Driven Brands (DRVN) Q4 2025 earnings summary

Executive summary

• Completed a comprehensive restatement of prior financials for 2023–2025 due to material errors in lease accounting, cash, accounts payable, expense misclassification, and accounts receivable, primarily from rapid acquisitions and integration activities.

• Strengthened finance leadership and systems, including a new CFO, Chief Accounting Officer, and Oracle ERP implementation, leading to improved controls and identification of legacy issues.

• Streamlined portfolio by divesting U.S. and International Car Wash businesses, focusing on core North American automotive services.

• 2025 marked a foundational year with significant deleveraging, portfolio simplification, and execution of a growth and cash strategy.

• Take 5 segment achieved 3.7% same-store sales growth in Q4 2025, marking its 22nd consecutive quarter of growth.

Financial highlights

• 2025 revenue grew 6.3% year-over-year to $1.9 billion; adjusted EBITDA was $449.1 million, up $6 million year-over-year.

• Q4 2025 revenue was $460.1 million, up 7.7–8% year-over-year; adjusted EBITDA for Q4 was $111.9 million, up 7% year-over-year.

• Net income from continuing operations for 2025 was $132.1 million; adjusted net income was $199.2 million.

• System-wide sales for 2025 grew to $6.1 billion, with same-store sales up 1%.

• Net capital expenditures for 2025 were $149.7 million; free cash flow was $180.9 million, up $174.2 million from 2024.

Outlook and guidance

• 2026 revenue expected at $1.95–$2.05 billion; adjusted EBITDA of $430–$460 million, including $35–$45 million in non-recurring restatement costs.

• Adjusted diluted EPS guidance for 2026 is $1.15–$1.25.

• Same-store sales growth projected flat to 2%; net store growth of 160–190 units.

• Free cash flow for 2026 expected between $125–$145 million; focus remains on debt reduction and achieving 3x net leverage by year-end.

• Q1 2026 preliminary same-store sales growth expected at 1.9–2.1% overall, with Take 5 at 4.3–4.5%.