Highlights

  • Carma (ASX:CMA) operates a full-stack digital platform for buying and selling used vehicles in Australia.
  • FY2026 Revenue increased 59% to A$113.8 million as total vehicle deliveries rose 86%.
  • Gross profit doubled to A$10.5 million, while underlying operating margins improved as the Business scaled.
  • Inventory management, customer acquisition, Gross Profit per vehicle and progress towards profitability remain key measures to watch.

Carma (ASX:CMA) is building a technology-led, full-stack platform for buying and selling used vehicles in Australia. The company sources vehicles directly from consumers and other channels, handles inspection and in-house reconditioning, uses technology-supported pricing, sells vehicles through its online retail platform and also operates dealer-only wholesale auctions. Financing and delivery further extend the model across the automotive retail chain.

Since listing on the ASX in November 2025, the key question has shifted from whether Carma can generate customer Demand to whether growing scale can translate into stronger unit Economics and, ultimately, a sustainable Earnings profile.

The numbers behind the platform

Carma (ASX:CMA) reported significant operating growth in FY2026. Revenue increased 59% year-on-year to A$113.8 million, while total vehicle deliveries rose 86% to 5,416 units.

Retail deliveries reached 3,156 units, up 50%, while wholesale deliveries increased 180% to 2,260 units. Gross profit doubled to A$10.5 million, with Gross Profit Margin improving to 9.2%.

The results indicate that greater transaction volumes are beginning to translate into better economics across the platform. Importantly, gross profit grew faster than revenue, suggesting that sourcing, reconditioning and sales efficiencies are contributing alongside Volume growth.

However, the business remains loss-making. Pro forma EBITDA was negative A$30.2 million in FY2026, although the corresponding margin improved to negative 26.5%, compared with negative 39% in the previous year. The continued losses mean Operating Leverage remains one of the most important areas for investors to monitor.

Scaling the operating model

Carma's vertically integrated approach is central to its strategy.

During FY2026, the company purchased 6,235 vehicles, an increase of 127%, with 5,577 sourced through its Sell-to-Carma channel, including trade-ins. This direct sourcing model is important because it can give Carma greater control over inventory quality, Acquisition pricing and vehicle availability.

The company also reconditioned 3,743 retail units during the year, up 99%, while average units processed per shift increased to 15.1.

Investment in the St Peters reconditioning Facility has increased capacity, giving Carma infrastructure to handle higher volumes as demand expands.

The challenge is ensuring that greater operational capacity does not simply increase costs. Higher throughput needs to translate into stronger gross profit per vehicle, lower unit-level operating costs and better inventory turnover.

Improving unit economics

One of the more important elements of FY2026 was the improvement in Carma's gross-profit profile.

Retail gross profit per unit increased to approximately A$2,500, while total gross profit per retail unit reached around A$3,400.

Marketing efficiency also matters because digital retail models can become expensive if customer-acquisition costs rise too quickly. Carma reported retail Marketing expenditure of approximately A$1,500 per retail unit during FY2026, reflecting some improvement compared with the prior year.

The broader Investment case therefore depends on the relationship between vehicle volumes, gross profit per unit and customer-acquisition costs.

If Carma can continue increasing deliveries while maintaining or improving those economics, fixed operating costs could become less significant relative to revenue over time.

Why the business model matters

Australia's used-car market remains fragmented, with traditional dealerships, online classifieds, wholesalers and private sellers all participating in different parts of the transaction process.

Carma (ASX:CMA) seeks to integrate much of that chain within a single platform.

Its Sell-to-Carma operation provides a direct sourcing channel, while its digital marketplace handles retail sales and its wholesale platform helps dispose of vehicles that are not suitable for consumer retail.

This model potentially allows the company to capture value at several stages of the transaction while maintaining greater control over the customer experience.

However, vertical integration also increases operational complexity. Inventory must be acquired at appropriate prices, reconditioned efficiently and sold quickly enough to avoid excessive working-capital requirements or margin pressure.

What to watch next

The next phase of the Carma story is likely to be determined by execution rather than a single corporate catalyst.

Vehicle deliveries remain an important indicator, particularly whether retail volumes can continue growing without requiring disproportionate marketing expenditure.

Gross profit per retail unit and overall gross margin will also be important because they indicate whether increased scale is translating into better economics.

Inventory turnover deserves close attention. Used-car prices can change relatively quickly, and holding vehicles for longer periods can increase financing and Depreciation risks.

Carma's Balance Sheet and cash requirements are also relevant while the business remains loss-making. The company ended FY2026 with A$16 million in cash and had access to A$25.3 million of undrawn bailment facilities, providing total available funding of A$41.3 million.

The central financial question is how quickly operating improvements can reduce cash consumption and move the company towards breakeven.

Key risks

The risks remain meaningful. Carma (ASX:CMA) continues to generate operating losses and is therefore dependent on improving margins and managing available Liquidity while it scales.

Used-car retail is also highly competitive. Traditional dealerships, online platforms and private-market alternatives compete on price, convenience and vehicle choice.

Inventory risk is another significant consideration. Changes in used-car values can affect margins if vehicles are purchased at prices that prove difficult to recover through retail or wholesale channels.

Consumer conditions can also influence demand, particularly where household budgets, financing costs or confidence affect willingness to make larger discretionary purchases.

Execution risk remains particularly important because Carma is simultaneously managing sourcing, reconditioning, retailing, wholesale operations, financing and logistics.

On balance, Carma (ASX:CMA) delivered substantial FY2026 growth while also improving gross profit and underlying operating margins. The business, however, remains loss-making, making the next stage less about proving demand and more about demonstrating operating leverage. Continued delivery growth, stronger unit economics, disciplined inventory management and lower cash burn will determine whether scale can ultimately translate into sustainable profitability.