Camping World Holdings(US:CWH)2025-10-29 13:30Financial Data and Key Metrics Changes - The company reported revenue of over $1.8 billion for Q3 2025, an increase of 5% driven by unit volume increases in used RVs exceeding 30% [11] - Adjusted EBITDA grew over 40% to $95.7 million compared to $67.5 million in the previous year [5][11] - SG&A as a percentage of gross profit improved by 360 basis points year over year [12] Business Line Data and Key Metrics Changes - The company sold nearly 14% of all new and used RVs in North America, indicating strong market penetration [5] - New average selling prices (ASPs) improved sequentially to just under $38,000, a decline of roughly 9% year over year [11] - The used RV sales segment showed significant growth, with expectations of yielding approximately $6 million of adjusted EBITDA for every additional 1,000 used units sold [9] Market Data and Key Metrics Changes - The RV industry is experiencing high single-digit declines in new RV sales, while the company has been outperforming the market [19] - The company anticipates entering 2026 with uneven consumer sentiment and rising OEM pricing on like-for-like models [6] Company Strategy and Development Direction - The company aims to improve revenue and earnings while reducing net leverage, with a target adjusted EBITDA floor of around $310 million for 2026 [7] - The strategy focuses on market-leading used sales, service, and Good Sam businesses, with a long-term objective of achieving mid-cycle adjusted EBITDA of $500 million [10] - The company is investing in AI and technology to enhance operational efficiency and customer experience, which is expected to yield significant cost savings [45][47] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the new RV market, acknowledging potential resistance due to rising prices and economic uncertainties [20][31] - The company believes that the used RV market will continue to thrive, providing a buffer against potential declines in new RV sales [22][108] - Management emphasized the importance of maintaining a conservative approach to inventory and forecasting to avoid overstocking [24] Other Important Information - The company ended the quarter with $230 million in cash, $427 million in used inventory owned outright, and nearly $260 million in real estate without an associated mortgage [12][13] - The management team highlighted the significant improvement in the balance sheet and net leverage, aiming to reach a target of 4 or below by the end of 2026 [50] Q&A Session Summary Question: What have you seen regarding new RV demand? - Management noted that while there was some stabilization in the new RV market, they are still seeing year-over-year declines, and consumer resistance to price increases is a concern [19][20] Question: How do you view the building blocks to reach the $310 million floor? - Management indicated that the used business is a significant driver of additional EBITDA, alongside cost savings and dealership acquisitions [38][39] Question: What is the outlook for financing and consumer credit profiles? - The credit profile has remained stable, with expectations that retail lending rates may decrease in the upcoming months [121][124]