CarMax Inc

Ladies and gentlemen, thank you for standing by and welcome to the Q3 fiscal year 2024 CarMax earnings release conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David Lowenstein, AVP, Investor Relations. Please go ahead.

Thank you, Jamie. Good morning, everyone. Thank you for joining our fiscal 2024 third quarter earnings conference call. I'm here today with Bill Nash, our President and CEO, Enrique Mayor-Moorer, our Executive Vice President and CFO, and John Daniels, our Senior Vice President, CarMax Auto Finance Operations. Let me remind you, our statements today that are not statements of historical fact, including statements regarding the company's future business plans, prospects, and financial performance, are forward-looking statements we make pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on our current knowledge, expectations, and assumptions and are subject to substantial risks and uncertainties that could cause actual results to differ materially from our expectations. In providing projections and other forward-looking statements, we disclaim any intent or obligation to update them. For additional information on important factors that could affect these expectations, please see our Form 8-K filed with the SEC this morning and our annual report on Form 10-K for the fiscal year ended February 28, 2023 previously filed with the SEC. Should you have any follow-up questions after the call, please feel free to contact our Investor Relations Department at 804-747-0422, extension 7865. Lastly, let me thank you in advance for asking only one question and getting back in the queue for more follow-ups.

Bill? Great. Thank you, David. Good morning, everyone, and thanks for joining us. Our third quarter results reflect the continuation of our strategy that has yielded sequential year-over-year improvements across key components of our business for four straight quarters. While affordability of used car remains a challenge for consumers, we're excited about the positive impact we are seeing from our omnichannel investments, which reinforces our strong belief that we are well positioned for the future. This quarter, we delivered strong retail and wholesale GPUs. We bought more vehicles from consumers and dealers, and we also sold more wholesale units than a year ago. We further reduced SG&A from the prior year. We continued to strengthen the credit mix within CAP's receivables portfolio, which had a positive impact on our loan loss provision. And we resumed our share repurchase program. For the third quarter of FY24, our diversified business model delivered total sales of $6.1 billion, down 5% compared to last year. This was driven by lower retail and wholesale prices and lower retail volume partially offset by higher wholesale volume. In our retail business, total unit sales declined 2.9% and used unit comps were down 4.1%. Average selling price declined approximately $1,300 per unit or 5% year over year. Third quarter retail gross profit per used unit was $2,277, relatively consistent with $2,237 from last year. For the fourth quarter, our expectation is that our margin, our per unit margin will be lower than last year's fourth quarter record margin. We continue to expect that per unit margin for the full year will be similar to last year. As always, we will continue to actively manage this as we test price elasticity and monitor the competitive landscape. Wholesale unit sales were up 7.7% versus the third quarter last year. Average selling price declined approximately $600 per unit or 7% year over year. Third quarter wholesale gross profit per unit was $961, in line with $966 a year ago. Like our outlook on retail GPU, we anticipate wholesale per unit margin for the full year will be similar to last year. As a reminder, last year's fourth quarter wholesale GPU was within $4 of our all-time record and benefited from appreciation and strong dealer demand, particularly at the end of the quarter. we expect this year's fourth quarter per unit margin will be more in line with our year-to-date performance and lower than last year. We bought approximately 250,000 vehicles from consumers and dealers during the quarter, up 5% from last year. Of these vehicles, we purchased approximately 228,000 from consumers, with slightly more than half of those buys coming through our online instant appraisal experience. As a result, our self-sufficiency remained above 70% for the quarter. With the support of our Edmond sales team, we sourced the remaining approximately 22,000 vehicles through dealers, up from approximately 14,000 last year. In regard to our third quarter online metrics, approximately 14% of retail unit sales were online, up from 12% last year. Approximately 55% of retail unit sales were omni sales this quarter, up from 52% in the prior year. All of our third quarter wholesale auctions and sales were virtual and are considered online transactions. This represents 19% of total revenue. Total revenue from online transactions was approximately 31% up from 28% last year. Pharmax Auto Finance, or CAF, delivered income of $149 million, down slightly from $152 million during the same period last year. John will provide more detail on customer financing, the loan loss provision, and CAF contribution in a few moments. At this point, I'd like to turn the call over to Enrique, who will provide more information on our third quarter financial performance. Enrique?