Q4 2025 Lithia Motors Inc Earnings Call Transcript
Key Points
- Lithia Motors Inc (LAD) achieved record revenues in the fourth quarter, driven by impressive used vehicle sales.
- Quarterly revenue reached $9.2 billion, contributing to a full-year revenue of $37.6 billion, up 4% from 2024.
- Adjusted diluted EPS for the quarter was $6.74, with a full-year adjusted EPS of $33.46, marking a 16% increase from 2024.
- Driveway Finance Corporation (DFC) saw a $19 million year-over-year increase in pretax income, with a 16.7% penetration rate in December.
- The company reported double-digit growth in aftersales revenue and stable F&I performance, helping offset front-end pressures.
- Same-store revenues were essentially flat, and gross profit was down 1.2%, reflecting industry-wide compression in vehicle margins.
- New vehicle revenue declined 6.6% on an 8.3% unit decline as industry demand softened and supply normalized.
- Total vehicle gross profit per unit (GPU) was down $258 year-over-year, in line with industry-wide margin compression.
- SG&A as a percentage of gross profit increased to 71.4% from 66.3% a year ago, reflecting pressure from normalizing GPUs.
- Luxury brand revenue was down 12.7% year-over-year, partially due to difficult prior year comparisons and softening demand.
Welcome to the Lithia & Driveway's 2025 fourth quarter earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Jardon Jaramillo, Senior Director of Finance. Thank you. You may begin.
Good morning. Thank you for joining us for our fourth quarter earnings call. With me today are Bryan DeBoer, President and CEO; Tina Miller, Senior Vice President and CFO; and Chuck Lietz, Senior Vice President of Driveway Finance.
Today's discussion may include statements about future events, financial projections and expectations about the company's products, markets, and growth. Such statements are forward-looking and subject to risks and uncertainties and that could cause actual results to materially differ from the statements made. We disclose those risks and uncertainties we deem to be material in our filings with the Securities and Exchange Commission.
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