Core Insights - Penske Automotive Group reported strong Q2 2025 earnings with GAAP EPS of $3.78, exceeding analyst estimates of $3.57, while net income rose to $250.0 million [1][2] - Revenue remained stable at $7,662.3 million, slightly below the consensus estimate of $7,881.12 million, reflecting challenges in vehicle volumes and the freight market [1][5] Financial Performance - GAAP EPS increased by 4.7% year-over-year from $3.61 in Q2 2024 [2] - Revenue was flat compared to the previous year, with retail automotive revenue declining by 1.5% [2][7] - Operating income rose to $348.2 million, a 3.0% increase from $338.0 million in Q2 2024 [2][6] - Gross profit reached a record $1.3 billion, driven by service and parts, which accounted for over 12.5% of retail automotive revenue [2][6] Business Overview - Penske Automotive Group operates in automotive and commercial truck dealerships, retail commercial vehicle distribution, and has a stake in Penske Transportation Solutions [3] - The company focuses on expanding its premium and luxury brand presence and growing service and parts revenue [4] Operational Highlights - The company experienced a decline in new unit deliveries by 6% and used unit sales by 16.1%, while commercial truck operations saw a revenue increase of 5.7% [7] - The premium brand mix accounted for 72% of retail automotive dealership revenue in 2024, helping to mitigate margin pressures from electric vehicles [7] Strategic Initiatives - Penske Automotive Group increased its quarterly dividend by 4.8% to $1.32 per share, marking the nineteenth consecutive increase [9] - The company repurchased 630,000 shares, with $295.7 million remaining under its buyback authorization [9] - Liquidity stood strong at $2.3 billion with low leverage at 1.2 times total capitalization [9] Future Outlook - Management did not provide formal guidance for EPS or revenue for the remainder of FY2025 but expressed cautious optimism regarding cost discipline and margin management [10] - Ongoing trends to monitor include changes in vehicle demand, impacts from tariffs, and the effects of electric vehicle adoption on margins [11]

Revenue and Profit - Total revenue for the six months ended June 30, 2025, was $15.3 billion, with $13.1 billion from retail automotive dealerships, $1.8 billion from retail commercial truck dealerships, and $412.7 million from commercial vehicle distribution and other operations[116] - Gross profit for the same period was $2.6 billion, comprising $2.2 billion from retail automotive dealerships, $284.6 million from retail commercial truck dealerships, and $88.4 million from commercial vehicle distribution and other operations[116] - Retail automotive dealerships accounted for 85.7% of total revenues and 85.5% of total gross profit in the six months ended June 30, 2025[119] - For the six months ended June 30, 2025, total revenue increased by $122.3 million, or 0.8%, and gross profit increased by $56.3 million, or 2.2% compared to the same periods in 2024[140] - Total revenue for the three months ended June 30, 2025, decreased by $34.4 million, or 0.4%, while gross profit increased by $32.5 million, or 2.6%[140] Vehicle Sales - The company retailed and wholesaled over 280,000 vehicles in the six months ended June 30, 2025[117] - U.S. industry new light vehicle sales increased by 3.2% to 8.1 million units in the six months ended June 30, 2025, with retail sales up by 5.1%[133] - New retail unit sales (excluding agency) decreased by 6.5% to 47,546 units for the three months ended June 30, 2025[153] - Retail unit deliveries of new vehicles decreased by 2,963 units, or 5.0%, from 2024 to 2025, with a 0.2% decrease in same-store retail units delivered in the U.S. and an 11.0% decrease internationally[154] - Total retail unit sales decreased by 13,887 units, or 11.9%, from 2024 to 2025, with same-store retail unit sales decreasing by 10,995 units, or 9.9%[162] Commercial Truck Performance - Retail commercial truck dealerships represented 11.6% of total revenues and 11.1% of total gross profit in the same period, with 10,203 new and used trucks sold[120] - New retail unit sales of commercial trucks increased by 155 units, or 3.5%, from 2024 to 2025, while same-store new retail unit sales decreased by 154 units, or 3.4%[167] - New commercial truck retail sales revenue rose by $47.1 million, with a 1.1% decrease in same-store revenues offsetting this growth[169] - Used commercial truck retail sales revenue increased by $4.0 million, or 8.2%, driven by a rise in average selling price per unit[173] Service and Parts Revenue - Service and parts revenue increased by $63.8 million, or 8.5%, from 2024 to 2025, with same-store service and parts revenue increasing by $51.2 million, or 6.9%[163] - Same-store gross profit for service and parts increased by $63.7 million, or 7.5%, with a gross margin increase from 57.9% to 59.0%[199] - Service and parts revenue increased by $107.1 million, or 7.1%, from 2024 to 2025, with same-store service and parts revenue increasing by $80.7 million, or 5.5%[197] Expenses and Financials - Total SG&A expenses rose by $18.8 million, or 2.1%, with same-store SG&A expenses increasing by $16.3 million, or 1.9%[182] - Floor plan interest expense decreased by $3.3 million, or 7.1%, due to lower applicable rates despite increased inventory levels[184] - Income taxes increased by $3.4 million, or 4.1%, from 2024 to 2025, primarily due to an $11.4 million increase in pre-tax income[187] - Selling, General, and Administrative (SG&A) expenses increased by $52.6 million, or 3.0%, from 2024 to 2025, totaling $1,819.9 million[213] Cash Flow and Debt - Net cash provided by operating activities was $472.4 million for the six months ended June 30, 2025, compared to $691.1 million for the same period in 2024, a decrease of 31.7%[242] - Total long-term debt as of June 30, 2025, was $1,782.7 million, with a net long-term debt of $906.7 million after accounting for the current portion[230] - As of June 30, 2025, the company had $155.3 million in cash and approximately $2.2 billion available for borrowing under various credit agreements[224] Market Conditions and Risks - Higher inflation rates have recently impacted vehicle prices, parts costs, and consumer demand, potentially affecting the company's profitability[263] - The company is exposed to market risks from interest rate fluctuations, which could impact its earnings and cash flows[273] - Future results could be materially and adversely impacted by changes in economic conditions, political climate, tax structures, and foreign currency exchange rate volatility[275]

Core Viewpoint - Penske Automotive Group (NYSE: PAG) has underperformed over the past year, remaining largely flat and missing out on significant market rallies despite reporting solid Q2 results [1] Company Performance - The company's stock has not shown meaningful growth, indicating potential challenges in capitalizing on market opportunities [1] Market Context - The broader market has experienced rallies, yet Penske Automotive Group's performance has not aligned with these trends, raising questions about its competitive positioning [1]

Group 1 - The analyst's previous "Buy" call on Penske Automotive Group (NYSE: PAG) was considered premature as it occurred just before a decline in stock price, which later provided better buying opportunities after April Liberation Day [1] - The analyst has extensive experience in the energy industry, having worked in various roles including engineering, planning, and financial analysis, and has managed a personal investment portfolio since 1998 [1] - The investment strategy focuses on long-term holdings unless compelling reasons to sell arise, with an emphasis on maximizing total return by purchasing when prices are low relative to intrinsic value [1] Group 2 - The analyst holds a beneficial long position in PAG shares through stock ownership, options, or other derivatives, indicating a personal investment interest in the company [2] - The article reflects the analyst's own opinions and is not influenced by compensation from any company mentioned, ensuring an independent perspective [2]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $7.7 billion, consistent with Q2 2024, impacted by strategic divestitures of approximately $200 million in revenue [6][10] - Earnings before tax (EBT) increased by 4%, net income also increased by 4%, and earnings per share rose by 5% compared to 2024 [7] - Gross profit increased to $1.3 billion, with a gross profit margin of 16.9%, marking the eighth consecutive quarter of stable gross margin [8][9] - Selling, general and administrative expenses as a percentage of gross profit improved to 69.9%, a 30 basis point improvement [9] Business Line Data and Key Metrics Changes - North American retail automotive service and parts gross profit increased by 9%, with same-store service and parts revenue up by 7% [13] - Premier Truck Group sold 5,339 new and used units, with new units up 4% and used units down 8%, but used truck grosses increased over 50% [17] - Penske Transportation Solutions (PTS) revenue was $2.8 billion, with full-service revenue and contracts increasing by 4% [19] Market Data and Key Metrics Changes - In the U.K., new vehicle sales declined by 16% due to macroeconomic challenges and reduced incentives [21] - Same-store used units in the U.K. declined by 23%, attributed to the realignment of used-only dealerships [22] - In Australia, three Porsche dealerships generated $128 million in revenue, with a nearly one-to-one used-to-new ratio [24] Company Strategy and Development Direction - The company emphasizes diversification, with 61% of revenue from North America, 29% from the U.K., and 10% from other international markets [10] - The company is focused on capital allocation, with a disciplined approach to share buybacks and dividends, having increased dividends by 4.8% [29][30] - The acquisition of a Ferrari dealership in Modena, Italy, aligns with the company's strategy to enhance its premium brand presence [30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the resilience of the business and the benefits from recent trade agreements [9][10] - The company anticipates improvements in used vehicle sourcing due to increasing lease returns starting in 2026 [12] - Management noted that the operating environment in the U.K. remains challenging due to inflation and interest rates impacting consumer affordability [21] Other Important Information - The company generated $472 million in cash flow from operations for the first half of 2025, with EBITDA over $1.5 billion on a trailing twelve-month basis [28] - The company has a backlog of $350 million for 2025 delivery in its commercial vehicle and power systems business [27] - The company has returned over $2.5 billion to shareholders through dividends and share repurchases over the last four years [29] Q&A Session Summary Question: Can you quantify the moving pieces affecting unit sales in the U.S. and the U.K.? - Management noted approximately $200 million in revenue loss due to divestitures and store closures, impacting new and used vehicle units sold [40][41] Question: What about the impact of mobility credits in the U.K.? - Management indicated that mobility credits were slowed down by certain brands, but expect recovery in the current quarter [44] Question: How do you see GPU trajectory and adjustments from OEMs regarding warranty claims? - Management stated that warranty claims are not seeing adjustments from OEMs, but customer demand remains strong [88] Question: What is the outlook for capital allocation with the additional cash flow? - Management indicated that the additional cash flow provides more opportunities for capital allocation, including share buybacks and acquisitions [111] Question: Is the $1.5 billion acquisition target still realistic? - Management suggested that while the target may not be realistic for 2025, they remain focused on acquisitions and organic growth [120][123]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $7.7 billion, consistent with Q2 2024, impacted by strategic divestitures of approximately $200 million in revenue [6][7] - Earnings before taxes (EBT) increased by 4%, net income also increased by 4%, and earnings per share rose by 5% compared to 2024 [7] - Gross profit increased to $1.3 billion, with a gross profit margin of 16.9%, marking the eighth consecutive quarter of stable gross margin [8][9] - Selling, general and administrative expenses as a percentage of gross profit improved by 30 basis points to 69.9% [9] Business Line Data and Key Metrics Changes - North American retail automotive service and parts gross profit increased by 9%, with same-store service and parts revenue up by 7% [14] - Premier Truck Group's new unit sales increased by 4%, while used unit sales decreased by 8%, but used truck grosses increased over 50% [17] - Penske Transportation Solutions (PTS) revenue was $2.8 billion, with full-service revenue and contracts increasing by 4% [19] Market Data and Key Metrics Changes - Approximately 61% of revenue is generated in North America, 29% in the UK, and 10% from other international markets [11] - In the UK, new unit deliveries declined by 16% due to OEM product changes and reduced incentives [21] - Same-store used units in the UK declined by 23%, attributed to the realignment of the company's used-only dealerships [22] Company Strategy and Development Direction - The company focuses on diversification across retail automotive and commercial truck industries, leveraging a highly variable cost structure [12][34] - Recent trade agreements, particularly with the EU, are expected to benefit major partners by enhancing U.S. production exports [10] - The company is actively pursuing acquisitions and has a pipeline for potential M&A opportunities [104][112] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business and the benefits of diversification, cost control, and a strong balance sheet [34] - The operating environment remains fluid, with OEMs adjusting pricing strategies amid tariff negotiations [10][42] - Management anticipates a gradual improvement in used vehicle sourcing as lease returns increase in 2026 [13] Other Important Information - The company generated $472 million in cash flow from operations for the first half of 2025, with a trailing twelve-month EBITDA of over $1.5 billion [27] - The dividend was increased by 4.8% to $1.32 per share, marking the nineteenth consecutive quarterly increase [29] - The company has a backlog of $350 million for 2025 delivery in its commercial vehicle and power systems business [25] Q&A Session Summary Question: Can you quantify the moving pieces affecting unit sales in the US and the UK? - Management noted approximately $200 million in revenue loss due to divestitures and store closures, impacting new and used vehicle units sold [38][40] Question: What about the impact of the UK market? - The UK faced challenges with mobility credits and OEMs suspending wholesales, affecting premium sector sales [42] Question: How do you see GPU trajectory and cadence throughout the quarter? - Management indicated stable grosses throughout the quarter, with the highest in April, and noted a potential for gross compression moving forward [62] Question: What is the outlook for capital allocation with the additional cash flow? - Management stated that the additional cash flow provides more opportunities for capital allocation, including share buybacks and acquisitions [100][103] Question: Is the $1.5 billion acquisition target still realistic? - Management indicated that while the target may not be met, they remain focused on organic growth and acquisitions [110][112]

Financial Performance - Revenue remained relatively flat at $7662 million for Q2 2025 compared to $7697 million in Q2 2024, while six-month revenue increased by 1% to $15267 million[15] - Income attributable to common stockholders increased by 4% to $250 million in Q2 2025 and by 8% to $494 million for the six months ended June 30, 2025[15] - Penske Transportation Solutions (PTS) equity earnings increased to $535 million in Q2 2025 from $529 million, and $867 million for the six months ended June 30, 2025[14,47] - Adjusted EBITDA for the six months ended June 30, 2025, was $773 million, a 48% increase compared to $7379 million in the same period of 2024[55] Retail Automotive - Retail automotive same-store revenue decreased by 1% to $6319 million in Q2 2025[21] - Gross margin increased by 50 bps to 169%[14] - Same-store retail automotive service and parts revenue increased by 7%, with related gross profit up by 9%[14] Retail Commercial Trucks - Retail commercial truck revenue increased to $944 million in Q2 2025 from $892 million in Q2 2024[31] - Same-store total units decreased by 4% to 4995 in Q2 2025[32] - Same-store used units gross per unit increased by 56% to $7016[32] Capital Allocation - Dividends paid were $165 million for the six months ended June 30, 2025[9] - Share repurchases totaled $133 million for the six months ended June 30, 2025[9] - Capital expenditures were $147 million for the six months ended June 30, 2025[9]

[Financial & Operational Highlights](index=1&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%20REPORTS%20QUARTERLY%20RESULTS) [Q2 2025 Financial & Operational Performance](index=1&type=section&id=Second%20Quarter%202025%20Operating%20Highlights) PAG reported flat Q2 2025 revenue at $7.7 billion, with gross profit up 3% to $1.3 billion, net income up 4% to $250 million, and EPS up 5% to $3.78 Q2 & H1 2025 Key Financial Results (vs. Prior Year) | Metric | Q2 2025 | Q2 2024 | % Change | H1 2025 | H1 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $7.7B | $7.7B | 0.0% | $15.3B | $15.1B | +1.0% | | Gross Profit | $1.3B | - | +3.0% | $2.57B | $2.51B | +2.2% | | Net Income (to Common Stockholders) | $250.0M | $241.2M | +4.0% | $494.3M | $456.4M | +8.0% | | Earnings Per Share (EPS) | $3.78 | $3.61 | +5.0% | $7.44 | $6.81 | +9.0% | Q2 2025 Same-Store Operating Highlights (vs. Q2 2024) | Metric | Change | | :--- | :--- | | Retail Automotive Revenue | -1% | | Retail Automotive Gross Profit | +3% | | Service & Parts Revenue | +7% | | Service & Parts Gross Profit | +9% | | Overall Gross Margin | +50 bps | | SG&A as % of Gross Profit | -30 bps | - Management highlighted that the strong results were driven by **gross margin expansion** and **improved SG&A leverage** The company's diversification across premium brands, geographic markets (U.S. and international), and business lines (new/used vehicles, service, F&I) provides resilience against market changes like potential tariffs[3](index=3&type=chunk) [Segment Performance](index=3&type=section&id=Segment%20Performance) [Retail Automotive Dealerships](index=3&type=section&id=Retail%20Automotive%20Dealerships) Retail Automotive revenue decreased 1% to $6.5 billion in Q2 2025, but gross profit rose 3% to $1.1 billion, primarily from a 9% increase in service and parts gross profit Retail Automotive Performance - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Change (YoY) | | :--- | :--- | :--- | | Total Revenue | $6.5B | -1% | | Total Gross Profit | $1.1B | +3% | | New Units Delivered | - | -6% | | Used Units Delivered | - | -16% | | Same-Store Service & Parts Gross Profit | - | +9% | - The **27% decrease** in international used unit sales was largely due to the realignment of the U.K. Sytner Select dealerships, which now focus on **higher margins and lower costs** rather than volume[6](index=6&type=chunk) [Retail Commercial Truck Dealerships](index=3&type=section&id=Retail%20Commercial%20Truck%20Dealerships) Retail Commercial Truck revenue increased 6% to $943.6 million in Q2 2025, with retail unit sales up 2%, and earnings before taxes growing to $54.2 million Retail Commercial Truck Performance - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Change (YoY) | | :--- | :--- | :--- | | Revenue | $943.6M | +6% | | Same-Store Revenue | - | 0% (Flat) | | Retail Unit Sales | 5,339 | +2% | | Same-Store Unit Sales | - | -4% | | Earnings Before Taxes | $54.2M | +4.8% | [Penske Transportation Solutions (PTS) Investment](index=3&type=section&id=Penske%20Transportation%20Solutions%20Investment) PAG recorded $53.5 million in equity earnings from its 28.9% stake in PTS for Q2 2025, driven by higher leasing and maintenance revenue, despite declines in truck rental and used truck sales - PAG has a **28.9% ownership stake** in PTS, which operates a managed fleet of **over 414,000 trucks, tractors, and trailers**[9](index=9&type=chunk)[14](index=14&type=chunk) Equity Earnings from PTS Investment | Period | 2025 | 2024 | | :--- | :--- | :--- | | Q2 Earnings | $53.5M | $52.9M | | H1 Earnings | $86.7M | $85.4M | [Corporate Development & Capital Allocation](index=3&type=section&id=Corporate%20Development%2C%20Capital%20Allocation%2C%20Liquidity%2C%20and%20Leverage) [Share Repurchases, Dividends, and Liquidity](index=3&type=section&id=Corporate%20Development%2C%20Capital%20Allocation%2C%20Liquidity%2C%20and%20Leverage) In H1 2025, PAG repurchased 885,272 shares for $133.3 million, increased its quarterly dividend by 4.8% to $1.32, and maintained strong liquidity of $2.3 billion with a 1.2x leverage ratio - Share Repurchases: Repurchased **885,272 shares** (**1.3% of outstanding**) for **$133.3 million** in H1 2025 **$295.7 million** remains available under the repurchase program[10](index=10&type=chunk)[11](index=11&type=chunk)[35](index=35&type=chunk) - Dividend Increase: The quarterly dividend was increased by **4.8%** to **$1.32 per share**, representing a **3.1% forward yield** and the **19th consecutive quarterly increase**[12](index=12&type=chunk) - Liquidity and Leverage: The company has approximately **$2.3 billion** in liquidity and a leverage ratio of **1.2x** as of June 30, 2025[11](index=11&type=chunk) - Acquisition: Completed the acquisition of a Ferrari dealership in Italy with expected annualized revenue of **$40 million** in July 2025[12](index=12&type=chunk) [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Condensed Statements of Income](index=8&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Consolidated%20Condensed%20Statements%20of%20Income) Q2 2025 revenue was flat at $7.66 billion, with gross profit up 2.6% to $1.30 billion, and net income up 3.6% to $250.0 million, resulting in $3.78 EPS Consolidated Income Statement Summary - Q2 2025 vs Q2 2024 (in Millions) | Account | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $7,662.3 | $7,696.7 | (0.4)% | | Gross Profit | $1,296.6 | $1,264.1 | 2.6% | | Operating Income | $348.2 | $338.0 | 3.0% | | Income Before Taxes | $336.9 | $325.5 | 3.5% | | Net Income to Common Stockholders | $250.0 | $241.2 | 3.6% | [Consolidated Condensed Balance Sheets](index=9&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Consolidated%20Condensed%20Balance%20Sheets) As of June 30, 2025, total assets reached $17.39 billion, up from $16.72 billion, with inventories at $4.85 billion and total equity at $5.63 billion Balance Sheet Summary (in Millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and Cash Equivalents | $155.3 | $72.4 | | Inventories | $4,849.6 | $4,640.2 | | Total Assets | $17,393.4 | $16,720.9 | | Total Liabilities | $11,762.0 | $11,493.6 | | Total Equity | $5,631.4 | $5,227.3 | [Consolidated Operations Selected Data](index=10&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Consolidated%20Operations%20Selected%20Data) Q2 2025 saw North America's revenue share rise to 61.8%, total gross margin improve to 16.9%, and SG&A as a percentage of gross profit improve to 69.9% Q2 2025 Revenue & Gross Profit by Segment (in Millions) | Segment | Revenue | Gross Profit | | :--- | :--- | :--- | | Retail Automotive | $6,517.5 | $1,108.8 | | Retail Commercial Truck | $943.6 | $143.6 | | Commercial Vehicle Distribution & Other | $201.2 | $44.2 | Q2 Geographic Revenue Mix | Region | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | North America | 61.8% | 59.8% | | U.K. | 27.2% | 31.2% | | Other International | 11.0% | 9.0% | [Detailed Operational Metrics](index=12&type=section&id=Detailed%20Operational%20Metrics) [Retail Automotive Operations (Total & Same-Store)](index=12&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Retail%20Automotive%20Operations) Q2 2025 total retail automotive unit sales declined 11.9%, but gross profit per used vehicle surged 27.7% to $2,326, and service and parts gross profit rose 9.4% Q2 2025 Total Retail Automotive Performance Highlights | Metric | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Units Retailed | 102,545 | 116,432 | (11.9)% | | Service & Parts Revenue | $816.6M | $752.8M | +8.5% | | Gross Profit per Used Vehicle | $2,326 | $1,822 | +27.7% | | Service & Parts Gross Margin | 58.9% | 58.4% | +50 bps | Q2 2025 Same-Store Retail Automotive Performance Highlights | Metric | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Same-Store Revenue | $6,318.9M | $6,400.6M | (1.3)% | | Total Same-Store Gross Profit | $1,080.1M | $1,048.4M | +3.0% | | Same-Store Service & Parts Gross Profit | $469.0M | $431.1M | +8.8% | [Retail Commercial Truck Operations (Total & Same-Store)](index=18&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Retail%20Commercial%20Truck%20Operations) Q2 2025 total commercial truck revenue grew 5.7%, driven by new vehicle revenue, with gross profit per used vehicle surging 56.3%, despite a slight 0.6% decline in total gross profit Q2 2025 Total Retail Commercial Truck Performance Highlights | Metric | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $943.6M | $892.3M | +5.7% | | Total Gross Profit | $143.6M | $144.5M | (0.6)% | | Gross Profit per New Vehicle | $7,889 | $8,765 | (10.0)% | | Gross Profit per Used Vehicle | $7,037 | $4,502 | +56.3% | Q2 2025 Same-Store Retail Commercial Truck Performance Highlights | Metric | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Same-Store Revenue | $883.9M | $887.3M | (0.4)% | | Total Same-Store Gross Profit | $135.6M | $143.1M | (5.2)% | | Same-Store New Vehicle Gross Profit | $33.2M | $39.0M | (14.9)% | [Supplemental Information](index=23&type=section&id=Supplemental%20Information) [Supplemental Data](index=23&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Supplemental%20Data) Q2 2025 retail automotive revenue from premium brands was 72%, with $93.3 million in share repurchases, and new vehicle days' supply at 57 days - The retail automotive revenue mix remains heavily weighted towards premium brands, which constituted **72% of revenue** in Q2 2025, consistent with the prior year[35](index=35&type=chunk) Inventory Days' Supply | Vehicle Type | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | New Vehicle | 57 days | 49 days | | Used Vehicle | 44 days | 47 days | Q2 2025 Capital Allocation (in Millions) | Item | Amount | | :--- | :--- | | Capital Expenditures | $70.8 | | Stock Repurchases | $93.3 | [Non-GAAP Reconciliations](index=25&type=section&id=PENSKE%20AUTOMOTIVE%20GROUP%2C%20INC.%20Consolidated%20Non-GAAP%20Reconciliations) H1 2025 GAAP net income of $494.3 million and EPS of $7.44 are adjusted for a $52.3 million gain and $25.2 million in impairments, yielding adjusted net income of $476.3 million and EPS of $7.17 H1 2025 GAAP to Non-GAAP Reconciliation | Metric | Reported (GAAP) | Adjustments | Adjusted (Non-GAAP) | % Change (YoY) | | :--- | :--- | :--- | :--- | :--- | | Net Income | $494.3M | ($18.0M) | $476.3M | +4.4% | | EPS | $7.44 | ($0.27) | $7.17 | +5.3% | - Adjustments for H1 2025 include excluding a **$38.9 million** after-tax gain on a dealership sale and adding back **$20.9 million** in after-tax impairments and other charges[39](index=39&type=chunk)

Core Insights - Penske Automotive reported revenue of $7.66 billion for the quarter ended June 2025, a decrease of 0.5% year-over-year, with EPS at $3.78, up from $3.61 in the previous year [1] - The revenue fell short of the Zacks Consensus Estimate of $7.87 billion, resulting in a surprise of -2.63%, while the EPS exceeded expectations by +6.18% [1] Financial Performance Metrics - Retail Automotive Gross Profit Per Vehicle Retailed for new vehicles was $5,443, surpassing the average estimate of $5,125.47 [4] - Retail Commercial Truck Revenue Per Vehicle Retailed for new vehicles was $141,345, exceeding the average estimate of $138,729.90 [4] - Retail Automotive Units for used retail were 54,999, below the average estimate of 62,109 [4] - Retail Automotive Revenue Per Vehicle Retailed for new vehicles was $61,340, compared to the estimated $56,292.94 [4] - Revenue from Retail Automotive for new vehicles was $2.94 billion, lower than the estimated $3.13 billion, reflecting a -1.8% change year-over-year [4] - Revenue from Retail Automotive for fleet and wholesale was $358.1 million, below the estimated $376.45 million, representing a -6.3% change year-over-year [4] - Revenue from Retail Automotive for service and parts was $816.6 million, exceeding the estimate of $791.44 million, with a year-over-year change of +8.5% [4] - Revenue from Retail Automotive for finance and insurance was $200.5 million, compared to the estimated $208.12 million, reflecting a -3.9% change year-over-year [4] - Revenue from Retail Automotive for used vehicles was $2.2 billion, below the estimated $2.27 billion, representing a -3.3% change year-over-year [4] - Total Revenue from Retail Automotive was $6.52 billion, lower than the estimated $6.78 billion, indicating a -1.5% change year-over-year [4] - Revenue from Retail Commercial Truck was $943.6 million, exceeding the estimated $906.79 million, with a +5.8% change year-over-year [4] - Revenue from Commercial Vehicle Distribution and Other was $201.2 million, surpassing the estimated $195.44 million, reflecting a +6.5% change year-over-year [4] Stock Performance - Penske's shares have returned -5.5% over the past month, contrasting with the Zacks S&P 500 composite's +3.4% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Group 1 - Penske Automotive reported quarterly earnings of $3.78 per share, exceeding the Zacks Consensus Estimate of $3.56 per share, and showing an increase from $3.61 per share a year ago, resulting in an earnings surprise of +6.18% [1] - The company posted revenues of $7.66 billion for the quarter ended June 2025, which was a 2.63% miss compared to the Zacks Consensus Estimate, and a slight decrease from $7.7 billion year-over-year [2] - Penske shares have increased by approximately 10.2% since the beginning of the year, outperforming the S&P 500's gain of 8.3% [3] Group 2 - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to those expectations [4] - The trend of estimate revisions for Penske was unfavorable prior to the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - The current consensus EPS estimate for the upcoming quarter is $3.51 on revenues of $7.69 billion, and for the current fiscal year, it is $13.73 on revenues of $30.78 billion [7] Group 3 - The Automotive - Retail and Whole Sales industry, to which Penske belongs, is currently ranked in the bottom 35% of over 250 Zacks industries, which may negatively impact stock performance [8] - Worksport Ltd., another company in the same industry, is expected to report a quarterly loss of $0.76 per share, reflecting a year-over-year change of +49.3%, with revenues anticipated to be $4.07 million, up 112% from the previous year [9]