Jash Patwa

Adair did not commit to specifics but said a team would evaluate cross-deploying ACV and Copart capabilities.

Jeff described the crossover buyer discovery journey from clean vehicles to increasingly damaged ones, noting buyers first enter via non-insurance then expand to insurance vehicles within 90 days.

Jeff cited Title Express penetration (processing 6-8x more than competitors), higher ASPs generating fee share, and growth in higher-ASP non-insurance vehicles as the primary RPU drivers.

Jeff clarified pure sale is not contractual; carriers maintain discretion. Virtually no carrier has increased managed sale mix because they recognize Copart's auction liquidity generates the best outcomes.

Leah clarified deemphasized units are sub-$1K junk vehicles unrelated to uninsured driver vehicles. Uninsured vehicles likely ending up in impound yards or cash-for-cars, a highly fragmented market.

Jeff acknowledged underestimating tariff disruption to heavy equipment market. Purple Wave still outpacing industry despite headwinds. Cultural bias is organic growth; M&A bar is very high with only a tiny handful in 10 years.

Leah attributed margin moderation to $6.8M onetime international VAT accrual. Ex-cat margins performed well year-over-year on gross margin basis.

Jeff described this as a tactical experiment in matching right buyers to right products. Shared liquidity is the guiding principle. Expect ongoing iteration on auction architecture.

Jeff framed opportunity broadly: Copart sells a fraction of total auction-mediated vehicles. Competition includes repair shops as well as other intermediaries. Service quality determines share gains.

Leah confirmed a small nonrecurring equipment sale with a slight gain in other income. Not material to overall quarter and no forward implications.

Leah noted Purple Wave sales force investment as main G&A driver. Declined to characterize it as a steady state run rate, emphasizing investment mindset approach.

Jeff said storage fee caps would benefit insurance industry broadly. Total loss threshold changes less concerning since insurers should economically total at lower thresholds than statutory requirements.

Jeff confirmed Copart has multiple shots on goal including Cash for Cars and dealer trade-ins, but acknowledged less efficient pathway than direct insurance consignment.

Jeff declined to identify Q2 as a run rate, saying they don't manage for earnings smoothness. Encouraged looking at multiple quarters for trends rather than any single period.

Leah cited Germany consignment transition, UK contract structure changes, and margin benefit from consumer purchase vehicles. Jeff framed purchase activity as transitional step toward consignment.

Jeff described the gradual migration from purchase to consignment in Germany, consistent with UK and US patterns. Progress made but room to go.

Jeff said CapEx is primarily land, development and technology. Quarter-to-quarter variations reflect lumpy facility purchases that can take years to finalize. Delighted to invest for long-term capacity.