Sonic Automotive(SAH) - 2025 Q3 - Quarterly Results

Financial Performance - Total revenues for Q3 2025 reached an all-time record of $4.0 billion, representing a 14% increase year-over-year[2] - Gross profit for Q3 2025 was $615.5 million, up 13% year-over-year, marking another all-time record[2] - Net income for Q3 2025 was reported at $46.8 million, a decrease of 37% year-over-year, primarily due to increased medical expenses and a higher effective income tax rate[2] - Adjusted net income for Q3 2025 was $49.5 million, reflecting a 13% increase year-over-year, with adjusted earnings per diluted share at $1.41, up 12% year-over-year[2] - Total revenues for the three months ended September 30, 2025, increased by 14% to $3,973.8 million compared to $3,491.5 million in the same period of 2024[17] - Gross profit for the three months ended September 30, 2025, was $615.5 million, reflecting a 13% increase from $543.6 million in 2024[17] - Operating income for the three months ended September 30, 2025, was $122.7 million, an 8% increase compared to $113.6 million in 2024[17] - Basic earnings per share for the three months ended September 30, 2025, was $1.37, down 37% from $2.18 in 2024[17] - Total gross profit for the three months ended September 30, 2025, was $537.7 million, a 14% increase from $470.7 million in 2024[27] Segment Performance - EchoPark Segment revenues were $522.5 million, down 4% year-over-year, with retail used vehicle unit sales volume decreasing by 8% to 16,353 units[4] - Powersports Segment achieved all-time record quarterly revenues of $84.1 million, a 42% increase year-over-year, and segment income of $7.8 million, up 95% year-over-year[4] - The Franchised Dealerships Segment reported total revenues of $3,367.2 million for the three months ended September 30, 2025, a 17% increase from $2,887.2 million in 2024[18] - Retail new vehicle revenues rose by 20% to $1,872.8 million, while used vehicle revenues increased by 6% to $1,253.1 million for the same period[17] - EchoPark Segment's total revenues decreased by 4% to $522.5 million in Q3 2025, down from $544.9 million in Q3 2024[21] - The total vehicles sold in the Franchised Dealerships Segment increased by 12% to 2,565.9 million in Q3 2025, compared to 2,296.4 million in Q3 2024[20] Expenses and Adjustments - Total SG&A expenses for the nine months ended September 30, 2025, were $1,244.5 million, a decrease of 6% compared to $1,177.4 million in 2024[26] - Total adjusted SG&A expenses for the nine months ended September 30, 2025, were $1,273.2 million, reflecting a 10% increase from $1,159.7 million in 2024[26] - Total SG&A expenses for the three months ended September 30, 2025, were $395.1 million, a 16% increase compared to $340.5 million in 2024[27] - Total adjusted SG&A expenses for the three months ended September 30, 2025, were $391.6 million, a 16% increase from $337.2 million in 2024[27] - Total SG&A expenses for the EchoPark segment increased to $43.5 million in Q3 2025, up from $40.2 million in Q3 2024, representing an 8% increase[29] Income Before Taxes - The Franchised Dealerships segment reported an income before taxes of $60.8 million for Q3 2025, an 18% increase compared to $51.6 million in Q3 2024[33] - EchoPark segment reported an income before taxes of $2.6 million for Q3 2025, a decrease of 50% from $5.2 million in Q3 2024[34] - Powersports segment achieved an income before taxes of $7.8 million in Q3 2025, a 95% increase from $4.0 million in Q3 2024[35] Dividends - Sonic's Board of Directors approved a quarterly cash dividend of $0.38 per share, payable on January 15, 2026[7] - Dividends declared per common share increased by 27% to $0.38 for the three months ended September 30, 2025, compared to $0.30 in 2024[17] Adjusted Metrics - Total adjusted EBITDA for Q3 2025 reached $149.4 million, compared to $135.0 million in Q3 2024, indicating a growth in operational performance[37] - For the nine months ended September 30, 2025, adjusted EBITDA totaled $466.1 million, an increase from $410.8 million in the same period of 2024[37] - The EchoPark segment's adjusted income for Q3 2025 was $2.7 million, a 7% increase from $2.9 million in Q3 2024[34] - Powersports segment's adjusted income for Q3 2025 was $8.0 million, a 100% increase from $4.0 million in Q3 2024[35] Impairment Charges - The total impairment charges for the nine months ended September 30, 2025, were $173.8 million, significantly higher than $2.4 million in the same period of 2024[37]