Company: KMX
Filing Date: 2025-04-11
Form Type: 10-K
Source: 0001170010-25-000024
Chunk: 59

Company: CARMAX INC
Filing Date: 2025-04-11
Form: 10-K
Item: Item 7
Chunk 59
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 credit spectrum, which positions us to grow CAF income modestly in the near-term and more materially over time.  We also released an update to our finance-based shopping experience that seamlessly incorporates existing instant appraisal offers into our prequalification offering, giving customers more precise credit terms.

In addition to these actions, we are focused on driving down our cost of sales by pursuing incremental efficiency opportunities that we have identified across our logistics network and reconditioning operations.  We achieved savings of approximately $125 per unit in fiscal 2025 and anticipate that we will achieve another $125 per unit in fiscal 2026.  This exceeds the initial $200 per unit target that we set at the beginning of fiscal 2025.  These efficiencies support affordability as we pass savings on to our customers and also support our margins.

In fiscal 2026, we will leverage and enhance our capabilities to drive growth through better execution, innovative efforts and upleveled experiences.  Examples of our initiatives for fiscal 2026 include the following:

•For retail, we will continue leveraging data science and AI to offer even better digital experiences for associates and consumers, driving conversion and efficiency.  We plan to improve our online vehicle transfer experience and expand Skye’s functionality with additional data and new architecture.

•We will launch a new marketing campaign that will bring our best-in-class omni-channel experience to the forefront for the consumer.

•For supply, we plan to streamline the online appraisal checkout process, expand appraisal pick-up availability to new markets and further enhance MaxOffer to attract new dealers, expanding our access to directly sourced vehicles.  

•For credit, we plan to continue expanding CAF’s participation across the credit spectrum to grow penetration and capture profitable returns.  Additionally, we plan to modernize the ownership experience on CAF’s digital platform, which will enhance the customer experience and drive operating efficiencies.  

As noted above, during fiscal 2025, we focused on MaxOffer improvements, attracting more dealers and increasing our purchases through the program.  We leverage the Edmunds sales team to open new markets and sign up new dealers for MaxOffer.  During fiscal 2025, our MaxOffer active dealers increased approximately 47% from the prior year.  We purchased approximately 269,000 vehicles from consumers and dealers during the fourth quarter of fiscal 2025, up 15.3% from the prior year quarter.  Approximately 46,000 vehicles were purchased from dealers, including through MaxOffer, up 114.2% from the prior year quarter