CarMax stock continued to dip on Tuesday (April 12), dropping about 5% in early trading with news that its fiscal 2022 fourth-quarter earnings were lower than the year before and that they had missed most analysts’ estimates.
CarMax shares have dropped in value almost 20% in the past year. The company’s net earnings for Q4 suffered because of higher-than-expected expenses, dropping 22.8% to below $1 per share, down from $1.27 a year earlier. Annual earnings were up 54.2% to $1.2 billion.
The struggle to meet earnings estimates came despite CarMax increasing the number of vehicles it sold in the fourth quarter by 11.3% year-over-year to 343,413 units. The company sold more than 1.6 million vehicles for the year and generated $7.7 billion in revenue, up 48.8% from fiscal 2020.
CarMax’s net revenues jumped 68.3% to $31.9 billion. The company’s financing division surged 42.4% year-over-year to $801.5 million, including a 3% jump in Q4 to $193.8 million.
“We are extremely proud of our accomplishments in fiscal 2022, which we believe position us well for continued long-term growth across our retail and wholesale business and CarMax Auto Finance,” said Bill Nash, CarMax president and CEO, in the company announcement.
CarMax, said Nash, is expecting to allow all customers to experience an “end-to-end, unaided online experience” by the end of the first quarter while continuing to improve the finance-based portion of the shopping experience.
Related: Competitive Auto Market Drives Car Shopping App Usage
Meanwhile, as new car production has been limited by the effects of COVID-19 and the semiconductor chip shortage, the price of both new and used cars has skyrocketed, meaning shoppers must follow the market closely and car owners must take good care of the cars they own.
Bumper has been helping customers keep track of these trends for about two years with its app that provides vehicle history reports, estimated market value and other information. The company has also been adding other services for buyers, sellers and even car owners who are content with their vehicles.