Copart (NASDAQ:CPRT) Executive Chairman and incoming Chief Executive Officer Jay Adair told investors the company is preparing to accelerate growth initiatives as he returns to the CEO role, emphasizing that the leadership change is not temporary and that the salvage vehicle auction company remains focused on long-term expansion.
Speaking on a conference call held between earnings releases, which Adair said was the first such call in Copart’s more than three decades as a public company, he said his return was decided jointly with outgoing CEO Jeff, whom he described as a “dear friend.”
Adair, who said he joined Copart 37 years ago in 1989, used the call to outline the company’s history in online auctions and international expansion, as well as its current priorities. He said Copart’s strategy rests on three growth pillars: international insurance expansion, domestic whole-car expansion and technology services for customers.
Copart Points to Three Growth Pillars
Adair said Copart is “going to focus and double down” on initiatives tied to its three core growth areas. He said the company plans to speed up some of those efforts, which will require building a “more robust team,” including promotions and outside hiring.
When asked how long it would take to reinvigorate the growth engine, Adair said the timeline would be measured in quarters rather than years.
He also said mergers and acquisitions will be part of the strategy across all three pillars, alongside internal investment. Asked about build versus buy, Adair said, “We’re going to do both.”
Adair said Copart would remain disciplined in M&A and focus on opportunities within its industry. “We’re not going to go out and buy something that has nothing to do with our industry,” he said. He added that the company could take on debt for the right deal, despite its historically conservative balance sheet approach.
International Expansion Expected to Accelerate
Adair said Copart plans to “fire” its international growth engine “back up again,” after previously slowing expansion while working through different operating models, including in Germany. He said the company is now profitable in Germany and understands how to grow in that market.
Copart reported that international unit volumes grew 5.9% and international revenue grew 14.1% year over year in the third quarter of fiscal 2026, with contributions from both insurance and non-insurance channels, according to Adair.
He said the company’s buyer network spans more than 160 countries and remains a key driver of auction returns. Adair highlighted international buyers, crossover buyers and finance buyers as critical contributors to U.S. insurance average selling prices, which he said reached an all-time high in the most recent quarter and rose approximately 4.1% year over year.
Management Sees Insurance Pressures as Cyclical
Adair addressed what he described as cyclical headwinds in the U.S. insurance market, saying the company is seeing the impact of an “unprecedented dislocation” across the industry. He said inflation from 2022 to 2024 pushed carrier combined ratios out of balance, leading to rate increases and prompting some consumers to reduce coverage through higher deductibles or liability-only policies.
However, Adair said he believes those pressures are beginning to soften and that insurers are becoming more aggressive again. “We believe the consumer retrenchment is cyclical, not structural,” he said.
Adair also reiterated that total loss frequency reached approximately 23.6% in the most recent period, up nearly five percentage points over the past four years. He said higher repair costs and strong auction returns make total loss decisions more attractive to carriers. He noted that total loss frequency was about 8% when he began at Copart.
Balance Sheet and Capital Allocation
Adair said Copart had nearly $4.2 billion in cash as of the third quarter of fiscal 2026, after deploying $1.6 billion into share repurchases. He said the company has “no debt on the balance sheet to speak of” and has the liquidity to evaluate strategic options.
Asked about recent land purchases, Adair said Copart has built an “amazing network” of locations and acreage. He said land buying and development, which he described as roughly half a billion dollars a year over the last decade, is “definitely going to slow down,” though some development and add-ons remain.
AI, Whole Cars and Purple Wave
Adair said artificial intelligence is becoming a near-term focus, saying Copart thinks about AI “in quarters, not years.” He said the company has a head of AI and has guided employees on preferred tools. He described efficiencies as the obvious use case and said strategic applications are also being evaluated, though he declined to provide details.
On domestic whole-car growth, Adair said the business has historically been a growth engine and that he wants to see it “increase dramatically.” He said Copart is considering restructuring and other strategic moves, with a goal for the business to look “very different” in three to four quarters.
Chief Financial Officer Leah Stearns also addressed Purple Wave, saying its expansion strategy is focused primarily on building out a territory sales force to serve enterprise accounts. She said Purple Wave is domestically focused and is expanding from its Central Time Zone base toward coastal markets, initially targeting areas with the highest gross merchandise potential, with that roadmap expected to continue through 2027.
Adair closed the call by saying Copart remains customer-focused and will continue to emphasize auction liquidity. He said he expects to provide more detail when the company reports its quarter and fiscal year results in the coming months.
About Copart (NASDAQ:CPRT)
Copart (NASDAQ: CPRT) is a global provider of online vehicle auction and remarketing services, focused primarily on the sale of salvage and clean-title vehicles. The company operates a technology-driven auction platform that connects sellers — including insurance companies, vehicle finance firms, rental car companies, dealerships and fleet owners — with a broad buyer base consisting of vehicle dismantlers, recyclers, rebuilders and retail buyers. Copart’s business model centers on efficient vehicle disposition using digital bidding and logistics services to maximize recovery value for its clients.
Core services include hosting live and timed online auctions, vehicle listing and inspection support, title processing, and transportation and storage solutions.
