Strong Q1 beat on subscriber growth and subscription revenue acceleration, with guidance reaffirmed, supports the bull case. However, the sharp free cash flow decline to ZAR60M (from ZAR338M) due to heavy IoT device investment warrants monitoring — if subscriber retention and ARPU expansion don't materialize as expected, the growth capex could pressure returns. Watch the July 27 dividend payment and next quarter's free cash flow trajectory.
Price Chart
Executive Summary
Karooooo reported strong Q1 FY2027 results with Cartrack subscription revenue accelerating 19% YoY (21% constant currency) to ZAR1,351 million, record net subscriber additions of 142,472 (up 70% YoY), and record operating profit of ZAR410 million (up 16% YoY). The company reaffirmed its FY2027 outlook for 18-24% subscription revenue growth and EPS growth of 18-23% at midpoint. Free cash flow fell sharply to ZAR60 million from ZAR338 million due to increased investment in IoT devices and working capital to support accelerated subscriber growth.
Key Facts
- Cartrack subscription revenue accelerated to 19% YoY reaching ZAR1,351 million (21% constant currency)
- Record net subscriber additions of 142,472, up 70% YoY (Q1 2026: 84,013)
- Total subscribers surpassed 2.8 million, up 18% YoY to 2,804,694
- Karooooo operating profit increased 16% to a record ZAR410 million
- EPS increased 11% to ZAR9.53 (Q1 2026: ZAR8.55)
- FY2027 guidance reaffirmed: Cartrack subscription revenue ZAR5,700M-ZAR6,000M (18-24% growth), EPS ZAR38.50-ZAR40.00 (18-23% growth)
- Free cash flow dropped 82% to ZAR60 million from ZAR338 million due to ZAR462 million investment in IoT devices
- Interim dividend of USD1.50 per share declared, payable July 27, 2026 (Nasdaq)
Financial Impact
Subscription revenue growth of 19% YoY (21% constant currency) with record subscriber additions; operating profit up 16% to record ZAR410M; free cash flow declined 82% to ZAR60M due to growth investments
Risk Factors
- Free cash flow declined 82% YoY to ZAR60 million due to increased working capital and IoT device investment
- Cartrack operating profit margin contracted to 28% from 30% as sales & marketing spend grew 32%
- ZAR strengthening creates FX headwinds; constant currency subscription revenue growth of 21% exceeds reported 19%
- Asia Pacific subscription revenue growth only 6% reported (17% constant currency) due to lower-ARPU country mix
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 6-K Filing (Primary) | 0001213900-26-078315 |
| Document: ea0298094-6k_karooooo.htm | 0001213900-26-078315 |
| Document: 0001213900-26-078315-index-headers.html | 0001213900-26-078315 |
| Document: 0001213900-26-078315-index.html | 0001213900-26-078315 |
| Document: 0001213900-26-078315.txt | 0001213900-26-078315 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 19, 2026 7d ago | 6-K | $62.65 $61.47 | ▼ −1.88% | ▼ −2.41% | $63.96 (+2.09%) |
Oct 5, 2026 22d ago | 6-K | $61.00 $61.60 | ▲ +0.98% | ▲ +0.43% | $63.96 (+4.85%) |
Jul 28, 2026 12w ago | 6-K | $63.96 $64.46 | ▲ +0.78% | ▲ +2.32% | $63.96 (−0.00%) |
Jul 23, 2026 13w ago | 6-K | $61.19 $63.34 | ▲ +3.51% | ▲ +3.41% | $63.96 (+4.53%) |
Jul 15, 2026 14w ago | 6-K | $65.16 $62.69 | ▼ −3.79% | ▼ −2.80% | $63.96 (−1.84%) |
Jul 9, 2026 15w ago | 6-K | $58.09 $57.73 | ▼ −0.62% | ▼ −1.05% | $63.96 (+10.11%) |
Jul 8, 2026 15w ago | 6-K | $57.73 $58.09 | ▲ +0.62% | ▼ −0.22% | $63.96 (+10.79%) |
Jul 2, 2026 16w ago | 6-K | $53.87 $56.32 | ▲ +4.55% | ▲ +3.68% | $63.96 (+18.73%) |
May 5, 2026 25w ago | 6-K | $50.32 $49.90 | ▼ −0.83% | ▼ −2.22% | $63.96 (+27.11%) |
US Market Status
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