CEO
That's a great and complex question you've raised. I mentioned used car prices, and I would approach this carefully as there are many factors to consider. Starting with used car prices, their high levels would naturally lead to fewer cars being totaled. If they help elevate salvage auction values, that could also increase the frequency of total losses to some degree. Your main inquiry is how much today's auction returns are factored in by insurance companies when making total loss decisions. I believe the answer is somewhat yes, but generally, companies have not fully factored in today's auction returns regarding total loss frequency. You've noticed the rise in total loss frequency, but it's relatively small, around 1%. If these prices prove to be stable, we would likely see a more significant increase in total loss frequency.
Bob Labick, Analyst
Got it. That's great. Thank you. And then, obviously, you guys were all going into the pandemic, but it still was a largely disruptive event for everyone. Can you talk about some of the biggest changes you've made to the business model as a result? And where that positions you going forward?
Jeff Liaw, CEO
Yes. I think we have the good benefit, Bob, in some respects of having been wired for disruptions like this even before we could expect them, meaning we have been an online-only auction platform, as you know, since 2003. We didn't have to figure it out on the fly. We have been a global online auction house for literally decades. So that's been the single biggest help during the pandemic. Otherwise, we certainly had to make real-time accommodations to a number of our customers who have their own evolving workflows that now wish to send fewer people to physical locations and so forth. So we have had to find ways to accommodate that workflow through some mix of business process and technology deployments on our part to keep our own people safe and to reduce density in our facilities. We've deployed tools that help our members, our employees and our sellers reduce congestion. They can go to the facilities at the right times and wait in their cars instead of coming into the facility and waiting in line physically. We've certainly had to accommodate work-from-home arrangements for folks who have been quarantined, exposed or in high case count areas where the restrictions are more severe. By and large, we have, I'd say, much more business as usual in actionable practice than not, in part because we had already been a digital business beforehand.
Bob Labick, Analyst
Okay. Got it. And then the last one for me, I'll get back in the queue. I know you guys are always looking out three to five, 10 years in your planning. I'd love to hear your thoughts on the biggest changes in opportunities you see domestically and internationally over the next three to five or 10 years?
Jeff Liaw, CEO
Incredibly open-ended question and probably a longer discussion than we can handle today, but we're certainly excited about our core business being the incumbent market specifically. In the U.S., we believe that rising total loss frequency is a huge opportunity for us, not just as the passive beneficiaries of it, but because we affect those results to some extent through our auction technology and our member recruitments. Building that global liquidity base is everything. As we drive returns upwards, we can for our customers continue to achieve better returns and therefore, earn the right to sell still more of those cars. This brings us back to the total loss frequency thesis you described a moment ago. Therefore, we can continue to grow our business in the non-insurance realms as well, including among automotive dealers. As our auction values rise, as liquidity grows, this will further empower us to serve our insurance customers better with superior returns.
Bob Labick, Analyst
Okay. Terrific. I’ll jump back in the queue. Thank you.
Jeff Liaw, CEO
Most welcome.
Operator, Operator
Thank you. Our next question comes from Stephanie Benjamin with Truist Financial. Please proceed with your question.
Stephanie Benjamin, Analyst
Hi. Good afternoon.
Jeff Liaw, CEO
Hi, Stephanie.
Stephanie Benjamin, Analyst
Jeff, you made an interesting comment. I don't think it's particularly unique, but you called out that your buyers are now buying at a greater rate than pre-COVID levels. Given what we have seen with ASPs, I'd love to hear your thoughts on why you think the buyer base has been a little bit more active. I know you've made a lot of strides in building and expanding the buyer base, but the frequency is an interesting dynamic as well. So I would love to hear your thoughts. Thanks.
Jeff Liaw, CEO
Sure. The observation was more that at the height of the pandemic, which I think of as the uncertainty during the spring and summer of 2020, many of our buyer currencies relative to the U.S. dollar had been affected. These are all small percentage point changes definitely to be fair. But we have now seen international buyers purchasing the most cars on a percentage basis relative to our total units sold that they have bought since pre-pandemic levels. I think it's a reflection of ongoing demand, underlined by the 40-year trends, coupled with the fact that our cars are incredibly valuable as drivable cars to many other countries around the world. So I think that's really the phenomenon at play, supported by our marketing and technology efforts to build upon that buyer base.
Stephanie Benjamin, Analyst
Great. Thank you. I was wondering if you could just provide a little bit of an update on your efforts to build out your presence in Germany?
Jeff Liaw, CEO
Sure. In Germany, I think the economic thesis, which we described at great length in a couple of calls in 2019, is that the status quo today is a disservice to insurance carriers and to their policyholders, both in economic terms and experiential ones. The Copart auction model, which we have deployed at great scale in the U.S., U.K., Canada, Brazil, and elsewhere, generates better economic outcomes for everyone involved and better experiential outcomes as well. Our experience there, including during the pandemic, has reinforced that. As noted on a few calls ago, we are selling consigned vehicles on behalf of a number of the top insurance carriers in Germany. We are continuing to invest in our technology, our land, our people, our marketing efforts. Ultimately, we think it is our business process, our global buyer base, and our technology that will ultimately allow us to prevail. We are very excited about this opportunity. The pandemic has acted as an interesting catalyst; it shakes up the status quo to some extent. Our auction results there continue to demonstrate superior outcomes, which ultimately benefits the insurance carriers and benefits the policyholders because they don't have an owner-retained wrecked vehicle and this will drive insurance rates down as well.
Stephanie Benjamin, Analyst
Great. Thank you so much.
Jeff Liaw, CEO
Thanks, Stephanie.
Operator, Operator
Thank you. Our next question comes from Craig Kennison with Baird. Please proceed with your question.
Craig Kennison, Analyst
Good morning, Jeff and John. Thanks for taking my questions. I wanted to take another opportunity to deconstruct ARPU trends over the last several years. To what extent is the higher ARPU due to services that you didn't even offer five years ago? I'm thinking like loan payoff or other fee-for-service opportunities that are available on the platform that maybe just weren't available five years ago?
Jeff Liaw, CEO
Craig, clarifying question. ARPU, what's your arithmetic?
Craig Kennison, Analyst
Well, I'm just thinking, I mean, you've got a big trend, obviously, a big movement in your average selling price and overall revenue per unit, which I can't remember the number you cited on the call, but obviously, this quarter was up a lot. We know that there are several factors driving it, and I'm trying to just get a probe, really one issue, which is maybe you're offering features and capabilities today that you didn't offer in the past, and that would partially explain the growth in that metric?
Jeff Liaw, CEO
It does partially, but only partially. A minority of that would be explained by additional services. We do think we offer the best suite of seller services in the business, including the loan payoff tool you mentioned, various title services and the like. But the majority of what I think you're calling ARPU growth, which is the comparison of our revenue change relative to our units sold change, has some principal mix in there as well. So principal mix can throw that math off in ways that overstate its economic importance, as you know. But that aside, it is principally driven by strong auction returns, which then, in turn, of course, generates higher revenue for Copart as well.
Craig Kennison, Analyst
Okay. Thanks. And then maybe somewhat related, but it goes to the platform itself. You've continued to innovate this platform, but you don't like to talk as much about that innovation. I'd be curious to know what you achieved in 2020 that your buyers or sellers embraced? I'm looking for the tools that build confidence in the buyer, especially whether it's pictures, sounds, facts, or like inspection services. I'm just looking to learn more about innovation in 2020.
Jeff Liaw, CEO
I think as you might know, Craig, we are quite delighted to invest aggressively in innovation and to talk about it, principally with the actual audiences themselves, with the sellers and members alike. When it comes to building member confidence, it is essential to reduce friction. Ensuring a seamless auction platform participation for those buyers, from their desktop or from their phones, increasingly, we are mobile-first as they are as well. Ensuring frictionless experiences for them in purchasing cars, paying for cars, and registering as a member. There are dozens of individual innovations that I'll avoid going into great detail about here, but our principal aim is to create excellent visibility, transparency and a frictionless experience for both the members and sellers.
Craig Kennison, Analyst
Got it. Thank you.
Jeff Liaw, CEO
Thanks, Craig.
Operator, Operator
Thank you. Our next question comes from Bret Jordan with Jefferies. Please proceed with your question.
Bret Jordan, Analyst
Hey, good morning guys.
Jeff Liaw, CEO
Hi, Bret.
Bret Jordan, Analyst
When considering the dealer cars, they are still experiencing significant growth. How are they influencing average selling prices? Could you provide some insight into the average value of the dealer cars? At what point does the dealer mix become substantial enough to independently support the average selling price?
Jeff Liaw, CEO
Yes, that's a good question. The reason we went ahead and proactively disclosed, because I think the intuition is fair that if dealer volume is up 10% year-over-year and the ASPs are higher than those of your insurance cars, to what extent is it contributing to ASP growth? The answer is yes, it contributes, but it's offset by other mix effects as well. U.S. insurance ASPs are up 36% year-over-year right now. It is not, by and large, the story for ASP change year-over-year for this quarter. Over time, it certainly could have that effect as well. The total of our non-insurance business is in the order of the 20% kind of range, so it won't drive ASP changes during the next quarters and years. It will continue to grow, and that will nudge our ASPs upward.
Bret Jordan, Analyst
Okay. And then in the past, you've talked about what percentage of IP addresses were either foreign or maybe brokers on behalf of foreign buyers. Could you give us an update on that number, or at least maybe some idea what percentage of vehicles sold end up in export now?
Jeff Liaw, CEO
Yes, we know there are international IP addresses that belong to buyers intending to export cars. There are international IP addresses that we know are not, for U.S. buyers who have outsourced their purchasing operations outside the U.S., and we purposely exclude them as well. The output of that analysis is about 40% of our units are purchased by those international buyers. I qualify that by saying that more than 90% of our cars have their values affected by international buyers, because they bid on many more cars than they buy.
Bret Jordan, Analyst
Okay, great. Thank you.
Jeff Liaw, CEO
Thanks, Bret.
Operator, Operator
Thank you. Our next question comes from Daniel Imbro with Stephens Inc. Please proceed with your question.
Daniel Imbro, Analyst
Yes. Hey, good morning, guys. Thanks for taking our question. I wanted to start on a bit more of a near-term one before a longer-term question, Jeff. When we look at the volume backdrop near-term, miles driven appear to have stagnated here, down about 10%. But total loss rates are going higher. As we look forward, do you expect the gains we've seen in total loss rate to stay this year? We saw a step function change during the pandemic. Do you think the industry holds onto this? What's your expectation for miles driven as we look out over the next 12 to 24 months for the U.S. business?
Jeff Liaw, CEO
On the first question, is there some blip at some moment where somehow it is down slightly year-over-year or quarter-over-quarter? Suppose that's possible. When I look at the 40-year trend line, the total loss frequency in 1980 was 4% or so. And 40 years later, it's north of 20%. That's a five-fold increase in the past 40 years. I think that's an inexorable march to 30%, 40% and beyond. Whether there are near-term technical blips that cause it to change in a given quarter, I think it's totally plausible. But the 40-year trend is unassailable. To your other question about miles driven, unfortunately, I think we have tons of data. I think since November, we have tons of data. It's unclear that we have tons of incremental insight beyond what you and others would cite as well in the EIA’s data, Google, Apple, INRIX, etc. We study those same trends. There are so many variables, such as the proliferation of the vaccine, when the kids go back to school, when leisure travel resumes, air travel resumes that are upstream of that question, even driving activity to say nothing of Copart volume. That said, we are preparing ourselves. In terms of our business, we are investing in technology and land for a growth environment. I don’t know if that upcoming growth is coming in six months or beyond. That remains to be seen, but we are prepared for it.
Daniel Imbro, Analyst
Yes. That's helpful. Moving over to the international operations. I want to dig in to the U.K., Brazil, Germany. How much are you doing on the non-insurance side over there? I would think with your global buyer base, you could give them a good dealer market compared to what they have. But I'm curious how that opportunity looks, and how achievable you think that will be?
Jeff Liaw, CEO
I think the response is that where we have very substantial liquidity, as we do here in the U.S., Canada, Brazil, U.K., we are therefore a very attractive platform for other non-insurance cars as well. Your hypothesis is fair and accurate.
Daniel Imbro, Analyst
Got it. And then last one for me. Jeff, you mentioned that shipping rates and logistics challenges are affecting the international buyer. I believe the buyer is responsible for the shipping costs, which seems to be a result of the limited availability of shipping containers. Are you forecasting that this situation will continue for a while? What is your outlook on this?
Jeff Liaw, CEO
Yes. You are correct that the logistics are the responsibility of the buyer. I think the disruptions were more severe, frankly, in the middle of last year than they are now. But that has weighed on those international buyers to some extent. My sharing that context is that against that backdrop, they are not at pre-pandemic levels in terms of the share of cars they're purchasing in the international markets. Anything I can share with you would just be anecdotal, based on what we've heard from our members, and I gather it's a condition today, but not a major one.
Daniel Imbro, Analyst
I appreciate it. Best of luck.
Jeff Liaw, CEO
Thank you.
Operator, Operator
Thank you. Our next question comes from Chris Bottiglieri with Exane BNP Paribas. Please proceed with your question.
Chris Bottiglieri, Analyst
Hey, guys. Thanks for taking the question. First one is clerical. Did you give the non-insurance mix this quarter for the U.S.?
John North, CFO
Sorry, can you repeat that? You broke up a little bit?
Chris Bottiglieri, Analyst
Did you give a non-insurance mix in the call?
John North, CFO
Yes. It's about 22% of total volume in the quarter.
Chris Bottiglieri, Analyst
Got down a little bit. Okay. And I guess my question was, so dealer consignment was up more than insurance. It sounds like non-insurance was down a little bit, but what were some of the mitigating factors that hurt the ARPU growth? You talked about mix effects. I'm trying to understand the channels that would have been weaker that would have hurt ARPU?
John North, CFO
Our insurance ASPs are up in ARPU. We're probably completing a few things there, Chris. So if you start – let's just state ASPs, which are not revenue for us, right? And there, the insurance selling went up 36%. Dealer prices also went up. They didn't go up 36%, right? So that is a quite headwind relative to the overall 36%. That is offset by the mix shift benefits of those dealer cars. We noted during the prepared remarks we did see a decline in charities and wholesaler volumes to some extent. That is also ASP supportive by itself, because they are lower-value cars that are declining as a share of the overall mix. Chris, this is John. Just to jump in. The number was 22% of total volume in the quarter, not – I said approximately 20%. It's definitely 22%.
Chris Bottiglieri, Analyst
Okay. Perfect. That actually went up. Okay. That makes sense. And then just a big picture question. From what I could tell, it seems like you took more share in dealer consignment this quarter than last quarter just based on what one of your peers reported yesterday. Is that, what you're seeing? And then two, is there something related to COVID that's eroding the barriers to entry in dealer consignment? Is there anything you're doing differently to win more accounts from dealers? Just want to hear your perspective on how you're able to accelerate market share gains in dealer consignment right now?
Jeff Liaw, CEO
Yes, based on what we can tell from publicly available information from other dealer auction platforms, yes. We are outgrowing other participants in the industry. I would describe our practices during the pandemic as largely a continuation of our trends. We have a terrific internal sales team that pursues those dealers. Our extensive operating history as an online auction platform has proven to be an asset during times when other auction firms that are more accustomed to physical auctions have been significantly disrupted. Our global marketplace has been our most important tool in winning those dealer accounts.
Chris Bottiglieri, Analyst
Got you. Makes sense. Thank you.
Operator, Operator
Thank you. Our next question comes from Gary Prestopino with Barrington Research. Please proceed with your question.
Gary Prestopino, Analyst
Hey, good morning all. Hey, Jeff, John, what was the U.S. revenue growth and the international revenue growth? I couldn't write that down quick enough.
John North, CFO
U.S. service revenue was 4.4%, global was 4.4%. U.S. was 4%, and international experienced a growth of 7.2%.
Gary Prestopino, Analyst
And revenue growth?
John North, CFO
For purchased vehicles, it's 29.7 U.S., 48.3, and international was 7.5%.
Gary Prestopino, Analyst
Okay. Thank you. Just a question on your dealer vehicles. Are you seeing your platform being used to move, I guess, up the value channel? The impression I always had when this was initially started was that you were kind of trying to dis-intermediate maybe the wholesaler that was getting the 12 to 15-year-old car. It seems that as you're gaining share here, are you seeing your platform almost play out to the extent that it's mimicking some of the other online services that are out there on a dealer-to-dealer market basis?
Jeff Liaw, CEO
That direct comparison is harder for us to comment on, Gary. I think your general observation is fair that, I agree, our overall pool vehicles evolve over time. If you look at what a Copart car looked like in 1990 versus the median Copart car in 2020, it was much more heavily wrecked. Cars were more readily repairable than they are today. Today, if a couple of sensors are knocked out, then the cars can be totaled much more readily in part because the returns are better on the back end, as well. Therefore, the overall pool of liquidity has evolved, and more whole cars are directly addressable by our buyer base as well. So to your overall question, yes, we are moving up the value chain.
Gary Prestopino, Analyst
Okay. Thank you.
Jeff Liaw, CEO
Thanks, Gary.
Operator, Operator
Thank you. Our next question comes from Ryan Brinkman with JPMorgan. Please proceed with your question.
Ryan Brinkman, Analyst
Hi. Thanks for taking my questions. I know you've addressed a number of questions regarding the non-insurance business. Could you clarify what percent of your non-insurance volume is truly whole cars as opposed to salvage cars sourced outside of insurance companies? Are whole cars more profitable vehicles for you to sell because they transact at higher prices? Is there anything else to think about, like, for example, on the self fee side, smaller dealers selling vehicles may not get the volume discounts that your customers selling tens of thousands of vehicles do, making it even more profitable. Lastly, are there certain parts of the whole car market that you're targeting now? Are there other segments or categories of sellers that you've not tapped into yet, which might offer future growth opportunities?
Jeff Liaw, CEO
Thanks, Ryan. Insightful questions, some we can address more transparently than others. In short, we do believe that as total loss frequency rises and as the character of the vehicles that we sell changes, that more transacted vehicles become addressable through Copart's platform. As for the profitability or the mix thereof, dealers are not the majority of it, but a very important portion of our non-insurance business. We won't comment on relative fees paid by our customers, as the services we provide them also vary greatly. However, it is a profitable business for us. It is important as well, for it helps us serve insurance customers better.
Ryan Brinkman, Analyst
Okay, very helpful, thanks. And then finally on the winter weather outside your office window, should investors be thinking about that as a potential tailwind to both revenue and profits, or is it more of a surge or cat-type volume that also comes with a higher cost?
Jeff Liaw, CEO
It's a fair question. I have to confess, despite having grown up here, not having tremendous experience with Texas snowstorms to be fair. So I think we'll see how this unfolds over the course of the next few weeks. Typically, the major challenge in flooding, major rainstorms and windstorms is that cars are stranded in all kinds of different places that require very urgent pickups. We’ve certainly seen reduced driving activity, with pandemic effects turbo-charging driving declines. We are deploying many of our resources to address this question. Many of our owned company trucks, our people, are being deployed as well. I don’t know what the ultimate financial impact will be, but we're prepared to handle it regardless.
Ryan Brinkman, Analyst
Interesting. Thank you.
Jeff Liaw, CEO
Thank you.
Operator, Operator
Thank you. There are no further questions at this time. I'd like to turn the floor back over to management for any closing remarks.
Jeff Liaw, CEO
Great. Well, thank you for joining us for the second quarter call. We look forward to talking to you in a few months. Thanks, everyone.
Operator, Operator
Ladies and gentlemen, thank you for your participation. This does conclude today's conference call. Have a great rest of your day.