--- ticker: KMX company: KMX filing_type: 10-K year_current: 2026 year_prior: 2025 risks_added: 1 risks_removed: 0 risks_modified: 4 risks_unchanged: 22 source: SEC EDGAR url: https://riskdiff.com/kmx/2026-vs-2025/ markdown_url: https://riskdiff.com/kmx/2026-vs-2025/index.md generated: 2026-06-01 --- # KMX: 10-K Risk Factor Changes 2026 vs 2025 > Source: U.S. Securities and Exchange Commission (EDGAR) > Generated: 2026-06-01 > All data extracted directly from official filings. No hallucinated content. ## Summary | Status | Count | |--------|-------| | New risks added | 1 | | Risks removed | 0 | | Risks modified | 4 | | Unchanged | 22 | --- ## New in Current Filing: Our business and operations could be negatively affected by actions of activist shareholders against us, which could cause us to incur significant expense, hinder execution of business and growth strategy, and impact our stock price. Shareholders have engaged, and in the future may engage, in activist activities against the company, including engaging in proxy solicitations, submitting shareholders proposals, nominating individuals to serve on our Board or otherwise attempting to effect changes, assert influence or acquire some level of control over us. We have been and may continue to be subject to activism in the future. Activist shareholders have sought, and may in the future seek, to effect changes in our strategic direction and how our company is governed through changes to our Board or otherwise. Shareholder activism, including potential proxy contests, could result in substantial costs and divert management's and the Board's attention and resources from our business. Additionally, such shareholder activism could give rise to perceived uncertainties as to our future, adversely affect our relationships with service providers and make it more difficult to attract and retain qualified personnel. We may also be required to incur significant fees and other expenses related to any activist shareholder matters. Further, our stock price could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any shareholder activism. 19 19 19 19 19 19 --- ## Modified: The automotive retail industry in general and our business in particular are sensitive to economic conditions. These conditions could adversely affect our business, sales, results of operations and financial condition. **Key changes:** - Reworded sentence: "These conditions include, but are not limited to, economic downturn, recession, inflation, interest rates, unemployment levels, the state of the housing market, gasoline prices, consumer credit availability, consumer credit delinquency and loss rates, tariffs or the imposition and enforceability of tariffs, trade wars, barriers or restrictions, or threats of such actions and related uncertainties, personal discretionary spending levels, and consumer sentiment about the economy in general." - Reworded sentence: "When these economic conditions worsen or stagnate (as, for example, the current conflict in the Middle East and the resulting increase in the price of gasoline in the U.S.), it can have a material adverse effect on consumer demand for vehicles generally, demand 12 12 12 12 12 12 from particular consumer segments or demand for particular vehicle types." - Reworded sentence: "For example, tariffs impacting the availability and price of automotive parts, vehicles, or steel used in constructing new locations, and uncertainties regarding the ability to obtain refunds for previously paid tariffs that have subsequently been invalidated could also adversely impact our business." **Prior (2025):** We are subject to national and regional U.S. economic conditions. These conditions include, but are not limited to, recession, inflation, interest rates, unemployment levels, the state of the housing market, gasoline prices, consumer credit availability, consumer credit delinquency and loss rates, tariffs or the imposition of new tariffs, trade wars, barriers or restrictions, or threats of such actions, personal discretionary spending levels, and consumer sentiment about the economy in general. These conditions and the economy in general have been, and in the future may be, affected by significant national or international events such as a global health crisis or current geopolitical conditions. When these economic conditions worsen or stagnate, it can have a material adverse effect on consumer demand for vehicles generally, demand from particular consumer categories or demand for particular vehicle types. It can also negatively impact availability of credit to finance vehicle purchases for all or certain categories of consumers. This could result in challenges to vehicle affordability, lower sales, decreased margins on units sold, and decreased profits for our CAF segment. For example, tariffs impacting the availability and price of automotive parts, vehicles, or steel used in constructing new locations could also adversely impact our business. Economic conditions can also have a material adverse effect on the supply of late-model used vehicles, as automotive manufacturers produce fewer new vehicles and consumers retain their current vehicles for longer periods of time. This could result in increased costs to acquire used vehicle inventory and decreased margins on units sold. Any significant change or deterioration in economic conditions could have a material adverse effect on our business, sales, results of operations and financial condition. **Current (2026):** We are subject to national and regional U.S. economic conditions. These conditions include, but are not limited to, economic downturn, recession, inflation, interest rates, unemployment levels, the state of the housing market, gasoline prices, consumer credit availability, consumer credit delinquency and loss rates, tariffs or the imposition and enforceability of tariffs, trade wars, barriers or restrictions, or threats of such actions and related uncertainties, personal discretionary spending levels, and consumer sentiment about the economy in general. These conditions and the economy in general have been, and in the future may be, affected by significant national or international events such as a global health crisis or current geopolitical conditions. When these economic conditions worsen or stagnate (as, for example, the current conflict in the Middle East and the resulting increase in the price of gasoline in the U.S.), it can have a material adverse effect on consumer demand for vehicles generally, demand 12 12 12 12 12 12 from particular consumer segments or demand for particular vehicle types. It can also negatively impact availability of credit to finance vehicle purchases for all or certain categories of consumers. This could result in challenges to vehicle affordability, lower sales, decreased margins on units sold, and decreased profits for our CAF segment. For example, tariffs impacting the availability and price of automotive parts, vehicles, or steel used in constructing new locations, and uncertainties regarding the ability to obtain refunds for previously paid tariffs that have subsequently been invalidated could also adversely impact our business. Economic conditions can also have a material adverse effect on the supply of late-model used vehicles, as automotive manufacturers produce fewer new vehicles and consumers retain their current vehicles for longer periods of time. This could result in increased costs to acquire used vehicle inventory and decreased margins on units sold. Any significant change or deterioration in economic conditions could have a material adverse effect on our business, sales, results of operations and financial condition. --- ## Modified: Our success depends upon the continued contributions of our associates. **Key changes:** - Reworded sentence: "Our associates are critical to our success, and our culture is an important differentiator." - Added sentence: "Our future success also depends in substantial part on our ability to attract, recruit, hire, motivate, develop and retain talented personnel possessing the qualifications, experiences, capabilities and skills we need for all areas of our organization, including senior leadership." - Added sentence: "As our new chief executive officer leads our company in its next chapter, there could be uncertainty among investors, customers, third parties and employees." - Added sentence: "Failure to successfully execute our succession plans or disruptions associated with leadership transitions could have a material adverse effect on our business, sales and results of operations." - Reworded sentence: "Our ongoing success also depends upon the continued contributions of our store, CEC, regional and corporate management teams." **Prior (2025):** Our associates are the driving force behind our success. We believe that one of the key factors that distinguishes CarMax is a culture centered on valuing our associates. We provide flexible, hybrid and remote work arrangements for certain associates, which may impact associate engagement, integration of new associates and overall company culture. A failure to maintain our culture could have a material adverse effect on our business, sales and results of operations. In addition, managing our response to a changing economic environment, evolving technologies and our strategic initiatives require management, employees and contractors to adapt and learn new skills and capabilities. A failure to maintain an adaptable and responsive culture or to continue developing and retaining the associates that drive our success could have a material adverse effect on our business, sales and results of operations. We have experienced, and could experience in the future, a shortage of associates for retail and operational positions, which could have an impact on our ability to conduct our business and maintain qualified talent in key areas. Further, there has been a general increase in domestic workers organizing to form or join a union. If we are unable to maintain positive associate relations, or if, despite our efforts, we become subject to successful unionization efforts, it could increase costs, limit our ability to respond to competitive threats and have a material adverse effect on our business, sales and results of operations. Our ongoing success also depends upon the continued contributions of our store, CEC, region and corporate management teams. Consequently, the loss of the services of any of these associates could have a material adverse effect on our business, sales and results of operations. In addition, an inability to build our management bench strength to support store growth could have a material adverse effect on our business, sales and results of operations. **Current (2026):** Our associates are critical to our success, and our culture is an important differentiator. Cost-reduction initiatives, workforce reductions and changes to our workplace model may affect our ability to attract and retain qualified personnel, result in loss of institutional knowledge and expertise, cause attrition beyond our intended reduction in force or negatively impact associate morale. Internal restructurings may also divert management attention from our business and may negatively impact our culture. A failure to maintain our culture could have a material adverse effect on our business, sales and results of operations. Our future success also depends in substantial part on our ability to attract, recruit, hire, motivate, develop and retain talented personnel possessing the qualifications, experiences, capabilities and skills we need for all areas of our organization, including senior leadership. As our new chief executive officer leads our company in its next chapter, there could be uncertainty among investors, customers, third parties and employees. Failure to successfully execute our succession plans or disruptions associated with leadership transitions could have a material adverse effect on our business, sales and results of operations. In addition, managing our response to a changing economic environment, evolving technologies and our strategic initiatives require management, employees and contractors to adapt and learn new skills and capabilities. A failure to maintain an adaptable and responsive culture or to continue developing and retaining the associates that drive our success could have a material adverse effect on our business, sales and results of operations. We have experienced, and could experience in the future, a shortage of associates for retail and operational positions, which could have an impact on our ability to conduct our business and maintain qualified talent in key areas. Further, there has been a general increase in domestic workers organizing to form or join a union. If we are unable to maintain positive associate relations, or if, despite our efforts, we become subject to successful unionization efforts, it could increase costs, limit our ability to respond to competitive threats and have a material adverse effect on our business, sales and results of operations. Our ongoing success also depends upon the continued contributions of our store, CEC, regional and corporate management teams. Consequently, the loss of the services of any of these associates could have a material adverse effect on our business, sales and results of operations. In addition, an inability to build our management bench strength to support store growth could have a material adverse effect on our business, sales and results of operations. --- ## Modified: The market price of our common stock has been and may continue to be volatile and could expose us to securities class action litigation. **Key changes:** - Reworded sentence: "The price of our common stock has been and may continue to be subject to wide fluctuations based upon our operating results, general economic and market conditions, general trends and prospects for our industry, announcements by our competitors, our ability to achieve any long-term targets or performance metrics and other factors." **Prior (2025):** The price of our common stock may be subject to wide fluctuations based upon our operating results, general economic and market conditions, general trends and prospects for our industry, announcements by our competitors, our ability to achieve any long-term targets or performance metrics and other factors. In addition, the market price of our common stock may also be affected by whether we meet analysts' expectations. Failure to meet such expectations could have a material adverse effect on the price of our common stock. Following periods of volatility in the market price of a company's securities, securities class action litigation is more likely. If litigation were instituted against us, it could result in substantial costs and a diversion of our attention and resources, which could have a material adverse effect on our business. **Current (2026):** The price of our common stock has been and may continue to be subject to wide fluctuations based upon our operating results, general economic and market conditions, general trends and prospects for our industry, announcements by our competitors, our ability to achieve any long-term targets or performance metrics and other factors. We have at times not met analysts' expectations, and any continued failure to meet analysts' expectations, or variations between our results and analysts' projections, could result in further volatility in the price of our common stock. Failure to meet such expectations has had and could in the future have a material adverse effect on the price of our common stock. Following periods of volatility in the market price of the company's securities, securities class action litigation has been brought against the company. Securities litigation could result in substantial costs and a diversion of our attention and resources, which could have a material adverse effect on our business. --- ## Modified: CarMax was founded on the fundamental principle of integrity. Failure to maintain a reputation of integrity and to otherwise maintain and enhance our brand could adversely affect our business, sales and results of operations. **Key changes:** - Reworded sentence: "Integrity is a critical component of the CarMax brand and foundational to the trust our customers place in us." **Prior (2025):** Our reputation as a company that is founded on the fundamental principle of integrity is critical to our success. Our reputation as a retailer offering competitive, no-haggle prices, a broad selection of CarMax Quality Certified used vehicles, superior customer service and a seamless omni-channel experience is also critical to our success. If we fail to maintain the high 13 13 13 13 13 13 standards on which our reputation is built, or if an event occurs that damages this reputation, it could adversely affect consumer demand and have a material adverse effect on our business, sales and results of operations. Such an event could include an isolated incident at a single store, particularly if such incident results in adverse publicity, governmental investigations, or litigation and could involve, among other things, our sales process, our provision of financing, our reconditioning process, our treatment of customers or associates, our use of AI, cultural brand positioning, or real or perceived vehicle quality and related injury. Even the perception of a decrease in the quality of our brand could impact results. The use of social media has increased the speed with which information and opinions can be shared and the speed with which reputation can be affected. We monitor social media and attempt to address customer concerns, provide accurate information and protect our reputation, but there can be no guarantee that our efforts will succeed. If we fail to correct or mitigate misinformation or negative information, including information spread through social media or traditional media channels, about the vehicles we offer, our customer experience, or any aspect of our brand, it could have a material adverse effect on our business, sales and results of operations. **Current (2026):** Integrity is a critical component of the CarMax brand and foundational to the trust our customers place in us. Our reputation for integrity, together with transparent, no‑haggle pricing, vehicle quality, customer service and a seamless omni‑channel experience, is important to our ability to attract and retain customers. While consumers consider a range of factors when choosing where to buy or sell a vehicle, a perceived failure to act with integrity, or a loss of trust in our brand for any reason, could significantly undermine customer confidence and have a material adverse effect on our business, sales and results of operations. Our brand and reputation could be harmed by actual or perceived failures to maintain high standards of integrity, quality or customer experience, including isolated incidents at a single store or broader issues, particularly if they result in adverse publicity, governmental investigations or litigation. These events could relate to, among other things, our sales or financing practices, vehicle reconditioning or quality, treatment of customers or associates, use of AI or other technologies, cultural brand positioning or real or perceived safety issues or injuries. The widespread use of social media and other digital platforms has increased the speed and scale with which information and misinformation can be disseminated, and we may not be successful in correcting or mitigating negative perceptions. Any resulting damage to our reputation or brand could have a material adverse effect on our business, sales and results of operations. 13 13 13 13 13 13 --- *Data sourced from SEC EDGAR. Last updated 2026-06-01.*