Karooooo (KARO) Q3 2026 earnings summary

Executive summary

• SaaS ARR grew 22% year-over-year to ZAR 5,106 million (USD $298 million), with USD ARR growth accelerating to 28% and record net subscriber additions of 111,000, bringing total subscribers to 2.6 million, up 16% year-over-year.

• Subscription revenue rose 20% year-over-year to ZAR 1,239 million, and operating profit increased 14% to ZAR 369 million.

• Adjusted EPS increased 11% to ZAR 8.55, and adjusted EBITDA margin reached 45%.

• Achieved fourth consecutive quarter of ARR growth acceleration, with strong performance across all regions.

• Significant upfront investments in sales and marketing are driving future recurring revenue and earnings.

Financial highlights

• Q3 total revenue increased 22% year-over-year to ZAR 1,410 million; subscription revenue up 20% to ZAR 1,239 million, comprising 97% of total revenue.

• Operating profit rose 14% to ZAR 369 million; adjusted earnings per share increased 11% to ZAR 8.54.

• Adjusted free cash flow up 28% in Q3 to ZAR 239 million; year-to-date up 37% to ZAR 597 million.

• Net cash and cash equivalents at quarter-end were ZAR 531 million as of November 30, 2025.

• Paid a cash dividend of $38.6 million (or $1.25 per share) in August 2025.

Outlook and guidance

• FY 2026 Cartrack subscription revenue outlook raised to ZAR 4,785–4,900 million (18–21% growth).

• Cartrack operating profit margin outlook revised to 27–30%.

• FY 2026 adjusted EPS guidance unchanged at ZAR 32.50–35.50.

• Ongoing investment in sales capacity, AI, and platform capabilities expected to drive subscriber and ARPU growth in FY 2027.