UPDATE: CarMax Q2 Profit Misses Estimates, Shares Drop

Shares of CarMax KMX tumbled more than 6% in pre-market trading after the company reported weaker-than-expected second-quarter earnings. The Richmond, Virginia-based company posted quarterly net income of $154.5 million, or $0.70 per share, compared to $140.3 million, or $0.62 per share. The latest quarter earnings included $0.06 per share benefit related to settlement. Its adjusted earnings came in at $0.64 per share in the quarter. Its revenue climbed 10.9% to $3.60 billion from $3.25 billion. However, analysts were expecting earnings of $0.67 per share on revenue of $3.57 billion. The company's used car sales surged 6.3% to 143,325 units in the second quarter, while comparable store used unit sales rose 0.2%. Wholesale vehicle unit sales increased 7.4%. CarMax Auto Finance income jumped 9.7% to $92.6 million in the quarter. Total gross profit rose 6.6% to $463.3 million in the quarter. CarMax opened four stores during the quarter. During the quarter, it repurchased 4.0 million shares of common stock for $201.0 million. Tom Folliard, president and chief executive officer said, “The continued growth in our store base and improvements across our used, wholesale and CAF operations, as well as our share repurchase program, all contributed to our record second quarter earnings per share.” CarMax shares fell 6.27% to $49.50 in pre-market trading.