What changed in this filing

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Item 5. Other Information

2026-03-03 compared with 2025-11-24 · 261 added, 141 removed, 865 unchanged (32% of the section changed)

4 unchanged sentences

(In thousands, except share amounts)

October 31, 2025

January 31, 2026

July 31, 2025

36 unchanged sentences

Consoli dated Statements of Income

Three Months Ended October 31,

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands, except per share amounts)

15 unchanged sentences

Income tax expense

Net (loss) income attributable to redeemable noncontrolling interest

Net loss attributable to redeemable noncontrolling interest

Net income attributable to Copart, Inc.

5 unchanged sentences

Conso lidated Statements of Comprehensive Income

Three Months Ended October 31,

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

13 unchanged sentences

Balances at July 31, 2025

Net income (loss)

Currency translation adjustment

2 unchanged sentences

Balances at October 31, 2025

Net income (loss)

Currency translation adjustment

Exercise of stock options, net of repurchased shares

Stock-based compensation

Shares issued for Employee Stock Purchase Plan

Shares repurchased

Balances at January 31, 2026

The accompanying notes are an integral part of these consolidated financial statements.

Consolidated Statement of Changes in Redeemable Noncontrolling Interest and Stockholders’ Equity (Continued)

(In thousands, except share amounts)

4 unchanged sentences

Balances at July 31, 2024

Net income (loss)

Currency translation adjustment

2 unchanged sentences

Balances at October 31, 2024

Net income (loss)

Currency translation adjustment

Exercise of stock options, net of repurchased shares

Stock-based compensation

Shares issued for Employee Stock Purchase Plan

Balances at January 31, 2025

The accompanying notes are an integral part of these consolidated financial statements.

Consol idated Statements of Cash Flows

Three Months Ended October 31,

Six Months Ended January 31,

(In thousands)

21 unchanged sentences

Proceeds from sale of property and equipment

Purchases of held to maturity securities

Proceeds from held to maturity securities

3 unchanged sentences

Proceeds from the exercise of stock options

Proceeds from the issuance of Employee Stock Purchase Plan shares

Repurchases of common stock

Payments for employee stock-based tax withholdings

Debt issuance costs

Payments of finance lease obligations

Net cash provided by financing activities

Net cash (used) provided by financing activities

Effect of foreign currency translation

8 unchanged sentences

Notes to Co nsolidated Financial Statements

October 31, 2025

January 31, 2026

NOTE 1 – Summary of Significant Accounting Policies

4 unchanged sentences

Basis of Presentation

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments of a normal recurring nature considered necessary for fair presentation of the Company’s financial position as of October 31, 2025 and July 31, 2025, its consolidated statements of income, comprehensive income, changes in redeemable noncontrolling interests and stockholders’ equity for the three months ended October 31, 2025 and 2024, and its cash flows for the three months ended October 31, 2025 and 2024.

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments of a normal recurring nature considered necessary for fair presentation of the Company’s financial position as of January 31, 2026 and July 31, 2025, its consolidated statements of income, comprehensive income, changes in redeemable noncontrolling interests and stockholders’ equity for the three and six months ended January 31, 2026 and 2025, and its cash flows for the six months ended January 31, 2026 and 2025.

These consolidated financial statements have been prepared in accordance with the rules and regulations of the U.S.

2 unchanged sentences

generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations.

The interim consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2025 .

The consolidated financial statements of the Company include the accounts of the parent company, its wholly-owned subsidiaries and affiliates in which the Company holds a controlling financial interest as of financial statement date.

The interim consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2025 (the "2025 Form 10-K").

Use of Estimates

9 unchanged sentences

These inputs may be used with internally developed methodologies that result in management’s best estimate.

The amounts recorded for financial instruments in the Company’s consolidated financial statements, which included cash, restricted cash, accounts receivable, accounts payable, and accrued liabilities approximated their fair values as of October 31, 2025 and July 31, 2025, due to the short-term nature of those instruments and are classified within Level II of the fair value hierarchy.

The amounts recorded for financial instruments in the Company’s consolidated financial statements, which included cash, restricted cash, accounts receivable, accounts payable, and accrued liabilities approximated their fair values as of January 31, 2026 and July 31, 2025, due to the short-term nature of those instruments and are classified within Level II of the fair value hierarchy.

Cash equivalents are classified within Level II of the fair value hierarchy because they are valued using quoted market prices of the underlying investments.

7 unchanged sentences

For interests that are redeemable in the future, we recognize changes in the redemption value immediately as they

Shares are redeemable at adjusted fair value from the third anniversary of the acquistion through the 10th anniversary of the acquisition, and are redeemable at fair value thereafter.

Shares are redeemable at adjusted fair value from the third anniversary of the acquisition through the 10th anniversary of the acquisition, and are redeemable at fair value thereafter.

Cash, Cash Equivalents, and Restricted Cash

6 unchanged sentences

The Company had held to maturity securities comprised of U.S.

Treasury Bills as of October 31, 2025 and July 31, 2025 .

Treasury Bills as of July 31, 2025 .

These investments were classified as held to maturity as the Company had the intent and ability to hold these investments until they matured.

1 unchanged sentence

(In thousands)

October 31, 2025

January 31, 2026

Amortized Cost

8 unchanged sentences

Credit Agreement

On December 21, 2021, the Company entered into a Second Amended and Restated Credit Agreement by and among the Company, certain subsidiaries of the Company party thereto, the lenders party thereto, and Bank of America, N.A., as administrative agent (the “Second Amended and Restated Credit Agreement”).

The Second Amended and Restated Credit Agreement amends and restates certain terms of the First Amended and Restated Credit Agreement, dated as of July 21, 2020, by and among the Company, the lenders party thereto, and Bank of America, N.A., as administrative agent (as successor in interest to Wells Fargo Bank, National Association) (the “Existing Credit Agreement”).

The Second Amended and Restated Credit Agreement provides for, among other things, (a) an increase in the secured revolving credit commitments by $ 200.0 million, bringing the aggregate principal amount of the revolving credit commitments under the Second Amended and Restated Credit Agreement (the “Revolving Loan Facility”) to $ 1,250.0 million, (b) an increase in the letter of credit sublimit from $ 60.0 million to $ 100.0 million, (c) addition of Copart UK Limited, CPRT GmbH and Copart Autos España, S.L.U., each a wholly-owned direct or indirect foreign subsidiary of the Company, as borrowers, (d) addition of the ability to borrow under the Second and Amended and Restated Credit Agreement in certain foreign currencies including Pounds Sterling, Euro and Canadian Dollars, (e) extension of the maturity date of the revolving credit facility under the Existing Credit Agreement from July 21, 2023 to December 21, 2026, (f) replacing the LIBOR interest rate applicable to U.S.

Dollar denominated borrowings with a SOFR-based interest rate, and (g) changing the pricing levels with respect to the revolving loans as further described below.

The Second and Amended and Restated Credit Agreement provides for the Revolving Loan Facility of $ 1,250.0 million maturing on December 21, 2026 (including up to $ 550.0 million equivalent of borrowings in Pounds Sterling, Euro and Canadian Dollars) with a $ 150.0 million equivalent sub-facility available to CPRT GmbH, a $ 150.0 million equivalent sub-facility available to Copart Autos España, S.L.U.

and a $ 250.0 million equivalent sub-facility available to Copart UK Limited.

The proceeds may be used for general corporate purposes, including working capital and capital expenditures, potential share repurchases, acquisitions, or other investments relating to the Company’s expansion strategies in domestic and international markets.

Borrowings under the Second Amended and Restated Credit Agreement bear interest based on, at our option, either (1) the applicable fixed rate plus 1.00 % to 1.75 % or (2) the daily rate plus 0.0 % to 0.75 %, in each case, depending on the Company’s consolidated total net leverage ratio.

Additionally, the unused revolving commitments under the Second Amended and Restated Credit Agreement are subject to the payment of a customary commitment fee at a range of 0.175 % to 0.275 %, depending on the Company’s consolidated total net leverage ratio.

The applicable fixed rates described above with respect to borrowings denominated in (1) U.S.

Dollars is SOFR plus certain “spread adjustments” described in the Second Amended and Restated Credit Agreement, (2) Pounds Sterling is SONIA plus certain “spread adjustments” described in the Second Amended and Restated Credit Agreement, (3) Euro is EURIBOR, and (4) Canadian Dollars is CDOR.

The Company had no outstanding borrowings under the Revolving Loan Facility as of October 31, 2025 and July 31, 2025.

The Company’s obligations under the Second Amended and Restated Credit Agreement are guaranteed by certain of the Company’s domestic subsidiaries meeting materiality thresholds set forth in the Second Amended and Restated Credit Agreement.

Such obligations, including the guaranties, are secured by substantially all of the assets of the Company and the assets of the subsidiary guarantors pursuant to a Security Documents Confirmation Agreement as part of the Second Amended and Restated Credit Agreement.

The Second Amended and Restated Credit Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict the Company and its subsidiaries’ ability to, among other things, incur indebtedness, grant liens, merge or consolidate, dispose of assets, make investments, make acquisitions, enter into transactions with affiliates, pay dividends, or make distributions on and repurchase stock, in each case subject to certain exceptions.

The Company is also required to maintain compliance, measured at the end of each fiscal quarter, with a consolidated total net leverage ratio and a consolidated interest coverage ratio.

The Second Amended and Restated Credit Agreement contains no restrictions on the payment of dividends and other restricted payments, as defined, as long as (1) the consolidated total net leverage ratio, as defined, both before and after giving effect to any such dividend or restricted payment on a pro forma basis, is less than 3.25 :1, in an unlimited amount, (2) if clause (1) is not available, so long as the consolidated total net leverage ratio both before and after giving effect to any such dividend on a pro forma basis is less than 3.50 :1, in an aggregate amount not to exceed the available amount, as defined, and (3) if clauses (1) and (2) are not available, in an aggregate amount not to exceed $ 50.0 million;

provided, that, minimum liquidity, as defined, shall be not less than $ 75.0 million both before and after giving effect to any such dividend or restricted payment.

As of October 31, 2025 , the consolidated total net leverage ratio was ( 2.55 ):1 .

Minimum liquidity available as of October 31, 2025 was $ 6.4 billion.

Accordingly, the Company does not believe that the provisions of the Second Amended and Restated Credit Agreement represent a significant restriction to its ability to pay dividends or to the successful future operations of the business.

The Company has not paid a cash dividend since becoming a public company in 1994.

The Company was in compliance with all covenants related to the Second Amended and Restated Credit Agreement as of October 31, 2025.

Related to execution of the Second Amended and Restated Credit Agreement, the Company incurred $ 2.7 million in costs, which were capitalized as debt issuance fees.

The debt issuance cost is amortized to interest expense over the term of the respective debt instruments and is included in other assets on the consolidated balance sheet.

On January 23, 2026, the Company entered into a Senior Revolving Credit Agreement (the “2026 Credit Agreement”) by and among the Company, certain subsidiaries of the Company party thereto, the lenders party thereto, and Wells Fargo Bank, National Association, as administrative agent.

The 2026 Credit Agreement provides for an unsecured revolving credit facility in an aggregate principal amount of up to $ 1,250 million, including subfacilities for standby letters of credit and swingline loans.

The 2026 Credit Agreement matures on January 23, 2031 .

The 2026 Credit Agreement replaced the previous secured revolving credit facility under the credit agreement dated December 21, 2021 by and among the Company, certain subsidiaries of the Company party thereto, the lenders party thereto, and Bank of America, N.A., as the administrative agent (the “Second Amended and Restated Credit Agreement”), which was scheduled to mature on December 21, 2026.

Borrowings under the 2026 Credit Agreement bear interest based on the Company’s option, either (1) the applicable fixed rate plus 0.75 % to 1.125 % or (2) the daily rate plus 0.0 % to 0.125 %, in each case, depending on the Company’s consolidated total net leverage ratio.

Additionally, the unused revolving commitments under the 2026 Credit Agreement are subject to the payment of a customary commitment fee at a range of 0.05 % to 0.125 %, depending on the Company’s consolidated total net leverage ratio.

As of January 31, 2026, the unused capacity of $ 1,250 million was fully available to us.

The 2026 Credit Agreement contains representations and warranties, conditions, and covenants.

As of January 31, 2026, we were in compliance with these financial covenants.

In connection with the 2026 Credit Agreement, the Company incurred $ 1.5 million in costs, which were capitalized as debt issuance fees.

The debt issuance cost is amortized to interest expense over the term of the debt instrument and is included in other assets on the consolidated balance sheet.

NOTE 3 – Fair Value Measurements

The following table summarizes the carrying values and fair values of the Company’s financial instruments that were not carried at fair value in the consolidated balance sheets:

October 31, 2025

January 31, 2026

July 31, 2025

6 unchanged sentences

The carrying value of the U.S.

Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment.

Treasury Bills are adjusted for accretion of

discounts over the remaining life of the investment.

Income related to the Treasury Bills is recognized in interest income in the Company’s consolidated statement of income.

Treasury Bills are classified within Level I of the fair value hierarchy.

During the three months ended October 31, 2025 , no transfers were made between any levels within the fair value hierarchy.

During the six months ended January 31, 2026 , no transfers were made between any levels within the fair value hierarchy.

NOTE 4 – Net Income Per Share

The table below reconciles basic weighted average shares outstanding to diluted weighted average shares outstanding:

Three Months Ended October 31,

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

2 unchanged sentences

Weighted average common and dilutive potential common shares outstanding

There were no material adjustments to net income required in calculating diluted net income per share.

Excluded from the dilutive net income per share calculation were 2,078,513 and 1,105,573 options to purchase the Company’s common stock and restricted stock for the three months ended October 31, 2025 and 2024 , respectively, because their inclusion would have been anti-dilutive.

Ther e were no material adjustments to net income required in calculating diluted net income per share.

Excluded from the dilutive net income per share calculation were 2,664,176 and 1,131,328 options to purchase the Company’s common stock and restricted stock for the three months ended January 31, 2026 and 2025, respectively, and 4,742,689 and 2,158,733 options to purchase the Company’s common stock and restricted stock for the six months ended January 31, 2026 and 2025 , respectively, because their inclusion would have been anti-dilutive.

NOTE 5 – Stock-based Compensation

Refer to Note 12 - Stockholders’ Equity of the Notes to the Consolidated Financial Statements in 2025 Form 10-K for further description of the various types of stock-based compensation awards, their valuations and their award terms.

The table below sets forth the

stock-based compensation recognized by the Company for stock options, restricted stock awards ("RSA"), restricted stock unit awards ("RSU"), and performance stock units ("PSU"):

Three Months Ended October 31,

The table below sets forth the stock-based compensation recognized by the Company for stock options, restricted stock awards ("RSA"), restricted stock unit awards ("RSU"), and performance stock units ("PSU"):

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

9 unchanged sentences

The fair value of the awards is determined at the grant date using either a Lattice or Monte Carlo model, risk-free interest rates ranging from 0.71 % to 4.37 %, estimated volatility ranging from 25.2 % to 29.8 %, and no expected dividends.

The Company recognized $ 0.6 million and $ 1.3 million in compensation expense related to these awards in the three months ended October 31, 2025 and 2024, respectively.

The following is a summary of activity for the Company’s stock options for the three months ended October 31, 2025:

The Company recognized $ 0.6 million and $ 1.0 million in compensation expense related to these awards for the three months ended January 31, 2026 and 2025, and $ 1.2 million and $ 2.3 million in compensation expense related to these awards for the six months ended January 31, 2026 and 2025, respectively.

The following is a summary of activity for the Company’s stock options for the six months ended January 31, 2026:

Time and Market Condition Based

7 unchanged sentences

Forfeitures or expirations

Outstanding as of October 31, 2025

Exercisable as of October 31, 2025

Outstanding as of January 31, 2026

Exercisable as of January 31, 2026

The Company’s RSA, RSU, and PSU awards have been issued with vesting periods ranging from two years to five years .

1 unchanged sentence

Accordingly, the Company recognizes compensation expense for RSA and RSU awards on a straight-line basis over the requisite service period of the award.

Compensation expense for PSU awards is recognized on an accelerated attribution method when the achievement of certain financial performance targets appear probable and is recognized over the remaining requisite service period.

The following is a summary of activity for the Company’s RSA, RSU and PSU awards for the three months ended October 31, 2025:

Compensation expense for PSU awards is recognized on an accelerated attribution method when the achievement of certain financial performance targets appears probable and is recognized over the remaining requisite service period.

The following is a summary of activity for the Company’s RSA, RSU and PSU awards for the six months ended January 31, 2026:

(In thousands, except per share data)

2 unchanged sentences

Forfeitures or expirations

Outstanding as of October 31, 2025

Outstanding as of January 31, 2026

NOTE 6 – Stock Repurchases

On September 22, 2011, the Company’s Board of Directors approved a 320 million share increase in the stock repurchase program, bringing the total current authorization to 784 million shares.

The repurchases may be effected through solicited or unsolicited transactions in privately negotiated transactions or in the open market, including under plans complying with Rule 10b5-1 under the Securities Exchange act of 1934, as amended.

No time limit has been placed on the duration of the stock repurchase p rogram.

Subject to applicable securities laws, such repurchases will be made at such times and in such amounts as the Company deems appropriate and may be discontinued at any time.

The Company repurchased 5,480,191 shares of its common stock during the six months ended January 31, 2026 at a weighted average price of $ 39.82 per share totaling $ 218.2 million.

The Company did no t repurchase any common stock under the program during the six months ended January 31, 2025.

As of January 31, 2026 , the total number of shares repurchased under the program was 464 million, and subject to applicable limitations under Delaware law, 320 million shares were available for repurchase under the program.

NOTE 7 – Income Taxes

The Company’s effective income tax rates were 17.4 % and 20.0 % for the three months ended October 31, 2025 and 2024, respectively, which differs from the U.S.

The Company’s effective income tax rates were 19.0 % and 18.2 % for the six months ended January 31, 2026 and 2025 , respectively, which differs from the U.S.

statutory rate of 21 % primarily due to state income taxes, deduction for Foreign Derived Intangible Income, and excess tax benefits associated with equity-based compensation.

The recognition of excess tax benefits from the exercise of employee stock options was $ 2.8 million and $ 4.6 million for the three months ended October 31, 2025 and 2024, respectively.

The recognition of excess tax benefits from the exercise of employee stock options was $ 3.0 million and $ 23.7 million for the three months ended January 31, 2026 and 2025, respectively, and $ 5.9 million and $ 28.3 million for the six months ended January 31, 2026 and 2025 , respectively.

NOTE 8 – Recent Accounting Pronouncements

32 unchanged sentences

Additionally, the insurance that the Company carries requires that the Company pay for costs and/or claims exposure up to the amount of the insurance deductibles.

Department of Justice, Consumer Protection Branch (DOJ) is conducting an ongoing investigation into potential violations by the Company of certain money laundering laws related to its practices and procedures for preventing and detecting money-laundering activity by its auction platform members.

Department of Justice (DOJ) is conducting an ongoing investigation into potential violations by the Company of certain money laundering laws related to its practices and procedures for preventing and detecting money-laundering activity by its auction platform members.

In connection with this investigation, the Company received a letter from the DOJ in October 2023 in which the DOJ indicated the Company may have exposure as a result of potential violations of such money laundering statutes and regulations.

7 unchanged sentences

The following table presents financial information by segment:

Three Months Ended October 31, 2025

Three Months Ended October 31, 2024

Three Months Ended January 31, 2026

Three Months Ended January 31, 2025

(In thousands)

13 unchanged sentences

Capital expenditures and acquisitions

October 31, 2025

Six Months Ended January 31, 2026

Six Months Ended January 31, 2025

(In thousands)

United States

International

United States

International

Service revenues

Vehicle sales

Total service revenues and vehicle sales

Facility operations

Cost of vehicle sales

General and administrative

Operating income

Depreciation and amortization, excluding debt costs

Interest income

Capital expenditures and acquisitions

January 31, 2026

July 31, 2025

4 unchanged sentences

International

NOTE 11 – Subsequent Events

Recent Share Repurchases:

Subsequent to the end of the second quarter ended January 31, 2026, through March 2, 2026, the Company repurchased 24,262,025 shares of its common stock at a weighted average price of $ 37.11 per share totaling $ 898.7 million.

MA NAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion, which presents Copart Inc.'s (“Copart,” the “Company,” “our,” "us” or “we”) results for periods occurring in the fiscal year ending July 31, 2026 and the fiscal year ended July 31, 2025, should be read in conjunction with our Consolidated Financial Statements as of and for the three months ended October 31, 2025, and the accompanying notes included in Part 1, Item 1 of this Quarterly Report on Form 10-Q, as well as our Consolidated Financial Statements as of and for the year ended July 31, 2025, the accompanying notes and the related Management's Discussion and Analysis of Financial Condition and Results of Operations, contained in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025.

This discussion, which presents Copart Inc.'s (“Copart,” the “Company,” “our,” "us” or “we”) results for periods occurring in the fiscal year ending July 31, 2026 and the fiscal year ended July 31, 2025, should be read in conjunction with our Consolidated Financial Statements as of and for the six months ended January 31, 2026, and the accompanying notes included in Part 1, Item 1 of this Quarterly Report on Form 10-Q, as well as our Consolidated Financial Statements as of and for the year ended July 31, 2025, the accompanying notes and the related Management's Discussion and Analysis of Financial Condition and Results of Operations, contained in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025 (the "2025 Form 10-K ") .

Re sults of Operations

The following table shows certain data from our consolidated statements of income expressed as a percentage of total service revenues and vehicle sales for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

The following table shows certain data from our consolidated statements of income expressed as a percentage of total service revenues and vehicle sales for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In percentages)

11 unchanged sentences

Income before income taxes

Comparison of the Three Months Ended October 31, 2025 and 2024

The following table presents a comparison of service revenues for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

Comparison of the three and six months ended January 31, 2026 and 2025

The following table presents a comparison of service revenues for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

4 unchanged sentences

Service Revenues.

The increase in service revenues during the three months ended October 31, 2025 of $5.5 million, or 0.6%, as compared to the same period last year resulted from (i) a decrease in the U.S.

The decrease in service revenues during the three months ended January 31, 2026 of $(39.2) million, or (4.0)%, as compared to the same period last year resulted from (i) a decrease in the U.S.

of $(48.7) million and (ii) an increase in International of $9.4 million.

The decrease in the U.S.

compared to the same period last year is the related to the one time revenue associated with hurricanes Helene and Milton recognized in fiscal year 2025 offset by an increase in revenue per car.

The growth in International, after excluding positive fluctuations in currency exchange rates of $3.7 million, was driven primarily by an increase in revenue per car, offset by decrease in volume.

The following table presents a comparison of vehicle sales for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

compared to the same period last year was primarily related to the one time revenue associated with hurricanes Helene and Milton recognized in fiscal year 2025.

The growth in International, after excluding positive fluctuations in currency exchange rates of $8.4 million, was driven primarily by an increase in revenue per car, offset by a decrease in volume.

The decrease in service revenues during the six months ended January 31, 2026 of $(33.7) million, or (1.7)%, as compared to the same period last year resulted from (i) a decrease in the U.S.

of $(53.1) million and (ii) an increase in International of $19.4 million.

The decrease in the U.S.

compared to the same period last year was primarily related to the one time revenue associated with hurricanes Helene and Milton recognized in fiscal year 2025 offset by an increase in revenue per car.

The growth in International, after excluding positive fluctuations in currency exchange rates of $12.2 million, was driven primarily by an increase in revenue per car, offset by a decrease in volume.

The following table presents a comparison of vehicle sales for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

4 unchanged sentences

Vehicle Sales.

The increase in vehicle sales for the three months ended October 31, 2025 of $2.7 million, or 1.7%, as compared to the same period last year, resulted from (i) an increase in the U.S.

The decrease in vehicle sales for the three months ended January 31, 2026 of $(2.4) million, or (1.4)%, as compared to the same period last year, resulted from (i) a decrease in the U.S.

of $(4.6) million and (ii) an increase in International of $2.2 million.

The decrease in the U.S.

was primarily driven by a decrease in volume, offset by an increase in revenue per car, which we believe was due to a change in mix of vehicles sold.

The decrease in International, after excluding positive fluctuations in currency exchange rates of $5.1 million, was primarily driven by a decrease in volume related to sellers switching to a consignment model, offset by an increase in revenue per car, which we believe was due to a change in mix of vehicles sold.

The increase in vehicle sales for the six months ended January 31, 2026 of $0.3 million, or 0.1%, as compared to the same period last year, resulted from (i) an increase in the U.S.

of $5.0 million and (ii) a decrease in International of $(4.7) million.

The increase in the U.S.

was primarily driven by an increase in revenue per car, which we believe was due to a change in mix of vehicles

sold, offset by a decrease in volume.

The decrease in International, after excluding positive fluctuations in currency exchange rates of $2.7 million, was primarily driven by a decrease in volume related to sellers switching to a consignment model and decrease in revenue per car, which we believe was due to a change in mix of vehicles sold.

The following table presents a comparison of facility operations expenses for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

was primarily driven by an increase in revenue per car, which we believe was due to a change in mix of vehicles sold, offset by a decrease in volume.

The decrease in International, after excluding positive fluctuations in currency exchange rates of $7.6 million, was primarily driven by a decrease in volume related to sellers switching to a consignment model.

The following table presents a comparison of facility operations expenses for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

10 unchanged sentences

Facility Operations Expenses .

The decrease in facility operations expense for the three months ended October 31, 2025 of $20.1 million, or 4.0%, as compared to the same period last year resulted from (i) a decrease in the U.S.

The decrease in facility operations expense for the three months ended January 31, 2026 of $(11.6) million, or (2.4)%, as compared to the same period last year resulted from (i) a decrease in the U.S.

of $(23.5) million, and (ii) an increase in International of $11.8 million.

The decrease in the U.S.

compared to the same period last year is related to one time costs associated with hurricanes Helene and Milton recognized in fiscal year 2025 offset by increase in subhaul, insurance, and bank charges.

The increase in International , after excluding negative fluctuations in currency exchange rate of $1.9 million, was the result of an increase in cost to process a car.

compared to the same period last year was related to one time costs associated with hurricanes Helene and Milton recognized in fiscal year 2025 offset by increases in subhaul, freight, insurance, and bank charges.

The increase in International, after excluding negative fluctuations in currency exchange rates of $(5.6) million, was the result of an increase in the cost to process a car.

Included in facility operations expenses were depreciation and amortization expenses.

The increase in facility operations depreciation and amortization expenses during the three months ended October 31, 2025 as compared to the same period last year resulted primarily from depreciating new and expanded facilities placed into service in International.

The decrease in the United States is the result of a customer relationship being fully amortized.

The following table presents a comparison of cost of vehicle sales for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

The decrease in facility operations depreciation and amortization expenses during the three months ended January 31, 2026 as compared to the same period last year resulted primarily from the disposal of assets and a customer relationship being fully amortized in the United States.

The increase in the International was result of depreciating new and expanded facilities placed into service

The decrease in facility operations expense for the six months ended January 31, 2026 of $(31.7) million, or (3.2)%, as compared to the same period last year resulted from (i) a decrease in the U.S.

of $(48.6) million, and (ii) an increase in International of $16.9 million.

The decrease in the U.S.

compared to the same period last year was related to one time costs associated with hurricanes Helene and Milton recognized in fiscal year 2025 offset by increases in subhaul, insurance, and bank charges.

The increase in International , after excluding negative fluctuations in currency exchange rates of $(7.6) million, was the result of an increase in the cost to process a car.

Included in facility operations expenses were depreciation and amortization expenses.

The decrease in facility operations depreciation and amortization expenses during the six months ended January 31, 2026 as compared to the same period last year resulted primarily from the disposal of assets and a customer relationship being fully amortized in the United States.

The increase in the International was result of depreciating new and expanded facilities placed into service

The following table presents a comparison of cost of vehicle sales for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

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Cost of Vehicle Sales.

The increase in cost of vehicle sales for the three months ended October 31, 2025 of $3.4 million, or 2.4%, as compared to the same period last year resulted from (i) an increase in the U.S.

The increase in cost of vehicle sales for the three months ended January 31, 2026 of $2.7 million, or 1.8%, as compared to the same period last year resulted from (i) an increase in the U.S.

of $3.6 million and (ii) a decrease in International of $(0.8) million.

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was primarily the result of a change in the mix of vehicles sold offset by a decrease in volume.

The decrease in International after excluding the positive fluctuations of currency exchange rates of $2.2 million, was primarily due to a decrease in volume related to sellers switching to a consignment model, combined with a change in the mix of vehicles sold.

The following table presents a comparison of general and administrative expenses for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

The decrease in International, after excluding the negative fluctuations of currency exchange rates of $4.3 million, was primarily due to a decrease in volume related to sellers switching to a consignment model.

The increase in cost of vehicle sales for the six months ended January 31, 2026 of $6.1 million, or 2.1%, as compared to the same period last year resulted from (i) an increase in the U.S.

of $17.2 million and (ii) a decrease in International of $(11.2) million.

The increase in the U.S.

was primarily the result of a change in the mix of vehicles sold offset by a decrease in volume.

The decrease in International, after excluding the negative fluctuations of currency exchange rates of $6.3 million, was primarily due to a decrease in volume related to sellers switching to a consignment model, combined with a change in the mix of vehicles sold.

The following table presents a comparison of general and administrative expenses for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

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General and Administrative Expenses.

The increase in general and administrative expenses for the three months ended October 31, 2025 of $0.6 million, or 0.5%, as compared to the same period last year resulted from (i) a decrease in the U.S.

The increase in general and administrative expenses for the three months ended January 31, 2026 of $4.8 million, or 4.8%, as compared to the same period last year resulted from (i) an increase in the U.S.

of $1.1 million and (ii) an increase in International of $3.7 million.

Excluding depreciation and amortization, the decrease in the U.S.

of $3.9 million resulted primarily from decreases in third party outside services (including legal, compliance, and system implementations).

of $(0.5) million resulted primarily from decreases in legal, compliance, and system implementation, offset by increases in consulting, bank charges, and labor.

The increase in International of $3.6 million, after excluding the negative fluctuations in currency exchange rates of $(1.1) million, resulted primarily from an increase in labor, third party outside services (including consulting and legal), and taxes.

Depreciation and amortization expenses for the three months ended January 31, 2026 as compared to the same period last year increased as a result of the addition of technology assets being placed in service in the U.S.

and Internationally.

The increase in general and administrative expenses for the six months ended January 31, 2026 of $5.3 million, or 2.6%, as compared to the same period last year resulted from (i) a decrease in the U.S.

of $2.3 million and (ii) an increase in International of $7.6 million.

Excluding depreciation and amortization, the decrease in the U.S.

of $4.4 million resulted primarily from decreases in legal, compliance, and system implementations offset by increase in labor, consulting services, insurance, and bank charges.

The increase in International of $7.6 million, after excluding the negative fluctuations in currency exchange rates of $(1.7) million, resulted primarily from an increase in third party outside services (including consulting and legal), and labor.

Depreciation and amortization expenses for the three months ended October 31, 2025 as compared to the same period last year increased as result of the addition of technology assets being placed in service in the U.S.

Depreciation and amortization expenses for the six months ended January 31, 2026 as compared to the same period last year increased as result of the addition of technology assets being placed in service in the U.S.

and Internationally.

The following table summarizes total other income (expense) for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

The following table summarizes total other income (expense) for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

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Other Income (Expense).

The increase in total other income for the three months ended October 31, 2025 of $11.5 million, or 25.5%, as compared to the same period last year was due to higher interest income earned from U.S.

Treasury Bills, realized currency gain, and gain on sale of fixed assets.

The following table summarizes income taxes for the three months ended October 31, 2025 and 2024:

Three Months Ended October 31,

The increase in total other income for the three months ended January 31, 2026 of $15.5 million, or 42.1%, as compared to the same period last year was due to higher interest income earned from U.S.

Treasury Bills, and realized and unrealized currency gains.

The increase in total other income for the six months ended January 31, 2026 of $27.0 million, or 33.0%, as compared to the same period last year was due to higher interest income earned from U.S.

Treasury Bills, realized and unrealized currency gains, and gain on sale of fixed assets.

The following table summarizes income taxes for the three and six months ended January 31, 2026 and 2025:

Three Months Ended January 31,

Six Months Ended January 31,

(In thousands)

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Liq uidity and Capital Resources

The following table presents a comparison of key components of our liquidity and capital resources at October 31, 2025 and July 31, 2025 and for the three months ended October 31, 2025 and 2024, respectively, excluding additional funds available to us through our Revolving Loan Facility:

The following table presents a comparison of key components of our liquidity and capital resources at January 31, 2026 and July 31, 2025 and for the six months ended January 31, 2026 and 2025, respectively, excluding additional funds available to us through our Revolving Loan Facility:

(In thousands)

October 31, 2025

January 31, 2026

July 31, 2025

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Working capital

Three Months Ended October 31,

Six Months Ended January 31,

(In thousands)

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Capital expenditures and acquisitions

Cash, cash equivalents, and restricted cash and working capital increased $2,453.1 million and $349.6 million at October 31, 2025, respectively, as compared to July 31, 2025.

Cash, cash equivalents, and restricted cash and working capital increased $2,321.3 million and $491.0 million at January 31, 2026, respectively, as compared to July 31, 2025.

Cash, cash equivalents, and restricted cash increased due to cash generated from operations, maturity of held to maturity securities as a result of maximizing our return on U.S.

Treasury Bills, and proceeds from stock option exercises not fully offset by capital expenditures.

Treasury Bills, not fully offset by capital expenditures and the repurchase of common stock as part of our stock repurchase program.

Working capital increased primarily from cash generated from operations and timing of cash receipts, partially offset by capital expenditures, and timing of cash payments.

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These alternative potential uses include additional stock repurchases, acquisitions and the payment of dividends.

For further detail, see Note to Unaudited Consolidated Financial Statements, NOTE 2 – Long-Term Debt and under the subheading “ Credit Agreement ” below.

For further detail, see Note to Unaudited Consolidated Financial Statements, NOTE 2 – Long-Term Debt and NOTE 6 – Stock Repurchases in this Quarterly Report on Form 10-Q and under the subheading “ Credit Agreement ” below.

Our business is seasonal as inclement weather during the winter months increases the frequency of accidents and consequently, the number of cars involved in accidents which the insurance companies salvage rather than repair.

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and (v) most importantly, has the appropriate zoning for our business.

As of October 31, 2025, $287.8 million of the $5.2 billion of cash, cash equivalents, and restricted cash was held by our foreign subsidiaries.

As of January 31, 2026, $362.8 million of the $5.1 billion of cash, cash equivalents, and restricted cash was held by our foreign subsidiaries.

If these funds are needed for our operations in the U.S., the repatriation of these funds could be subject to the foreign withholding tax.

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and our current plans do not require repatriation to fund our U.S.

Net cash provided by operating activities increased for the three months ended October 31, 2025 as compared to the same period in 2024 due to higher revenue per car.

The change in operating assets and liabilities was primarily the result of an increase in cash provided by an increase in income tax payable of $52.6 million, a decrease in accounts receivable of $23.9 million, a decrease in vehicle pooling costs of $13.3 million.

This was offset by cash used due to decrease in accounts payable and accrued liabilities of $38.4 million, and a decrease in prepaid expenses, other current and non current assets of $51.1 million.

Net cash provided by investing activities increased for the three months ended October 31, 2025 as compared to the same period in 2024 due primarily to an increase in proceeds from maturing held to maturity securities and decrease in capital expenditures.

Net cash provided by operating activities increased for the six months ended January 31, 2026 as compared to the same period in 2025 as a result of changes in operating assets and liabilities.

The changes in operating assets and liabilities were primarily the result of an increase in cash provided by a decrease in income tax receivable of $48 million, decrease in inventory of $14.6 million, decrease in accounts receivable of $8.2 million and an increase in income tax payable of $4.3 million These changes were offset by cash used due to a decrease in accounts payable and accrued liabilities of $83.4 million.

Net cash provided by investing activities increased for the six months ended January 31, 2026 as compared to the same period in 2025 due primarily to an increase in proceeds from maturing held to maturity securities, and proceeds from the sale of equipment, and a decrease in capital expenditures.

Our capital expenditures are primarily related to lease buyouts of certain facilities, acquiring land, opening and improving facilities, capitalized software development costs for new software for internal use and major software enhancements, and acquiring facility equipment.

We continue to develop, expand and invest in new and existing facilities.

Net cash provided by financing activities decreased for the three months ended October 31, 2025 as compared to the same period in 2024 due primarily to a decrease in the receipt of proceeds from the exercise of stock options.

Net cash used in financing activities decreased for the six months ended January 31, 2026 as compared to the same period in 2025 due primarily due to repurchases of common stock as part of our stock repurchase program.

Credit Agreement

On December 21, 2021, we entered into a Second Amended and Restated Credit Agreement by and among Copart, certain subsidiaries of Copart party thereto, the lenders party thereto, and Bank of America, N.A., as administrative agent (the “Second Amended and Restated Credit Agreement”).

The Second Amended and Restated Credit Agreement provides for a revolving loan facility of $1,250.0 million maturing on December 21, 2026 (including up to $550.0 million equivalent of borrowings in the Pounds Sterling, European Union Euro and Canadian dollars) with a $150.0 million equivalent sub-facility available to CPRT GmbH, a $150.0 million equivalent sub-facility available to Copart Autos España, S.L.U.

and a $250.0 million sub-facility available to Copart UK Limited.

proceeds may be used for general corporate purposes, including working capital, capital expenditures, potential share repurchases, acquisition, or other investments relating to the Company’s expansion strategies in domestic and international markets.

We had no outstanding borrowings under the Revolving Loan Facility as of October 31, 2025 and July 31, 2025.

The Credit Agreement contains customary affirmative and negative covenants and we were in compliance with all covenants related to the Credit Agreement as of October 31, 2025.

The 2026 Credit Agreement provides for an unsecured revolving credit facility in an aggregate principal amount of up to $1,250 million, including subfacilities for standby letters of credit and swingline loans.

The 2026 Credit Agreement matures on January 23, 2031.

The 2026 Credit Agreement replaced the previous secured credit facility under the credit agreement dated December 21, 2021 by and among the Company, certain subsidiaries of the Company party thereto, the lenders party thereto, and Bank of America, N.A., as the administrative agent (the “Second Amended and Restated Credit Agreement”), which was scheduled to mature on December 21, 2026.

Borrowings under the 2026 Credit Agreement bear interest based on the Company’s option, either (1) the applicable fixed rate plus 0.75% to 1.125% or (2) the daily rate plus 0.0% to 0.125%, in each case, depending on the Company’s consolidated total net leverage ratio.

Additionally, the unused revolving commitments under the 2026 Credit Agreement are subject to the payment of a customary commitment fee at a range of 0.05% to 0.125%, depending on the Company’s consolidated total net leverage ratio.

As of January 31, 2026, the unused capacity of $1,250 million was fully available to us.

The 2026 Credit Agreement contains representations and warranties, conditions, and covenants.

As of January 31, 2026, we were in compliance with these financial covenants.

In connection with entering into the 2026 Credit Agreement, the Company incurred $1.5 million in costs, which were capitalized as debt issuance fees.

The debt issuance cost is amortized to interest expense over the term of the debt instrument and is included in other assets on the consolidated balance sheet.

Stock Repurchases

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Subject to applicable securities laws, such repurchases will be made at such times and in such amounts as we deem appropriate and may be discontinued at any time.

We did not repurchase any shares of our common stock under the program during the three months ended October 31, 2025 or 2024.

As of October 31, 2025, the total number of shares repurchased under the program was 458 million, and subject to applicable limitations under Delaware law, 326 million shares were available for repurchase under the program .

We repurchased 5,480,191 shares of our common stock under the program during the six months ended January 31, 2026 at a weighted average price of $39.82 per share totaling $218.2 million.

We did not repurchase any common stock under the program during the six months ended January 31, 2025.

As of January 31, 2026, the total number of shares repurchased under the program was 464 million, and subject to applicable limitations under Delaware law, 320 million shares were available for repurchase under the program.

See NOTE 11 – Subsequent Events in the Notes to Unaudited Consolidated Financial Statements in this Quarterly Report on Form 10-Q for information regarding share repurchases completed subsequent to January 31, 2026.

Crit ical Accounting Policies and Estimates

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Management has discussed the selection of critical accounting policies and estimates with the Audit Committee of the Board of Directors and the Audit Committee has reviewed our disclosure relating to critical accounting policies and estimates in this Quarterly Report on Form 10-Q.

There have been no material changes to the critical accounting policies and estimates from what was disclosed in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025 filed with the SEC on September 26, 2025.

There have been no material changes to the critical accounting policies and estimates from what was disclosed in our 2025 Form 10-K .

Our significant accounting policies are described in the Notes to Unaudited Consolidated Financial Statements, NOTE 1 – Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q.

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Contrac tual Obligations and Commitments

There have been no material changes during the three months ended October 31, 2025 to our contractual obligations disclosed in our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025, filed with the SEC on September 26, 2025 .

There have been no material changes during the six months ended January 31, 2026 to our contractual obligations disclosed in our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2025 Form 10-K .

Cautionary Note on Forward-Looking Statements

Unless the context otherwise requires, references in this Quarterly Report on Form 10-Q to “Copart,” the “Company,” “we,” “us,” or “our” refer to Copart, Inc.

This Quarterly Report on Form 10-Q, including the information incorporated by reference herein, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act).

All statements other than statements of historical facts are statements that could be deemed forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “intend,” “forecast,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue” or the negative of these terms or other comparable terminology.

The forward-looking statements contained in this Form 10-Q involve known and unknown risks, uncertainties and situations that may cause our or our industry’s actual results, level of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these statements.

These forward-looking statements are made in reliance upon the safe harbor provision of the Private Securities Litigation Reform Act of 1995.

These factors include those listed in Part II, Item 1A.

under the caption entitled “Risk Factors” in this Quarterly Report on Form 10-Q and those discussed elsewhere in this Quarterly Report on Form 10-Q.

We encourage investors to review these factors carefully together with the other matters referred to herein, as well as in the other documents we file with the Securities and Exchange Commission (the “SEC”).

We may from time to time make additional written and oral forward-looking statements, including statements contained in our filings with the SEC.

We do not undertake to update any forward-looking statement that may be made from time to time by or on behalf of us.

Although we believe that, based on information currently available to us and our management, the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

You should not place undue reliance on these forward-looking statements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes to the information required under this Item from what was disclosed in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025, filed with the SEC on September 26, 2025.

There have been no material changes to the information required under this Item from what was disclosed in our 2025 Form 10-K .

CONTROLS AND PROCEDURES

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For a discussion of Legal Proceedings that affect us, refer to the Notes to Unaudited Consolidated Financial Statements, NOTE 9 – Legal Proceedings included in Part I , Item 1 of this Quarterly Report on Form 10-Q.

Set forth below and elsewhere in this Quarterly Report on Form 10-Q and in other documents we file with the SEC are descriptions of the risks and uncertainties that could cause our actual results to differ materially from the results contemplated by the forward-looking statements contained in this Quarterly Report on Form 10-Q.

The descriptions below include any material changes to and supersede the description of the risk factors affecting our business previously disclosed in “Part I, Item 1A, Risk Factors” of our 2025 Form 10-K .

Risks Related to Our Business and Industry

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The loss of one or more of these major sellers could adversely affect our consolidated results of operations and financial position, and an inability to increase our sources of vehicle supply could adversely affect our growth rates.

Although no single customer accounted for more than 10% of our consolidated revenues during three months ended October 31, 2025, a limited number of vehicle sellers historically have collectively accounted for a substantial portion of our revenues.

Although no single customer accounted for more than 10% of our consolidated revenues during six months ended January 31, 2026, a limited number of vehicle sellers historically have collectively accounted for a substantial portion of our revenues.

Vehicle sellers have terminated agreements with us in the past in particular markets, which has affected revenues in those markets.

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Furthermore, there can be no assurance that we will be able to enter into future agreements with vehicle sellers or that we will be able to retain our existing supply of salvage vehicles.

A reduction in vehicles from a significant vehicle seller or any material changes in the terms of an arrangement with a significant vehicle seller could have a material adverse effect on our consolidated results of operations and financial position.

A reduction in vehicles from a significant vehicle seller or any material changes in the terms of an arrangement with a significant vehicle seller could have a

material adverse effect on our consolidated results of operations and financial position.

In addition, a failure to increase our sources of vehicle supply could adversely affect our earnings and revenue growth rates.

Our expansion into markets outside the U.S., including expansions in the U.K., Canada, Europe, Brazil, and the Middle East expose us to risks arising from operating in international markets.

Any failure to successfully integrate businesses acquired or

operational capabilities established outside the U.S.

Any failure to successfully integrate businesses acquired or operational capabilities established outside the U.S.

could have an adverse effect on our consolidated results of operations, financial position, or cash flows.

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To securely transmit confidential information such as customer credit card numbers, we rely on encryption and authentication technology.

Unanticipated events or developments could result in a compromise or breach of the systems

we use to protect customer transaction data.

Unanticipated events or developments could result in a compromise or breach of the systems we use to protect customer transaction data.

Furthermore, our servers may also be vulnerable to viruses transmitted via the internet and other points of access.

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These programs include the Registered Broker program through which the public can purchase vehicles through a registered member, and Copart Lounge programs through which registered members can open Copart storefronts in foreign markets with internet kiosks enabling the general public to search our inventory and purchase vehicles.

Initiating programs that allow access to our online auctions to the general public will involve material expenditures and we cannot predict what future benefit, if any, will be derived.

Initiating programs that allow access to our online auctions to the general public

will involve material expenditures and we cannot predict what future benefit, if any, will be derived.

These programs could also create additional risks, including heightened regulation and litigation risk related to vehicle sales to the general public, and heightened branding, reputational, and intellectual property risk associated with allowing Copart registered members to establish Copart-branded storefronts in foreign jurisdictions.

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Although we have implemented policies, procedures, and training designed to ensure compliance with anti-bribery laws, trade controls and economic sanctions, and similar regulations, our employees or agents may take actions in violation of our policies.

incur costs or other penalties in the event that any such violations occur, which could have an adverse effect on our business and reputation.

We may incur costs or other penalties in the event that any such violations occur, which could have an adverse effect on our business and reputation.

In some cases, the enforcement practices of governmental regulators in certain foreign areas and the procedural and substantive rights and remedies available to us may vary significantly from those in the U.S., which could have an adverse effect on our business.

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Participants in the vehicle sales industry are subject to, and may be required to expend funds to ensure compliance with a variety of laws, regulations, and ordinances.

These include, without limitation, land use ordinances, business and occupational licensure requirements and procedures, vehicle titling, sales, and registration rules and procedures, and laws and regulations relating to the environment, anti-money laundering, anti-corruption, exporting, and reporting and notification requirements to agencies and law enforcement relating to vehicle transfers.

environment, anti-money laundering, anti-corruption, exporting, and reporting and notification requirements to agencies and law enforcement relating to vehicle transfers.

Many of these laws and regulations are frequently complex and subject to interpretation, and failure to comply with present or future regulations or changes in interpretations of existing laws or regulations may result in government investigation or proceedings, which could lead to impairment or suspension of our operations and the imposition of penalties and other liabilities.

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As described under NOTE 9 – Legal Proceedings , the U.S.

Department of Justice, Consumer Protection Branch is conducting an ongoing investigation into potential violations by the Company of certain money laundering laws related to its practices and procedures for preventing and detecting money-laundering activity by its auction platform members.

Department of Justice is conducting an ongoing investigation into potential violations by the Company of certain money laundering laws related to its practices and procedures for preventing and detecting money-laundering activity by its auction platform members.

The Company is cooperating with the DOJ’s investigation.

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Any such inquiries or investigations may be time-consuming, costly, divert management resources, or otherwise have a material adverse effect on our business, financial condition or results of operation.

These or other governmental

investigations, inquiries, or lawsuits could lead to our incurring liability for damages or other costs, a criminal or civil proceeding, the imposition of fines and penalties, and/or other remedies, and reputational harm to our business, which can impact our ability to attract and retain customers and qualified personnel, as well as restrictions on or added costs for our business operations going forward.

These or other governmental investigations, inquiries, or lawsuits could lead to our incurring liability for damages or other costs, a criminal or civil proceeding, the imposition of fines and penalties, and/or other remedies, and reputational harm to our business, which can impact our ability to attract and retain customers and qualified personnel, as well as restrictions on or added costs for our business operations going forward.

Changes in laws or the interpretation of laws, including foreign laws and regulations, affecting the import and export of vehicles may have an adverse effect on our business and financial condition.

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New tax legislative initiatives may be proposed from time to time, such as proposals for comprehensive tax reform in the United States, which may impact our effective tax rate and which could adversely affect our tax positions or tax liabilities.

Our future effective tax rate could be adversely affected by, among other things, changes in the composition of earnings in jurisdictions with differing tax

rates, changes in statutory rates and other legislative changes, changes in interpretations of existing tax laws, or changes in determinations regarding the jurisdictions in which we are subject to tax.

Our future effective tax rate could be adversely affected by, among other things, changes in the composition of earnings in jurisdictions with differing tax rates, changes in statutory rates and other legislative changes, changes in interpretations of existing tax laws, or changes in determinations regarding the jurisdictions in which we are subject to tax.

From time to time, U.S.

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The techniques used by criminals to obtain unauthorized access to sensitive data change frequently and are often not recognized immediately.

For example, as AI technologies, including generative AI models, develop rapidly, threat actors are using these technologies to create new sophisticated attack methods that are increasingly automated, targeted and coordinated and more difficult to defend against.

We may be unable to anticipate these techniques or implement adequate preventative measures and believe that cyber-attacks and threats against us have occurred in the past and are likely to continue in the future.

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In the event of another, more serious ransomware attack, we could suffer significant financial and reputational harm, regardless of whether we choose to pay the ransom amount.

In addition, as cyber-threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities.

In addition, as cyber-threats continue to evolve, we may be required to expend significant additional resources to continue to

modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities.

Any of the risks described above could materially and adversely affect our consolidated results of operations and financial position.

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Such technologies present unique business opportunities along with ever-changing legal and regulatory risks.

Both state and federal regulations relating to these emerging technologies are quickly and constantly evolving and may require significant resources to modify and maintain business practices to comply with laws, the nature of

which cannot be determined at this time.

Our failure to accurately identify and address our responsibilities and liabilities in this new environment could negatively affect any solutions we develop incorporating such technology and could subject us to reputational harm, regulatory action, or litigation, which may harm our financial condition and operating results.

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Our executive officers, directors, and their affiliates hold a large percentage of our stock and their interests may differ from other stockholders.

Our executive officers, directors and their affiliates beneficially own, in the aggregate, more than 10% of our issued and outstanding common stock as of October 31, 2025.

Our executive officers, directors and their affiliates beneficially own, in the aggregate, more than 10% of our issued and outstanding common stock as of January 31, 2026.

If they were to act together, these stockholders would have significant influence over most matters requiring approval by stockholders, including the election of directors, any amendments to our amended and restated certificate of incorporation and certain significant corporate transactions, including potential merger or acquisition transactions.

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Issuer Purchases of Equity Securities

The The following table sets forth information concerning the number of shares of our common stock purchased by us during the three months ended January 31, 2026:

Total Number of

Shares Purchased

as Part of Publicly

Announced Program

Maximum Number

of Shares That May

Yet be Purchased

Under the Program (1)

Balance at October 31, 2025

November 1, 2025 through November 30, 2025

December 1, 2025 through December 31, 2025

January 1, 2025 through January 31, 2026

(1) Our stock repurchase program was announced on February 20, 2003.

On September 22, 2011, our board of directors approved a 320 million share increase in our stock repurchase program, bringing the total current authorization to 784 million shares.

No time limit has been placed on the duration of the stock repurchase program.

Subject to applicable securities laws, such repurchases will be made at such times and in such amounts as the Company deems appropriate and may be discontinued at any time.

DEFAULTS UPON SENIOR SECURITIES

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Securities Trading Plans of Directors and Executive Officers

During the fiscal quarter ended October 31, 2025 , no director or officer of the Company adopted or terminated any “Rule 10b5-1 trading arrangement,” or any “non-Rule 10b5-1 trading arrangement,” as such terms are defined in Item 408(a) of Regulation S-K.

During the fiscal quarter ended January 31, 2026 , no director or officer of the Company adopted or terminated any “Rule 10b5-1 trading arrangement,” or any “non-Rule 10b5-1 trading arrangement,” as such terms are defined in Item 408(a) of Regulation S-K.

Amended and Restated Certificate of Incorporation of Copart, Inc.

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(incorporated by reference from Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed on March 12, 2024)

Senior Revolving Credit Agreement, dated as of January 23, 2026, by and among Copart, Inc., the subsidiaries of Copart, Inc.

party thereto, the lenders party thereto, and Wells Fargo Bank, National Association, as administrative agent (incorporated by reference to Exhibit 10.1 of the Form 8-K filed on January 26, 2026)

Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

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(Principal Financial and Accounting Officer and duly Authorized Officer)

November 21, 2025

March 3, 2026

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 5. Other Information