CarMax stock fell 12% as the CEO stepped down and issued his forecast

DETROIT – STOCKS Car Max Company It fell more than 12% during morning trading Thursday after the used car retailer reported a weak preliminary outlook for the current fiscal quarter and said CEO Bill Nash would unexpectedly step down.

Preliminary expectations for the fiscal third quarter include an 8% to 12% decline in comparable store used unit sales and net earnings per diluted share of between 18 cents and 36 cents, including 9 cents in non-recurring expenses primarily related to leadership changes and other workforce reductions.

Regarding its CEO, the company said that board member David McCright, an apparel retail executive who served as CEO of Lulu Fashion Lounge Holding And the president Urban Outfitters IncHe will replace Nash on an interim basis until a permanent replacement is found.

CarMax also said President Tom Folliard, an executive with a 30-year history with the company, including as CEO from 2006 to 2016, has been named interim CEO.

“The board has decided that more direct involvement from David and I will help strengthen the business in this transition period. During this time, we are focused on increasing sales, enhancing profitability and reducing cost,” Folliard said in a statement, adding that the company’s recent results “do not reflect that potential and change is needed.”

The announced changes are effective December 1, according to CarMax.

In connection with the announced changes and expectations, William Blair downgraded CarMax stock to market perform from outperform.

CarMax has struggled this year, with its stock price falling nearly 50% in 2025. This compares to shares of other auto retailers rising by double digits, including a 52% surge this year for online used car retailer Carvana.

Nash admitted on CarMax’s last quarterly earnings call in September that results “were below the company’s expectations, as well as Wall Street’s expectations.” The results included significant declines in almost all key earnings including sales, net profits and gross profit.

Those September results led to a significant decline in the company’s shares and negative reactions from analysts, including a $24 price cut by Morgan Stanley.

CarMax is scheduled to announce results for the current fiscal quarter on December 18.