Copart Returns to Growth as Margins Expand
The online auto-auction company posted $1.2 billion in revenue, snapping a three-quarter decline.
The online auto-auction operator Copart (CPRT) reversed a three-quarter slide, reporting revenue of $1.2 billion for the period ended April 30, 2026, a 2.1% year-over-year increase that marked its first positive quarter since mid-2025. The result contrasted with a 3.6% decline in the prior quarter and signaled a turn in volumes after a prolonged inventory drought among insurers and dealers.
The quarter’s standout was margin expansion. Gross profit rose 3.7% to $572.6 million, recovering from a 6.2% drop in January, while gross margin widened to 46.3% from 43.2% in the prior quarter. Operating income climbed 2.8% to $464.3 million, erasing an 8.8% contraction three months earlier. Net income attributable to Copart slipped 1.0% to $402.4 million, though the decline narrowed sharply from a 9.5% drop in the prior quarter. Earnings of $0.43 a share rose 2.4%, the first increase in four quarters.
Service revenues, which account for 86% of total sales, grew 2.1% to $1.06 billion, accelerating from a 4.0% decline in January. Vehicle sales, the smaller segment, rose 2.3% to $180.99 million, improving from a 1.4% dip. The turnaround was most pronounced overseas: international service revenues jumped 17.9% to $160.6 million, nearly doubling the 7.7% growth rate of the prior quarter, while operating income in the segment surged 24.9% to $73.8 million after a 6.1% drop three months earlier.
Cost discipline underpinned the rebound. Cost of vehicle sales fell 5.6% to $160.3 million, reversing a 1.8% increase in the prior quarter, while facility operations expenses rose just 2.5% after a 2.7% decline. General and administrative expenses climbed 7.2%, faster than the 3.2% increase in January, but the company said the rise reflected higher incentive compensation tied to improved performance.
Copart did not provide formal guidance for the current quarter. The company said it expects capital expenditures of $250 million to $300 million for the fiscal year ending July 2027, in line with prior disclosures.
Liquidity strengthened during the period. Cash, cash equivalents, and restricted cash rose to $3.35 billion from $2.78 billion at the end of July 2025, driven by $933.5 million in net cash from investing activities, primarily proceeds from held-to-maturity securities. The company also disclosed $1.63 billion in share repurchases over the nine-month period, a new program after no buybacks in the prior year.