Copart ACV Acquisition, Mixed Q4 Results

Copart, Inc. (NASDAQ: CPRT) on Sept. 10 reported fiscal fourth-quarter 2026 results for the period ended July 31 and announced a definitive agreement to acquire ACV Auctions Inc. (NYSE: ACVA) in an all-cash tender offer. Copart said the deal will expand its digital marketplace presence.

Mixed Q4 Financial Results

Copart’s revenue rose 2.4% year over year to $1.2 billion in the quarter. Net income attributable to Copart declined 17.4% to $327 million, while fully diluted earnings per share fell 14.6% to $0.35. Gross profit dropped 5.5% to $481 million, reducing the gross margin to 41.8%. Operating income fell 10.6% to $369 million.

The revenue mix shifted toward services, which generated about $970 million, while purchased-vehicle sales accounted for roughly $183 million. Global units sold fell 2.9%, with U.S. weakness offset by international growth. International revenue increased 11.7% to $222 million, producing gross profit near $78 million at a 35% margin and operating income around $57 million, a 25.6% operating margin.

For fiscal 2026, Copart reported revenue of about $4.7 billion and gross profit near $2.1 billion. Net income was roughly $1.5 billion, with diluted EPS of $1.55 and operating income of approximately $1.7 billion. Management described the year as mixed, with top-line growth offset by margin pressure from higher facility operations and vehicle-sales costs, investment-related expenses, lower interest income, and the absence of a prior-year asset disposal gain. Commentary highlighted continued international strength and suggested underlying growth would appear stronger excluding prior-year catastrophe effects.

ACV Deal Terms and Timeline

Copart agreed to acquire ACV for $10.50 per share in cash, implying an equity value of about $1.9 billion. The parties entered an Agreement and Plan of Merger on Sept. 10. Copart will cause its wholly owned subsidiary, Apple Merger Sub, Inc., to commence a cash tender offer for ACV common stock, followed by a merger under Delaware General Corporation Law Section 251(h), which allows a back-end merger without a separate shareholder vote. ACV will become a wholly owned subsidiary, retaining its existing leadership team and operating independently within Copart.

The transaction requires a majority-tender condition, Hart-Scott-Rodino antitrust clearance, and other customary closing conditions. Copart must launch the offer within five business days if practicable and no later than seven business days after the merger agreement date. The offer will remain open for at least 10 business days and is not contingent on financing. Closing is expected by the end of calendar 2026.

The agreement includes termination fees of about $58 million payable by ACV under specified circumstances, such as a change of recommendation or superior proposal. Copart faces a termination fee of approximately $115 million tied to certain regulatory outcomes, including failure to obtain required antitrust clearances. Approximately 4.1% of ACV shares are subject to support agreements, and the boards of both companies have approved the transaction.