Used car dealer Motorpoint (LON:MOTR) rallied after reporting an 83% rise in pre-tax profits for the year to March 2026. With its use of data and AI helping to drive sales and improve margins, the company delivered record retail sales volumes and market share gains in FY26.
Investors also welcomed news of encouraging current trading, with Motorpoint putting up retail volume growth of 15% across April and May. This was despite the negative impact of the Middle East conflict on consumer confidence.
Pedal to the metal
FY26 results showed an 8.1% rise in total revenues to the best part of £1.27 billion as Motorpoint continued to outperform the used car market.
Taxable profits motored up from £4.1 million to £7.5 million as Derby-headquartered Motorpoint achieved a record-breaking 64.6k vehicles sold. And in a show of confidence, management hiked the full-year dividend from 1p to 2.2p.
Deepening the moat
CEO Mark Carpenter described FY26 as ‘a step change year’ for his charge. One in which the use of data became fundamental within the business and Motorpoint embraced the tangible benefits of AI.
‘This progress deepens our competitive moat and provides the necessary foundation for the group to expand further and significantly grow profitability in the years ahead,’ insisted Carpenter.
He added: ‘Our strategic investment in technology and the use of data and AI, combined with the quality of service provided by our exceptional team, has enabled us to sell more vehicles at good metal margins and provide our customers with a seamless car buying experience.’
Why analysts are bullish
With a ‘buy’ rating on Motorpoint, Deutsche Numis commented: ‘Supply conditions are now more normalised and, together with an increasingly data-driven commercial approach, we view Motorpoint as well placed to drive further volume growth with a substantial mid-term profit opportunity.’
House broker Shore Capital said Motorpoint’s management team is now ‘firmly pushing the pedal to the metal’.
Shore Capital stressed that traditional sourcing routes have normalised, technology is increasingly enabling margin outcomes and the company has no structural debt. As such, it views Motorpoint as ‘very well-positioned to deliver sustained market share gains and growth’.
Motorpoint continues to rebuild its profits following the demand and supply shockwaves seen in the wake of the pandemic. It is benefiting from the ongoing improvements in the supply of nearly new vehicles. And investments in new agentic AI tools are paying off big time.
In the short term, there is a risk that increased inflation and interest rates stall the company’s impressive recovery. But over the long term, Motorpoint is well-positioned for further market share gains in what remains a highly-fragmented market.
No new sites opened last year, leaving Motorpoint on 21 stores. But a large site in Leeds is set to open this summer. And management reiterated its ambition to have ‘at least 30 in the medium term’.
Read the press release here: https://www.motorpoint.co.uk/plc/investor-relations
