Lithia Motors (LAD) Q1 2025 earnings summary

Executive summary

• Achieved record Q1 2025 revenue of $9.2 billion, up 7.2% year-over-year, with diluted EPS of $7.94 (up 34.8%) and adjusted EPS of $7.66 (up 25.4%), marking the first quarterly year-over-year adjusted earnings increase since Q4 2022.

• Net income attributable to the company rose 28.8% to $209.5 million, with adjusted net income up 20% to $204 million.

• National network and eCommerce tools, including Driveway, contributed to a $37B+ annualized revenue run-rate.

• Strategic M&A, digital expansion, and disciplined capital allocation have driven growth and diversification.

• Board approved a 4% dividend increase to $0.55 per share and repurchased 1.7% of outstanding shares in Q1.

Financial highlights

• Q1 2025 revenue: $9.18B; gross profit: $1.41B (up 5.6%); net income: $209.5M; adjusted EBITDA: $402.1M (up 17.1%).

• SG&A as a percentage of gross profit improved to 67.5% (down 250 bps YoY); operating margin rose to 4.4%.

• DFC originated $623 million in loans, portfolio over $4 billion, with net interest margin at 4.6%.

• Cash and cash equivalents stood at $234.4 million, with total available liquidity of $1.4 billion.

• New vehicle retail gross profit per unit: $3,046; used vehicle: $1,877; F&I per unit: $1,881.

Outlook and guidance

• Targeting $2.00 in EPS per $1 billion in revenue in a normalized environment.

• 2025 outlook: new vehicle retail gross profit per unit $2,600–$2,800; used vehicle $1,800–$2,100; F&I $1,800–$2,000.

• Adjusted SG&A as % of gross profit targeted at 65.5%–67.5%; aftersales gross margin 54%–57%.

• Management expects continued growth through acquisitions, network optimization, and digital expansion.

• Capital allocation to remain balanced between acquisitions and share buybacks, with $2B-$4B in annualized acquired revenues targeted in coming years.