Financial Data and Key Metrics Changes - Quarterly revenue was $9.7 billion, up 4.9% year-over-year, and adjusted diluted EPS was $9.50, up 17% [4][17] - Same-store revenues for the quarter increased 7.7%, driven by growth in every business line [6] - Total gross profit increased 3.2%, with total vehicle GPU at $4,109, down $216 year-over-year [6][8] Business Line Data and Key Metrics Changes - New retail revenue grew 5.5%, with units up 2.5%, while new GPU was $2,867, down $348 sequentially [6] - Used retail revenue increased by 11.8% over last year, driven by a 6.3% increase in unit growth and higher average selling prices [6][7] - After-sales revenue increased 3.9%, with gross profit rising 9.1% and margins expanding to 58.4%, up 280 basis points year-over-year [8] Market Data and Key Metrics Changes - The used vehicle performance outperformed the industry, with value segments delivering a 22.3% unit increase year-over-year [7] - In the UK, SG&A as a percentage of gross profit was high, reflecting market challenges and labor costs [9][18] Company Strategy and Development Direction - The company aims to capture market share and increase customer loyalty, focusing on high ROI used vehicles and after-sales services [5][11] - Strategic acquisitions remain a core pillar, with a target of $2 billion acquisition revenue estimate for 2025 [12][13] - The company is focused on investing where it can create the most shareholder value, prioritizing share repurchases and selective acquisitions [11][21] Management's Comments on Operating Environment and Future Outlook - Management highlighted strong top-line growth across all business lines and emphasized the importance of cost control and operational efficiency [4][5] - The company is optimistic about its ability to convert momentum into share gains and sustained cost efficiency [5][20] - Management acknowledged challenges in the UK market but expressed confidence in the team's ability to respond effectively [18][27] Other Important Information - The company reported adjusted SG&A as a percentage of gross profit at 67.9%, reflecting cost discipline despite normalization of GPUs [17] - Financing operations income was $19 million in the quarter, with a net interest margin of 4.6%, up 70 basis points year-over-year [19] Q&A Session Summary Question: Discussion on EV inventory and sales - Management noted that electrified vehicles constituted 43% of total new car mix, with significant sales driven by federal incentives and manufacturer support [23][24] Question: Overview of the used market and subprime impact - Management indicated that the used car market presents opportunities, particularly in the value auto segment, which is driven by higher credit quality customers [30][31] Question: UK market performance and regulatory environment - Management discussed challenges in the UK, including labor costs and market conditions, but highlighted improvements in parts and service profitability [26][27] Question: U.S. versus UK performance comparison - Management reported strong performance in the U.S. with significant growth in used cars, while UK profitability was only slightly down year-over-year [49][50] Question: M&A opportunities and targets - Management confirmed a hard target of $2 billion in acquisitions for the year, emphasizing a disciplined approach to capital allocation [53][56]

Financial Performance & Growth - Lithia & Driveway (LAD) achieved a 10-year Revenue Compound Annual Growth Rate (CAGR) of 16%[10, 14] - LAD's Adjusted Earnings Per Share (EPS) increased by 494% from 2015 to YTD 2025[10] - Revenue per share grew by 507% from 2015 to YTD 2025[10] - Total Shareholder Return increased by 273% from 2015 to YTD 2025[12] - The company aims for $2 EPS per $1 billion of Revenue[15] Strategic Goals & Market Position - LAD targets 100% national coverage[11] - The company operates within a $3 trillion+ market[14, 21] - LAD's platform provides access to a 70% larger market than traditional franchise auto dealers[22] - Driveway Finance Corporation (DFC) portfolio size is projected to reach $17 billion in the long-term[50] Operational Efficiency & Capital Allocation - LAD is improving operating efficiency, targeting SG&A as a percentage of gross profit in the mid-50% range in the long term[17, 27] - In the first nine months of 2025, the company allocated $662 million to share repurchases at an average price of $313 per share[36] - LAD's capital allocation strategy directs capital towards growth and expansion[36]

Core Insights - Lithia Motors exceeded Q3 revenue and EPS estimates, indicating strong performance in the automotive sector [1] Group 1: Financial Performance - The company reported robust used vehicle sales, contributing significantly to revenue growth [1] - There was an expansion in high-margin after-sales growth, further enhancing profitability [1] Group 2: Market Position - The strong performance in Q3 positions Lithia Motors favorably within the competitive automotive market [1]

Lithia & Driveway (LAD) Reports Record Third Quarter Revenue of $9.7 billion, Achieves 11% Increase in Diluted Earnings Per Share, 17% Increase in Adjusted Diluted Earnings Per Share ________________________________________________ Announces Dividend of $0.55 per Share for Third Quarter Medford, Oregon, October 22, 2025 - Lithia & Driveway (NYSE: LAD) today reported the highest third quarter revenue in company history, and a 11% increase in diluted earnings per share compared to the same period in 2024. Thi ...

Core Insights - Lithia Motors (LAD) reported quarterly earnings of $9.5 per share, exceeding the Zacks Consensus Estimate of $8.53 per share, and showing an increase from $8.21 per share a year ago, resulting in an earnings surprise of +11.37% [1] - The company achieved revenues of $9.68 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 0.70% and up from $9.22 billion year-over-year [2] - Lithia Motors has outperformed consensus EPS estimates three times in the last four quarters [2] Earnings Outlook - The future performance of Lithia Motors' stock will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current consensus EPS estimate for the upcoming quarter is $8.28 on revenues of $9.46 billion, and for the current fiscal year, it is $34.78 on revenues of $37.83 billion [7] Industry Context - The Automotive - Retail and Whole Sales industry, to which Lithia Motors belongs, is currently ranked in the bottom 23% of over 250 Zacks industries, indicating potential challenges ahead [8] - The performance of Lithia Motors' stock may be influenced by the overall outlook for the industry [8]

Core Insights - Lithia & Driveway (LAD) reported the highest third quarter revenue in company history, with a revenue increase of 5% to $9.7 billion compared to $9.2 billion in Q3 2024, and a diluted earnings per share increase of 11% to $8.61 from $7.73 in the same period [1][2] Financial Performance - Third quarter 2025 net income was $219 million, a slight decrease of 1.1% from $221 million in Q3 2024. However, adjusted net income increased by 9% to $241 million from $221 million in the same period [2] - For the first nine months of 2025, revenues increased by 5% to $28.4 billion compared to $27.0 billion in 2024. Diluted earnings per share for the same period rose by 23% to $26.42 from $21.47 [4][5] Operational Highlights - The company achieved a 7.7% increase in total revenue on a same-store basis compared to Q3 2024, with used retail revenue increasing by 11.8% [13] - The company repurchased approximately 1,312,000 shares at a weighted average price of $312 during Q3 2025, with a total of 2,168,000 shares repurchased year-to-date at an average price of $313 [9] Corporate Development - In September 2025, LAD expanded its network in the Southeast region by acquiring Palm Beach Acura, West Palm Beach Hyundai, and West Palm Beach Genesis, which are expected to add $220 million in annualized revenue [6] - As of September 30, 2025, LAD had acquired $620 million of expected annualized revenues year-to-date [7] Dividend and Shareholder Returns - The Board of Directors approved a dividend of $0.55 per share related to Q3 2025 financial results, expected to be paid on November 21, 2025 [8]

Core Viewpoint - Lithia Motors, Inc. is experiencing a shift in analyst price targets, reflecting a more conservative outlook despite strong financial performance and positive investor sentiment [2][4][6] Financial Performance - Lithia Motors reported a 19.2% increase in net income and a 25.4% growth in earnings per share (EPS) in Q2, indicating robust financial health [4][6] - The stock has risen by 18.9% since the last earnings report, suggesting positive investor sentiment [3] Price Target Adjustments - The average price target for Lithia Motors has decreased from $373.6 to $327 over the past year, indicating a more cautious perspective from analysts [2][6] - Wells Fargo and JPMorgan have set higher price targets of $350, reflecting optimism about Lithia's future growth [2][5][6] Market Outlook - Analysts are anticipating growth in earnings for the upcoming earnings report, although there are concerns that the company may not meet expectations [3] - JPMorgan's price target adjustment from $320 to $350 considers the mix of electric vehicles and challenges in the UK market, suggesting a balanced medium-term outlook [5]

Core Insights - Lithia & Driveway (NYSE: LAD) has 20 U.S. dealerships recognized among Automotive News' 2025 Best Dealerships To Work For, highlighting exceptional employee work environments [1][2] - The recognition is based on confidential management information and employee surveys measuring engagement, satisfaction, and workplace culture [1] Company Achievements - Bryan DeBoer, President and CEO, emphasized the importance of a people-first culture that empowers employees to provide exceptional customer experiences [2] - Two LAD stores received special category distinctions, showcasing the company's commitment to employee satisfaction [2] Company Overview - Lithia & Driveway is the largest global automotive retailer, offering a wide range of products and services throughout the vehicle ownership lifecycle [4] - The company aims to modernize personal transportation solutions through a comprehensive network of physical locations, e-commerce platforms, and finance solutions [4]

Core Viewpoint - Lithia Motors (LAD) is expected to report a year-over-year increase in earnings and revenues for the quarter ended September 2025, with the actual results being crucial for the stock's near-term price movement [1][2]. Earnings Expectations - The upcoming earnings report is anticipated to show quarterly earnings of $8.84 per share, reflecting a +7.7% change year-over-year, and revenues of $9.67 billion, which is a 4.9% increase from the previous year [3]. - The consensus EPS estimate has been revised 0.06% higher in the last 30 days, indicating a slight positive adjustment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for Lithia Motors is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -3.14%, indicating a bearish outlook from analysts [12]. - The stock currently holds a Zacks Rank of 3, making it challenging to predict a beat on the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, Lithia Motors exceeded the expected earnings of $9.78 per share by delivering $10.24, resulting in a surprise of +4.70% [13]. - Over the past four quarters, the company has beaten consensus EPS estimates three times [14]. Conclusion - While Lithia Motors may not be a strong candidate for an earnings beat, investors should consider other factors influencing stock performance ahead of the earnings release [17].

Core Insights - Lithia & Driveway (NYSE: LAD) has acquired Stivers Decatur Subaru in the Atlanta market, enhancing its network density in the Southeast and expected to generate approximately $100 million in annualized revenue [1][2] Company Strategy - The acquisition aligns with Lithia & Driveway's growth strategy, focusing on lifetime ownership experiences and expanding its Southeast footprint [2] - The total year-to-date annualized U.S. revenue acquired by Lithia & Driveway now stands at $720 million, financed through existing on-balance sheet capacity [2] Company Overview - Lithia & Driveway is the largest global automotive retailer, offering a wide range of products and services throughout the vehicle ownership lifecycle [3] - The company emphasizes simple, convenient, and transparent experiences through a comprehensive network of physical locations and e-commerce platforms, aiming for consistent and profitable growth in a large, unconsolidated industry [3]