Executive Summary
Copart reported QQ2 2024 revenue of $1.020 billion, up approximately 7% year over year, with consolidated gross profit of $460.1 million and a gross margin of 45.5%. Operating income reached $379.9 million (operating margin 37.2%), and net income totaled $325.6 million or $0.34 per basic share ($0.33 per diluted share). The quarter benefited from a favorable margin mix: a meaningful shift toward higher-margin fee units (non-insurance) and a resilient U.S. and international ASP backdrop even as the Manheim Used Vehicle Value Index declined about 7% YoY. Management framed the period as a step in Copart’s longer-run operating-leverage trajectory, supported by disciplined capital investment in real estate, fleet and technology to scale core and adjacent businesses.
Key growth drivers included: (1) non-insurance volume growth north of 30% YoY in the U.S. (dealer, fleet and finance channels) and over 21% international unit growth, (2) a continued shift toward fee-based and higher-margin transactions, (3) international expansion with a 16%+ inventory delta versus prior year, and (4) ongoing investments in talent and technology to enhance auction liquidity and operating efficiency. Copart ended QQ2 with a robust liquidity position of approximately $3.9 billion, including roughly $2.7 billion in cash and held-to-maturity investments, and a net cash position of about $1.14 billion. Free cash flow for the quarter was $38.8 million, after $123 million of capex primarily directed toward real estate and infrastructure to enable capacity expansion.
Management signaled a constructive longer-term outlook emphasizing operating leverage from ongoing investments and capacity expansion, while noting no formal quarterly guidance. The company also highlighted strategic actions (Purple Wave consolidation, new executive hires) aimed at broadening product capabilities and geographic reach. While the insurance cycle remains a key driver of Copart’s mix, the leadership framed the period as evidence of durable earnings quality under a diversified model, with net cash and an aversion to excessive capex relative to growth opportunities.
Key Performance Indicators
Key Insights
Revenue: $1,020.149 million, up 6.63% YoY and -0.03% QoQ; Gross profit: $460.098 million, up 7.88% YoY and -0.85% QoQ; Gross margin: 45.50% (consolidated), with U.S. margin 50.2% and International margin 24.9%; Operating income: $379.900 million (operating margin 37.24%); Net income: $325.635 million (net margin 31.92%); EPS: $0.34 basic, $0.33 diluted; EBITDA: $379.900 million; EBITDARatio: 37.24%; Tax rate: 20.7%; Weighted average shares (GAAP): 960.525 million; Diluted: 974.589 million.
Cash...
Financial Highlights
Revenue: $1,020.149 million, up 6.63% YoY and -0.03% QoQ; Gross profit: $460.098 million, up 7.88% YoY and -0.85% QoQ; Gross margin: 45.50% (consolidated), with U.S. margin 50.2% and International margin 24.9%; Operating income: $379.900 million (operating margin 37.24%); Net income: $325.635 million (net margin 31.92%); EPS: $0.34 basic, $0.33 diluted; EBITDA: $379.900 million; EBITDARatio: 37.24%; Tax rate: 20.7%; Weighted average shares (GAAP): 960.525 million; Diluted: 974.589 million.
Cash flow and liquidity: Net cash provided by operating activities $161.793 million; CapEx $123.029 million; Free cash flow $38.764 million; Cash and cash equivalents at period end $1.256B; Total liquidity about $3.9B; Net debt negative (net cash) of approximately $1.141B; Debt to capital 1.67%; Current ratio 7.13x; Quick ratio 7.04x; CCC ~83.05 days.
Campus-to-market metrics: DSO ~76.17 days; DIO ~6.88 days; DPO ~76.15 days; Inventory turnover 13.08x; Asset turnover 0.134; Return on assets ~4.29%; Return on equity ~4.80%; Enterprise value multiple ~118.46x (as indicated in ratios section). P/E ~35.43x; P/B ~6.80x; P/S ~45.23x; P/FCF ~1,190x (all values USD basis). Note: ratio data reflect market pricing and ongoing investor expectations as of QQ2 publication.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.02B |
6.63% |
-0.03% |
| Gross Profit |
460.10M |
7.88% |
-0.85% |
| Operating Income |
379.90M |
3.93% |
-3.91% |
| Net Income |
325.64M |
10.88% |
-2.07% |
| EPS |
0.34 |
9.68% |
-2.86% |
Key Financial Ratios
operatingProfitMargin
37.2%
operatingCashFlowPerShare
$0.17
freeCashFlowPerShare
$0.04
Management Commentary
- Strategy and platform: Management emphasizes Copart as a unified, global auction platform. Jeff Liaw stated, “copart.com, is certainly a unified platform… ultimately, we are one global auction platform with buyers, many buyers purchasing vehicles on multiple of our countries.” This underscores the network effect and cross-border liquidity that support pricing power.
- Capacity and growth cadence: Jeff also noted the company’s willingness and ability to onboard more volume, “we invest years ahead of the curve in capital expenditures… we would be delighted to serve new volume and certainly have the capacity to do so,” highlighting the flywheel between capacity expansion, logistics, and technology.
- Margin resilience through mix shift: Leah Stearns explained that ASP resilience and higher-margin fee units are supporting margins even as overall used-vehicle price indices softened; “the incremental unit that is totaled by an insurance company is inherently a higher value unit… driving additional resilience within our ASP.”
- Non-insurance and international momentum: Jeff Liaw and Leah Stearns highlighted >30% YoY growth in non-insurance U.S. volumes (dealer and fleet/rental channels) and >21% international unit growth, which is a meaningful driver of gross profit expansion and revenue mix.
- Capital allocation and strategic bets: The transcript reiterates a disciplined approach to capital deployment, expanding capacity, and pursuing adjacencies (Purple Wave consolidation; Hi Marley partnership) with a focus on long-term operating leverage. “We are incredibly patient on the capital allocation front” and “investing to grow our core business” were key themes.
- Insurance cycle and risk: Management acknowledged the total loss rate trajectory and the potential for higher loss rates in the long run, noting that “total loss could exceed 30%” given ongoing dynamics between used-vehicle values, repair costs, and auction liquidity. This remains a key macro risk to monitor.
Copart.com, is certainly a unified platform… we are one global auction platform with buyers, many buyers purchasing vehicles on multiple of our countries.
— Jeff Liaw
We invest years ahead of the curve in capital expenditures… we would be delighted to serve new volume and certainly have the capacity to do so.
— Jeff Liaw
Forward Guidance
Copart did not provide formal quarterly guidance for QQ3 or full-year 2024. However, management signaled a constructive outlook built on operating leverage from ongoing investments in real estate, fleet, and technology, plus capacity to onboard additional volume given existing logistics and platform capabilities. The company expects longer-term margin improvement driven by mix shifts toward fee-based units and higher auction liquidity. Key factors investors should monitor: (1) insurance cycle and total loss frequency trends (especially as used-vehicle values stabilize and repair costs rise), (2) progression of non-insurance volumes, particularly Blue Car, dealer, and fleet/rental channels in the U.S. and internationally, (3) execution and integration benefits from Purple Wave and other strategic partnerships, (4) capital allocation outcomes (rate of return on capex, capex intensity relative to incremental revenue), and (5) regional performance in Europe (U.K., Germany, Spain) as Copart scales internationally. Overall, the outlook is one of solid operating leverage and earnings quality supported by a diversified mix and a robust balance sheet, albeit with the caveat of macro insurance-cycle sensitivity.