Carmax Inc 10-Q for FY2023 Q2

Carmax Inc (KMX)

10-Q 2022-09-30 For: 2022-08-31

Added on April 07, 2026

About this 10-Q

Carmax Inc filed this 10-Q on September 30, 2022, covering the quarter ended August 31, 2022 (FY2023 Q2).

Headline figures

Quarter ended August 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $8.14B; up 2.0% from $7.99B a year earlier
Net income: $125.91M; down 55.9% from net income of $285.27M a year earlier
Diluted EPS: $0.79; down 54.1% from $1.72 a year earlier

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Virginia		54-1821055
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)

12800 Tuckahoe Creek Parkway		23238
Richmond,	Virginia
(Address of Principal Executive Offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	KMX	New York Stock Exchange


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐


Class						Outstanding as of September 28, 2022
Common Stock, par value $0.50						158,015,491


			Page No.
PART I.	FINANCIAL INFORMATION

	Item 1.	Financial Statements:

		Consolidated Statements of Earnings (Unaudited) –
		Three and Six Months Ended August 31, 2022 and 2021	3

		Consolidated Statements of Comprehensive Income (Unaudited) –
		Three and Six Months Ended August 31, 2022 and 2021	4

		Consolidated Balance Sheets (Unaudited) –
		August 31, 2022 and February 28, 2022	5

		Consolidated Statements of Cash Flows (Unaudited) –
		Six Months Ended August 31, 2022 and 2021	6

		Consolidated Statements of Shareholders’ Equity (Unaudited) –
		Three and Six Months Ended August 31, 2022 and 2021	7

		Notes to Consolidated Financial Statements (Unaudited)	9

	Item 2.	Management’s Discussion and Analysis of Financial Condition and
		Results of Operations	31

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48

	Item 4.	Controls and Procedures	48

PART II.	OTHER INFORMATION

	Item 1.	Legal Proceedings	49

	Item 1A.	Risk Factors	49

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	49

	Item 6.	Exhibits	50

SIGNATURES			51


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Three Months Ended August 31						Six Months Ended August 31
(In thousands except per share data)	2022		%(1)	2021		%(1)	2022		%(1)	2021		%(1)
SALES AND OPERATING REVENUES:
Used vehicle sales	$	6,284,085	77.2	$	6,104,366	76.4	$	13,298,575	76.2	$	12,261,710	78.2
Wholesale vehicle sales	1,690,326		20.8	1,701,572		21.3	3,806,843		21.8	3,075,929		19.6
Other sales and revenues	170,392		2.1	182,421		2.3	351,006		2.0	348,319		2.2
NET SALES AND OPERATING REVENUES	8,144,803		100.0	7,988,359		100.0	17,456,424		100.0	15,685,958		100.0
COST OF SALES:
Used vehicle cost of sales	5,789,098		71.1	5,597,842		70.1	12,240,108		70.1	11,158,179		71.1
Wholesale vehicle cost of sales	1,549,669		19.0	1,512,559		18.9	3,474,519		19.9	2,701,072		17.2
Other cost of sales	68,891		0.8	62,474		0.8	129,261		0.7	86,714		0.6
TOTAL COST OF SALES	7,407,658		90.9	7,172,875		89.8	15,843,888		90.8	13,945,965		88.9
GROSS PROFIT	737,145		9.1	815,484		10.2	1,612,536		9.2	1,739,993		11.1
CARMAX AUTO FINANCE INCOME	182,869		2.2	200,033		2.5	387,342		2.2	441,764		2.8
Selling, general and administrative expenses	666,041		8.2	574,286		7.2	1,322,781		7.6	1,128,355		7.2
Depreciation and amortization	57,692		0.7	52,789		0.7	113,340		0.6	102,679		0.7
Interest expense	32,745		0.4	22,410		0.3	61,520		0.4	42,944		0.3
Other income	(4,039)		—	(1,782)		—	(1,940)		—	(27,359)		(0.2)
Earnings before income taxes	167,575		2.1	367,814		4.6	504,177		2.9	935,138		6.0
Income tax provision	41,670		0.5	82,547		1.0	126,007		0.7	213,115		1.4
NET EARNINGS	$	125,905	1.5	$	285,267	3.6	$	378,170	2.2	$	722,023	4.6
WEIGHTED AVERAGE COMMON SHARES:
Basic	158,801			162,966			159,556			163,058
Diluted	160,218			165,643			161,015			165,969
NET EARNINGS PER SHARE:
Basic	$	0.79		$	1.75		$	2.37		$	4.43
Diluted	$	0.79		$	1.72		$	2.35		$	4.35


	Three Months Ended August 31				Six Months Ended August 31
(In thousands)	2022		2021		2022		2021
NET EARNINGS	$	125,905	$	285,267	$	378,170	$	722,023
Other comprehensive income, net of taxes:
Net change in retirement benefit plan unrecognized actuarial losses	481		658		962		1,317
Net change in cash flow hedge unrecognized gains	25,626		2,753		77,459		5,031
Other comprehensive income, net of taxes	26,107		3,411		78,421		6,348
TOTAL COMPREHENSIVE INCOME	$	152,012	$	288,678	$	456,591	$	728,371


	As of August 31		As of February 28
(In thousands except share data)	2022		2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	56,772	$	102,716
Restricted cash from collections on auto loans receivable	533,253		548,099
Accounts receivable, net	402,452		560,984
Inventory	4,671,685		5,124,569
Other current assets	208,297		212,922
TOTAL CURRENT ASSETS	5,872,459		6,549,290
Auto loans receivable, net of allowance for loan losses of $477,543 and $433,030 as of August 31, 2022 and February 28, 2022, respectively	15,961,213		15,289,701
Property and equipment, net of accumulated depreciation of $1,544,765 and $1,437,548 as of August 31, 2022 and February 28, 2022, respectively	3,312,605		3,209,068
Deferred income taxes	93,057		120,931
Operating lease assets	530,285		537,357
Goodwill	141,258		141,258
Other assets	559,666		490,659
TOTAL ASSETS	$	26,470,543	$	26,338,264

LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	928,749	$	937,717
Accrued expenses and other current liabilities	482,361		533,271

Current portion of operating lease liabilities	48,783		44,197

Current portion of long-term debt	112,504		11,203
Current portion of non-recourse notes payable	559,792		521,069
TOTAL CURRENT LIABILITIES	2,132,189		2,047,457
Long-term debt, excluding current portion	2,511,417		3,255,304
Non-recourse notes payable, excluding current portion	15,534,801		14,919,715
Operating lease liabilities, excluding current portion	512,542		523,269
Other liabilities	365,367		357,080
TOTAL LIABILITIES	21,056,316		21,102,825

Commitments and contingent liabilities
SHAREHOLDERS’ EQUITY:
Common stock, $0.50 par value; 350,000,000 shares authorized; 158,043,981 and 161,053,983 shares issued and outstanding as of August 31, 2022 and February 28, 2022, respectively	79,022		80,527
Capital in excess of par value	1,684,408		1,677,268
Accumulated other comprehensive income (loss)	31,999		(46,422)
Retained earnings	3,618,798		3,524,066
TOTAL SHAREHOLDERS’ EQUITY	5,414,227		5,235,439
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	26,470,543	$	26,338,264


	Six Months Ended August 31, 2022
								Accumulated
	Common			Capital in				Other
	Shares	Common		Excess of		Retained		Comprehensive
(In thousands)	Outstanding	Stock		Par Value		Earnings		Income (Loss)		Total
Balance as of February 28, 2022	161,054	$	80,527	$	1,677,268	$	3,524,066	$	(46,422)	$	5,235,439
Net earnings	—	—		—		252,265		—		252,265
Other comprehensive income	—	—		—		—		52,314		52,314
Share-based compensation expense	—	—		21,594		—		—		21,594
Repurchases of common stock	(1,644)	(822)		(17,207)		(139,565)		—		(157,594)
Exercise of common stock options	49	24		3,418		—		—		3,442
Stock incentive plans, net shares issued	155	78		(6,901)		—		—		(6,823)

Balance as of May 31, 2022	159,614	$	79,807	$	1,678,172	$	3,636,766	$	5,892	$	5,400,637
Net earnings	—	—		—		125,905		—		125,905
Other comprehensive income	—	—		—		—		26,107		26,107
Share-based compensation expense	—	—		15,062		—		—		15,062
Repurchases of common stock	(1,730)	(865)		(18,279)		(143,873)		—		(163,017)
Exercise of common stock options	155	78		9,762		—		—		9,840
Stock incentive plans, net shares issued	5	2		(309)		—		—		(307)
Balance as of August 31, 2022	158,044	$	79,022	$	1,684,408	$	3,618,798	$	31,999	$	5,414,227


	Six Months Ended August 31, 2021
								Accumulated
	Common			Capital in				Other
	Shares	Common		Excess of		Retained		Comprehensive
(In thousands)	Outstanding	Stock		Par Value		Earnings		Loss		Total
Balance as of February 28, 2021	163,172	$	81,586	$	1,513,821	$	2,887,897	$	(118,691)	$	4,364,613
Net earnings	—	—		—		436,756		—		436,756
Other comprehensive income	—	—		—		—		2,937		2,937
Share-based compensation expense	—	—		20,102		—		—		20,102
Repurchases of common stock	(998)	(499)		(9,348)		(114,695)		—		(124,542)
Exercise of common stock options	375	187		21,403		—		—		21,590
Stock incentive plans, net shares issued	254	127		(18,102)		—		—		(17,975)
Balance as of May 31, 2021	162,803	$	81,401	$	1,527,876	$	3,209,958	$	(115,754)	$	4,703,481
Net earnings	—	—		—		285,267		—		285,267
Other comprehensive income	—	—		—		—		3,411		3,411
Share-based compensation expense	—	—		14,116		—		—		14,116
Shares issued for acquisition	776	388		90,183		—		—		90,571
Repurchases of common stock	(1,754)	(877)		(17,164)		(202,004)		—		(220,045)
Exercise of common stock options	621	311		38,185		—		—		38,496
Stock incentive plans, net shares issued	24	12		(130)		—		—		(118)

Balance as of August 31, 2021	162,470	$	81,235	$	1,653,066	$	3,293,221	$	(112,343)	$	4,915,179


(In thousands)
Total cash consideration for outstanding shares	$	251,047
Fair value of common stock (1)	90,571
Fair value of preexisting relationship	60,200
Total	$	401,818


(In thousands)	Fair Value
Cash	$	9,484
Accounts receivable, net	33,719
Other current assets	2,397
Property and equipment, net	20,741
Goodwill (1)	141,258
Intangible assets	218,000
Operating lease assets	97,250
Other assets	191
Total assets acquired	523,040

Accounts payable	5,063
Accrued expenses and other current liabilities	11,277
Current portion of operating lease liabilities	12,795
Deferred income taxes (1)	3,823
Operating lease liabilities, excluding current portion	88,264
Total liabilities assumed	121,222
Net assets acquired	$	401,818


(In thousands)	Useful Life (Years)	Fair Value
Trade name	Indefinite	$	31,900
Internally developed software	7	52,900
Customer relationships	17	133,200
Identifiable intangible assets		$	218,000


	Six Months Ended August 31
(In thousands)	2022		2021
OPERATING ACTIVITIES:
Net earnings	$	378,170	$	722,023
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization	137,903		129,300
Share-based compensation expense	47,010		72,780
Provision for loan losses	133,343		11,107
Provision for cancellation reserves	59,208		62,886
Deferred income tax provision	800		32,502
Other	9,713		(19,883)
Net decrease (increase) in:
Accounts receivable, net	158,532		(244,471)
Inventory	452,884		(948,299)
Other current assets	79,188		(26,496)
Auto loans receivable, net	(804,855)		(1,177,458)
Other assets	(31,703)		(9,745)
Net (decrease) increase in:
Accounts payable, accrued expenses and other
current liabilities and accrued income taxes	(74,986)		115,542
Other liabilities	(65,618)		(105,109)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	479,589		(1,385,321)
INVESTING ACTIVITIES:
Capital expenditures	(204,463)		(137,838)
Proceeds from disposal of property and equipment	84		260
Proceeds from sale of business	—		602
Purchases of investments	(5,428)		(12,651)
Sales and returns of investments	2,492		10,954
Business acquisition, net of cash acquired	—		(241,563)
NET CASH USED IN INVESTING ACTIVITIES	(207,315)		(380,236)
FINANCING ACTIVITIES:
Increase in short-term debt, net	—		167
Proceeds from issuances of long-term debt	2,412,900		3,035,601
Payments on long-term debt	(3,057,565)		(2,168,411)
Cash paid for debt issuance costs	(10,240)		(9,547)
Payments on finance lease obligations	(9,883)		(5,709)
Issuances of non-recourse notes payable	8,230,501		7,414,283
Payments on non-recourse notes payable	(7,576,056)		(6,201,801)
Repurchase and retirement of common stock	(325,168)		(355,495)


	Three Months Ended August 31				Six Months Ended August 31
(In millions)	2022		2021		2022		2021
Used vehicle sales	$	6,284.1	$	6,104.4	$	13,298.6	$	12,261.7
Wholesale vehicle sales	1,690.3		1,701.6		3,806.8		3,075.9
Other sales and revenues:
Extended protection plan revenues	109.8		113.0		226.3		247.3
Third-party finance income, net	2.7		2.8		6.1		(1.8)
Advertising & subscription revenues (1)	34.3		34.5		68.7		34.5
Service revenues	19.4		21.0		41.2		43.2
Other	4.2		11.1		8.7		25.1
Total other sales and revenues	170.4		182.4		351.0		348.3
Total net sales and operating revenues	$	8,144.8	$	7,988.4	$	17,456.4	$	15,686.0


	Three Months Ended August 31						Six Months Ended August 31
(In millions)	2022		% (1)	2021		% (1)	2022		% (1)	2021		% (1)
Interest margin:
Interest and fee income	$	357.2	8.8	$	324.1	8.8	$	703.9	8.8	$	634.4	8.8
Interest expense	(62.5)		(1.5)	(60.6)		(1.7)	(111.3)		(1.4)	(126.4)		(1.8)
Total interest margin	294.7		7.3	263.5		7.2	592.6		7.4	508.0		7.0
Provision for loan losses	(75.5)		(1.9)	(35.5)		(1.0)	(133.3)		(1.7)	(11.1)		(0.2)

Total interest margin after provision for loan losses	219.2		5.4	228.0		6.2	459.3		5.7	496.9		6.9



Direct expenses:
Payroll and fringe benefit expense	(15.9)		(0.4)	(12.4)		(0.3)	(30.6)		(0.4)	(25.0)		(0.3)
Depreciation and amortization	(3.8)		(0.1)	(0.2)		—	(7.6)		(0.1)	(0.4)		—
Other direct expenses	(16.6)		(0.4)	(15.3)		(0.4)	(33.7)		(0.4)	(29.7)		(0.4)
Total direct expenses	(36.3)		(0.9)	(27.9)		(0.8)	(71.9)		(0.9)	(55.1)		(0.8)
CarMax Auto Finance income	$	182.9	4.5	$	200.0	5.4	$	387.3	4.8	$	441.8	6.1

Total average managed receivables	$	16,176.2		$	14,683.3		$	15,996.6		$	14,416.0


	As of August 31		As of February 28
(In millions)	2022		2022
Asset-backed term funding	$	12,563.5	$	11,653.8
Warehouse facilities	2,997.9		3,291.9
Overcollateralization (1)	629.0		489.1
Other managed receivables (2)	158.9		217.5
Total ending managed receivables	16,349.3		15,652.3
Accrued interest and fees	81.7		67.3
Other	7.7		3.1
Less: allowance for loan losses	(477.5)		(433.0)
Auto loans receivable, net	$	15,961.2	$	15,289.7


	As of August 31, 2022
	Fiscal Year of Origination (1)
(In millions)	2023		2022		2021		2020		2019		Prior to 2019		Total		% (2)
Core managed receivables (3):
A	$	2,242.3	$	3,097.9	$	1,405.5	$	934.1	$	369.8	$	102.7	$	8,152.3	49.8
B	1,533.9		2,227.8		1,010.7		645.1		326.3		128.2		5,872.0		35.9
C and other	439.1		739.7		390.2		222.0		109.3		54.2		1,954.5		12.0
Total core managed receivables	4,215.3		6,065.4		2,806.4		1,801.2		805.4		285.1		15,978.8		97.7
Other managed receivables (4):
C and other	155.0		143.2		18.9		26.8		17.9		8.7		370.5		2.3
Total ending managed receivables	$	4,370.3	$	6,208.6	$	2,825.3	$	1,828.0	$	823.3	$	293.8	$	16,349.3	100.0


	As of February 28, 2022
	Fiscal Year of Origination (1)
(In millions)	2022		2021		2020		2019		2018		Prior to 2018		Total		% (2)
Core managed receivables (3):
A	$	3,885.5	$	1,788.3	$	1,266.1	$	574.1	$	203.4	$	32.3	$	7,749.7	49.5
B	2,795.2		1,288.5		857.7		473.1		205.2		50.4		5,670.1		36.2
C and other	919.1		496.2		294.8		156.7		73.8		29.6		1,970.2		12.6
Total core managed receivables	7,599.8		3,573.0		2,418.6		1,203.9		482.4		112.3		15,390.0		98.3
Other managed receivables (4):
C and other	165.2		23.9		34.7		23.8		10.0		4.7		262.3		1.7
Total ending managed receivables	$	7,765.0	$	3,596.9	$	2,453.3	$	1,227.7	$	492.4	$	117.0	$	15,652.3	100.0


	Three Months Ended August 31, 2022
(In millions)	Core		Other		Total		% (1)
Balance as of beginning of period	$	390.4	$	67.8	$	458.2	2.85
Charge-offs	(84.2)		(11.9)		(96.1)
Recoveries	35.9		4.0		39.9
Provision for loan losses	54.0		21.5		75.5
Balance as of end of period	$	396.1	$	81.4	$	477.5	2.92


	Three Months Ended August 31, 2021
(In millions)	Core		Other		Total		% (1)
Balance as of beginning of period	$	348.1	$	31.4	$	379.5	2.62
Charge-offs	(40.3)		(3.4)		(43.7)
Recoveries	25.1		1.7		26.8
Provision for loan losses	27.1		8.4		35.5
Balance as of end of period	$	360.0	$	38.1	$	398.1	2.66


	As of August 31, 2022
	Core Receivables								Other Receivables		Total
(In millions)	A		B		C & Other		Total		C & Other		$		% (1)
Current	$	8,119.0	$	5,548.4	$	1,644.0	$	15,311.4	$	279.4	$	15,590.8	95.36
Delinquent loans:
31-60 days past due	20.8		199.0		173.0		392.8		48.4		441.2		2.70
61-90 days past due	9.8		100.7		113.8		224.3		34.2		258.5		1.58
Greater than 90 days past due	2.7		23.9		23.7		50.3		8.5		58.8		0.36
Total past due	33.3		323.6		310.5		667.4		91.1		758.5		4.64
Total ending managed receivables	$	8,152.3	$	5,872.0	$	1,954.5	$	15,978.8	$	370.5	$	16,349.3	100.00


	As of August 31, 2022
(In thousands)	Level 1			Level 2			Total
Assets:
Money market securities	$	698,000		$	—		$	698,000
Mutual fund investments	23,809			—			23,809

Derivative instruments designated as hedges	—			76,580			76,580
Derivative instruments not designated as hedges	—			27,946			27,946
Total assets at fair value	$	721,809		$	104,526		$	826,335

Percent of total assets at fair value	87.4		%	12.6		%	100.0		%
Percent of total assets	2.7		%	0.4		%	3.1		%

Liabilities:



Total liabilities at fair value	$	—		$	—		$	—

Percent of total liabilities	—		%	—		%	—		%


(In billions)	Capacity
Warehouse facilities:
December 2022 expiration	$	0.25
February 2023 expiration	2.85
August 2023 expiration	2.30
Combined warehouse facility limit	$	5.40
Unused capacity	$	2.40

Non-recourse notes payable outstanding:
Warehouse facilities	$	3.00
Asset-backed term funding transactions	13.12
Non-recourse notes payable	$	16.12


	Three Months Ended				Six Months Ended
	August 31				August 31
	2022		2021		2022		2021
Number of shares repurchased (in thousands)	1,729.6		1,754.1		3,373.9		2,751.7
Average cost per share	$	94.24	$	125.44	$	95.01	$	125.22
Available for repurchase, as of end of period (in millions)	$	2,453.9	$	991.5	$	2,453.9	$	991.5


	Six Months Ended August 31, 2022
	Equity Classified						Liability Classified
(Shares/units in thousands)	Options		MSUs		Other		RSUs
Outstanding as of February 28, 2022	5,796		393		170		1,163
Granted	1,282		136		50		677
Exercised or vested and converted	(204)		(120)		(80)		(740)
Cancelled	(44)		(5)		(5)		(46)
Outstanding as of August 31, 2022	6,830		404		135		1,054

Weighted average grant date fair value per share/unit:

Granted	$	33.26	$	126.73	$	95.58	$	91.20
Ending outstanding	$	25.69	$	120.95	$	99.04	$	97.36


	As of August 31, 2022
Unrecognized compensation (in millions)	$	68.0	$	21.5	$	3.5


					Total
	Net		Net		Accumulated
	Unrecognized		Unrecognized		Other
	Actuarial		Hedge		Comprehensive
(In thousands, net of income taxes)	Losses		Gains		Income (Loss)
Balance as of February 28, 2022	$	(73,001)	$	26,579	$	(46,422)
Other comprehensive income before reclassifications	—		81,908		81,908
Amounts reclassified from accumulated other comprehensive income (loss)	962		(4,449)		(3,487)
Other comprehensive income	962		77,459		78,421
Balance as of August 31, 2022	$	(72,039)	$	104,038	$	31,999


	As of August 31		As of February 28
Lease Term and Discount Rate	2022		2022
Weighted Average Remaining Lease Term (in years)
Operating leases	16.91		17.31
Finance leases	11.36		12.42

Weighted Average Discount Rate
Operating leases	4.81	%	4.80	%
Finance leases	19.80	%	14.35	%


	As of August 31, 2022
(In thousands)	Operating Leases (1)		Finance Leases (1)
Fiscal 2023, remaining	$	37,495	$	16,682
Fiscal 2024	73,538		39,188
Fiscal 2025	71,693		36,222
Fiscal 2026	66,355		37,330
Fiscal 2027	60,313		33,211
Thereafter	575,478		214,012
Total lease payments	884,872		376,645
Less: interest	(323,547)		(202,318)
Present value of lease liabilities	$	561,325	$	174,327


	Three Months Ended August 31, 2022
(In thousands)	CarMax Sales Operations		Other		Eliminations		Total
Sales and operating revenues	$	8,110,524	$	34,279	$	—	$	8,144,803
Intersegment sales and operating revenues	—		6,929		(6,929)		—
Total sales and operating revenues	$	8,110,524	$	41,208	$	(6,929)	$	8,144,803
Depreciation and amortization (1)	$	376	$	3,389	$	—	$	3,765
Gross profit	$	712,284	$	26,362	$	(1,501)	$	737,145
Reconciliation to Consolidated Earnings Before Taxes:
CAF Income							182,869
Selling, general and administrative expenses							(666,041)
Depreciation and amortization (2)							(57,692)
Interest expense							(32,745)
Other income (expense)							4,039
Earnings before income taxes							$	167,575


(Dollars in millions except per share or per unit data)	Three Months Ended August 31, 2022			Change from Three Months Ended August 31, 2021		Six Months Ended August 31, 2022			Change from Six Months Ended August 31, 2021
Income statement information
Net sales and operating revenues	$	8,144.8		2.0	%	$	17,456.4		11.3	%
Gross profit	$	737.1		(9.6)	%	$	1,612.5		(7.3)	%
CAF income	$	182.9		(8.6)	%	$	387.3		(12.3)	%
Selling, general and administrative expenses	$	666.0		16.0	%	$	1,322.8		17.2	%
Net earnings	$	125.9		(55.9)	%	$	378.2		(47.6)	%
Unit sales information
Used unit sales	216,939			(6.4)	%	457,889			(8.9)	%
Change in used unit sales in comparable stores	(8.3)		%	N/A		(10.6)		%	N/A
Wholesale unit sales	159,677			(15.1)	%	345,984			(6.4)	%
Per unit information
Used gross profit per unit	$	2,282		4.4	%	$	2,312		5.3	%
Wholesale gross profit per unit	$	881		(12.3)	%	$	961		(5.3)	%
SG&A as a % of gross profit	90.4		%	20.0	%	82.0		%	17.2	%
Per share information
Net earnings per diluted share	$	0.79		(54.1)	%	$	2.35		(46.0)	%
Online sales metrics
Online retail sales (2)	11		%	2	%	11		%	3	%
Omni sales (3)	53		%	(2)	%	54		%	(2)	%
Revenue from online transactions (4)	30		%	2	%	30		%	4	%


	Three Months Ended August 31 (1)				Six Months Ended August 31 (1)
	2022		2021		2022		2021
Used vehicle units	(8.3)	%	6.2	%	(10.6)	%	41.8	%
Used vehicle revenues	0.4	%	38.8	%	6.0	%	70.4	%


	Three Months Ended August 31								Six Months Ended August 31
(In millions except per unit data)	2022			2021			Change		2022			2021			Change
Compensation and benefits:
Compensation and benefits, excluding share-based compensation expense	$	333.8		$	299.5		11.4	%	$	679.0		$	583.6		16.3	%
Share-based compensation expense	24.5			28.7			(14.5)	%	46.8			67.1			(30.3)	%
Total compensation and benefits (2)	$	358.3		$	328.2		9.2	%	$	725.8		$	650.7		11.5	%
Occupancy costs	68.8			55.1			25.0	%	134.7			105.6			27.5	%
Advertising expense	82.9			85.0			(2.5)	%	171.8			157.5			9.1	%
Other overhead costs (3)	156.0			106.0			47.2	%	290.5			214.6			35.5	%
Total SG&A expenses	$	666.0		$	574.3		16.0	%	$	1,322.8		$	1,128.4		17.2	%
SG&A as % of gross profit	90.4		%	70.4		%	20.0	%	82.0		%	64.8		%	17.2	%


	As of and for the Three Months Ended August 31						As of and for the Six Months Ended August 31
(In millions)	2022			2021			2022			2021
Total ending managed receivables	$	16,349.3		$	14,984.4		$	16,349.3		$	14,984.4
Total average managed receivables	$	16,176.2		$	14,683.3		$	15,996.6		$	14,416.0
Allowance for loan losses	$	477.5		$	398.1		$	477.5		$	398.1
Allowance for loan losses as a percentage of ending managed receivables	2.92		%	2.66		%	2.92		%	2.66		%
Net credit losses on managed receivables	$	56.2		$	16.9		$	88.8		$	24.1
Annualized net credit losses as a percentage of total average managed receivables	1.39		%	0.46		%	1.11		%	0.34		%
Past due accounts as a percentage of ending managed receivables	4.64		%	2.72		%	4.64		%	2.72		%
Average recovery rate (1)	67.3		%	66.3		%	69.1		%	65.4		%


					Approximate
					Dollar Value
				Total Number	of Shares that
	Total Number	Average		of Shares Purchased	May Yet Be
	of Shares	Price Paid		as Part of Publicly	Purchased Under
Period	Purchased	per Share		Announced Program	the Program
June 1 - 30, 2022	575,500	$	93.31	575,500	$	2,563,233,107
July 1 - 31, 2022	565,556	$	93.20	565,556	$	2,510,523,456
August 1 - 31, 2022	588,516	$	96.15	588,516	$	2,453,937,874
Total	1,729,572			1,729,572


10.1			CarMax, Inc. 2002 Employee Stock Purchase Plan, as amended and restated January 1, 2023, filed herewith.

31.1			Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a), filed herewith.

31.2			Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a), filed herewith.

32.1			Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, filed herewith.

32.2			Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, filed herewith.

101.INS			XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH			XBRL Taxonomy Extension Schema Document

101.CAL			XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF			XBRL Taxonomy Extension Definition Linkbase Document

101.LAB			XBRL Taxonomy Extension Label Linkbase Document

101.PRE			XBRL Taxonomy Extension Presentation Linkbase Document

104			Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.



CARMAX, INC.


By:			/s/ William D. Nash
			William D. Nash
			President and
			Chief Executive Officer


By:			/s/ Enrique N. Mayor-Mora
			Enrique N. Mayor-Mora
			Executive Vice President and
			Chief Financial Officer