Starboard Delivers Letter to CarMax

Key Terms

omnichannel technical

A coordinated approach to selling and serving customers across all touchpoints—stores, websites, mobile apps, social media, and call centers—so the experience feels like one continuous conversation no matter where a customer interacts. For investors, omnichannel capability signals how well a company can attract and keep customers, turn interactions into sales, and use shared customer data to cut costs and boost revenue—making it a key driver of growth and competitive strength.

sg&a financial

SG&A stands for Selling, General, and Administrative expenses. It includes the costs a company spends on selling products, running the business day-to-day, and managing staff, like advertising, rent, and salaries. These expenses matter because they affect how much profit a company can make from its sales.

dynamic pricing technical

Dynamic pricing is a strategy where the cost of a product or service changes frequently based on factors like demand, time, or availability. It’s similar to how airline tickets or hotel rooms can become more expensive during busy periods and cheaper when demand is low. For investors, understanding this approach is important because it affects a company's revenue, competitiveness, and overall market behavior.

Views Appointment of New CEO Keith Barr as Timely Opportunity to Address Fixable Execution Gaps and Unlock CarMax’s Full Value Potential

Has Nominated Directors to Help Support the Next Phase of Execution and Accelerate Shareholder Value Creation

Believes CarMax’s Structurally Superior Omnichannel Model Is Not Reflected in Current Performance

Sees Clear Opportunities to Drive Improvement Through Enhanced Digital Execution, Reconditioning Efficiencies and Dynamic Pricing

Urges a Substantially Expanded SG&A Reduction Program to Restore Cost Discipline and Enhance Long-Term Earnings Power

NEW YORK--(BUSINESS WIRE)-- Starboard Value LP (together with its affiliates, “Starboard”), a significant stockholder of CarMax Inc. (“CarMax” or the “Company”) (NYSE: KMX), today announced that it has delivered a letter to Keith Barr, the Company’s incoming Chief Executive Officer, with a copy to the Company’s Board of Directors (the “Board”). The full text of Starboard's letter to the Company can be viewed here.

Starboard has nominated two individuals – William C. Cobb and Jeffrey C. Smith – for election to the Board at the Company’s 2026 Annual Meeting of Shareholders.

Nominee Biographies:

• William C. Cobb has served as Chief Executive Officer of Frontdoor, Inc. since June 2022 and has been Chairman of the Board since its 2018 spin-off from ServiceMaster Global Holdings, Inc. Previously, he served as President and Chief Executive Officer of H&R Block, Inc. from 2011 to 2017, where he also served as a director. Earlier in his career, Mr. Cobb held senior leadership roles at eBay Inc., including as President of eBay Marketplaces North America, as well as various executive positions at PepsiCo, Inc. and TRICON Global Restaurants, Inc. (n/k/a Yum! Brands, Inc.). He has served on several public company boards, including Deluxe Corporation, ServiceMaster, Pacific Sunwear of California, Inc., Orbitz Worldwide, Inc., and Och-Ziff Capital Management Group LLC. Mr. Cobb brings extensive public company leadership and board experience across consumer, services and digitally enabled businesses.
• Jeff Smith is a Managing Member, Chief Executive Officer, and Chief Investment Officer of Starboard Value LP. Mr. Smith has extensive public company board experience having served on boards through his role at Starboard Value. Prior to founding Starboard Value LP in 2011, Mr. Smith served as the Chief Investment Officer for the funds that comprised the Value and Opportunity investment platform at Ramius LLC, a subsidiary of the Cowen Group, where he was a Partner Managing Director. Mr. Smith is currently on the Board of Directors of Kenvue Inc. Mr. Smith was formerly the Chair of the Boards of Papa John's International, Inc., Starboard Value Acquisition Corp., Advance Auto Parts, Inc., Darden Restaurants, Inc. and Phoenix Technologies Ltd. and formerly a member of the Boards of RB Global, Inc., Cyxtera Technologies, Perrigo Company plc., Yahoo! Inc., Quantum Corporation, Office Depot, Inc., Regis Corporation, Surmodics, Inc., Zoran Corporation, Actel Corporation, Kensey Nash Corp., S1 Corp and the Fresh Juice Company.

About Starboard Value LP

Starboard Value LP is an investment adviser with a focused and differentiated fundamental approach to investing in publicly traded companies. Starboard invests in deeply undervalued companies and actively engages with management teams and boards of directors to identify and execute on opportunities to unlock value for the benefit of all shareholders.

CERTAIN INFORMATION CONCERNING THE PARTICIPANTS

Starboard Value LP, together with the other participants named herein (collectively, “Starboard”), intends to file a preliminary proxy statement and accompanying universal proxy card with the Securities and Exchange Commission (“SEC”) to be used to solicit votes for the election of a slate of director nominees at the 2026 annual meeting of shareholders of CarMax, Inc., a Virginia corporation (the “Company”).

STARBOARD STRONGLY ADVISES ALL SHAREHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS' PROXY SOLICITOR.

The participants in the proxy solicitation are anticipated to be Starboard Value and Opportunity Master Fund Ltd (“Starboard V&O Fund”), Starboard Value and Opportunity S LLC (“Starboard S LLC”), Starboard Value and Opportunity Master Fund L LP (“Starboard L Master”), Starboard Value L LP (“Starboard L GP”), Starboard Value R GP LLC (“Starboard R GP”), Starboard X Master Fund Ltd (“Starboard X Master”), Starboard Value LP, Starboard Value GP LLC (“Starboard Value GP”), Starboard Principal Co LP (“Principal Co”), Starboard Principal Co GP LLC (“Principal GP”), Jeffrey C. Smith, Peter A. Feld and William C. Cobb.

As of the close of business on March 10, 2026, Starboard V&O Fund beneficially owned directly 3,269,125 shares of Common Stock, par value $0.50, of the Company (the “Common Stock”), which includes 494,262 shares of Common Stock underlying certain forward purchase contracts exercisable within 60 days of the date hereof. As of the close of business on March 10, 2026, Starboard S LLC beneficially owned directly 416,231 shares of Common Stock, which includes 54,482 shares of Common Stock underlying certain forward purchase contracts exercisable within 60 days of the date hereof. As of the close of business on March 10, 2026, Starboard L Master beneficially owned directly 215,017 shares of Common Stock, which includes 28,031 shares of Common Stock underlying certain forward purchase contracts exercisable within 60 days of the date hereof. Starboard L GP, as the general partner of Starboard L Master, may be deemed the beneficial owner of the 215,017 shares of Common Stock owned by Starboard L Master. Starboard R GP, as the general partner of Starboard L GP, may be deemed the beneficial owner of the 215,017 shares of Common Stock owned by Starboard L Master. As of the close of business on March 10, 2026, Starboard X Master beneficially owned directly 1,354,947 shares of Common Stock, which includes 213,277 shares of Common Stock underlying certain forward purchase contracts exercisable within 60 days of the date hereof. As of the close of business on March 10, 2026, 1,320,788 shares of Common Stock were held in an account managed by Starboard Value LP (the “Starboard Value LP Account”), which includes 170,340 shares of Common Stock underlying certain forward purchase contracts exercisable within 60 days of the date hereof. Starboard Value LP, as the investment manager of each of Starboard V&O Fund, Starboard L Master and Starboard X Master and the Starboard Value LP Account and the manager of Starboard S LLC, may be deemed the beneficial owner of an aggregate of 6,576,108 shares of Common Stock directly owned by Starboard V&O Fund, Starboard S LLC, Starboard L Master, Starboard X Master and held in the Starboard Value LP Account. Each of Starboard Value GP, as the general partner of Starboard Value LP, Principal Co, as a member of Starboard Value GP, Principal GP, as the general partner of Principal Co and Messrs. Smith and Feld, as members of Principal GP and as members of each of the Management Committee of Starboard Value GP and the Management Committee of Principal GP, may be deemed the beneficial owner of 6,576,108 shares of Common Stock directly owned by Starboard V&O Fund, Starboard S LLC, Starboard L Master, Starboard X Master and held in the Starboard Value LP Account.

Starboard V&O Fund, Starboard S LLC, Starboard L Master, Starboard X Master and Starboard Value LP through the Starboard Value LP Account have entered into certain cash-settled total return swap agreements that constitute economic exposure to an aggregate of 2,100,000 notional shares of Common Stock.

As of the close of business on March 10, 2026, Mr. Cobb beneficially owned directly 300 shares of Common Stock.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260310607307/en/

Investor:

Peter Feld, (212) 201-4878

Gavin Molinelli, (212) 201-4828

www.starboardvalue.com



Media:

Longacre Square Partners

Joe Germani / Ashley Areopagita, (646) 386-0003

starboard@longacresquare.com

Source: Starboard Value LP