Carma (ASX: CMA) Shares Slide: What’s Behind the Drop?

Sonal Goyal

20 October 2026 03:07 PM AEDT

Carma (ASX: CMA) Shares Slide: What’s Behind the Drop?

Image Source: Shutterstock

You are reading a free article with opinions that may differ from the recommendation given by Kalkine in its paid research reports. Become a Kalkine member today to get access to our research reports, in-depth technical and fundamental research. Learn more

Start Your Free Trial Now!

Key highlights

Carma (ASX:CMA) shares fell 10.37% to $0.605 during the Trading session on 20 October 2026.
FY26 results released on 31 August 2026 showed Revenue of $113.8 million, up 59%, and a Pro Forma EBITDA loss of $30.2 million.
The company expects FY27 revenue growth of over 80% and targets crossing to positive EBITDA before the end of calendar 2027.

During the trading session on 20 October 2026, shares of Carma Limited (ASX:CMA) fell 10.37% to $0.605. Separately, on 31 August 2026, the company released its Appendix 4E, Financial Report and Investor Presentation for the year ended 30 June 2026 (FY26), together with a trading update. The share price move and the results release occurred on different dates and are not connected in this article.

About Carma Limited

Carma is an Australian online used-car retailer that began trading on the ASX on 5 November 2025 after raising $70 million in new equity. It purchases vehicles through its Sell-to Carma channel, reconditions them at a 35,000 square metre Facility at St Peters in Sydney, and distributes them through retail and wholesale channels. The network had nine locations in New South Wales at 30 June 2026, including its first sites outside Sydney, in Newcastle and Wollongong.

FY26 operating and financial results

Carma delivered 5,416 units in FY26, up 86%, made up of 3,156 retail units (up 50%) and 2,260 wholesale units (up 180%). Revenue rose 59% to $113.8 million and Gross Profit rose 102% to $10.5 million, with gross profit per retail unit up 35% to $3,300. The average retail selling price fell 6% to $28,900 as a higher share of older vehicles was sold.

Pro Forma EBITDA was a loss of $30.2 million, compared with a loss of $27.8 million in FY25, although the Pro Forma EBITDA Margin improved to negative 26.5%. The statutory loss after tax was $49.6 million, including $13.3 million of non-recurring items. Operating cash outflow was $46.7 million and the company ended the year with $41.3 million in available funding.

Market conditions and operations

The announcement states that fuel prices rose sharply from March 2026, dealer Demand for wholesale vehicles fell, used car prices declined and vehicles took longer to sell. The June quarter was nonetheless a record for retail and wholesale deliveries, although gross profit per unit was lower than in the first three quarters.

Reconditioning throughput averaged 15.1 retail units per shift for the year and 21.7 in the June quarter. A second shift at St Peters is planned for the March 2027 quarter, which would lift capacity to about 60 retail units per operating day.

Trading update and FY27 outlook

Retail deliveries booked in from 1 July to 31 August 2026 were up 120% on the same period a year earlier. For FY27, Carma expects revenue growth of over 80% and a reconditioning exit rate of more than 35 retail units per operating day. It expects to reach positive EBITDA when reconditioning averages 45 to 60 retail units per operating day, which it forecasts before the end of calendar 2027.

Sector backdrop

Australia’s used-car market is influenced by fuel prices, consumer finance conditions, vehicle Supply and the level of online competition. Online dealers have to manage inventory, pricing and reconditioning costs at the same time.

The announcement itself notes that market conditions affected the Business in the June quarter before stabilising in the first quarter of FY27.

Risks shareholders should weigh

Carma continues to report losses and negative operating cash flow. The path to positive EBITDA depends on reaching higher reconditioning volumes, and the forecasts are forward-looking statements that may differ from actual results.

The company notes that vehicles held for more than 60 days earned lower gross profit, and that older vehicles carry lower selling prices. Used-car pricing, fuel prices and demand can move quickly, and its inventory is partly financed through a bailment facility with a $30.0 million limit. Further Capital may be needed if losses persist.

What’s next

Items listed for FY27 include the Apollo unit-economics program, the move of core systems onto its own platform, and the second shift at St Peters scheduled for the March 2027 quarter.

Download Free Report – Explore 3 Stock Ideas & Industry Insights

Unlock 3 stock ideas and key industry insights in our free report. This information is general in nature and does not consider your personal objectives, financial situation, or needs. It is not financial advice.

All investments involve risk—consider independent advice before making any investment decisions.

View 3 Research Reports

Disclaimer:

This article (“Article”) has been prepared by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and its related bodies corporate who are authorised to provide general financial product advice. Kalkine.com.au and its associated pages are published by Kalkine.

Any information/advice provided in this article is general in nature and does not take into account your objectives, financial situation or needs. You should therefore consider whether the information is appropriate for your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Memorandum or other offer document (“Offer Document”) for the securities or other financial products referred to in Kalkine articles. You should obtain a copy of the Offer Document and consider it before making any decision about whether to acquire the security or financial product.

Kalkine strongly recommends that you seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) before acting on any advice/information in this Article or on the Kalkine website. Not all investments are appropriate for all people.

The information in this Article and on Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of the information contained in its articles (including this Article), newsletters and websites. All information represents our views at the date of publication and may change without notice.

The information in this Article does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products.

Kalkine does not issue, sell or deal in any financial products.

This Article may contain information on past performance of particular investments. Please note past performance is neither an indicator nor a guarantee of future performance.

To the extent permitted by law, and excluding any dishonesty or gross negligence by Kalkine, Kalkine disclaims and excludes all liability for any direct, indirect, implied, punitive, special, incidental or other consequential loss or damage arising from the use of or reliance on this Article, the Kalkine website and any information published on the Kalkine website without any warranties or representations by Kalkine to you. To the extent the law prohibits or limits this exclusion, Kalkine limits its liability to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this Article or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Some of the images/music that may be used in the Article are copyright to their respective owner(s). Kalkine does not claim ownership of any of the pictures displayed/music used in the Article unless stated otherwise. The images/music that may be used in the Article are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.