Lithia Motors (LAD) Q3 2025 earnings summary

Executive summary

• Achieved $36.2B in 2024 revenue, with a 10-year revenue CAGR of 16% and adjusted EPS CAGR of 16%.

• For the first nine months of 2025, revenue increased 5.3% year-over-year to $28.4B, with adjusted diluted EPS up 25% to $26.60.

• Same-store revenues increased 7.7% across all business lines, with strong growth in used vehicles and after-sales.

• Strategic M&A added $16.7B in acquired revenues since 2019, with a 95% success rate and disciplined returns.

• Accelerated share repurchases, buying back 8% of outstanding shares in 2025 at an average price of $313.

Financial highlights

• Adjusted EBITDA YTD 2025 was $1.63B, with Q3 at $438M, up 7.7% year-over-year.

• Gross profit for Q3 was $1.47B, up 2.5% year-over-year; aftersales gross profit increased 9.1% on a same store basis.

• Free cash flow of $174M generated in Q3; net cash provided by operating activities was $233M for nine months.

• SG&A as a percentage of gross profit was 67.9% YTD 2025; North America SG&A flat sequentially at 64.8%.

• Floor plan interest expense declined $44.2M year-over-year due to lower inventory balances and interest rates.

Outlook and guidance

• 2025 outlook: new vehicle gross profit per unit $2,800–$3,000; used vehicle $1,800–$2,000; aftersales gross margin 55–58%.

• Management targets long-term annual after-tax returns of over 15% on acquisitions and a long-term EPS target of $2 per $1B revenue.

• Free cash flow deployment strategy allocates 25–35% to acquisitions, 25% to capex and innovation, and 40–50% to shareholder returns.

• Available liquidity at quarter-end was $1.9B, including $206.5M in cash and $1.6B in credit facility availability.