Q4 2026 Copart Inc Earnings Call

September 10, 2026

Speaker #1: Please stand by. Good day, everyone, and welcome to the Copart Inc. Q4 2026 earnings call. Just a reminder, today's conference is being recorded. Before turning the call over to management, I will share Copart's safe harbor statement.

Operator: Please stand by. Good day, everyone, and welcome to the Copart, Inc. Q4 fiscal 2026 earnings call. Just a reminder, today's conference is being recorded. Before turning the call over to management, I will share Copart's safe harbor statement. The company's comments today include forward-looking statements within the meaning of the federal securities laws, including management's current views with respect to trends, opportunities, and uncertainties in the company's industry. These forward-looking statements involve substantial risks and uncertainties. For more detail on the risks associated with the company's business, we refer you to the section titled Risk Factors in the company's annual report on Form 10-K for the year ended 31 July 2025, and each of the company's subsequent quarterly reports on Form 10-Q. Any forward-looking statements are made as of today, and the company has no obligation to update or revise any forward-looking statements.

Speaker #1: The company's comments today include forward-looking statements within the meaning of the federal securities laws, including management's current views with respect to trends, opportunities, and uncertainties in the company's industry.

Speaker #1: These forward-looking statements involve substantial risks and uncertainties. For more detail on the risks associated with the company's business, we refer you to the section titled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended July 31, 2025, and each of the company's subsequent quarterly reports on Form 10-Q.

Speaker #1: Any forward-looking statements are made as of today, and the company has no obligation to update or revise any forward-looking statements. I will now turn the call over to the company's CEO and Executive Chairman, Jay Adair.

Operator: I will now turn the call over to the company's CEO and Executive Chairman, Jay Adair.

Speaker #2: All right. Thank you. Well, welcome, everyone, to the fourth quarter earnings call for 2026. I've got some prepared remarks that I'll talk through, and then I will turn it over to Leah Sterns, our CFO. After that, we will open it up for questions.

Jay Adair: Well, thank you. Well, welcome everyone to the Q4 earnings call for 2026. I have got some prepared remarks that I will talk to, and then I will turn it over to Leah Stearns, our CFO, and then we will open it up for questions. I will remind you that on the prior call, I talked about the three pillars of growth for Copart. We will continue to focus on international expansion on insurance. We will continue to focus on whole car expansion domestically, and then we will continue to invest in technology and services that assist all of our customers. Additionally, we view the differentiators for Copart as, one, we are a business that is run by founders and that has a founder's mindset. We do not think in quarters or years. We think in decades. Very long-term. Number two, I would say liquidity.

Speaker #2: So I'll remind you that on the prior call, I talked about the three pillars of growth for Copart. We will continue to focus on international expansion and on insurance.

Speaker #2: We'll continue to focus on whole car expansion domestically, and we'll continue to invest in technology and services that assist all of our customers.

Speaker #2: Additionally, we view the differentiators for Copart as, one, we are a business that is run by founders and that has a founder’s mindset. We don’t think in quarters or years—we think in decades.

Speaker #2: Very long term, number two, I would say liquidity. When you think about how our website functions, we are constantly focused on improving buyer activity.

Jay Adair: When you think about how our website functions, we are constantly focused on improving buyer activity, and I will talk more about some of the buyer data that we have got. But that liquidity continues to be a differentiator. In the spirit of acting like a startup, we are very fast. We are moving very quickly, and we are bringing products and services to market in quarters, not in years. So we expect to have some of that coming out in the next four quarters. Looking at global unit sales, we were down across the company 2.9%. Domestically, that was down 5.7%. Internationally, we were up 10%. Global insurance units were down 4.2%, with domestic insurance being down 7.5% and international insurance being up 11.2%. With the exception of one single customer loss, domestic insurance assignments would be up 2.3%. Collision claim frequency, we are down 3.4% year-over-year.

Speaker #2: And I'll talk more about some of the buyer data that we've got, but that liquidity continues to be a differentiator. And then, in the spirit of acting like a startup, we are very fast.

Speaker #2: We're moving very quickly, and we're bringing products and services to market in quarters, not in years. So we expect to have some of that coming out in the next four quarters.

Speaker #2: Looking at global unit sales, we were down across the company 2.9%. Domestically, that was down 5.7%. Internationally, we were up 10%. Global insurance units were down 4.2%, with domestic insurance being down 7.5% and international insurance being up 11.2%.

Speaker #2: With the exception of one single customer loss, domestic insurance assignments would be up 2.3%. Collision claim frequency: we are down 3.4% year over year.

Speaker #2: This is a moderation from a high of single-digit declines through 2025. Total loss frequency reached 23.3% in the second quarter of 2026, the highest second quarter on record, up from 22.4% in the same quarter last year.

Jay Adair: This is a moderation from a high of single-digit declines through 2025. Total loss frequency reached 23.3% in Q2 2026, the highest Q2 on record, up from 22.4% in the same quarter last year. Looking at severity, average collision severity was over $6,300 per claim, up nearly 8.8% year over year. Fastest in more than three years, and the fourth straight quarter of acceleration. Repair costs are up more than 50% from 2019 levels per data from CCC. Looking at rental car rates, that is something that obviously costs or increases the cost of repair for insurers. That rose by 4.5% year over year. Obviously, every additional day of repair and any costs associated with that, increase the total cost of repair.

Speaker #2: Looking at severity, average collision severity was over $6,300 per claim, up nearly 8.8% year over year. That's the fastest in more than three years and the fourth straight quarter of acceleration.

Speaker #2: Repair costs are up more than 50% from 2019 levels, per data from CCC. Looking at rental car rates—and that's something that obviously increases the cost of repair for insurers—those rose by 4.5% year over year.

Speaker #2: Obviously, every additional day of repair and any cost associated with that increases the total cost of repair. Turning to the complexity of vehicles, I recently had a conversation with a client—a friend of mine—who was talking about how complex cars are.

Jay Adair: Turning to the complexity of vehicles, I recently had a conversation with a client friend of mine that was talking about how complex cars are. There was a recent article by PTC that pointed out a military drone has 3.5 million lines of code. An Airbus aircraft has 30 million lines of code, and the Windows 10 operating system has 50 million lines of code. What makes this interesting is that a new Tesla has approximately 100 million lines of code. When we think about cars, they really are becoming computers on wheels. We believe total loss frequency will continue to go up. Vehicle miles traveled were up 0.27% year over year in Q4 2026. Vehicles in operation, or what we refer to as the car park, was up 1.6% year over year in calendar Q2 2026.

Speaker #2: And there was a recent article by Parametric Technology Corporation that pointed out a military drone has 3.5 million lines of code. An Airbus aircraft has 30 million lines of code.

Speaker #2: And the Windows 10 operating system has 50 million lines of code. What makes this interesting is that a new Tesla has approximately 100 million lines of code.

Speaker #2: So, when we think about cars, they really are becoming computers on wheels. We believe total loss frequency will continue to go up. Vehicle miles traveled were up 0.27% year over year in the fourth quarter of 2026.

Speaker #2: Vehicles in operation, or what we refer to as the car park, were up 1.6% year over year in calendar quarter two, 2026. Looking at insurance ASPs globally, we were up 3.1% year over year in the fourth quarter of '26.

Jay Adair: Looking at insurance ASPs globally, we were up 3.1% year over year in Q4 2026. Domestically, we were up 3.7% year over year in Q4 2026, and internationally, we were up 3.3% year over year in Q4 2026. Turning to the Manheim Used Vehicle Value Index, it was up 2.8% year over year in Q4 2026. We are outpacing the Manheim Index. As we stated before, liquidity comes from buyers. I would like to give you some statistics now on why we believe and others believe that we have the greatest liquidity in the industry. Vehicles sold to buyers less than a year. This means that one year or more ago, that buyer was not buying from Copart, was likely not aware of Copart.

Speaker #2: Domestically, we were up 3.7% year over year in fourth quarter '26, and internationally, we were up 3.3% year over year in fourth quarter '26.

Speaker #2: Turning to the Mannheim Used Vehicle Value Index, it was up 2.8% year over year in the fourth quarter of '26. So we are outpacing the Mannheim Index. As we stated before, liquidity comes from buyers.

Speaker #2: And so, I'd like to give you some statistics now on why we believe—and why others believe—that we have the greatest liquidity in the industry.

Speaker #2: Vehicles sold to buyers less than a year. This means that one year or more ago, that buyer was not buying from Copart and was likely not aware of Copart.

Speaker #2: Vehicles that have been sold to buyers for less than a year in 2026 were 8.9% of our total vehicles. That number for fiscal year '25 was 8.3%.

Jay Adair: Vehicles that have been sold to buyers less than a year for 2026, were 8.9% of our total vehicles. That number for FY25 was 8.3%, so we have seen nice growth there. Expanding it out an additional year, vehicles sold to buyers that have been with Copart less than two years for 2026, our total sales, they represented 21.7% of our vehicles. I would like to turn to vehicles sold in the US to international buyers. These are buyers outside the US. Total units sold in FY26 represent 38.2% of our units. However, more importantly, the dollars purchased, the amount of dollars that were spent on the vehicles that we sold represented 45.7% of the total amount of dollars that we sold in the vehicles. They are obviously buying a more valuable vehicle when they are purchasing it internationally.

Speaker #2: So we've seen nice growth there. Expanding it out an additional year, vehicles sold to buyers that have been with Copart less than two years for 2026—of our total sales, they represented 21.7% of our vehicles.

Speaker #2: Now, I'd like to turn to vehicles sold in the U.S. to international buyers—these are buyers outside the U.S. Total units sold in fiscal year 2026 represent 38.2% of our units.

Speaker #2: However, more importantly, the dollars purchased—the amount of dollars that were spent on the vehicles that we sold—represented 45.7% of the total amount of dollars that we sold in the vehicles.

Speaker #2: So, they're obviously buying a more valuable vehicle when they're purchasing it internationally. On the previous call, I spoke to AI, and I think about AI as a very important differentiator for Copart.

Jay Adair: On the previous call, I spoke to AI, and I think about AI as a very important differentiator for Copart. As we stated, we will continue to lower costs through automation. This is an important part of our journey and we are very focused on that. But I think even more important is using AI to create more demand for the vehicles that we are selling. The ability for a buyer to find that vehicle and to find a vehicle that matches their desired purchase, is becoming more and more important every single day. If you think about the journey of becoming aware of Copart, then signing up, becoming a member, and then from membership to bidding and then to buying, us connecting that buyer to that vehicle, we believe is more important than ever. Then finally, I think about accuracy.

Speaker #2: As we stated, we'll continue to lower costs through automation. This is an important part of our journey, and we're very focused on that. But I think even more important is using AI to create more demand for the vehicles that we're selling.

Speaker #2: The ability for a buyer to find that vehicle, and to find a vehicle that matches their desired purchase, is becoming more and more important every single day.

Speaker #2: So, if you think about the journey of becoming aware of Copart, then signing up, becoming a member, and then from membership to bidding, and then to buying, us connecting that buyer to that vehicle—we believe is more important than ever.

Speaker #2: And then finally, I think about accuracy. Every time that we can automate something and use AI, we eliminate errors, and improved accuracy is one of our core tenets at Copart. We're continuing to make sure that we have less and less opportunity for mistakes.

Jay Adair: Every time that we can automate something and use AI, we eliminate errors. Improved accuracy is one of our core tenets in Copart and continuing to make sure that we have less and less opportunity for mistakes. Looking at OpEx per car in Q4 2026 versus Q4 2025, we are up 12.7%. Leah will talk more about expense control. My point is that we are focused on it, where we are going to be working towards reducing our costs on a per car basis. Finally, let me close by talking about our most recent announcement. We have agreed to acquire ACV, one of the largest primarily digital automotive marketplaces in the country. ACV sells more than 800,000 vehicles each year and importantly, operates with virtually no land of its own.

Speaker #2: Looking at OpEx per car in Q4 '26 versus Q4 '25, we are up 12.7%. Leo will talk more about expense control. My point is that we are focused on it.

Speaker #2: We are going to be working towards reducing our costs on a per-car basis. Finally, let me close by talking about our most recent announcement.

Speaker #2: We have agreed to acquire ACV, one of the largest primarily digital automotive marketplaces in the country. ACV sells more than 800,000 vehicles each year and, importantly, operates with virtually no land of its own.

Speaker #2: We are excited about using our locations as staging areas for their vehicles and combining our global buyer base with their digital marketplace and remarketing technology.

Jay Adair: We are excited about using our locations as staging areas for their vehicles and combining our global buyer base with their digital marketplace and remarketing technology. Copart and ACV are highly complementary. We bring physical scale, deep institutional relationships, Salvage expertise and international buyer demand with more than 275 locations, over 4 million vehicles sold a year, and approximately 1 million members across more than 185 countries. ACV brings dealer liquidity and relationships and inspections and valuation technology, transacting approximately USD 10 billion of gross merchandise value in 2025 across more than 22,000 active buyers. Together, Copart and ACV create a more complete automotive marketplace, connecting the right vehicle to the right buyer through the right channel, without forcing every vehicle into a single operating model. For dealers, that means one partner to value, manage, and dispose of virtually every used vehicle they touch.

Speaker #2: COPART and ACV are highly complementary. We bring physical scale, deep institutional relationships, salvage expertise, and international buyer demand with more than 275 locations, over 4 million vehicles sold a year, and approximately 1 million members across more than 185 countries.

Speaker #2: ACV brings dealer liquidity, relationships, inspections, and valuation technology, transacting approximately $10 billion of gross merchandise value in 2025 across more than 22,000 active buyers.

Jay Adair: ACV brings dealer liquidity and relationships and inspections and valuation technology, transacting approximately USD 10 billion of gross merchandise value in 2025 across more than 22,000 active buyers. Together, Copart and ACV create a more complete automotive marketplace, connecting the right vehicle to the right buyer through the right channel, without forcing every vehicle into a single operating model. For dealers, that means one partner to value, manage, and dispose of virtually every used vehicle they touch.

Speaker #2: Together, Copart and ACV create a more complete automotive marketplace, connecting the right vehicle to the right buyer through the right channel, without forcing every vehicle into a single operating model.

Speaker #2: For dealers, that means one partner to value, manage, and dispose of virtually every used vehicle they touch. For commercial consignors—like banks, rental car companies, fleet, and leasing companies—it means one national relationship across multiple disposition channels, optimizing net proceeds.

Jay Adair: For commercial consignors like banks, rental car companies, fleet, and leasing companies, it means one national relationship across multiple disposition channels, optimizing net proceeds. For buyers, it means unparalleled wholesale selection at every price point, with integrated transportation and complete vehicle marshaling. Copart has a very strong track record of driving strong return on invested capital across the businesses it has acquired, and we view this transaction in the same framework as our past acquisitions. We expect the transaction to be accretive to earnings in the first full year, and we will provide more details after it closes. We are excited about ACV's people-first culture, which fits naturally with our own culture. This is an all-cash transaction funded from cash on hand with no financing conditions. It is structured as a tender offer, which supports a relatively quick and clean path to closing.

Speaker #2: For buyers, it means unparalleled wholesale selection at every price point, with integrated transportation and complete vehicle marshalling. Copart has a very strong track record of driving strong return on invested capital across the businesses.

Speaker #2: It has acquired, and we view this transaction in the same framework as our past acquisitions. We expect the transaction to be accretive to earnings in the first full year.

Jay Adair: We expect the transaction to be accretive to earnings in the first full year, and we will provide more details after it closes. We are excited about ACV's people-first culture, which fits naturally with our own culture. This is an all-cash transaction funded from cash on hand with no financing conditions. It is structured as a tender offer, which supports a relatively quick and clean path to closing.

Speaker #2: And we will provide more details after it closes. We are excited about ACV's people-first culture, which fits naturally with our own culture. This is an all-cash transaction funded from cash on hand, with no financing conditions.

Speaker #2: It's structured as a tender offer, which supports a relatively quick and clean path to closing. It is subject to the customary conditions you would expect, including regulatory review.

Jay Adair: It is subject to the customary conditions you would expect, including regulatory review. Both boards have unanimously approved the transaction. We expect to close by the end of the calendar year, and ACV will operate as an independent subsidiary led by its existing team. I will obviously explain more after the close. With that, let me hand it over to Leah, our CFO, who will give you an update on the numbers, and then we will open it up for questions.

Speaker #2: Both boards have unanimously approved the close by the end of the calendar year, and ACV will operate as an independent subsidiary led by its existing team.

Speaker #2: I will obviously explain more after the close. With that, let me hand it over to Lea, our CFO, who will give you an update on the numbers, and then we’ll take questions.

Speaker #1: Thank you, Jay. And good afternoon to everyone on the call. I will lead today with our financial results and per unit economics for the fourth quarter and fiscal year 2026.

Leah Stearns: Thank you, Jay, and good afternoon to everyone on the call. I will lead today with our financial results and per unit economics for Q4 and FY26. Then I will walk you through our US and international segments and close with capital structure and liquidity highlights. For Q4, consolidated revenue grew to $1.2 billion, up 2.4% year-over-year, driven by the strength in both service revenues and purchased vehicle sales. Global service revenue increased more than $13 million, or 1.4%, and global purchased vehicle sales increased $14 million, or 8.3%. For FY26, revenue was $4.7 billion, up 0.4%, with service revenue up $1 million, which was primarily due to increased international volumes and higher revenue per unit. As a reminder, FY25 included the benefit of Hurricane Helene and Hurricane Milton. Excluding the impact of these storms, FY26 total revenue grew 2.4%.

Speaker #1: Then I'll walk you through our US and international segments and close with capital structure and liquidity highlights. For the fourth quarter, consolidated revenue grew to $1.2 billion, up 2.4% year over year, driven by strength in both service revenues and purchased vehicle sales.

Speaker #1: Global service revenue increased more than $13 million, or 1.4%, and global revenue increased $8 million, or 8.3%. For fiscal year 2026, revenue was $4.7 billion, up 0.4%, with service revenue up $1 million, which was primarily due to increased international volumes and higher revenue per unit.

Speaker #1: As a reminder, FY25 included the benefit of hurricanes Helena and Milton. Excluding the impact of these storms, FY26 total revenue grew 2.4%. Finally, purchased vehicle sales were up 18.4 million during the quarter, or approximately 2.7%.

Leah Stearns: Finally, purchased vehicle sales were up $18.4 million during the quarter, or approximately 2.7%. On a per unit basis, Q4 revenue per unit increased 5.4% and approximately 5.7% for the full year. Average selling prices continue to expand across the platform, with global ASPs increasing 3.5% versus the prior year quarter and 5.5% for the full year. We believe the continued growth in our ASPs reflects the strength of our auctions as our global auction liquidity continues to deliver superior outcomes for our sellers. Global gross profit for the quarter was $481 million, a decrease of $28 million or 5.5%, with gross margin of 41.8%. Our gross profit declines primarily reflect the impact of costs associated with our continued investment across new products and services, including long-haul delivery, Title Express, and our dedicated wholesale facilities in the US.

Speaker #1: On a per-unit basis, fourth quarter revenue per unit increased 5.4%, and approximately 5.7% for the full year. Average selling prices continue to expand across the platform, with global ASPs increasing 3.5% versus the prior-year quarter and 5.5% for the full year.

Speaker #1: We believe that continued growth in our ASPs reflects the strength of our auctions, as our global auction liquidity continues to deliver superior outcomes for our sellers.

Speaker #1: Global gross profit for the quarter was $481 million, a decrease of $28 million, or 5.5%, with gross margin of 41.8%. Our gross profit declines primarily reflect the impact of costs associated with our continued investment across new products and services, including long-haul delivery, Title Express, and our dedicated wholesale facilities in the U.S.

Speaker #1: For the fiscal year, gross profit was $2.1 billion, down $15.8 million, or 0.8%, and was flat when you exclude the impact of CAD events in 2025.

Leah Stearns: For the fiscal year, gross profit was $2.1 billion, down $15.8 million or 0.8%, and was flat when you exclude the impact of cat events in 2025. Gross margin was 44.7% for the full year. Q4 operating income decreased 10.6% to $368.9 million, and for the fiscal year, operating income decreased 2.6% to $1.7 billion. Q4 net income attributable to Copart decreased 17.4% to $327.4 million, or $0.35 per diluted common share, which was down 14.6%. As a reminder, we had a one-time $13 million gain on the disposal of assets in Q4 2025. This, combined with lower interest income in Q4 2026, which was a result of our deployment of $1.63 billion into share purchases earlier in the fiscal year, contributed to the year-over-year decline in net income.

Speaker #1: Gross margin was 44.7% for the full year. Fourth quarter operating income decreased 10.6% to $368.9 million, and for the fiscal year, operating income decreased 2.6% to $1.7 billion.

Speaker #1: Fourth quarter net income attributable to Copart decreased 17.4% to $327.4 million, or $0.35 per diluted common share, which was down 14.6%. As a reminder, we had a one-time $13 million gain on the disposal of assets in the fourth quarter of 2025.

Speaker #1: This, combined with lower interest income in the fourth quarter of 2026—which was a result of our deployment of $1.63 billion into share repurchases earlier in the fiscal year—contributed to the year-over-year decline in net income.

Speaker #1: For the fiscal year, net income attributable to Copart decreased 4.4% to $1.48 billion, or $1.55 per diluted common share. On a global basis, total fourth quarter sold units declined 2.9% year over year, while fiscal 2026 units sold declined 5.5%, or 3.1% excluding CAD units.

Leah Stearns: For the fiscal year, net income attributable to Copart decreased 4.4% to $1.48 billion, or $1.55 per diluted common share. On a global basis, total Q4 sold units declined 2.9% year over year, while fiscal 2026 units sold declined 5.5%, or 3.1% excluding cat units. For the quarter, global assignment volumes decreased 2.2%, and as of year-end, global inventory was down 1% from a year ago period. Turning to our US segment, total revenue was up 0.4% in the quarter, as higher revenue per unit largely offset a decline in volume. US service revenue decreased less than 1% for the quarter and less than 2% for the full year, with the full-year decline primarily related to the one-time revenue associated with Hurricane Helene and Hurricane Milton, which was recognized in fiscal 2025, and offset by an increase in revenue per car.

Speaker #1: For the quarter, global assignment volumes decreased 2.2%. As of year-end, global inventory was down 1% from the year-ago period. Turning to our U.S. segments, total revenue was up 0.4% in the quarter, as higher revenue per unit largely offset a decline in volume.

Speaker #1: US service revenue decreased less than 1% for the quarter and less than 2% for the full year, with the full-year decline primarily related to the one-time revenue associated with Hurricane Selene and Milton, which was recognized in fiscal '25.

Speaker #1: And offset by an increase in revenue per car. U.S. purchased vehicle revenue was up $11.1 million, or 10.9%, in the quarter, with purchased vehicle gross profit up half a million, or 8.7%.

Leah Stearns: US purchased vehicle revenue was up $11.1 million, or 10.9% in the quarter, with purchased vehicle gross profit up half a million or 8.7%. For the fiscal year, US purchased vehicle revenue increased $15.6 million or 3.9%, and purchased vehicle gross profit increased $2.7 million or 10.5%. For the full year, US purchased unit margins were 6.7%, representing an increase of 40 basis points compared to fiscal 2025. US facility-related costs increased $30 million or 7.7% in the Q4, which is a 14.2% increase on a per-unit basis, and again, reflects the ongoing investments I referenced earlier. For the full fiscal year, US facility-related costs decreased $11.8 million or 0.7%, while increasing 6.6% on a per-unit basis. We continue to invest across our US business on behalf of our sellers and members to enhance the products and services we offer.

Speaker #1: For the fiscal year, U.S. purchased vehicle revenue increased $15.6 million, or 3.9%, and purchased vehicle gross profit increased $2.7 million, or 10.5%. For the full year, U.S. purchased unit margins were 6.7%, representing an increase of 40 basis points compared to fiscal '25.

Speaker #1: US facility-related costs increased $30 million, or 7.7%, in the fourth quarter, which is a 14.2% increase on a per unit basis, and again reflects the ongoing investments I referenced earlier.

Speaker #1: For the full fiscal year, U.S. facility-related costs decreased $11.8 million, or 0.7%, while increasing 6.6% on a per-unit basis. We continue to invest across our U.S. business on behalf of our sellers and members to enhance the products and services we offer.

Speaker #1: That being said, cost management is an equally important component of our long-term strategy, and we believe we can execute on both dimensions. We are focused on managing our facility costs down on a per-unit basis through focused cost management across the company.

Leah Stearns: That being said, cost management is an equally important component of our long-term strategy, and we believe we can execute on both dimensions. We are focused on managing our facility costs down on a per-unit basis through focused cost management across the company. US gross profit was $403.8 million, down 8.3% for the quarter and down 2.7% for the fiscal year, with gross margin of 43.4% for the quarter and 46.8% for the full year. Our US operating income was $312.2 million, reflecting a 33.6% operating margin for the quarter. Total Q4 units sold declined 5.7% and 6.9% for the fiscal year 2026. US insurance volumes decreased 7.5% in the quarter and 8% for the fiscal year, which is primarily a result of the industry trends around claims frequency, which Jay described a few moments ago. Beyond insurance, our diversified seller base is showing signs of inflection.

Speaker #1: U.S. gross profit was $403.8 million, down 8.3% for the quarter and down 2.7% for the fiscal year, with gross margin of 43.4% for the quarter and 46.8% for the full year.

Speaker #1: Our U.S. operating income was $312.2 million, reflecting a 33.6% operating margin for the quarter. Total fourth quarter units sold declined 5.7%, and 6.9% for the fiscal year 2026.

Speaker #1: US insurance volumes decreased 7.5% in the quarter and 8% for the fiscal year, which is primarily a result of the industry trends around claims frequency that Jay described a few moments ago.

Speaker #1: Beyond insurance, our diversified seller base is showing signs of inflection. While our U.S. non-insurance unit volume declined 3.9% for the full fiscal year, which was primarily a result of lower Copart Direct units, our non-insurance unit volume returned to modest growth in the fourth quarter, up 0.2%, marking a strong sequential improvement which we believe reflects the traction of our commercial and dealer initiatives.

Leah Stearns: While our US non-insurance unit volume declined 3.9% for the full fiscal year, which was primarily a result of lower Copart Direct units, our non-insurance unit volume returned to modest growth in the Q4, up 0.2%, marking a strong sequential improvement, which we believe reflects the traction of our commercial and dealer initiatives. Our dealer units grew 5.8% in the quarter and 3.9% for the year. Blue Car, which serves our bank, rental, and fleet partners, expanded nearly 20% over the prior year quarter and 2.4% for fiscal 2026, with continued double-digit growth across our bank and fleet customers. Copart Direct unit volume declined 11.7% in the quarter, or 34.5% for the fiscal year 2026, as we continue to optimize our principal unit strategy.

Speaker #1: Our dealer units grew 5.8% in the quarter and 3.9% for the year. BlueCar, which serves our bank, rental, and fleet partners, expanded nearly 20% over the prior year quarter and 2.4% for fiscal 2026, with continued double-digit growth across our bank and fleet customers.

Speaker #1: And Copart direct unit volume declined 11.7% in the quarter, or 34.5% for the fiscal year '26, as we continue to optimize our principal unit strategy.

Speaker #1: U.S. inventory was down 3.4% year over year, with the three main drivers being the decline in assignments of 5%, faster cycle times experienced by our customers, and the reduction in overall aged inventory.

Leah Stearns: US inventory was down 3.4% year over year, with the three main drivers being the decline in assignments of 5%, faster cycle times experienced by our customers, and the reduction in the overall aged inventory. In the US, ASPs increased 4.2% in the quarter, with full-year ASPs increasing 5.5%. US insurance ASPs increased 3.7%, or 5.5% for the full year. US non-insurance ASPs increased 5.9% in the quarter, or 5.6% for the full year, and were led by bank and finance seller ASPs, which were up 12.4% year to date, and with Copart Direct ASPs increasing 29.2%. Turning to our international segment. Q4 revenue grew 11.7% to USD 222.1 million. The primary source of growth was service revenues, up 15.5% for the quarter and 12.4% for the year, driven by a 3.5% increase in fee revenue per unit and volume growth.

Speaker #1: In the U.S., ASPs increased 4.2% in the quarter, with full-year ASPs increasing 5.5%. U.S. insurance ASPs increased 3.7%, or 5.5% for the full year.

Speaker #1: US non-insurance ASPs increased 5.9% in the quarter, or 5.6% for the full year. And WER-led ASPs were up 12.4% year to date, with Copart Direct ASPs increasing 29.2%.

Speaker #1: Turning to our international segment, fourth quarter revenue grew 11.7% to $222.1 million. The primary source of growth was service revenues, up 15.5% for the quarter and 12.4% for the year, driven by a 3.5% increase in fee revenue per unit and volume growth.

Leah Stearns: International purchased vehicle revenue increased USD 2.9 million or 4.4% in the quarter, while purchased vehicle gross profit decreased USD 3.4 million or 22.1%. For the full year, international purchased vehicle revenue increased USD 2.8 million or 1%, and purchased vehicle gross profit increased USD 2.3 million or 4.5%. International facility-related costs were up USD 8.8 million or 11.4% in the quarter, an increase of 1.2% on a per-unit basis, and up USD 33.3 million or 11.2% for the fiscal year, or 7.2% on a per-unit basis. The profit picture for international is equally compelling. Our international gross profit increased 11.8% to USD 77.6 million for the quarter at a 35% gross margin and was USD 301.9 million for fiscal year 2026, which was up 12.3% and drove a 35.2% margin. International operating income reached USD 56.8 million, representing a 25.6% operating margin. International ASPs were up 3.3% in the quarter and 7.3% on a full-year basis.

Speaker #1: International purchased vehicle revenue increased $2.9 million, or 4.4%, in the quarter, while purchased vehicle gross profit decreased $3.4 million, or 22.1%. For the full year, international purchased vehicle revenue increased $2.8 million, or 1%, and purchased vehicle gross profit increased $2.3 million, or 4.5%.

Speaker #1: International facility-related costs were up $8.8 million, or 11.4% in the quarter, an increase of 1.2% on a per unit basis, and up $33.3 million, or 11.2% for the fiscal year, or 7.2% on a per unit basis.

Speaker #1: The profit picture for international is equally compelling. Our international gross profit increased 11.8% to $77.6 million for the quarter, at a 35% gross margin, and was $301.9 million for fiscal year 2026, which was up 12.3% and drove a 35.2% margin.

Leah Stearns: The profit picture for international is equally compelling. Our international gross profit increased 11.8% to USD 77.6 million for the quarter at a 35% gross margin and was USD 301.9 million for fiscal year 2026, which was up 12.3% and drove a 35.2% margin. International operating income reached USD 56.8 million, representing a 25.6% operating margin. International ASPs were up 3.3% in the quarter and 7.3% on a full-year basis.

Speaker #1: International operating income reached $56.8 million, representing a 25.6% operating margin. International ASPs were up 3.3% in the quarter and 7.3% on a full-year basis. International insurance ASPs increased 3.3% for the quarter and 5.2% for the full year.

Leah Stearns: International insurance ASPs increased 3.3% for the quarter and 5.2% for the full year. Internationally, the story is one of continued momentum. Total units sold increased 10% in the quarter, with insurance units up 11.2% and non-insurance units up 6%. Fee units increased to 11.5% for the quarter and 4.6% for the fiscal year, and were primarily driven by our UK and Canadian operations, while purchase units increased 0.2% for the quarter and declined to 2.1% for the full year. For fiscal year 2026, total international units grew 3.7%. International inventory ended the quarter up 10.4% from a year-ago period, and international assignments grew 10% in the quarter.

Speaker #1: Internationally, the story is one of continued momentum. Total units sold increased 10% in the quarter, with insurance units up 11.2% and non-insurance units up 6%.

Speaker #1: Fee units increased 11.5% for the quarter and 4.6% for the fiscal year, and were primarily driven by our UK and Canadian operations. While purchased units increased 0.2% for the quarter, they declined 2.1% for the full year.

Speaker #1: For fiscal year '26, total international units grew 3.7%. International inventory ended the quarter up 10.4% from the year-ago period, and international assignments grew 10% in the quarter.

Speaker #1: Our performance continues to reflect the investments we are making in complementary products and services. And, as I mentioned earlier, this includes Title Express for insurance customers, long-haul delivery for our members, and dedicated wholesale facilities for our dealer and commercial sellers.

Leah Stearns: Our performance continues to reflect the investments we are making in complementary products and services. As I mentioned earlier, this includes Title Express for our insurance customers, long-haul delivery for our members, and dedicated wholesale facilities for our dealer and commercial sellers. On that last point, today we have 25 dedicated wholesale facilities co-located at existing Copart locations in the top US metro markets, which serve 80% of the addressable wholesale market. Our investments to date have included facility upgrades, the hiring of skilled technicians, and the implementation of technology capabilities to serve this segment of our customers at a superior level. Finally, turning to our capital structure and liquidity. Copart remains in an exceptionally strong financial position.

Speaker #1: On that last point, today we have 25 dedicated wholesale facilities, co-located at existing Copart locations in the top U.S. metro markets, which serve 80% of the addressable wholesale market.

Speaker #1: Our investments to date have included facility upgrades, the hiring of skilled technicians, and the implementation of technology capabilities to serve this segment of our customers at a superior level.

Speaker #1: And finally, turning to our capital structure and liquidity, Copart remains in an exceptionally strong financial position. As of the end of July, we had approximately $5.7 billion of liquidity, comprised of $4.5 billion in cash, cash equivalents, and held-to-maturity securities.

Leah Stearns: As of the end of July, we had approximately $5.7 billion of liquidity, comprised of $4.5 billion in cash equivalents, and held-to-maturity securities, plus $1.25 billion of capacity under a revolving credit facility with no debt outstanding. Our balance sheet gives us tremendous flexibility to be opportunistic investors throughout business and credit cycles. Accounting for the consideration associated with the ACV transaction we announced a short while ago, we will still retain significant financial flexibility and capacity to drive further accretive investments. We continue to focus on driving best-in-class outcomes for our customers while generating superior long-term returns for our shareholders. Thank you. With that, Jay and I would be happy to take your questions.

Speaker #1: Plus a $1.25 billion capacity under a revolving credit facility, with no debt outstanding. Our balance sheet gives us tremendous flexibility to be opportunistic investors throughout business and credit cycles.

Speaker #1: Accounting for the consideration associated with the ACV transaction we announced a short while ago, we will still retain significant financial flexibility and capacity to drive further accretive investments.

Speaker #1: We continue to focus on driving best-in-class outcomes for our customers while generating superior long-term returns for our shareholders. Thank you. With that, Jay and I would be happy to take your questions.

Speaker #2: Thank you. Ladies and gentlemen, if you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue.

Operator: Thank you. Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad, and a confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. Participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Speaker #2: You may press star 2 if you would like to remove your question from the queue. Participants using speaker equipment may need to pick up your handset.

Speaker #2: Before pressing star keys.

Speaker #3: Good night.

Jay Adair: Good night.

Speaker #2: And the first question comes from the line of Bob Labick with CJS Securities. Please proceed.

Operator: The first question comes from the line of Bob Labick with CJS Securities. Please proceed.

Speaker #4: Good afternoon, and congratulations on buying a great company and getting a great management team as well.

Bob Labick: Good afternoon, and congratulations on buying a great company and getting a great management team as well.

Speaker #3: Thank you, Bob. We're excited about it.

Jay Adair: Thank you, Bob. We're excited about it.

Bob Labick: Yeah. It's really exciting. Just on that, can you talk a little bit about the fit of ACV into the Copart culture? You guys have such a strong

Speaker #4: Yeah, it's really exciting. And just on that, can you talk a little bit about the fit of ACV into the Copart culture? Because you guys have such a strong—

Speaker #3: Sure.

Jay Adair: Sure

Speaker #4: Culture, and tell us how they fit into it?

Bob Labick: culture, and tell us how they fit into it.

Speaker #3: Sure. Yeah. George and I have gotten to know each other really well, as well as many of his senior team. It's one of the things I talked about.

Jay Adair: Sure. George and I have gotten to know each other really well, as well as many of his senior team. It is one of the things I talked about. They have a startup mentality the way they run the company. They think very agile, and they are as non-corporate, and I would say, as non-large public company as you can get. They think scrappy like we do, and you have heard me use those terms in the past. We are a very scrappy company that can make decisions very quickly, and they have very much that same culture. Additionally, I would say there is a friendship culture that they have. We are all friends in this company. We get along. We do not just get along, we hang out together. It is one of those things where we are all pretty chummy, and I noticed that with them as well. They are going to fit in perfect.

Speaker #3: They really have a startup mentality in the way they run the company. They think very agile, and they're as non-corporate and non–large public company as you can get.

Speaker #3: They think scrappy, like we do, and you've heard me use those terms in the past. We are a very scrappy company that can make decisions very quickly.

Jay Adair: We are a very scrappy company that can make decisions very quickly, and they have very much that same culture. Additionally, I would say there is a friendship culture that they have. We are all friends in this company. We get along. We do not just get along, we hang out together. It is one of those things where we are all pretty chummy, and I noticed that with them as well. They are going to fit in perfect.

Speaker #3: And they have very much that same culture. Additionally, I'd say there's a friendship culture that they have. We're all friends in this company.

Speaker #3: We get along. I mean, we don't just get along—we hang out together. So it's one of those things where we're all pretty chummy.

Speaker #3: And I noticed that with them as well. So they're going to fit in perfectly. We're about winning; they're about results-driven culture. And I think we're just going to get along great.

Jay Adair: We are about winning. They are about results-driven culture, and I think we are just going to get along great. We are going to put these two companies together, and it is going to be amazing.

Speaker #3: We're going to put these two companies together, and it's going to be—it's going to be amazing.

Speaker #4: That's great. And then you said they're going to operate as a subsidiary, so I'm assuming that means you'll retain each of the brands. Is that right?

Bob Labick: That is great. You said they are going to operate as a subsidiary. I am assuming that means you will retain each of the brands. Is that right?

Speaker #3: Yeah, we're going to—yes, for sure. We're going to maintain both brands. But look, make no mistake, we are going to integrate buyers. We're going to integrate the liquidity of the buyers so that they're available on both platforms.

Jay Adair: Yes, for sure. We are going to maintain both brands. Look, make no mistake, we are going to integrate buyers. We are going to integrate the liquidity of the buyers so that they are available on both platforms. They will be marketing that product separately. They will be selling those cars on that website separately from Copart. They will be utilizing the logistics of Copart. We can move a vehicle anywhere in the country in less than 24 hours, and we do it sometimes over 15,000 to 20,000 times a day. There is a bunch that we bring to the table, but there is also a bunch that they bring to the table with their technology and their buyer base. They are going to be separate brands, but they will be integrated on some level between buyers and experiences, that kind of thing. Again, separate websites separately operating.

Speaker #3: But they will be marketing that product separately. They'll be selling those cars on that website separately from Copart. They'll be utilizing the logistics of Copart.

Speaker #3: We can move a vehicle anywhere in the country in less than 24 hours, and we do it sometimes over 15,000 to 20,000 times a day.

Speaker #3: So there's a lot that we bring to the table, but there's also a lot that they bring to the table with their technology and their buyer base.

Speaker #3: So they're going to be separate brands, but they will be integrated on some level between buyers and experiences, that kind of thing.

Speaker #3: But again, separately—separate websites, separately operating.

Speaker #4: Okay, great. And last one from me—I'll jump back, I promise. But obviously, you already have some whole cars and you have massive auction liquidity.

Bob Labick: Okay, great. Last one from me. I'll jump back, I promise. But obviously you already have some whole cars and you have massive auction liquidity. Just thinking over the next several years, how does growing your liquidity in whole car and going up value in dealer to dealer ultimately benefit your insurance customers as well?

Speaker #4: Just thinking over the next several years, how does growing your liquidity in whole car and going up in value in dealer-to-dealer ultimately benefit your insurance customers as well?

Speaker #3: Well, I think it's just going to—it's obvious, it's going... I mean, I feel like it's a loaded question. You knew the answer, but you want me to answer it anyway.

Jay Adair: Well, I think it's obvious. I feel like it's a loaded question. You knew the answer, but you want me to answer it anyway. It is obvious that as we bring in more independent dealers, and yes, you're right, we have a huge number of independent dealers today. As we bring in more independent dealers, in their case, more franchise dealers. They have more franchise dealers than we do. So as we bring in more of those buyers, that'll improve returns, especially when you start to look at insurance-damaged vehicles. More often than not now, you're seeing cars that don't look like they should've been totaled, but they're economic totals. So while they're still drivable, while they're repairable, they're economically totaled. So that's going to help on that front.

Speaker #3: It is obvious that as we bring in more independent dealers—yes, you're right, we have a huge number of independent dealers today—as we bring in more independent dealers, in their case, more franchise dealers, they have more franchise dealers than we do.

Speaker #3: So as we bring in more of those buyers, that'll improve returns, especially when you start to look at insurance-damaged vehicles. More often than not now, you're seeing cars that don't look like they should have been totaled, but they're economic totals.

Speaker #3: And so, while they're still drivable, while they're repairable, they're economically totaled. And so that's going to help on that front. On their units, they have a certain amount of trade-ins that are on the lower end, that our international buyers, especially Mexico, just love. Those vehicles—

Jay Adair: On their units, they have a certain amount of trade-ins that are on the lower end that our international buyers, especially Mexico, just love those vehicles. So, given our network of one of the things that's a challenge logistically is if you buy 50 cars from dealerships and they're staying at the dealership, how does a nine-car get in there to pick those up? With Copart, we can move those vehicles over to Copart, and then a nine-car coming through can pick those up on their time and bring them down to Mexico or bring them to a port where they're going to be shipped. So the international play and the logistics play is going to become real powerful.

Speaker #3: And so, given our network, one of the things that's a logistical challenge is if you buy 50 cars from dealerships and they're staying at the dealership, how does a nine-car get in there to pick those up?

Speaker #3: With Copart, we can move those vehicles over to Copart, and then a nine-car coming through can pick those up on their time and bring them down to Mexico or bring them to a port where they're going to be shipped.

Speaker #3: So the international play and the logistics play are going to become really powerful.

Speaker #4: That's great. Really exciting stuff. Thanks, Jay.

Bob Labick: That's great. Really exciting stuff. Thanks, Jay.

Speaker #3: Thank you. Thanks, Bob.

Jay Adair: Thank you. Thanks, Bob.

Speaker #2: The next question comes from the line of Craig Tennyson with Baird. Please proceed.

Operator: The next question comes from the line of Craig Kennison with Baird. Please proceed.

Speaker #4: Hey, good afternoon. Thank you for taking my question as well. I wanted to ask, Jay, I'm trying to anticipate, I guess, where you may want to invest in ACV to accelerate the growth plan.

Craig Kennison: Hey, good afternoon. Thank you for taking my question as well. Wanted to ask, Jay, I am trying to anticipate, I guess, where you may want to invest in ACV to accelerate the growth plan. Sounds like you plan to leverage existing land. Do you need to invest in people or technology, or do you need new parts of the business, like wholesale financing, or do you intend to get into reconditioning. Just trying to get the scope and scale of where your investments may be.

Speaker #4: It sounds like you plan to leverage existing land. Do you need to invest in people or technology, or do you need new parts of the business, like wholesale financing? Or do you intend to get into reconditioning?

Speaker #4: Just trying to get the scope and scale of where your investments may be.

Speaker #3: Sure. Some of the investment, Craig, is going to be in training. So we've got to bring the ACV folks up to speed on what Copart can do and what offerings we have.

Jay Adair: Sure. Some of the investment, Craig, is going to be in training. We have got to bring the ACV folks up to speed on what Copart can do and what offerings we have, and we have got to do the same thing for Copart. We have got to bring some of the Copart folks up to speed on what ACV products and services are. Some of the investment will be in making areas for our facilities that are specialty for ACV, so that they are not considered Copart areas. They will be partitioned off and separated so that they are for ACV. Then part of the investment will be technology. We are doubling down on tech right now. There is no question about that. There is a buzz at Copart right now about all that we are accomplishing and that we are getting done at Copart on the technology front, and that will continue with this deal.

Speaker #3: And we've got to do the same thing for Copart. So we've got to bring some of the Copart folks up to speed on what ACV products and services are.

Speaker #3: Some of the investment will be in making areas for our facilities that are specialty for ACV, so that they're not considered Copart areas. They'll be partitioned off and separated so that they're for ACV.

Jay Adair: They will be partitioned off and separated so that they are for ACV. Then part of the investment will be technology. We are doubling down on tech right now. There is no question about that. There is a buzz at Copart right now about all that we are accomplishing and that we are getting done at Copart on the technology front, and that will continue with this deal. You will see a continued investment in ACV as well as Copart on tech and making tech that enables the buyer to come in and access both products. They are separate, but they feel connected.

Speaker #3: And then part of the investment will be technology. We're going to—we're going to keep—we're doubling down on tech right now. I mean, there's no question about that.

Speaker #3: There is a buzz at COPART right now about what we're accomplishing and what we're getting done at COPART on the technology front.

Speaker #3: And that will continue with this deal. So you'll see continued investment in ACV, as well as Copart, on tech and making tech that enables the buyer to come in and access both products.

Jay Adair: You will see a continued investment in ACV as well as Copart on tech and making tech that enables the buyer to come in and access both products. They are separate, but they feel connected.

Speaker #3: So, they are separate, but they feel connected.

Speaker #4: Thank you. And then with respect to your core operations, Jay, I think you mentioned your operating costs per vehicle. They were up 12%, and you had a plan to address that.

Craig Kennison: Thank you. With respect to your core operations, Jay, I think you mentioned your operating cost per vehicle were up 12%, and you had a plan to address that. Can you help us understand that plan?

Speaker #4: Can you help us understand that plan?

Speaker #3: Yeah, I mean, we're on it. That's really all I can tell you. We're aware of it, we've identified it, and we are on it.

Jay Adair: Yeah. We are on it. That is really all I can tell you. We are aware of it. We have identified it. We are on it. We are going to be focusing on reducing cost and getting that cost down. In just focusing on the cost, that is going to be one piece of it. The other side is, as we bring more units through, we are going to leverage those costs through more units. The per car, I fully anticipate per car cost to go down.

Speaker #3: We are going to be focusing on reducing costs and getting those costs down. So, just focusing on cost—that's going to be one piece of it.

Speaker #3: The other side is, as we bring more units through, we're going to leverage those costs through more units. So, per car, I fully anticipate per car costs to go down.

Speaker #4: And on that unit side, I know you mentioned one customer loss, but has the drama died down, or are there still RFPs out there that lead to uncertainty?

Craig Kennison: On that unit side, I know you mentioned one customer loss. Has the drama died down on or are there still RFPs out there that lead to uncertainty?

Jay Adair: I do not think there is any drama. If anything, there is swagger maybe right now is what I would say at Copart. We are pretty pumped up about where we are headed. We have a lot of great people that are kicking ass, and that is going to continue. That is not going to change. I feel wonderful about our relationships with our existing customers. Everything is good. I do not really have anything that I would say right now is drama. I think everything is really positive.

Speaker #3: I don't think there's any drama. I mean, if anything, there's swagger—maybe right now is what I would say at Copart. We're pretty pumped up about where we're headed.

Speaker #3: And we've got a lot of great people that are kicking ass, and that's going to continue—that's not going to change. I feel wonderful about our relationships with our existing customers.

Speaker #3: So everything's good. I don't really have anything that I would say right now is drama. I think everything's really positive.

Speaker #4: Great. Well, thank you.

Craig Kennison: Well, thank you.

Speaker #3: Thanks, Craig.

Jay Adair: Thanks, Craig.

Speaker #2: The next question comes from the line of Chris, particularly Ari with BNP Paribas. Please proceed.

Operator: The next question comes from the line of Chris Bottiglieri with BNP Paribas. Please proceed.

Speaker #5: Hey, this is Ian Davis on for Chris. Thanks a lot for taking our questions here. Jay, first one for me is: how should we think about opportunities for future M&A from here?

Ian Davis: Hey, this is Ian Davis on for Chris. Thanks a lot for taking our questions here. Jay, first one for me is, how should we think about opportunities for future M&A from here? Do you think this acquisition precludes you from doing another deal of substantial size for a little while? I know there were some rumors floating around for other opportunities towards tech services. Just wanted to get thoughts on other acquisitions or maybe SaaS-based models that could further improve your access to data from here.

Speaker #5: Do you think this acquisition precludes you from doing another deal of substantial size for a little while? I know there were some rumors floating around about other opportunities towards tech services.

Speaker #5: So, I just wanted to get your thoughts on other acquisitions, and maybe SaaS-based models, that could further improve your access to data from here.

Speaker #3: Yeah, no, I don't think this prohibits us from doing any future acquisitions. We're looking at other businesses that we may want to acquire in the auction space.

Jay Adair: Yeah, no, I don't think this prohibits us from doing any future acquisitions. We're looking at other businesses that we may want to acquire in the auction space. We've got a lot of options. Even with this deal done, we've got over $2 billion of cash on our balance sheet. So I think we're in a great spot. What really matters to me is that we buy companies that make sense, that fit in with Copart, and that Copart can add a lot of value. I'm not really big on buying businesses that are, I'm not going to go out and buy hotels tomorrow because Copart books hotel rooms across the country. That's not synergistic enough. In this case, this is going to be a sharing of customers, a sharing of buyers. Remember, we do a bunch of wholesale today already.

Speaker #3: So we've got a lot of options. Even with this deal done, we've got over $2 billion. So I think we're in a great spot. What really matters to me is that we buy companies that make sense, that fit in with Copart, and that Copart can add a lot of value.

Speaker #3: I'm not really big on buying businesses that are—I'm not going to go out and buy hotels tomorrow, because Copart books hotel rooms across the country.

Speaker #3: That's not synergistic enough. In this case, it's going to be a sharing of customers, a sharing of buyers. Remember, we already do a significant amount of wholesale today.

Speaker #3: So a bunch of the customers that are with ACV are with Copart. So we're sharing customers, we're sharing buyers in some cases. And now we have the ability to put this network of facilities and logistics network.

Jay Adair: So a bunch of the customers that are with ACV are with Copart. So we're sharing customers, we're sharing buyers in some cases, and now we have the ability to put this network of facilities and logistics network. By the way, ACV's got a logistics engine internally that they've developed as well. So there's a lot of benefit here. If there's something in the future that has similar benefit, we'll look at it.

Speaker #3: By the way, ACV has got a logistics engine internally that they've developed as well. So there's a lot of benefit here. If there's something in the future that has similar benefit, we'll look at it.

Speaker #5: Got it, that's helpful. And then, thinking about that international pillar, what's the way to frame your thinking there? Is this something where you want to strike a balance between greater depth and expanded capabilities in existing international markets?

Ian Davis: Got it. That's helpful. Then I think, thinking about that international pillar, what's the way to frame your thinking there? Is this something that you want to strike a balance between greater depth and expanded capabilities in existing international markets or maybe pursuing completely new international markets? How should we think about that for the coming year or two, and what role would potential bolts-on M&A play into that part?

Speaker #5: Or maybe pursuing completely new international markets? Is that how we should think about that for the coming year or two? And what role would potential bolt-on M&A play into that part?

Speaker #3: Yeah, we're profitable in all of our international markets now, and that was something that we wanted to see. But do we want to expand in the existing markets?

Jay Adair: Yeah. We are profitable in all of our international markets now, and that was something that we wanted to see. Do we want to expand in the existing markets? Absolutely. I think that we said for the quarter we were up 10%. We want to expand in the existing markets. Do we want to expand outside of those markets into new countries? The answer is yes.

Speaker #3: Absolutely. I think what we said for the quarter, we were up 10%. So, we want to expand in the existing markets. Do we want to expand outside of those markets into new countries?

Speaker #3: The answer is yes.

Speaker #5: Got it. Thanks a lot. Appreciate it.

Ian Davis: Got it. Thanks a lot. Appreciate it.

Speaker #3: You bet.

Jay Adair: You bet.

Speaker #2: The next question comes from the line of John Healey with North Coast Research. Please proceed.

Operator: The next question comes from the line of John Healy with Northcoast Research. Please proceed.

Speaker #5: Thanks for taking my question. Jay, I wanted to ask about how the transaction is structured with the tender offer. I know you mentioned that it helps close faster.

John Healy: Thanks for taking my question. Jay, I wanted to ask just about how the transaction is structured with the tender offer. I know you mentioned that helps close faster, but I am curious if there is any sort of guardrails on the transaction. Is there any sort of breakup fee or is there anything that prohibits a competing tender offer that you guys have evaluated or any parameters or

Speaker #5: But I'm curious if there's any sort of guardrails on the transaction. Is there any sort of breakup fee, or is there anything that prohibits a competing tender offer that you guys have evaluated, or any parameters, or...?

Jay Adair: I mean,

Speaker #5: Any way you've kind of attempted to get deal certainty with this?

John Healy: any way you have kind of attempted to get deal certainty with this?

Speaker #3: I mean, it's a publicly held company. So some of the what you would expect in terms of go shop or breakup fees exists. But at the end of the day, I think we've I think we've negotiated a good deal for both of us.

Jay Adair: It is a publicly held company, so some of what you would expect in terms of go shop or breakup fees exists. But at the end of the day, I think we negotiated a good deal for both of us. I think it makes sense for both companies.

Speaker #3: I think it makes sense for both companies.

Speaker #5: Okay. Could you share with us, because I haven't seen any filings yet, if there might be breakups or go-shops or anything like that?

John Healy: Could you share with us, because I haven't seen any filings, what those might be, the breakups or go shops or anything like that?

Jay Adair: No, not really. I think it's best that it just comes out in the filings.

Speaker #3: No, not really. I think it's best that it just comes out in the filings. I don't think it's— I don't think it's appropriate for the call, for one. But for two, I'm not a lawyer.

John Healy: Okay.

Jay Adair: I don't think it's appropriate for the call, for one, but for two, I'm not a lawyer.

Speaker #6: So, John, the issue's on file, so you should be able to see the details there.

John Healy: Understood.

Leah Stearns: John, the agreement is on file, so you should be able to see the detail there.

Speaker #5: Okay, thank you. And then, Jay, you guys have made a go at Polcar in the past, and you've had the blue car. I think you had Copart go.

John Healy: Okay. Thank you. Jay, you guys have made a go at whole car in the past, and you have had the Blue Car. I think you had Copart GO, you had Copart Dealer Services, some different iterations of things. Just curious your thoughts kind of thinking backward. You have had traction, but maybe not as big of a splash as maybe we would have thought or maybe hoped for. Was it just the branding, and maybe that is a big part of the ACV value to you guys, is just kind of keeping it distinctly and kind of their presence in the mind of dealers. Just kind of curious what you have kind of learned in the past iterations of the whole car strategy and how that kind of might have evolved with what you are going to do going forward. Thanks.

Speaker #5: You had Copart dealer services, some different iterations of things. I'm just curious about your thoughts, kind of thinking backward. You've had traction, but maybe not as big of a splash as we might have thought or hoped for.

Speaker #5: So was it just the branding, and maybe that's a big part of the ACV value to you guys—just kind of keeping it distinct and maintaining their presence in the mind of dealers?

Speaker #5: Just kind of curious what you've kind of learned and in the past iterations of the whole car strategy and how that kind of might have evolved with what you're going to do going forward.

Speaker #5: Thanks.

Speaker #3: Well, sure. Happy to do that for you. If you go back 20 years ago, literally, there were no dealer services at Copart. We founded that in 2007.

Jay Adair: Well, sure. Happy to do that for you. If you go back 20 years ago, literally, there was no dealer services at Copart. We founded that in 2007, and there was definitely no Blue Car. Yet if you look at non-insurance, it is 25%, 26%, 24%?

Speaker #3: And there was definitely no blue car. And yet, if you look at non-insurance, it's 25%, 26%, 24%.

Speaker #6: Yeah, radical.

Leah Stearns: Yeah, around a quarter.

Speaker #3: Around a quarter. Okay. So, it's roughly a quarter of our volume today. Given that, I think we've been very successful. But to get into those franchise dealers and get into the higher-end trades, I think it does take a different product.

Jay Adair: Around a quarter, okay. It is roughly a quarter of our volume today. Given that, I think we have been very successful. To get into those franchise dealers and get into the higher-end trades, I think does take a different product, and ACV is a different product than Copart. The way they inventory the vehicle all the way through to the condition report, it is different. I think this opens up the world and our ability to do a lot more vehicles in that space.

Speaker #3: And ACV is a different product than Copart. The way they inventory the vehicle, all the way through to the condition report, is different.

Speaker #3: So I think this opens up the world and our ability to do a lot more vehicles in that space.

Speaker #5: Understood, and good luck with everything. Thank you.

John Healy: Understood. Great. Good luck with things. Thanks.

Speaker #3: Thank you, sir. Appreciate it.

Jay Adair: Thank you, sir. Appreciate it.

Operator: The next question comes from the line of Bret Jordan with Jefferies. Please proceed.

Speaker #2: The next question comes from the line of Brett Jordan with Jefferies. Please proceed.

Jay Adair: Hey, Bret.

Speaker #3: Hey, Brett.

Speaker #7: Hey, guys. How's it going?

Bret Jordan: Hey, guys. How's it going?

Speaker #3: Good.

Jay Adair: Good.

Bret Jordan: One of your peers seems to have been using price to gain some volume, and I guess could you talk about what you're seeing sort of in the market on the insurance side around pricing? Is behavior getting back to rational?

Speaker #7: On the one of your peers seems to have been using price to gain some volume. And I guess, could you talk about what you're seeing sort of in the market on the insurance side around pricing?

Speaker #7: Is behavior getting back to rational?

Speaker #3: I mean, look, you have two options in this business. You can either generate the liquidity and get the returns on the units that are going to generate—that are going to bring the dollars in for the customer.

Jay Adair: Well, you have two options in this business. You either can generate the liquidity and get the returns on the units that are going to bring the dollars in for the customer, or you've just got to cut pricing dramatically because you're not getting the returns, and that's how you offset that weakness. At the end of the day, we don't need to play that game. We've got an amazing liquidity. This is only going to make it better. We are going to be that much stronger in terms of our returns and our prices. Think about every car that is not damaged or lightly damaged is going to be put in front of thousands of dealers. That alone gets me excited. I'm not concerned about pricing per se going forward. I'm focused on improving liquidity so it's even more compelling.

Speaker #3: Or you've just got to cut pricing dramatically because you're not getting the returns. And that's how you offset that weakness. At the end of the day, we don't need to play that game.

Speaker #3: We've got amazing liquidity. This is only going to make it better. We are going to be that much stronger in terms of our returns and our prices.

Speaker #3: I mean, think about it—every car that is not damaged or only lightly damaged is going to be put in front of thousands of dealers. I mean, that alone gets me excited.

Speaker #3: So, I'm not concerned about pricing per se going forward. I'm focused on improving liquidity so it's even more compelling.

Speaker #7: Right. And then I guess you mentioned ACVA bank relationships on the commercial side. Given you have physical real estate, could you sort of expand a repo business with this relationship?

Bret Jordan: Right. Then I guess you mentioned ACV, bank relationships on the commercial side. Given you have physical real estate, could you sort of expand a repo business with this relationship, or is that something, just a path you don't want to go down?

Speaker #7: Or is that just a path you don't want to go down?

Speaker #3: I mean, we don't know. We didn't buy a repo business. We're not repossessing cars.

Jay Adair: No, we didn't buy a repo business. We're not repossessing cars.

Speaker #7: No, but could you build a repo business just given the bank relationships that they may have?

Bret Jordan: Yeah, but could you build a repo business just given the bank relationships that they may have?

Speaker #3: We love selling repos. I don't think I want to be the guy on television that picks the car up at someone's house, so I don't think we want to actually do the repo, but we love selling repos. We love picking them up from the repo lots and then auctioning them off.

Jay Adair: We love selling repos. I don't think I want to be the guy on television that picks the car up at someone's house. I don't think we want to actually do the repo, but we love selling repos. We love picking them up from the repo lots and then auctioning them off. We're going to focus heavily on that.

Speaker #3: So, we're going to focus heavily on that.

Speaker #7: Great. Thank ank you.

Bret Jordan: Great. Thank you.

Speaker #3: You bet.

Jay Adair: You bet.

Operator: The next question comes from the line of Jeff Liaw with Stephens. Please proceed.

Speaker #2: The next question comes from the line of Jeff Lick with Stevens. Please proceed.

Speaker #8: Good afternoon, and thanks for taking my question. I'll add my congratulations—this is a great acquisition, and I think you are going to do very well with it.

Jeff Liaw: Good afternoon. Thanks for taking my question. I will add my congratulations. It is a great acquisition. I think you guys are going to do great with it.

Speaker #3: Thank you, Joe.

Jay Adair: Thank you, Jeff.

Speaker #8: Yeah, I was curious. You mentioned your real estate, your properties, and kind of melding that in with ACV. I was curious, is that along the lines of their commercial business?

Jeff Liaw: Jeff, I was curious, you mentioned your real estate and your properties and kind of melding that in with ACV, and I was curious, is that along the lines of their commercial business, or do you see a way on their dealer business as well? Obviously, part of the allure or the value of the digital business is the car sits there. Obviously, you don't have the cost of the move. Sometimes you can actually consider wholesaling it or retailing it at the same time. Do you see ways where you might actually be able to bolster the product offering on the dealer side as well, using physical locations?

Speaker #8: Or do you see a way on their dealer business as well? Obviously, part of the allure or the value of the digital business is the car sits there.

Speaker #8: You don't have the cost of the move. Sometimes, you can actually consider wholesaling it or retailing it at the same time. Do you see ways where you might actually be able to bolster the product offering on the dealer side as well, using physical locations?

Speaker #3: Well, let me start by saying they built an amazing business, selling over 800,000 cars, of which the majority are sold at the dealership. That said, there are some dealers that get frustrated that they've got limited inventory.

Jay Adair: Well, let me start by saying they built an amazing business selling over 800,000 cars, of which the majority are sold at the dealership. That said, there are some dealers that get frustrated that they've got limited inventory, they want the vehicles moved. So I think it's both is the answer to your question. It's going to enhance vehicles that are sold at dealerships where they need to be moved. It's going to enhance when the buyer has bought the vehicle, but they don't want to pick it up for 2 weeks. We can move it to our location and store it until the buyer has time to get it. Then I say both because then it's also going to help on the commercial side. So when it comes to repos, that was the last question. Repossessions can't be kept at the repo lot and sold.

Speaker #3: They want the vehicles moved, so I think the answer to your question is both. It's going to enhance vehicles that are sold at dealerships, where they need to be moved.

Speaker #3: It's going to enhance when the buyer has bought the vehicle, but they don't want to pick it up for two weeks. We can move it to our location and store it until the buyer has time to get it.

Speaker #3: And then I say both, because then it's also going to help on the commercial side. So, when it comes to repos, that was the last question.

Speaker #3: Repossessions can't be kept at the repo lot and sold. They have to be brought to Copart. So we'll bring them in, and then we'll auction them off.

Jay Adair: They have to be brought to Copart. We'll bring them in and then we'll auction them off. So I think it's both.

Speaker #3: So I think it's both.

Speaker #8: And then, just a quick follow-up on international. During your introductory call, you had mentioned Germany and how you're using that as a model on the consignment side.

Jeff Liaw: And then just a quick follow-up on international. During your kind of introductory call, you mentioned about Germany and how you are using that as a model on the consignment side. I was wondering, it has always struck me as a little counterintuitive that Europe is not a little more into the salvage business. If you could just kind of update where that is in other countries.

Speaker #8: I was wondering, it's always struck me as a little counterintuitive that Europe isn’t a little more into the salvage business. If you could just kind of update where that is in other countries.

Speaker #3: Sure. I mean, there are some markets that are similar to the US model, and there are some markets that are similar to the German model. And I would say the good news is that we've figured out the German model.

Jay Adair: Sure. There are some markets that are similar to the US model, and there are some markets that are similar to the German model. I would say the good news is we figured out the German model. We have had the US model figured out for quite a while, but we have now got the German model figured out. So it is time to start growing, and it is time to start expanding across Europe, and we are going to be doing that.

Speaker #3: We've had the US model figured out for quite a while, but we've now got the German model figured out. So, it's time to start growing, and it's time to start expanding across Europe.

Speaker #3: And we're going to be doing that.

Speaker #8: And do you think the current growth rate you're at—where you're kind of growing in the low double digits—is sustainable for a reasonable period of time?

Jeff Liaw: Do you think the current growth rate you are at, where it is kind of growing low double digits, that is sustainable for a reasonable period of time?

Jay Adair: Oh, I never give guidance on growth.

Speaker #3: I never give guidance on growth. But I'm just telling you I'm just telling you as the CEO that we're going to start growing in those markets.

Jeff Liaw: Okay. Awesome.

Jay Adair: I am just telling you as the CEO that we are going to start growing in those markets.

Speaker #8: Awesome. Thanks very much, and best of luck.

Jeff Liaw: Awesome. Thanks very much, and best of luck.

Speaker #3: You bet. Thank you.

Jay Adair: You bet. Thank you.

Operator: The next question comes from the line of John Babcock with Barclays. Please proceed.

Speaker #2: The next question comes from the line of John Babcock with Barclays. Please proceed.

Speaker #9: Hey, guys. Thanks for taking my questions. Just the first one is a clarification question. I think in the press release it mentioned you expected a deal to be accretive in fiscal '28.

John Babcock: Hey, guys. Thanks for taking my questions. Just first one is a clarification question. I think in the press release it mentioned you expected the deal to be accretive in FY28. I was just curious because I think you might have mentioned accretive this year. Is it supposed to be accretive this year or next year?

Speaker #9: I was just curious because I think you might have mentioned a creative this year. So is it supposed to be a creative this year or next year?

Speaker #10: Sorry, John. Well, we expect the transaction to be break-even in the current year and effectively accretive in the first full year, which will be in FY '28.

Leah Stearns: Well, we expect the transaction to be breakeven in the current, effectively accretive in the first full year, which will be in FY28.

Speaker #9: Okay, gotcha. That's helpful. And the next—

John Babcock: Okay, got you. That is helpful.

Leah Stearns: Given when it closes.

Speaker #10: I said, given there's uncertainty in terms of when it closes, we've just got it to '28.

John Babcock: Say again?

Leah Stearns: I said, given there is uncertainty in terms of when it closes, we have just guided to 2028.

John Babcock: Okay, that makes sense. Then next one, I was wondering, just want a little bit of clarity on the increase in spending that you had. I was wondering how much of that is driven by your own decision to increase investments in the business versus increases in cost that you cannot control?

Speaker #9: Okay, makes sense. And then, the next one I was wondering—I just want a little bit of clarity on the increase in spending that you had.

Speaker #9: I was wondering, how much of that is driven by your own decision to increase investments in the business versus increases in costs that you can't control?

Speaker #10: So, the majority of it is driven by the introduction of new products and services. For example, I think $17 million of the year-over-year increase in our facility operations cost was driven by increased costs associated with our long-haul delivery service.

Leah Stearns: The majority of it is driven by the introduction of new products and services. For example, I think $17 million of the year-over-year increase in our facility operations cost was driven by increased costs associated with our long-haul delivery service. Again, that is a business that we typically generate a nice margin on. From where we stand, some of this is purely discretionary. If we see the revenue coming from a product like that, we are willing to take on the additional cost associated with it. The vast majority of the costs that we have incurred year-over-year have been associated with products and services that we have introduced for customers, as well as bringing on additional capacity with new facilities.

Speaker #10: And again, that's a business that we typically generate a nice margin on. So from where we stand, some of this is purely discretionary. If we see the revenue coming from a product like that, we're willing to forego—we're willing to take on the additional costs associated with it.

Speaker #10: And the vast majority of the costs that we have incurred year over year have been associated with products and services that we've introduced for customers, as well as bringing on additional capacity with new facilities.

Speaker #10: So, only a small portion was related to the increase in fuel costs, for example, as a result of some of the elevated cost environment that the broader economy is experiencing.

Leah Stearns: Only a small portion was related to increase in fuel costs, for example, as a result of some of the elevated cost environment that the broader economy is experiencing.

Speaker #9: Okay. And then, I guess just as a follow-up to that, on the call in early July, you talked about increasing spending, and I mean, that basically happened partway through the quarter.

John Babcock: Okay. I guess just as a follow-up to that, on the call in early July, you talked about increasing spending, and that basically happened partway through the quarter. I am just kind of curious, should we expect that the magnitude of spending should increase further in the coming quarter as you start to hit more of a run rate for the quarter, or how would you have us think about that?

Speaker #9: So I'm just kind of curious, should we expect that the magnitude of spending will increase further in the coming quarter as you start to hit more of a run rate for the quarter?

Speaker #9: Or how would you have us think about that?

Speaker #10: So, yeah, sorry. We don't guide specifically to cost or to any of the metrics on the P&L, but I would say we continue to see opportunities to drive growth across the new products and services that we're offering.

Leah Stearns: We do not, sorry, we do not guide specifically to cost or to any of the metrics on the P&L, but I would say we continue to see opportunities to drive growth across the new products and services that we are offering. From that, you can extrapolate your expectation with respect to how costs will trend.

Speaker #10: So from that, you can extrapolate your expectation with respect to how costs will trend.

Speaker #9: Okay, thanks. And then just one last question, if you don't mind. You mentioned that you're not concerned about pricing. Should we think that margins should be comparable next year, or are there pressures that could weigh on them?

John Babcock: Okay, thanks. Then just one last question, if you don't mind. You mentioned that you're not concerned about pricing. Should we think that margins should be comparable next year, or are there pressures that could weigh on them?

Speaker #3: I mean, like Leah said, I'm going to jump in because we just don't give guidance on earnings or any of that. We're very focused on making sure our customers are happy.

Jay Adair: Leah said, I'm going to jump in because we just don't give guidance on earnings or any of that. We're very focused on making sure our customers are happy, and we're very focused on increasing buyer liquidity. We're focused on cost control, and we're going to try and reduce cost per car. So that's what we're letting the Street know, and then you'll see the results.

Speaker #3: And we're very focused on increasing buyer liquidity, and we're focused on cost control. We're going to try to reduce costs per car, so that's what we're letting the Street know.

Speaker #3: And then you'll see the results.

Speaker #9: All right. Sounds good. Thanks for the help.

John Babcock: All right. Sounds good. Thanks for the help.

Speaker #3: Thank you, John.

Jay Adair: Thank you, John.

Operator: As a reminder, if you would like to ask a question, please press star one on your telephone keypad. The next question comes from the line of Jash Patwa with JPMorgan Chase & Co. Please proceed.

Operator: As a reminder, if you would like to ask a question, please press star one on your telephone keypad. The next question comes from the line of Jash Patwa with JPMorgan. Please proceed.

Speaker #2: As a reminder, if you would like to ask a question, please press star one on your telephone keypad. The next question comes from the line of Josh Botwell with J.P. Morgan.

Speaker #2: Please proceed.

Speaker #11: Hi, good evening, and thanks for taking my questions. Congratulations on the acquisition announcement as well. Just on ACV Auctions, the wiper technology in particular seems like a very compelling tool. I was curious if that is something you'd look to deploy at the salvage yards to accelerate intake and condition reporting.

Jash Patwa: Hi, good evening, and thanks for taking my questions. Congratulations on the acquisition announcement as well.

Jay Adair: Thank you.

Jash Patwa: Just on ACV Auctions, the VIPER technology in particular seems like a very compelling tool. I was curious if that is something you would look to deploy at the salvage yards to accelerate intake and condition reporting. Relatedly, is there an opportunity to bring ACV's dealer-to-dealer wholesale auction capabilities to international markets? Thanks, and I have a follow-up.

Speaker #11: And relatedly, is there an opportunity to bring ACV's dealer-to-dealer wholesale auction capabilities to international markets? Thanks again for the follow-up.

Speaker #3: Yeah. We're going to look at everything that we can do internally. So we'll be forming a team to see what benefits we can bring from ACV over to Copart, and what benefits we can bring from Copart over to ACV.

Jay Adair: Yeah, we're going to look at everything that we can do internally. We'll be forming a team to see what benefits we can bring from ACV over to Copart, what benefits we can bring from Copart over to ACV. And we've made it very clear that we're looking at expanding domestically in whole car right now and internationally in insurance and in salvage. We're going to continue on that path.

Speaker #3: And I've made it very clear that we're looking at expanding domestically in whole car right now, and internationally in insurance and in salvage. So, we're going to continue on that path.

Jash Patwa: That's fair. Thanks. Just as a quick follow-up, could you give us a refresher on RPU composition within the US insurance business? I'm just wondering how large a share is the fixed fee from insurance carriers today, and how that has evolved over the past few years. More broadly, as the value of your service improvements compounds with rising repair and rental car costs, is there an opportunity to capture more of that in how you're compensated? Where else in the claim process do you see room to take on more for carriers? Thank you.

Speaker #11: That's fair. Thanks. And just as a quick follow-up, could you give us a refresher on RPU composition within the U.S. insurance business? I'm just wondering how large a share is the fixed fee from insurance carriers today, and how that has evolved over the past few years.

Speaker #11: And more broadly, as the value of your service improvements compounds with rising repair and rental car costs, is there an opportunity to capture more of that in how you're compensated?

Speaker #11: And where else in the claim process do you see room to take on more for carriers? Thank you.

Speaker #10: So, Josh, I would say we don't speak specifically to our pricing strategy, but we certainly have had an opportunity to expand products like Title Express to our customers, which has driven an increase in revenue per unit over the course of the last several years.

Leah Stearns: Josh, I would say we don't speak specifically to our pricing strategy, but we certainly have had an opportunity to expand products like Title Express to our customers, which has driven an increase in revenue per unit over the course of the last several years. We will continue to look for ways to add incremental value. For example, offering loan payoff products for our carrier customers. Those will come along with additional fee opportunities. But we won't speak specifically to the mix or how that pricing strategy is developed.

Speaker #10: So, we will continue to look for ways to add incremental value, for example, offering loan payoff products for our carrier customers. Those will come along with additional fee opportunities.

Speaker #10: But we won't speak specifically to the mix or how that pricing strategy is developed.

Speaker #11: That's helpful. Thanks, and good luck.

Jash Patwa: That's helpful. Thanks, and good luck.

Speaker #10: Thank you.

Leah Stearns: Thank you.

Speaker #2: Thank you. This concludes our Q&A session, and I'd like to hand the call back to Jay Adair for closing remarks.

Operator: Thank you. This concludes our Q&A session, and I would like to hand the call back to Jay Adair for closing remarks.

Speaker #3: Thanks, sir. Appreciate it. George, if you're listening, we're excited, and I couldn't be more excited to be your partner on this. It's great to be back at Copart.

Jay Adair: Thanks, sir. Appreciate it. George, if you are listening, we are excited, and I could not be more excited to be your partner on this. It is great to be back at Copart. I look forward to all that we are going to do together. Again, I am going to reiterate the fact that we are focused on speed, and that we are as a team. We have got great people, and we are super fired up. So I cannot wait to report on the next quarter. I look forward to all that we are going to do, and I thank you all for attending today. Thanks so much. Bye.

Speaker #3: I look forward to all that we're going to do together. Again, I'm going to reiterate the fact that we are focused on speed, and that as a team, we've got great people, and we are super fired up.

Speaker #3: So I can't wait to report on the next quarter. I look forward to all that we're going to do, and I thank you all for attending today.

Speaker #3: Thanks so much. Bye.

Operator: Thank you. This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.