KMX CARMAX INC

Overview and Growth

CARMAX INC generated $25.88B of revenue in fiscal 2026, with net income of $247.29M and an operating cash inflow of $1.78B. Revenue of $25.88B sets the scale for evaluating how effectively sales translated into profit and cash during the year. The top line contracted 1.8% from $26.35B in fiscal 2025; this top-line contraction left the company with a smaller revenue base. On a per-share basis, diluted EPS was $1.68, which connects the reported earnings outcome with the company’s diluted share count. The per-share result recorded a 47.7% decrease from fiscal 2025 diluted EPS of $3.21. At period end, total assets were $26.37B, framing the scale of the company’s operating and financing commitments. Revenue equaled 0.98x of total assets, indicating how much reported top-line activity the company produced relative to its period-end asset base.

Profitability

After reported cost of revenue, the company retained $2.81B as gross profit before recognizing operating expenses and other items. The gross-profit relationship equaled 10.8% of revenue, quantifying the portion retained before operating expenses were recognized. Net income came to $247.29M, completing the progression from revenue through gross and operating profitability to the final reported result. The final earnings result represented 1.0% of revenue, connecting the absolute net income figure with the company’s top-line scale. The reported income-tax provision was $136.14M, the amount recognized between pretax income and the final net-income result. Return on period-end equity was 4.2%, relating annual net income to the equity capital on the balance sheet. The net-income-to-assets relationship measured 0.9%, showing earnings relative to the full balance sheet.

Liquidity and Capital Structure

At period end, the $26.37B asset base was financed through $20.48B of liabilities and $5.89B of equity. The near-term balance sheet paired $5.31B of current assets with $2.41B of current liabilities at the reporting date. The current ratio was 2.2x, with current assets exceeding current liabilities and providing a short-term liquidity cushion. Reported cash and equivalents were $122.83M, separating immediately recognizable cash resources from the rest of the current-asset base. Measured only with cash and equivalents, coverage of current liabilities was 5.1%, excluding receivables and other current assets. Borrowings totaled $17.48B, adding a fixed financing obligation alongside the company’s equity capital. The debt-to-equity relationship was 2.97x, showing how much debt the company carried for each unit of book equity. The debt-to-assets relationship was 66.3%, comparing borrowing with the total asset balance. Relative to total assets, liabilities measured 77.7%, complementing the separate equity-based view of the company’s capital structure. The cash-to-assets relationship was 0.5%, comparing reported cash and equivalents with the full positive asset balance. Total assets were 3.8% lower than fiscal 2025 assets of $27.40B, measuring the company’s own balance-sheet change. Reported equity changed 5.7% from $6.24B in fiscal 2025, placing the current capital base lower year over year.

Cash Flow and Earnings Quality

Operating activities produced a cash inflow of $1.78B, giving the cash-flow counterpart to the accrual-based profit measures reported for the year. Operating cash flow equaled 7.21x of net income, showing how strongly accounting earnings converted into cash from operations. Capital expenditures used $540.99M, identifying the reported investment outflow deducted from operating cash flow in the free-cash-flow calculation. Relative to operating cash flow, capital expenditures measured 30.3%, connecting investment intensity with the company’s cash-generation base. The combination of operating cash flow and capital spending produced $1.24B of positive free cash flow for the period. Relative to revenue, free cash flow equaled 4.8%, showing how much sales converted into cash after investment. The free-cash-flow-to-assets relationship was 4.7%, comparing post-investment cash with the balance-sheet asset base.

Based on the annual report for the fiscal year ending Feb 28, 2026. Analysis generated Oct 21, 2026.