Rogers-based America’s Car-Mart Inc.[1] posted a net loss and revenue decline in the first quarter of fiscal 2026, missing analyst expectations amid tariff-related supply challenges affecting vehicle prices and sales.
Shares of Car-Mart (NASDAQ: CRMT) fell to a 52-week low of $34.02 early Thursday. By mid-morning, shares were trading at $35.09, down $9.56 or 21.33%. Over the past 52 weeks, the stock has ranged between $34.02 and $62.72.
Before the markets opened, the buy here, pay here used car dealer posted a loss of $5.74 million, or a loss of 69 cents per share, in the quarter that ended July 31 from a loss of $974,000, or a loss of 15 cents per share, in the same period last year. Revenue declined by 1.9% to $341.31 million from $347.76 million.
Car-Mart missed earnings estimates of 83 cents per share, based on a consensus of three analysts. The company also missed revenue estimates of $359.21 million.
In an earnings report, equity analyst John Hecht and equity associates Alexander Villalobos, Yuna Sohn, and Jonathan Weitz, all of Jefferies, attributed the miss to a revenue decline offset by higher interest income and average retail vehicle price.
“It appears that tariff-related supply issues are impacting prices, affordability, and thus inventory levels and transaction volumes,” the analysts said. “The results indicate increasing headwinds from tariffs and lingering affordability/credit concerns. Despite these factors, (Car-Mart) demonstrated its ability to optimize funding costs and grow receivables.
“Soft revenue was a mixed result of limited units available for sale and retail unit sold,” the analysts added. “The offset from an increase in (average selling price), expanding margin on interest income and lower funding costs set (Car-Mart) up for navigating potential increasing pressure from the tariffs impact and continuing affordability issue. Managing credit trends going forward will be a key driver in the future quarters.”
Doug Campbell, president and CEO of Car-Mart, said the company’s investments are “delivering measurable results.” Customer loan application volumes are up more than 10%. The company implemented the second version of its loan origination system at the start of the first quarter. It includes “a more advanced underwriting scorecard, and the enablement of risk-based pricing embedded within the tool. This functionality is now live across our entire footprint, excluding our acquisitions.”
The company’s upgraded collections platform Pay Your Way is seeing “rapid adoption,” Campbell said. “Since the upgrade of Pay Your Way in late June 2025, we have driven a shift from customers paying in-store to paying online, which improves customer convenience and builds the foundation for more consistent payment behavior. Additionally, we have nearly doubled the number of customers enrolled in recurring payments, creating more predictable cash flows and reducing collection costs.”
Campbell said in this market Car-Mart is “prudently managing sales to balance affordability, profit margins and portfolio quality. During the quarter wholesale prices rose resulting in each unit of inventory consuming more of our borrowing capacity, which places some limits on how much inventory we can carry. We are actively working to improve these capacity constraints to better serve the customer demand we are experiencing.”
The company is also working to improve the credit quality of its loan portfolio. Campbell said credit applications from its customers that are within its top three customer credit rankings increased by 7.9 percentage points or 15% in the first quarter compared to the fiscal 2025 average.
“Nearly 72% of our portfolio is now operating under enhanced underwriting standards,” he said. “With the recent launch of (loan origination system version two), we continue to sharpen our underwriting capability and are very optimistic about the opportunity to sell more cars to better customers, creating a stronger foundation for sustainable returns.”
The number of dealerships remained flat at 154 from the fourth quarter but was down by two from the same period last year.
Following are other metrics in the first quarter compared to the same period last year.
• Vehicles sold fell by 5.7% to 13,568 from 14,391.
• Average retail sales price rose by 1.4% to $19,564 from $19,286.
• Gross profit percentage increased to 36.6% from 35%.
• Net charge-offs increased to 6.6% from 6.4%.
• Accounts over 30 days past due rose to 3.8% from 3.5%.
• Active loans increased by 1.4% to 104,691 from 103,231.
• Net finance receivables rose by 5.07% to $1.18 billion from $1.12 billion
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References
- ^ America’s Car-Mart Inc. (www.car-mart.com)