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Lithia reported Q3 adjusted EPS of $9.50, up from $8.21 and above the $8.53 consensus estimate.
Q3 revenues rose 5% year over year to $9.67 billion, surpassing the $9.61 billion consensus estimate.
New and used vehicle retail sales increased, while margins narrowed amid higher sales costs.
Lithia Motors (LAD - Free Report) reported third-quarter 2025 adjusted earnings per share of $9.50, which improved from the prior-year quarter’s $8.21 and beat the Zacks Consensus Estimate of $8.53. The auto retailer clocked revenues of $9.67 billion, which increased 5% year over year and also surpassed the Zacks Consensus Estimate of $9.61 billion.
Segmental Performance
New vehicle retail revenues increased 4.5% year over year to $4.63 billion and topped our estimate of $4.5 billion due to higher-than-expected unit sales and average selling price (ASP). New vehicle units sold rose 1.8% from the prior-year quarter’s levels to 96,639 units, beating our estimate of 95,276 units. The ASP of new vehicle retail increased to $47,913 from $46,649 reported in the prior-year quarter. Our estimate was $47,213. The gross margin in this segment contracted 90 basis points (bps) to 6% amid the high cost of sales, which rose 5.6% year over year to $4.35 billion.
Used vehicle retail revenues rose 8.9% year over year to $3.1 billion and surpassed our estimate of $3.08 billion, courtesy of higher-than-anticipated ASP. The used-vehicle retail units sold increased 4% from the year-ago quarter to 109,097 units, but lagged our expectation of 114,047 units. The ASP of used vehicle retail was $28,381, up 4.7% year over year. Our estimate was $27,016. The gross margin in the segment decreased 40 bps to 6.2%.
Revenues from used vehicle wholesale fell 6.1% to $367 million and missed our estimate of $455.9 million. The company’s finance and insurance revenues rose 5% to $378.6 million but fell short of our estimate of $384.7 million. Revenues from aftersales were $1.04 billion, which rose 2.4% year over year but missed our estimate of $1.07 billion. Revenues from fleet and others were $166.5 million, which contracted 9.3% year over year but topped our expectation of $163.5 million.
Same-store new vehicle revenues increased 5.5% year over year, while same-store used vehicle retail sales rose 11.8%. Same-store revenues from finance and insurance rose 5.7%, while those of the aftersales unit rose 3.9%.
Lithia Motors, Inc. Price, Consensus and EPS Surprise
Cost of sales were up 5.4% year over year in third-quarter 2025. SG&A expenses were $998 million, up 5.8% year over year. Adjusted SG&A, as a percentage of gross profit, was 67.9%, up from the prior-year quarter’s 66%. Pretax and net profit margins improved from the year-ago levels.
The company announced a dividend of 55 cents to be paid out on Nov. 21, 2025, to its shareholders of record as of Nov. 7, 2025. In third-quarter 2025, LAD repurchased nearly 1,312,000 shares at an average price of $312. Currently, Lithia has approximately $889.3 million shares remaining under its buyback authorization.
Lithia had cash/cash equivalents/restricted cash of $417.1 million as of Sept. 30, 2025, up from $402.2 million as of Dec. 31, 2024. Long-term debt was $6.97 billion as of Sept. 30, 2025, up from $6.12 billion as of Dec. 31, 2024.
The Zacks Consensus Estimate for CPS’ 2025 sales and earnings implies year-over-year growth of 2.5% and 137.8%, respectively. EPS estimates for 2025 and 2026 have improved 36 cents and 23 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for KAR’s fiscal 2025 sales and earnings implies year-over-year growth of 5.6% and 37.7%, respectively. EPS estimates for fiscal 2025 have improved 13 cents in the past 90 days. EPS estimates for fiscal 2026 have improved 13 cents in the past 30 days.
The Zacks Consensus Estimate for MBLY’s 2025 sales and earnings implies year-over-year growth of 11.6% and 36%, respectively. EPS estimates for 2025 have improved a penny in the past 60 days. EPS estimates for 2026 have improved a penny in the past 30 days.
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Lithia Q3 Earnings Surpass Expectations, Revenues Rise Y/Y
Key Takeaways
Lithia Motors (LAD - Free Report) reported third-quarter 2025 adjusted earnings per share of $9.50, which improved from the prior-year quarter’s $8.21 and beat the Zacks Consensus Estimate of $8.53. The auto retailer clocked revenues of $9.67 billion, which increased 5% year over year and also surpassed the Zacks Consensus Estimate of $9.61 billion.
Segmental Performance
New vehicle retail revenues increased 4.5% year over year to $4.63 billion and topped our estimate of $4.5 billion due to higher-than-expected unit sales and average selling price (ASP). New vehicle units sold rose 1.8% from the prior-year quarter’s levels to 96,639 units, beating our estimate of 95,276 units. The ASP of new vehicle retail increased to $47,913 from $46,649 reported in the prior-year quarter. Our estimate was $47,213. The gross margin in this segment contracted 90 basis points (bps) to 6% amid the high cost of sales, which rose 5.6% year over year to $4.35 billion.
Used vehicle retail revenues rose 8.9% year over year to $3.1 billion and surpassed our estimate of $3.08 billion, courtesy of higher-than-anticipated ASP. The used-vehicle retail units sold increased 4% from the year-ago quarter to 109,097 units, but lagged our expectation of 114,047 units. The ASP of used vehicle retail was $28,381, up 4.7% year over year. Our estimate was $27,016. The gross margin in the segment decreased 40 bps to 6.2%.
Revenues from used vehicle wholesale fell 6.1% to $367 million and missed our estimate of $455.9 million. The company’s finance and insurance revenues rose 5% to $378.6 million but fell short of our estimate of $384.7 million. Revenues from aftersales were $1.04 billion, which rose 2.4% year over year but missed our estimate of $1.07 billion. Revenues from fleet and others were $166.5 million, which contracted 9.3% year over year but topped our expectation of $163.5 million.
Same-store new vehicle revenues increased 5.5% year over year, while same-store used vehicle retail sales rose 11.8%. Same-store revenues from finance and insurance rose 5.7%, while those of the aftersales unit rose 3.9%.
Lithia Motors, Inc. Price, Consensus and EPS Surprise
Lithia Motors, Inc. price-consensus-eps-surprise-chart | Lithia Motors, Inc. Quote
Financial Tidbits
Cost of sales were up 5.4% year over year in third-quarter 2025. SG&A expenses were $998 million, up 5.8% year over year. Adjusted SG&A, as a percentage of gross profit, was 67.9%, up from the prior-year quarter’s 66%. Pretax and net profit margins improved from the year-ago levels.
The company announced a dividend of 55 cents to be paid out on Nov. 21, 2025, to its shareholders of record as of Nov. 7, 2025. In third-quarter 2025, LAD repurchased nearly 1,312,000 shares at an average price of $312. Currently, Lithia has approximately $889.3 million shares remaining under its buyback authorization.
Lithia had cash/cash equivalents/restricted cash of $417.1 million as of Sept. 30, 2025, up from $402.2 million as of Dec. 31, 2024. Long-term debt was $6.97 billion as of Sept. 30, 2025, up from $6.12 billion as of Dec. 31, 2024.
Lithia’s Zacks Rank & Key Picks
LAD carries a Zacks Rank #3 (Hold) at present.
Some better-ranked stocks in the auto space are Cooper-Standard Holdings Inc. (CPS - Free Report) , OPENLANE, Inc. (KAR - Free Report) and Mobileye Global Inc. (MBLY - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CPS’ 2025 sales and earnings implies year-over-year growth of 2.5% and 137.8%, respectively. EPS estimates for 2025 and 2026 have improved 36 cents and 23 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for KAR’s fiscal 2025 sales and earnings implies year-over-year growth of 5.6% and 37.7%, respectively. EPS estimates for fiscal 2025 have improved 13 cents in the past 90 days. EPS estimates for fiscal 2026 have improved 13 cents in the past 30 days.
The Zacks Consensus Estimate for MBLY’s 2025 sales and earnings implies year-over-year growth of 11.6% and 36%, respectively. EPS estimates for 2025 have improved a penny in the past 60 days. EPS estimates for 2026 have improved a penny in the past 30 days.