Will Copart report positive full-year FY2026 revenue growth?

H1 FY2026 revenue is approximately $2.28B vs H1 FY2025 $2.17B (+5.1%). For positive full-year growth, H2 FY2026 needs to exceed $2.37B (not the full $2.48B of H2 FY2025 — just exceed total FY2025 of $4.65B). This means H2 FY2026 needs to be at least $2.37B. H2 FY2025 was $2.48B, so H2 FY2026 can decline up to 4.4% from H2 FY2025 and still achieve positive full-year growth. Given that Q2 FY2026 was -3.6% but ex-CAT was +1.3%, and ASP growth of 6-9% continues to partially offset volume declines, a modest H2 revenue decline (around -2% to -4%) is plausible. Positive full-year growth is more likely than not but not high confidence.

The key challenge is the Q3 FY2025 comp (+11.3%, $1.35B). Q3 FY2026 needs to avoid a sharp decline from this elevated base. If Q3 FY2026 declines 5-6% (consistent with Q2 FY2026 trend of -3.6%), Q3 revenue would be approximately $1.27-1.28B. Combined with a Q4 at approximately $1.10-1.12B (assuming flat to slight decline from Q4 FY2025's $1.13B), H2 would be approximately $2.37-2.40B. This is right at the threshold. The outcome depends critically on whether Q3 FY2026 volume declines accelerate or moderate. I assign near-coin-flip probability.

I weight the ASP tailwind more heavily. US insurance ASP growth has been 6-9% consistently, driven by structural international buyer premium. Even if volumes remain negative, ASP growth of 6-9% on a base where volumes decline 5-8% produces revenue declines of only 0-3%. H1 already banked +5.1% growth, so H2 can decline modestly. Purple Wave GTV +17% and CDS +5.3% provide ancillary revenue support. I lean slightly positive on full-year growth, though the tough Q3 comp creates meaningful risk.

The math works in favor of positive full-year growth given the H1 cushion. H1 FY2026 is approximately +5.1% vs H1 FY2025. This means H2 FY2026 could decline about 4% and still achieve positive full-year growth. Q2 FY2026 declined only 3.6% (ex-CAT +1.3%), so a 4% H2 decline seems manageable. The risk is that Q3 FY2025 was unusually strong (+11.3%), making the Q3 FY2026 comp very difficult. If Q3 FY2026 shows a 6-7% decline, it would eat into the cushion significantly.

I emphasize the worsening volume trend: Q1 units -6.7%, Q2 units -8.0%. If this worsening continues into Q3/Q4 (even at a slower pace), the revenue decline could exceed 4% in H2, wiping out the H1 cushion. The Fugazi Filter confirmed the revenue decline is genuine business softness, not an artifact. Rising total loss frequency helps but has been insufficient to offset earned car years decline and consumer coverage pullback. I lean slightly below 50% due to the worsening trajectory.

Copart has consistently grown revenue in its modern history as a public company. A full-year decline would be extremely unusual. Management has pricing power (ASP growth 3-5x competitors), is deploying AI to improve operations, and has ancillary growth levers (Purple Wave, CDS, Blue Car). The ex-CAT Q2 trajectory (+1.3%) suggests underlying growth is still modestly positive. Combined with the H1 cushion, positive full-year growth is more likely than not, though with low conviction.

H1 +5.1% provides cushion, H2 can decline ~4% and still positive full year. Q2 was -3.6%, so 4% is achievable but tight. True coin-flip given offsetting factors.

Lean positive because ASP tailwind (6-9%) is strong enough to limit revenue declines even with persistent volume pressure. Ex-CAT revenue was +1.3% in Q2 — underlying growth is still positive. Full-year decline would be unprecedented for modern Copart.

Q3 FY2025 comp is very tough (+11.3%). If Q3 FY2026 shows a significant decline, it could negate the H1 cushion. Volume trend is worsening. Slightly below coin-flip reflecting Q3 comp risk.