KARO Reports 61% YoY Revenue Growth in Q1 FY26

KARO reported Q1 FY26 revenue of ZAR 1.6 billion, a 63% increase YoY, driven by strong growth in Cartrack subscription revenue, especially in Southeast Asia. The company attributes its success to its extensive market presence and optimistic outlook for the region. CARO's operating profit margin was 34%, and it maintained a high commercial retention rate of 95%. However, the company expects lower EPS growth in FY26 due to planned investments and anticipates a temporary dip in sales productivity in Asia.

Karooooo Limited (KARO) has announced impressive financial results for the first quarter of fiscal year 2026, ending May 31, 2025. The company's substantial growth is driven by an acceleration in its Cartrack subscription revenue, highlighting a 19% year-over-year increase to ZAR1,138 million, compared to ZAR960 million in Q1 2025. This increase reflects a robust performance across all regions, with Southeast Asia being a key driver [1].

Significantly, Karooooo's EPS saw a 19% rise, reaching ZAR8.55, up from ZAR7.17 in the previous year. The company also reported a 17% increase in its subscriber base, reaching 2.4 million from 2.0 million in Q1 2025. This growth is primarily attributed to the rapidly expanding Southeast Asian market, where Cartrack's subscription revenue growth hit 30% [1].

Cartrack's total revenue climbed by 18% to ZAR1,156 million, bolstered by net subscriber additions of 84,013 during the quarter. Karooooo Logistics also demonstrated a 20% revenue growth, reaching ZAR121 million [1].

The company's stock has added about 12.6% since the beginning of the year, outperforming the S&P 500's gain of 7.2%. The stock beat the Zacks Consensus Estimate of $0.45 per share, posting earnings of $0.47 per share [2].

CEO Zak Calisto expressed optimism about the company's future outlook, citing Karooooo's comprehensive digital transformation solutions and its scalable business model as key factors positioning the company to leverage further growth opportunities effectively [1].

However, the company expects lower EPS growth in FY26 due to planned investments and anticipates a temporary dip in sales productivity in Asia [3].

References:

[1] https://www.gurufocus.com/news/2995231/karooooo-reports-strong-q1-2026-results-highlighted-by-accelerating-cartrack-revenue-growth-karo-stock-news
[2] https://www.nasdaq.com/articles/karooooo-ltd-karo-q1-earnings-beat-estimates
[3] https://www.afaqs.com/marketing/coca-cola-q2-2025-profits-soar-63-globally-even-as-asia-volumes-shrink-3-9526880