2018 Q3 Form 10-Q Financial Statement

#000117001018000175 Filed on October 05, 2018

View on sec.gov

Income Statement

Concept 2018 Q3 2017 Q3
Revenue $4.766B $4.387B
YoY Change 8.65% 9.74%
Cost Of Revenue $4.115B $3.783B
YoY Change 8.8% 9.58%
Gross Profit $650.6M $604.0M
YoY Change 7.72% 10.75%
Gross Profit Margin 13.65% 13.77%
Selling, General & Admin $453.6M $405.1M
YoY Change 11.97% 10.63%
% of Gross Profit 69.71% 67.06%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $45.00M $44.20M
YoY Change 1.81% 4.74%
% of Gross Profit 6.92% 7.32%
Operating Expenses $453.6M $405.1M
YoY Change 11.97% 10.63%
Operating Profit $197.1M $198.9M
YoY Change -0.94% 11.0%
Interest Expense $17.95M $16.84M
YoY Change 6.62% 21.09%
% of Operating Profit 9.11% 8.46%
Other Income/Expense, Net $686.0K $189.0K
YoY Change 262.96% -56.55%
Pretax Income $289.5M $290.2M
YoY Change -0.26% 10.89%
Income Tax $68.60M $108.8M
% Of Pretax Income 23.7% 37.49%
Net Earnings $220.9M $181.4M
YoY Change 21.75% 11.74%
Net Earnings / Revenue 4.63% 4.14%
Basic Earnings Per Share $1.25 $0.99
Diluted Earnings Per Share $1.24 $0.98
COMMON SHARES
Basic Shares Outstanding 176.3M shares 182.9M shares
Diluted Shares Outstanding 178.2M shares 184.7M shares

Balance Sheet

Concept 2018 Q3 2017 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $37.00M $26.00M
YoY Change 42.31% -91.77%
Cash & Equivalents $37.15M $25.77M
Short-Term Investments
Other Short-Term Assets $75.06M $41.79M
YoY Change 79.6% -7.69%
Inventory $2.357B $2.232B
Prepaid Expenses
Receivables $104.9M $99.73M
Other Receivables $0.00 $0.00
Total Short-Term Assets $3.022B $2.803B
YoY Change 7.8% 1.74%
LONG-TERM ASSETS
Property, Plant & Equipment $2.767B $2.602B
YoY Change 6.32% 11.87%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $190.7M $147.1M
YoY Change 29.68% 6.11%
Total Long-Term Assets $15.15B $14.07B
YoY Change 7.69% 10.38%
TOTAL ASSETS
Total Short-Term Assets $3.022B $2.803B
Total Long-Term Assets $15.15B $14.07B
Total Assets $18.18B $16.88B
YoY Change 7.71% 8.85%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $605.5M $568.0M
YoY Change 6.6% 16.65%
Accrued Expenses $266.2M $251.9M
YoY Change 5.67% 2.39%
Deferred Revenue
YoY Change
Short-Term Debt $3.000M $0.00
YoY Change
Long-Term Debt Due $408.0M $366.0M
YoY Change 11.48% 4.27%
Total Short-Term Liabilities $1.283B $1.202B
YoY Change 6.82% 10.81%
LONG-TERM LIABILITIES
Long-Term Debt $13.18B $12.23B
YoY Change 7.71% 9.91%
Other Long-Term Liabilities $233.6M $239.2M
YoY Change -2.33% 5.38%
Total Long-Term Liabilities $233.6M $239.2M
YoY Change -2.33% 5.38%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.283B $1.202B
Total Long-Term Liabilities $233.6M $239.2M
Total Liabilities $14.69B $13.67B
YoY Change 7.46% 9.91%
SHAREHOLDERS EQUITY
Retained Earnings $2.183B $1.976B
YoY Change 10.48% 6.33%
Common Stock $87.65M $90.95M
YoY Change -3.64% -4.8%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $3.482B $3.201B
YoY Change
Total Liabilities & Shareholders Equity $18.18B $16.88B
YoY Change 7.71% 8.85%

Cashflow Statement

Concept 2018 Q3 2017 Q3
OPERATING ACTIVITIES
Net Income $220.9M $181.4M
YoY Change 21.75% 11.74%
Depreciation, Depletion And Amortization $45.00M $44.20M
YoY Change 1.81% 4.74%
Cash From Operating Activities -$119.9M -$110.4M
YoY Change 8.61% -8.46%
INVESTING ACTIVITIES
Capital Expenditures -$91.40M -$75.70M
YoY Change 20.74% -35.35%
Acquisitions
YoY Change
Other Investing Activities $900.0K -$100.0K
YoY Change -1000.0% -99.54%
Cash From Investing Activities -$90.50M -$75.80M
YoY Change 19.39% -45.43%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 188.4M 170.8M
YoY Change 10.3% -67.34%
NET CHANGE
Cash From Operating Activities -119.9M -110.4M
Cash From Investing Activities -90.50M -75.80M
Cash From Financing Activities 188.4M 170.8M
Net Change In Cash -22.00M -15.40M
YoY Change 42.86% -105.84%
FREE CASH FLOW
Cash From Operating Activities -$119.9M -$110.4M
Capital Expenditures -$91.40M -$75.70M
Free Cash Flow -$28.50M -$34.70M
YoY Change -17.87% 891.43%

Facts In Submission

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us-gaap Increase Decrease In Accounts Payable And Accrued Liabilities
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57639000 USD
us-gaap Increase Decrease In Accounts Receivable
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us-gaap Increase Decrease In Accounts Receivable
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us-gaap Increase Decrease In Finance Receivables
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637719000 USD
us-gaap Increase Decrease In Finance Receivables
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675614000 USD
us-gaap Increase Decrease In Inventories
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-28794000 USD
us-gaap Increase Decrease In Inventories
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1063000 USD
us-gaap Increase Decrease In Other Current Assets
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us-gaap Increase Decrease In Other Operating Assets
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us-gaap Increase Decrease In Other Operating Assets
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7167000 USD
us-gaap Increase Decrease In Other Operating Liabilities
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us-gaap Increase Decrease In Other Operating Liabilities
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us-gaap Interest And Fee Income Loans And Leases
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242200000 USD
us-gaap Interest And Fee Income Loans And Leases
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474500000 USD
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us-gaap Interest Expense
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33674000 USD
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17950000 USD
us-gaap Interest Expense
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36002000 USD
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us-gaap Interest Income Expense After Provision For Loan Loss
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257600000 USD
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us-gaap Interest Income Expense After Provision For Loan Loss
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270700000 USD
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us-gaap Interest Income Expense Net
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319100000 USD
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173100000 USD
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341600000 USD
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3700000 USD
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43200000 USD
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us-gaap Labor And Related Expense
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17300000 USD
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9600000 USD
us-gaap Labor And Related Expense
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19200000 USD
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1275000 USD
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us-gaap Net Cash Provided By Used In Operating Activities Continuing Operations
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us-gaap Net Cash Provided By Used In Operating Activities Continuing Operations
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110885000 USD
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us-gaap Other Comprehensive Income Defined Benefit Plans Adjustment Net Of Tax Portion Attributable To Parent
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us-gaap Other Comprehensive Income Defined Benefit Plans Adjustment Net Of Tax Portion Attributable To Parent
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us-gaap Other Comprehensive Income Derivatives Qualifying As Hedges Net Of Tax Portion Attributable To Parent
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240000 USD
us-gaap Other Comprehensive Income Derivatives Qualifying As Hedges Net Of Tax Portion Attributable To Parent
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us-gaap Other Comprehensive Income Loss Before Reclassifications Net Of Tax
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us-gaap Other Comprehensive Income Loss Derivatives Qualifying As Hedges Net Of Tax
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us-gaap Other Comprehensive Income Loss Net Of Tax
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us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
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us-gaap Other Comprehensive Income Loss Net Of Tax Portion Attributable To Parent
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us-gaap Other Comprehensive Income Loss Net Of Tax Portion Attributable To Parent
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Before Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Before Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Net Of Tax
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CY2018Q3 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Net Of Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Net Of Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Tax
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491000 USD
us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci On Derivatives Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Before Tax
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CY2018Q3 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Before Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Before Tax
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CY2017Q3 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossNetOfTax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
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CY2018Q3 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Net Of Tax
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CY2017Q3 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossTax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossTax
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CY2018Q3 us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossTax
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us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci Pension And Other Postretirement Benefit Plans For Net Gain Loss Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIPensionAndOtherPostretirementBenefitPlansForNetGainLossTax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Before Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Before Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Net Of Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Net Of Tax
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us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Tax
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577000 USD
us-gaap Other Comprehensive Income Unrealized Gain Loss On Derivatives Arising During Period Tax
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475000 USD
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us-gaap Other Nonoperating Expense
OtherNonoperatingExpense
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300000 USD
us-gaap Other Nonoperating Expense
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300000 USD
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us-gaap Payments For Repurchase Of Common Stock
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us-gaap Payments Of Debt Issuance Costs
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us-gaap Payments Of Debt Issuance Costs
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us-gaap Payments To Acquire Investments
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us-gaap Payments To Acquire Investments
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5306000 USD
us-gaap Payments To Acquire Property Plant And Equipment
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155110000 USD
us-gaap Payments To Acquire Property Plant And Equipment
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us-gaap Proceeds From Issuance Or Sale Of Equity
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us-gaap Proceeds From Issuance Or Sale Of Equity
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us-gaap Proceeds From Repayments Of Short Term Debt
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us-gaap Proceeds From Sale And Maturity Of Other Investments
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us-gaap Proceeds From Sale And Maturity Of Other Investments
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us-gaap Proceeds From Sale Of Property Plant And Equipment
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96000 USD
us-gaap Proceeds From Sale Of Property Plant And Equipment
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565000 USD
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us-gaap Provision For Loan And Lease Losses
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us-gaap Provision For Loan And Lease Losses
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32900000 USD
us-gaap Provision For Loan Lease And Other Losses
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us-gaap Provision For Loan Lease And Other Losses
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us-gaap Reclassification From Accumulated Other Comprehensive Income Current Period Net Of Tax
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CY2018Q1 us-gaap Restricted Cash And Cash Equivalents At Carrying Value
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CY2018Q3 us-gaap Restricted Cash And Cash Equivalents At Carrying Value
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447642000 USD
CY2017Q3 us-gaap Restricted Cash And Cash Equivalents Noncurrent
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CY2018Q3 us-gaap Restricted Cash And Cash Equivalents Noncurrent
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CY2017Q3 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
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us-gaap Revenue From Contract With Customer Excluding Assessed Tax
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us-gaap Revenue From Contract With Customer Excluding Assessed Tax
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CY2017Q3 us-gaap Revenues
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us-gaap Revenues
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CY2018Q3 us-gaap Revenues
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4766035000 USD
us-gaap Revenues
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405062000 USD
us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
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CY2018Q3 us-gaap Selling General And Administrative Expense
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453554000 USD
us-gaap Selling General And Administrative Expense
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CY2018Q1 us-gaap Senior Notes
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500000000 USD
us-gaap Share Based Compensation
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us-gaap Share Based Compensation
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CY2018Q1 us-gaap Short Term Bank Loans And Notes Payable
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127000 USD
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3296000 USD
CY2018Q1 us-gaap Standard Product Warranty Accrual
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6100000 USD
CY2018Q3 us-gaap Standard Product Warranty Accrual
StandardProductWarrantyAccrual
7300000 USD
CY2018Q1 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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3316849000 USD
CY2018Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
3482118000 USD
CY2018Q1 us-gaap Trading Securities
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CY2018Q3 us-gaap Trading Securities
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20552000 USD
CY2018Q1 us-gaap Unamortized Debt Issuance Expense
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24239000 USD
CY2018Q3 us-gaap Unamortized Debt Issuance Expense
UnamortizedDebtIssuanceExpense
24152000 USD
CY2018Q1 us-gaap Unrecognized Tax Benefits
UnrecognizedTaxBenefits
28700000 USD
CY2018Q3 us-gaap Unrecognized Tax Benefits
UnrecognizedTaxBenefits
30100000 USD
CY2017Q1 us-gaap Valuation Allowances And Reserves Balance
ValuationAllowancesAndReservesBalance
108200000 USD
CY2017Q2 us-gaap Valuation Allowances And Reserves Balance
ValuationAllowancesAndReservesBalance
109000000 USD
CY2017Q3 us-gaap Valuation Allowances And Reserves Balance
ValuationAllowancesAndReservesBalance
109800000 USD
CY2018Q1 us-gaap Valuation Allowances And Reserves Balance
ValuationAllowancesAndReservesBalance
105200000 USD
CY2018Q2 us-gaap Valuation Allowances And Reserves Balance
ValuationAllowancesAndReservesBalance
108700000 USD
CY2018Q3 us-gaap Valuation Allowances And Reserves Balance
ValuationAllowancesAndReservesBalance
110600000 USD
CY2017Q3 us-gaap Valuation Allowances And Reserves Charged To Cost And Expense
ValuationAllowancesAndReservesChargedToCostAndExpense
17400000 USD
us-gaap Valuation Allowances And Reserves Charged To Cost And Expense
ValuationAllowancesAndReservesChargedToCostAndExpense
34500000 USD
CY2018Q3 us-gaap Valuation Allowances And Reserves Charged To Cost And Expense
ValuationAllowancesAndReservesChargedToCostAndExpense
18600000 USD
us-gaap Valuation Allowances And Reserves Charged To Cost And Expense
ValuationAllowancesAndReservesChargedToCostAndExpense
38700000 USD
CY2017Q3 us-gaap Valuation Allowances And Reserves Deductions
ValuationAllowancesAndReservesDeductions
16600000 USD
us-gaap Valuation Allowances And Reserves Deductions
ValuationAllowancesAndReservesDeductions
32900000 USD
CY2018Q3 us-gaap Valuation Allowances And Reserves Deductions
ValuationAllowancesAndReservesDeductions
16700000 USD
us-gaap Valuation Allowances And Reserves Deductions
ValuationAllowancesAndReservesDeductions
33300000 USD
CY2017Q3 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
184696000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
185778000 shares
CY2018Q3 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
178200000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
178811000 shares
CY2017Q3 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
182868000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
184034000 shares
CY2018Q3 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
176284000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
177211000 shares
us-gaap Basis Of Accounting
BasisOfAccounting
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Basis of Presentation and Use of Estimates. </font><font style="font-family:inherit;font-size:10pt;">The accompanying interim unaudited consolidated financial statements include the accounts of CarMax and our wholly owned subsidiaries.&#160;&#160;All significant intercompany balances and transactions have been eliminated in consolidation.&#160;&#160;These consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (&#8220;GAAP&#8221;) for interim financial information.&#160;&#160;Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.&#160;&#160;In the opinion of management, such interim consolidated financial statements reflect all normal recurring adjustments considered necessary to present fairly the financial position and the results of operations and cash flows for the interim periods presented.&#160;&#160;The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full fiscal year.&#160;&#160;</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The accounting policies followed in the presentation of our interim financial results are consistent with those included in the company's Annual Report on Form 10-K for the fiscal year ended </font><font style="font-family:inherit;font-size:10pt;">February&#160;28, 2018</font><font style="font-family:inherit;font-size:10pt;"> (the &#8220;2018 Annual Report&#8221;), with the exception of those related to recent accounting pronouncements adopted in the current fiscal year. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes included in our 2018 Annual Report.</font></div></div>
us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Business. </font><font style="font-family:inherit;font-size:10pt;">CarMax, Inc. (&#8220;we,&#8221; &#8220;our,&#8221; &#8220;us,&#8221; &#8220;CarMax&#8221; and &#8220;the company&#8221;), including its wholly owned subsidiaries, is the largest retailer of used vehicles in the United States.&#160;We operate in </font><font style="font-family:inherit;font-size:10pt;">two</font><font style="font-family:inherit;font-size:10pt;"> reportable segments:&#160;&#160;CarMax Sales Operations and CarMax Auto Finance (&#8220;CAF&#8221;).&#160;&#160;Our CarMax Sales Operations segment consists of all aspects of our auto merchandising and service operations, excluding financing provided by CAF.&#160;&#160;Our CAF segment consists solely of our own finance operation that provides financing to customers buying retail vehicles from CarMax.</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We deliver an unrivaled customer experience by offering a broad selection of high quality used vehicles and related products and services at low, no-haggle prices using a customer-friendly sales process in an attractive, modern sales facility, as well as through carmax.com and our mobile apps.&#160;&#160;We provide customers with a range of related products and services, including the appraisal and purchase of vehicles directly from consumers; the financing of retail vehicle purchases through CAF and third-party finance providers; the sale of extended protection plan (&#8220;EPP&#8221;) products, which include extended service plans (&#8220;ESPs&#8221;) and guaranteed asset protection (&#8220;GAP&#8221;); and vehicle repair service.&#160;&#160;Vehicles purchased through the appraisal process that do not meet our retail standards are sold to licensed dealers through on-site wholesale auctions.</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div></div>
us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities.&#160;&#160;Actual results could differ from those estimates.&#160; Certain prior year amounts have been reclassified to conform to the current year&#8217;s presentation.&#160; Amounts and percentages may not total due to rounding.</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div></div>

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