Lithia Motors Inc.: Q3 FY2026 earnings call

What management said about Q3 FY2026, from the documents filed with the SEC on 21 October 2026: press release. Guidance figures: 1 raised. The quarter’s numbers.

Read the filing

Key takeaways

• Revenue rose to $9.9 billion: Third quarter revenue increased 3% from $9.7 billion a year earlier. Nine-month revenue rose 2% to $29.0 billion. Source
• Diluted EPS up 54%: Diluted EPS attributable to LAD was $13.22, against $8.61. Adjusted diluted EPS was $10.34, up 9% from $9.50 in the prior-year quarter. Source
• Adjusted net income fell 5%: Adjusted net income was $229.3 million, down 5% from $240.9 million. GAAP net income rose 34.0% to $292.9 million. Source
• Used retail gross profit per unit up: Used retail gross profit per unit rose $197, or 11%, to $1,970. Used vehicle gross margin was 5.8%, up 30 basis points. Source
• Financing Operations income up 69%: Financing Operations income was $32.3 million, up 69% year over year. Originations were $937 million and penetration was 18.3%. Source
• Repurchases reduced share count: The company repurchased $85 million of shares in the quarter, 1.1% of outstanding shares, and 8.7% year to date. Diluted shares were 22.0 million, down from 25.2 million. Source
• Third-quarter store swap: In the third quarter the company acquired two stores with about $150 million of annualized revenue and divested two stores with about $115 million. Source
• CEO named Chairman of Board: Bryan DeBoer, President and CEO, was appointed Chairman of the Board effective October 19, 2026, serving as both Chairman and CEO. Source

“Our people and our ecosystem set Lithia & Driveway apart again this quarter, delivering record quarterly revenues and continued growth in earnings per share.”

Bryan DeBoer, President and CEO

Guidance

What changed from last quarter

• New: Bryan DeBoer, President and CEO, was appointed Chairman of the Board effective October 19, 2026, and continues as CEO. Sidney B. DeBoer becomes Vice Chairman. Source
• New: In October 2026 the company acquired two Hyundai and two Kia stores in Memphis, Tennessee, adding $250 million of expected annualized revenue. Source

Results and earnings measures

• Revenue rose to $9.9 billion: Third quarter revenue increased 3% from $9.7 billion a year earlier. Nine-month revenue rose 2% to $29.0 billion. Source
• Diluted EPS up 54%: Diluted EPS attributable to LAD was $13.22, against $8.61. Adjusted diluted EPS was $10.34, up 9% from $9.50 in the prior-year quarter. Source
• Adjusted net income fell 5%: Adjusted net income was $229.3 million, down 5% from $240.9 million. GAAP net income rose 34.0% to $292.9 million. Source
• Pinewood gain lifted other income: Other income was $104.2 million, including an unrealized gain of $88.8 million on the Pinewood Technologies investment, which the company excluded from adjusted results. Source
• Nine-month EPS up 9%: Nine-month diluted EPS was $28.77, up 9% from $26.42. Adjusted diluted EPS for the nine months was $27.61, up 4% from $26.60. Source
• Operating income slipped slightly: Income from operations was $420.2 million, down 0.3%. Nine-month income from operations fell 3.9% to $1,204.2 million. Source

Vehicle sales and gross profit

• Used retail gross profit per unit up: Used retail gross profit per unit rose $197, or 11%, to $1,970. Used vehicle gross margin was 5.8%, up 30 basis points. Source
• New vehicle margin narrowed: New vehicle gross margin was 5.7%, down 40 basis points from 6.1%. Nine-month new vehicle gross margin was 5.8%, down 60 basis points. Source
• New unit sales edged up: New vehicle unit sales rose 1.1% to 105,471. Nine-month unit sales fell 0.3%. New vehicle average selling price was $46,777, down 0.1%. Source
• Finance and insurance per unit fell: Finance and insurance revenue fell 4.5% to $361.4 million. Finance and insurance gross profit per unit was $1,733, down 4.7%. Source

“The capital decisions of the past year are reflected in our financial results, with a meaningfully lower share count magnifying every dollar we earn.”

Bryan DeBoer, President and CEO

Aftersales and Financing Operations

• Same-store aftersales gross profit up: Same-store aftersales gross profit rose 2.4%, with gross margin at 59.5%, a 100 basis point increase. Source
• Aftersales revenue grew 4.3%: Aftersales revenue rose 4.3% to $1,086.6 million in the quarter. Nine-month aftersales revenue rose 4.8% to $3,197.0 million. Source
• Financing Operations income up 69%: Financing Operations income was $32.3 million, up 69% year over year. Originations were $937 million and penetration was 18.3%. Source
• Managed receivables grew: Average total managed finance receivables were $5,558.0 million, up from $4,541.8 million in the prior-year quarter. Source

Same-store and regional revenue

• Same-store revenue declined 1.4%: Same-store total revenues fell 1.4% to $9,400.6 million. Same-store new vehicle revenue fell 2.6%. Nine-month same-store revenue fell 1.5%. Source
• Same-store used units down 3.2%: Same-store used vehicle retail units fell 3.2% to 104,612. Same-store used average selling price rose 3.5% to $29,197. Source
• United States share of revenue: The United States was 75.9% of total revenue and 80.8% of gross profit. The United Kingdom was 20.5% of revenue and 16.4% of gross profit. Canada was 3.6% of revenue. Source

“Our strategy and priorities are unchanged: earn customers for life, keep growing our network and adjacent businesses, and allocate capital with discipline to drive long-term shareholder value.”

Bryan DeBoer, Chairman and Chief Executive Officer

Costs and operating margins

• SG&A rose faster than gross profit: SG&A expense rose 3.8% to $1,036.3 million. Adjusted SG&A was 68.8% of gross profit, compared with 67.9% a year earlier. Source
• Floor plan interest rose 21.6%: Floor plan interest expense was $70.3 million, up from $57.8 million. Nine-month floor plan interest expense rose 15.4%. Source
• Income tax rate rose: The income tax rate was 25.1% for the quarter, compared with 22.5% a year earlier. The nine-month rate was 25.8%, against 25.1%. Source
• Operating margin edged lower: Operating profit was 4.3% of revenue, against 4.4% a year earlier. Nine-month operating profit was 4.2% of revenue, against 4.4%. Source

Inventory and demand

• New vehicle days' supply flat: New vehicle days' supply was 54 days, unchanged from December 31, 2025 and up from 52 a year earlier. Used vehicle days' supply was 45 days, down from 48 at year-end. Source
• Inventories rose on balance sheet: Net inventories were $6,624.3 million, up from $6,119.6 million at December 31, 2025. Floor plan notes payable were $6,566.8 million, up from $5,008.9 million. Source
• Inventory absorbed nine-month cash: In the nine-month cash flow statement, the change in inventories used $555.0 million, compared with $44.8 million provided in the prior-year period. Source

Cash, debt and share repurchases

• Repurchases reduced share count: The company repurchased $85 million of shares in the quarter, 1.1% of outstanding shares, and 8.7% year to date. Diluted shares were 22.0 million, down from 25.2 million. Source
• Repurchase authorization remaining: About $535 million remained available under the current share repurchase authorization at September 30, 2026. The figure was about $620 million at June 30, 2026. Source
• Liquidity about $1.4 billion: Liquidity at quarter end combined cash, marketable securities and revolving credit availability, at approximately $1.4 billion. The second-quarter figure was approximately $1.3 billion. Source
• Net debt ratio rose: Net debt was $4,992.2 million, or 3.07 times trailing Adjusted EBITDA, against 2.63 times a year earlier. Net debt is a non-GAAP measure. Source
• Adjusted operating cash flow reconciled: Reported operating cash flow for nine months was negative $204.9 million. Adjusted operating cash flow was $2,125.2 million, including $1,138.3 million from converting revolvers to floorplan facilities. Source

Acquisitions and store network

• Third-quarter store swap: In the third quarter the company acquired two stores with about $150 million of annualized revenue and divested two stores with about $115 million. Source
• $1.17 billion acquired year to date: Acquisitions year to date total $1.17 billion of expected annualized revenue. Source
• October Memphis store additions: Four stores in Memphis, Tennessee, two Hyundai and two Kia, were added in October, adding $250 million of expected annualized revenue. Source

Board and leadership

• CEO named Chairman of Board: Bryan DeBoer, President and CEO, was appointed Chairman of the Board effective October 19, 2026, serving as both Chairman and CEO. Source
• Founder becomes Vice Chairman: Sidney B. DeBoer, who established the company and took it public, becomes Vice Chairman and continues on the Board. Source
• Lead Independent Director continues: Louis P. Miramontes continues as Lead Independent Director, with oversight of management and governance. Source

Coming up, as management said on 21 October 2026

• Dividend payment on November 20: The $0.75 per share dividend is set to be paid November 20, 2026, to shareholders of record on November 6, 2026. Source

Figures management reported

Earlier plans management reported on

• Not stated: Management says its strategy and priorities remain unchanged as it continues network growth and capital allocation. Source

Other quarters

• Q2 FY2026 earnings call
• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.