Investing.com -- CarMax Inc. shares jumped 7.2% in premarket trading on Friday after the used car retailer reported first-quarter earnings that easily topped Wall Street expectations, driven by higher sales volumes and strong profit margins.
The company reported earnings per share of $1.38 for the quarter ended May 31, beating analyst estimates of $1.19. Revenue rose 6.1% YoY to $7.55 billion, slightly above the $7.54 billion consensus forecast.
Retail used vehicle unit sales increased 9% YoY to 230,210, with comparable store sales up 8.1%. Total gross profit climbed 12.8% to $893.6 million, helped by record high gross profit per retail used unit of $2,407.
"We delivered our fourth consecutive quarter of positive retail comps and double-digit year-over-year earnings per share growth," said Bill Nash, CarMax (NYSE:KMX)’s president and CEO. "These results highlight the strength of our earnings growth model, which is underpinned by our best-in-class omni-channel experience, the diversity of our business, and our sharp focus on execution."
The company’s strong performance came despite ongoing economic uncertainty. CarMax Auto Finance (CAF) income decreased 3.6% to $141.7 million as higher provisions for loan losses offset growth in CAF’s net interest margin.
CarMax accelerated its share repurchase program, buying back $199.8 million worth of stock during the quarter. The company had $1.74 billion remaining on its repurchase authorization as of May 31.