A CarMax dealership in Santa Rosa, California on April 11, 2023.
Justin Sullivan | Getty Images
DETROIT – Actions of CarMax Inc. fell more than 12% during morning trading Thursday after the used car retailer reported a weak preliminary outlook for its current fiscal quarter and said CEO Bill Nash would unexpectedly resign.
The preliminary outlook for its fiscal third quarter includes an 8% to 12% decline in same-store used unit sales and diluted net income per share of between 18 cents and 36 cents, including 9 cents of one-time expenses related primarily to the management shakeup and other workforce reductions.
As for its CEO, the company said board member David McCreight, an apparel retail executive who served as CEO of Lulu’s fashion salon funds and president of Urban Outfitters Inc.will replace Nash on an interim basis until a permanent replacement is found.
CarMax also said that Chairman Tom Folliard, an executive with 30 years of experience at the company, including serving as CEO from 2006 to 2016, has been named interim executive chairman.
“The board of directors decided that more direct involvement from David and I would help strengthen the company during this transition period. During this time, we are focused on increasing sales, improving profitability and reducing costs,” Folliard said in a statement, adding that the company’s recent results “do not reflect this potential and a change is necessary.”
Car Dealership Inventories
The announced changes take effect December 1, according to CarMax.
As part of the announced changes and outlook, William Blair lowered CarMax stock’s rating from Outperform to Market Perform.
CarMax has struggled this year, with its stock price down about 50% in 2025. That compares to other auto retailers’ stocks rising double digits, including a 52% increase this year for online used car retailer Carvana.
Nash, during CarMax’s most recent quarterly earnings conference call in September, admitted that the results were “below” the company’s expectations, as well as those of Wall Street. The results include notable declines in almost all key profits, including sales, net profit and gross margin.
These September results led to a significant decline in the company’s shares and negative reactions from analysts, including a $24 price cut from Morgan Stanley.
CarMax is scheduled to report its current fiscal quarter results on December 18.