Copart generated roughly $4.7 billion in sales over the twelve months ended July 31. It spent $337.4 million on capital projects, down 41% from the prior year, yet operating cash flow fell 11% to $1.6 billion.
That is the filing’s central trade-off: the business needed less new capital, but it also produced less cash from operations. Revenue rose just 0.4%, while operating income slipped 2.6% and net income fell 4.4%. The operating margin narrowed to 35.4% from 36.5%.
The slowdown is not simply a price problem. Copart says revenue per car increased as the mix of vehicles sold changed, but volume declined as sellers shifted to a consignment model. Consignment can change how Copart earns money from a vehicle, so the annual sales line captures more price and mix than physical throughput.
Management described the international pattern this way:
"The increase in International, after excluding the negative fluctuations of currency exchange rates of $(10.6) million, was primarily due to an increase in average purchase price due to change in the mix of vehicles sold offset by a decrease in volume related to sellers switching to a consignment model."
Copart, 10-K, September 29, 2026
The plain-English version is less dramatic than the revenue line: Copart got more revenue per car, but handled fewer cars in that part of the business. The company gave a similar explanation for the U.S., where higher revenue per car was offset by lower volume.
The cash numbers add another layer. Inventory rose 29.6% to $51.4 million, far faster than revenue, while accounts receivable increased 6.1%. The company does not disclose a cause for the inventory build in the supplied filing receipts. Even with lower capex, cash conversion fell to 1.08 times net income from 1.16 times.
Copart also disclosed a cost signal beneath the broad margin decline. Excluding depreciation and amortization, U.S. expenses increased by $9.5 million, primarily from labor tied to investment in the business and expansion of the sales force, along with travel, insurance, and outside services.
"Excluding depreciation and amortization, the increase in the U.S. of $9.5 million resulted primarily from an increase in labor (as a result of investment in the business and the expansion of our sales force), travel, insurance, and third party outside services offset by decreases in legal, compliance, and stock-based compensation."
Copart, 10-K, September 29, 2026
That provides context for the gap between lower capital spending and weaker operating income. Capex is a cash outflow tied to longer-lived assets; labor and operating expenses run through the current period.
The latest year also breaks a recent rhythm. Revenue had grown 9.7% in the prior fiscal year, and the company’s operating margin was 36.5%. The new result is closer to a mature, slow-growth year, with the stock down 39.4% over the past twelve months and priced at 17.1 times earnings at the latest annual valuation snapshot.
Copart’s next report will leave one specific question on the table: whether inventory continues to grow faster than sales while vehicle volume remains lower under the consignment mix. More revenue per car, fewer cars, less cash. A tidy little trade-off, if not a tidy year.
Copart’s annual filing shows higher revenue per car alongside lower volume, narrower margins, and weaker operating cash flow.