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CarMax’s Big Profit Miss Sends Warning Signal on US Consumer

  • Auto dealers Carvana, Sonic Automotive plunge in broad selloff
  • Rising rates, low confidence makes consumers wary of spending
A CarMax dealership in Louisville, Kentucky.

A CarMax dealership in Louisville, Kentucky.

Photographer: Luke Sharrett/Bloomberg
Updated on

Already shaky market sentiment took a gut punch on Thursday, after used-car dealer CarMax Inc.’s latest quarterly results laid bare the plight of US consumers stuck between high inflation and climbing interest rates. 

CarMax’s fiscal second-quarter numbers failed to meet Wall Street’s expectations on nearly every metric. The company said the ability of potential buyers to afford vehicles has become a challenge, with rising interest rates and low consumer confidence adding further wrinkles.