Lithia Motors (LAD) Q4 2025 earnings summary

Executive summary

• Achieved record full-year revenue of $37.63 billion, up 4% year-over-year, and record Q4 revenue of $9.2 billion.

• Adjusted diluted EPS for the year was $33.46, up 16% year-over-year; full-year diluted EPS was $32.32, up 9.7%.

• Net income attributable to shareholders was $825.9 million, with adjusted net income at $854.7 million.

• Used vehicle and aftersales segments showed strong growth, offsetting new vehicle and margin pressures.

• Strategic acquisitions, disciplined capital allocation, and technology investments supported growth and shareholder returns.

Financial highlights

• Full-year revenue was $37.6 billion, a 4% increase from 2024; gross profit rose 3.1% to $5.73 billion.

• Adjusted EBITDA for the year was $1.67 billion, up 9% year-over-year.

• Free cash flow for the quarter was $97 million; adjusted cash flow from operations was $1.29 billion for the year.

• Net profit margin for the year was 2.3%, flat year-over-year.

• SG&A as a percentage of gross profit was 69–71.4%; as a percentage of revenue, it was 10.5%.

Outlook and guidance

• Management expects compounding earnings growth in 2026 as industry conditions normalize.

• Mid-term revenue target of $40–50 billion with operating margin of 5% and SG&A as % of gross profit at 60–65%.

• DFC penetration expected to reach 20% with continued growth in financing income.

• Focus on expanding national footprint, digital ecosystem, and adjacencies such as finance and fleet management.

• Mid-single-digit after-sales growth anticipated, supported by technology and customer experience investments.