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Lithia Motors Today

LAD

Lithia Motors

$364.61 -4.09 (-1.11%)

As of 02:07 PM Eastern

This is a fair market value price provided by Massive. Learn more.

$239.78▼

$439.490.77%

12.08

$436.33

Lithia Motors NYSE: LAD has built itself into the largest automotive retailer in the United States, and shareholders recently have been enjoying the ride.

The company, which operates as Lithia & Driveway, just turned in a record quarter; shares are up by one-third in the past three months, and management says growth is just getting started. Analysts generally like the stock, with many recently boosting their targets.

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But after a sharp run higher, investors might be left asking how much of that good news is already priced into the stock.

Autos Deliver Record ResultsFounded 80 years ago, Lithia is the nation’s largest auto dealer by revenue and new vehicle sales. From its beginning in the Pacific Northwest, it currently has 467 stores in the United States, Canada, and the United Kingdom, anchored by its Driveway online marketplace and its own captive lender, Driveway Finance Corporation.

That presence has been seen in the numbers. Second-quarter results, reported July 29, showed revenue coming in at a record $9.79 billion, topping analyst estimates of $9.64 billion.

Adjusted diluted earnings per share (EPS) hit $10.03, up 9% from a year earlier. That was against expectations of roughly $8.73, an increase that management attributed to steady new-vehicle margins, improving used-car profitability, and a leaner cost structure. That rise came even as same-store revenue dipped slightly compared with 2025's tariff-driven buying rush.

Overall, reported net income was up slightly to $261.6 million, and adjusted net income reached $227.6 million, a margin of just 2.3%, a reminder of how thin profit spreads remain in vehicle retailing even for an industry leader. Adjusted EBITDA margin came in at a healthy 4.5%, after new vehicle margins slid to 5.9% from 6.7% last year, but used vehicle margins rose to 6.1%.

Finance Arm Helps Fuel GrowthInterestingly, one of the company’s leading growth engines is not on the sales lot at all. Driveway Finance Corporation, the in-house lending arm, originated a record $884 million of loans during the quarter with a 17.5% penetration rate, and financing income more than doubled to $37 million.

Management has said it wants captive-finance penetration to eventually exceed 20% of vehicle sales, turning one-time transactions into recurring, counter-cyclical income. That ambition, paired with a long-stated goal of pushing selling, general, and administrative (SG&A) expenses below 60% of gross profit, is the backbone of the bull case.

Returning Cash to ShareholdersManagement has also been aggressive about returning cash to shareholders. The board raised the quarterly dividend 23% to 70 cents per share from 57 cents, and the company repurchased $242 million of stock in the quarter, retiring about 3.7% of shares outstanding. A new authorization also expanded its buyback scope by $500 million.

At an annual dividend of $2.80, the yield is less than 1%, signifying that buybacks, not dividends, remain management's preferred lever.

Analysts Are Bullish But Not UnanimousAnalyst sentiment is positive but split. Coverage from 11 Wall Street firms produces a consensus rating of Moderate Buy with an average price target of $436.33, implying upside of about 17%.

Lithia Motors Stock Forecast Today12-Month Stock Price Forecast:
$436.33
19.88% Upside

Moderate Buy
Based on 11 Analyst Ratings

Current Price$363.98High Forecast$500.00Average Forecast$436.33Low Forecast$340.00Lithia Motors Stock Forecast Details

Six analysts rate Lithia a Buy while five currently list it as a Hold. Targets ranging from a high of $500 to a low of $340 show a range of expectations over the next 12 months.

Notably, six analysts have increased their targets since the earnings were announced. UBS downgraded the stock to Neutral from Buy in July, even while lifting its price target to $440, perhaps a signal that even fans of the company are debating how much good news is already priced in.

The stock has indeed gotten pricier recently, climbing about 28% over the past three months, though it’s up only 13% since the start of the year. With recent prices near $373, the stock’s 52-week low came in March, when a month of tariff fears sent it down as low as $239.78. The second quarter earnings, however, had the opposite effect, propelling the stock to its recent high of $439.49 per share.

Risks Remain After the RallyThere are, of course, risks in the business of automotive sales.

Skeptics might look back to the prior quarter, when first-quarter EPS dropped 46% to $4.28 due to several factors. Missing consensus for those three months, the results showed that Lithia's results can swing from one quarter to the next.

Layer on tariff exposure, since much of the inventory sold is made abroad, and the stock's sensitivity to trade policy and consumer credit becomes clear. Further, a brisk acquisition pace, including recent dealership purchases in Oregon, Tennessee and Southern California, adds integration risk to the shortlist of considerations.

Competition is also present despite Lithia’s leadership. The company operates alongside AutoNation NYSE: AN, Penske Automotive NYSE: PAG, Asbury Automotive NYSE: ABG, Group 1 Automotive NYSE: GPI and online disruptor Carvana (NYSE: CVNA), all chasing the same buyers in a business where scale determines who can absorb software and financing investments.

Lithia Still Offers UpsideFor investors, Lithia still looks like a reasonably priced way to own a piece of the American auto retail business. The earnings beat, record financing income, and a rising dividend probably argue for nerve and patience with any stake.

The recent appointment of Scott Cooke, a 25-year Toyota Financial Services veteran, to oversee Driveway Finance might also signal management is doubling down on the lending engine as the next chapter of growth.

But the industry tends to be cyclical, and operating leverage is a cost of doing business. The ride appears smooth, but the economy and interest rates can make any auto trip bumpy.

Should You Invest $1,000 in Lithia Motors Right Now?Before you consider Lithia Motors, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Lithia Motors wasn't on the list.

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A month has gone by since the last earnings report for Lithia Motors (LAD - Free Report) . Shares have lost about 8.4% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Lithia Motors due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.

Lithia Q2 Earnings Top EstimatesLithia posted second-quarter 2026 adjusted earnings of $10.03 per share, which increased 9% from $9.20 a year ago. The bottom line beat the Zacks Consensus Estimate of $8.67 by 15.7%.

Quarterly revenues increased 2.2% year over year to $9.79 billion and topped the consensus estimate of $9.64 billion by 1.6%. Improved used-vehicle profitability, aftersales growth and record Financing Operations income supported the results. Driveway Finance Corporation generated record originations of $884 million.

Revenue Growth Spans Core Business LinesNew-vehicle revenues rose 2.7% year over year to $4,829.2 million, while used-vehicle revenues increased 1.4% to $3,528.3 million. Aftersales revenues advanced 3.9% to $1,067.4 million.

Finance and insurance revenues declined 2% to $366.4 million. Same-store new-vehicle revenues fell 1.5%, while same-store used-vehicle revenues decreased 2.2%, showing that acquisitions contributed to the consolidated growth in both categories.

Used Vehicle Profitability ImprovesNew-vehicle unit sales increased 2.7% to 104,089 units. Used retail unit sales declined 2.7% to 106,114 units, but the used retail average selling price rose 4.3% to $29,593.

Used-vehicle gross profit increased 4.2% to $214 million. Used retail gross profit per unit climbed 5.4% to $2,014, and the used-vehicle gross margin expanded 20 basis points to 6.1%. By contrast, new-vehicle gross profit per unit fell 11.8% to $2,728 as the new-vehicle margin contracted 80 basis points to 5.9%.

Aftersales Business Supports the Profit MixAftersales gross profit increased 6.8% year over year to $633 million. Its gross margin expanded 160 basis points to 59.3%, reinforcing the importance of recurring service and repair activity to overall profitability.

Aftersales accounted for 42.2% of total gross profit, up from 39.9% a year earlier. Total gross profit increased 0.8% to $1,497.4 million, although the consolidated gross margin narrowed 20 basis points to 15.3%.

Cost Control Lifts Operating IncomeSelling, general and administrative expenses were unchanged year over year at $1,014.7 million. Lower personnel and other costs offset higher advertising, rent and facility expenses.

Reported SG&A as a percentage of gross profit improved 50 basis points to 67.8%. Income from operations increased 5.4% to $448.3 million, while depreciation and amortization rose 8.7% to $70.9 million. Floor plan interest expense increased 26.7% to $69.7 million, partly tempering the operating improvement.

Financing Operations Reach Record IncomeFinancing Operations income surged 81.6% to $36.5 million. Interest and fee income increased to $116.4 million from $98.8 million, while the total interest margin expanded to 4.8% from 4.5%.

DFC’s penetration rate was 17.5%, and the average FICO score on originated loans was 749. Managed finance receivables reached nearly $5.3 billion, up 23% year over year, supporting a larger stream of interest income. More than 99% of the portfolio was less than 60 days past due.

Balance Sheet Reflects Finance GrowthAs of June 30, 2026, cash, restricted cash and cash equivalents totaled $363.9 million, up from $341.8 million as of Dec. 31, 2025. Inventories increased to $6,516.8 million from $6,119.6 million at year-end 2025, while total floor plan debt rose to $6,387.4 million from $5,008.9 million.

For the first six months of 2026, net cash used in operating activities was $174.1 million, reflecting increases in inventories and finance receivables. Capital expenditures totaled $153.4 million, and cash paid for acquisitions was $221.7 million. Available liquidity was approximately $1.3 billion.

Capital ReturnsDuring the quarter, LAD repurchased roughly 854,000 shares at a weighted average price of $284, representing $242 million of share repurchases. Approximately $620 million remained under the authorization at quarter-end.

The board increased the quarterly dividend 23% to 70 cents per share.

How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a upward trend in estimates revision.

The consensus estimate has shifted 8.7% due to these changes.

VGM ScoresCurrently, Lithia Motors has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, the stock has a grade of B on the value side, putting it in the top 40% for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Lithia Motors has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Key Highlights

Record second quarter revenues of $9.8 billionUsed retail GPUs increased $339, or 20%, sequentiallyAftersales gross profit increased by 3.1% and gross margin was 59.2%, a 120-basis point increase, on a same-store basisAdjusted SG&A as a percent of gross profit was 68.6%, a 290-basis point improvement sequentiallyFinancing Operations achieved record income of $37 million and record originations of $884 million, with a 17.5% penetration rateSecond quarter diluted earnings per share of $11.54, a 17% increase, and adjusted diluted earnings per share of $10.03, a 9% increaseRepurchased $242 million of shares, representing 3.7% of outstanding shares in the quarter, and 7.6% of outstanding shares in the first half of 2026Announced a 23% increase to quarterly dividend MEDFORD, Ore., July 29, 2026 (GLOBE NEWSWIRE) -- Lithia & Driveway (NYSE: LAD), the largest global automotive retailer, today reported financial results for the second quarter of 2026.

"Our team delivered differentiated growth across the platform, with record quarterly revenues, stable new vehicle margins, improved used vehicle profitability, and meaningful sequential SG&A improvement. Financing Operations delivered 80% income growth, with expanding margins and increasing penetration," said Bryan DeBoer, President and CEO. "We continued to return value to shareholders this quarter, expanding our repurchase authorization by $500 million and purchasing nearly 4% of shares. Our ecosystem is delivering on its design, and we carry strong momentum into the second half of the year.”

Second Quarter 2026 Operational Summary
Second quarter 2026 revenue increased 2% to $9.8 billion from $9.6 billion in the second quarter of 2025.

Second quarter 2026 diluted earnings per share attributable to LAD was $11.54, a 17% increase from $9.87 per share reported in the second quarter of 2025. After adjusting for the unrealized gain on our investment in Pinewood Technologies Group PLC and other non-core items, adjusted diluted earnings per share attributable to LAD for the second quarter of 2026 was $10.03, a 9% increase compared to $9.20 per share in the same period of 2025.

Second quarter 2026 net income was $261.6 million, a 1.3% increase compared to net income of $258.2 million in the second quarter of 2025. After adjusting for the unrealized gain on our investment in Pinewood Technologies Group PLC and other non-core items, adjusted net income for the second quarter 2026 was $227.6 million, an 6% decrease compared to adjusted net income of $240.9 million for the same period of 2025.

The financial measures discussed in this release include both GAAP and non-GAAP measures. See “Reconciliation of Certain Non-GAAP Measures”.

For the first six months of 2026 revenues increased 2% to $19.1 billion, compared to $18.8 billion in 2025.

Diluted earnings per share attributable to LAD for the first six months of 2026 was $15.68, compared to $17.80 per share in 2025, a decrease of 12%. Adjusted diluted earnings per share attributable to LAD for the first six months of 2026 increased 1% to $17.32 from $17.12 in the same period of 2025.

Corporate Development
In the second quarter of 2026, LAD acquired 5 stores, which are expected to generate $340 million in annualized revenues, and divested 3 stores representing $120 million in annualized revenues.

Balance Sheet Update
LAD ended the second quarter with approximately $1.3 billion in cash and cash equivalents, marketable securities, and availability on our revolving lines of credit.

Dividend Payment and Share Repurchases
The Board of Directors approved a dividend of $0.70 per share related to second quarter 2026 financial results. The dividend is expected to be paid on August 21, 2026 to shareholders of record on August 7, 2026.

During the second quarter of 2026, we repurchased approximately 854,000 shares at a weighted average price of $284. Under the current share repurchase authorization approximately $620 million remains available as of June 30, 2026.

Second Quarter Earnings Conference Call and Updated Presentation
The second quarter 2026 conference call may be accessed at 10:00 a.m. ET today by telephone at 877-407-8029. An updated presentation highlighting second quarter 2026 results has been added to our investor relations website. To listen live on our website or for replay, visit investors.lithiadriveway.com and click on Quarterly Earnings.

About Lithia & Driveway (LAD)
Lithia & Driveway (NYSE: LAD) is the largest global automotive retailer providing a wide array of products and services throughout the vehicle ownership lifecycle. Simple, convenient, and transparent experiences are offered through our comprehensive network of physical locations, e-commerce platforms, captive finance solutions, fleet management offerings, and other synergistic adjacencies. We deliver consistent, profitable growth in a massive and unconsolidated industry. Our highly diversified and competitively differentiated design provides us the flexibility and scale to pursue our vision to modernize personal transportation solutions wherever, whenever and however consumers desire.

Sites
www.lithia.com
investors.lithiadriveway.com
www.lithiacareers.com
www.driveway.com
www.greencars.com
www.drivewayfinancecorp.com

Lithia & Driveway on Facebook
https://www.facebook.com/LithiaMotors
https://www.facebook.com/DrivewayHQ

Lithia & Driveway on X
https://x.com/lithiamotors
https://x.com/DrivewayHQ
https://x.com/GreenCarsHQ

Lithia & Driveway on LinkedIn
https://www.linkedin.com/company/lithia-motors/

Lithia & Driveway on YouTube
https://www.youtube.com/@Lithia_Motors/featured

Contact:
Skyya for Lithia & Driveway  
[email protected]

Forward-Looking Statements
Certain statements in this presentation, and at times made by our officers and representatives, constitute forward-looking statements within the meaning of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. Generally, you can identify forward-looking statements by terms such as “project,” “outlook,” “target,” “may,” “will,” “would,” “should,” “seek,” “expect,” “plan,” “intend,” “forecast,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “likely,” “ensure,” “goal,” “strategy,” “future,” “maintain,” and “continue” or the negative of these terms or other comparable terms. Examples of forward-looking statements in this presentation include, among others, statements regarding:

The profitability of our strategy and growthFuture market conditions, including anticipated vehicle and other sales, gross profit and inventory supplyOur business strategy and plans, including our achieving our long-term financial targetsThe growth, expansion, make-up and success of our network, including our finding accretive acquisitions that meet our target valuations and acquiring additional storesAnnualized revenues from acquired stores or achieving target returnsThe growth and performance of our Driveway e-commerce home solution and Driveway Finance Corporation (DFC), their synergies and other impacts on our business and our ability to meet Driveway and DFC-related targetsThe impact of sustainable vehicles and other market and regulatory changes on our business, including evolving vehicle distribution modelsOur capital allocations and uses and levels of capital expenditures in the futureExpected operating results, such as improved store performance, continued improvement of selling, general and administrative expenses as a percentage of gross profit and any projectionsOur anticipated financial condition and liquidity, including from our cash and the future availability of our credit facilities, unfinanced real estate and other financing sourcesOur continuing to purchase shares under our share repurchase programOur compliance with financial and restrictive covenants in our credit facilities and other debt agreementsOur programs and initiatives for team member recruitment, training, and retentionOur strategies and targets for customer retention, growth, market position, operations, financial results and risk management Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this presentation. Therefore, you should not rely on any of these forward-looking statements. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation:

Future national and local economic and financial conditions, including as a result of inflation, interest rates, tariffs, governmental actions, programs and spending, and public health issuesThe market for dealerships, including the availability of stores to us for an acceptable priceChanges in customer demand, levels of consumer debt, consumer confidence and manufacturer sales incentives, and the electric vehicle landscape and the impact of evolving digital technologiesChanges in our relationship with, and the financial and operational stability of, OEMs and other suppliers, and vehicle delivery modelsChanges in the competitive landscape, including through technology and our ability to deliver new products, services and customer experiences and a portfolio of in-demand and available vehiclesRisks associated with our indebtedness, including available borrowing capacity, interest rates, compliance with financial covenants and ability to refinance or repay indebtedness on favorable termsThe adequacy of our cash flows and other conditions which may affect our ability to fund capital expenditures, obtain favorable financing and pay our quarterly dividend at planned levelsDisruptions to our technology network including computer systems, as well as natural events such as severe weather or man-made or other disruptions of our operating systems, facilities or equipmentGovernment regulations and legislationThe risks set forth throughout “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in “Part I, Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K, and in “Part II, Item 1A. Risk Factors” of our Quarterly Reports on Form 10-Q, and from time to time in our other filings with the SEC. Any forward-looking statement made by us in this presentation is based only on information currently available to us and speaks only as of the date on which it is made. Except as required by law, we undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Non-GAAP Financial Measures
All “adjusted” financial measures in this presentation are non-GAAP financial measures, as are EBITDA and net debt. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not comparable to similarly titled measures used by other companies. We caution you not to place undue reliance on such non-GAAP measures and to consider them together with the most directly comparable GAAP measures. We present cash flows from operations in the attached tables, adjusted to include the change in non-trade floor plan debt to improve the visibility of cash flows related to vehicle financing. As required by SEC rules, we have reconciled these measures to the most directly comparable GAAP measures in the attachments to this release. We believe the non-GAAP financial measures we present improve the transparency of our disclosures; provide a meaningful presentation of our results from core business operations, because they exclude items not related to core business operations and other non-cash items; and improve the period-to-period comparability of our results from core business operations. These presentations should not be considered an alternative to GAAP measures.

LAD
Consolidated Statements of Operations (Unaudited)
(In millions except per share data)

                     Three months ended
June 30,
 %
Increase Six months ended
June 30,
 %
Increase 2026
 2025
 (Decrease) 2026
 2025
 (Decrease)Revenues:           New vehicle$4,829.2  $4,703.5  2.7% $9,208.6  $9,283.9  (0.8)%Used vehicle 3,528.3   3,478.3  1.4   7,017.7   6,728.8  4.3 Finance and insurance 366.4   373.8  (2.0)  726.1   738.1  (1.6)Aftersales 1,067.4   1,027.4  3.9   2,110.3   2,010.4  5.0 Total revenues 9,791.3   9,583.0  2.2%  19,062.7   18,761.2  1.6%Cost of sales:           New vehicle 4,545.2   4,390.1  3.5   8,665.0   8,677.1  (0.1)Used vehicle 3,314.3   3,273.0  1.3   6,616.0   6,334.8  4.4 Aftersales 434.4   434.8  (0.1)  862.6   853.9  1.0 Total cost of sales 8,293.9   8,097.9  2.4   16,143.6   15,865.8  1.8 Gross profit 1,497.4   1,485.1  0.8%  2,919.1   2,895.4  0.8%            Finance operations income 36.5   20.1  81.6%  57.8   32.6  77.3%            SG&A expense 1,014.7   1,014.7  —   2,052.1   1,967.4  4.3 Depreciation and amortization 70.9   65.2  8.7   140.7   129.0  9.1 Income from operations 448.3   425.3  5.4%  784.1   831.6  (5.7)%Floor plan interest expense (69.7)  (55.0) 26.7   (125.6)  (112.0) 12.1 Other interest expense (62.7)  (66.7) (6.0)  (132.9)  (132.2) 0.5 Other income (expense) 36.2   48.5  (25.4)  (31.5)  49.3  NM Income before income taxes 352.1   352.1  —%  494.1   636.7  (22.4)%Income tax expense (90.5)  (93.9) (3.6)  (130.4)  (167.3) (22.1)Income tax rate 25.7%  26.7%    26.4%  26.3%  Net income$261.6  $258.2  1.3% $363.7  $469.4  (22.5)%Net income attributable to non-controlling interests (1.6)  (2.1) (23.8)%  (3.3)  (3.8) (13.2)%Net income attributable to LAD$260.0  $256.1  1.5% $360.4  $465.6  (22.6)%            Diluted earnings per share attributable to LAD:           Net income per share$11.54  $9.87  16.9% $15.68  $17.80  (11.9)%            Diluted shares outstanding 22.5   25.9  (13.1)%  23.0   26.2  (12.2)% NM - not meaningful

LAD
Key Performance Metrics (Unaudited)

 Three months ended
June 30, %
Increase Six months ended
June 30, %
Increase 2026
 2025
 (Decrease) 2026
 2025
 (Decrease)Gross margin           New vehicle 5.9%  6.7% (80) bps  5.9%  6.5% (60) bpsUsed vehicle 6.1   5.9  20   5.7   5.9  (20)Finance and insurance 100.0   100.0  —   100.0   100.0  — Aftersales 59.3   57.7  160   59.1   57.5  160 Gross profit margin 15.3   15.5  (20)  15.3   15.4  (10)            Unit sales           New vehicle 104,089   101,316  2.7%  198,876   200,819  (1.0)%Used vehicle retail 106,114   109,053  (2.7)  216,265   216,379  (0.1)            Average selling price (excluding agency)           New vehicle$47,156  $47,494  (0.7)% $47,024  $47,353  (0.7)%Used vehicle retail 29,593   28,379  4.3   29,018   27,793  4.4             Average gross profit per unit           New vehicle$2,728  $3,093  (11.8)% $2,733  $3,022  (9.6)%Used vehicle retail 2,014   1,911  5.4   1,848   1,840  0.4 Finance and insurance 1,808   1,819  (0.6)  1,807   1,812  (0.3)Total vehicle(1) 4,112   4,242  (3.1)  4,026   4,168  (3.4)            Revenue mix           New vehicle 49.3%  49.1%    48.3%  49.5%  Used vehicle 36.0   36.3     36.8   35.9   Finance and insurance, net 3.7   3.9     3.8   3.9   Aftersales 11.0   10.7     11.1   10.7               Gross Profit Mix           New vehicle 19.0%  21.1%    18.6%  21.0%  Used vehicle 14.3   13.8     13.8   13.6   Finance and insurance, net 24.5   25.2     24.9   25.5   Aftersales 42.2   39.9     42.7   39.9                         Adjusted As reported Adjusted As reported Three months
ended June 30, Three months
ended June 30, Six months ended
June 30, Six months ended
June 30,Other metrics2026
 2025
 2026
 2025
 2026
 2025
 2026
 2025
SG&A as a % of revenue10.5% 10.5% 10.4% 10.6% 10.7% 10.5% 10.8% 10.5%SG&A as a % of gross profit68.6  67.7  67.8  68.3  70.0  67.9  70.3  67.9 Operating profit as a % of revenue4.5  4.5  4.6  4.4  4.2  4.4  4.1  4.4 Operating profit as a % of gross profit29.1  29.3  29.9  28.6  27.1  28.8  26.9  28.7 Pretax margin3.2  3.4  3.6  3.7  2.9  3.3  2.6  3.4 Net profit margin2.3  2.5  2.7  2.7  2.1  2.4  1.9  2.5  (1)   Includes the sales and gross profit related to new, used, and finance and insurance and unit sales for new and used retail

LAD
Same Store Operating Highlights (Unaudited)

 Three months ended
June 30,
 % Six months ended
June 30, %  Increase  Increase 2026
 2025
 (Decrease) 2026
 2025
 (Decrease)Revenues           New vehicle$4,548.3  $4,619.6  (1.5)% $8,704.3  $9,080.0  (4.1)%Used vehicle 3,316.7   3,390.8  (2.2)  6,620.6   6,539.9  1.2 Finance and insurance 350.3   369.6  (5.2)  696.2   728.1  (4.4)Aftersales 1,013.0   1,002.9  1.0   2,003.9   1,957.2  2.4 Total revenues 9,228.3   9,382.9  (1.6)  18,025.0   18,305.2  (1.5)            Gross profit           New vehicle$267.1  $307.5  (13.1)% $513.6  $594.2  (13.6)%Used vehicle 205.3   202.9  1.2   383.9   389.9  (1.5)Finance and insurance 350.3   369.6  (5.2)  696.2   728.1  (4.4)Aftersales 599.7   581.7  3.1   1,182.2   1,132.4  4.4 Total gross profit 1,422.4   1,461.7  (2.7)  2,775.9   2,844.6  (2.4)            Gross margin           New vehicle 5.9%  6.7% (80) bps  5.9%  6.5% (60) bpsUsed vehicle 6.2   6.0  20   5.8   6.0  (20)Finance and insurance 100.0   100.0  —   100.0   100.0  — Aftersales 59.2   58.0  120   59.0   57.9  110 Gross profit margin 15.4   15.6  (20)  15.4   15.5  (10)            Unit sales           New vehicle 98,286   100,517  (2.2)%  189,168   198,103  (4.5)%Used vehicle retail 101,462   108,040  (6.1)  207,669   213,087  (2.5)            Average selling price (excluding agency)           New vehicle$47,082  $47,020  0.1% $46,767  $46,954  (0.4)%Used vehicle retail 29,141   27,965  4.2   28,553   27,454  4.0             Average gross profit per unit           New vehicle$2,718  $3,059  (11.1)% $2,715  $3,000  (9.5)%Used vehicle retail 2,019   1,899  6.3   1,839   1,846  (0.4)Finance and insurance 1,811   1,814  (0.2)  1,809   1,813  (0.2)Total vehicle(1) 4,119   4,220  (2.4)  4,016   4,164  (3.6) (1)   Includes the sales and gross profit related to new, used, and finance and insurance and unit sales for new and used retail

LAD
Other Highlights (Unaudited)

 Three months ended June 30, Six months ended June 30, 2026
 2026
Key Performance by CountryTotal Revenue Total Gross Profit Total Revenue Total Gross ProfitUnited States77.4% 82.2% 76.5% 81.6%United Kingdom18.7% 14.8% 20.0% 15.7%Canada3.9% 3.0% 3.5% 2.7%              As of June 30, December 31, June 30,Days’ Supply(1)2026 2025 2025New vehicle inventory59 54 63Used vehicle inventory60 48 48 (1) Days’ supply in inventory is calculated using on-ground inventory unit levels and a 30-day total unit sales volumes, both at the end of each reporting period.

Selected Financing Operations Financial Information

 Three months ended June 30, Six months ended June 30,($ in millions)2026
 %(1) 2025
 %(1) 2026
 %(1) 2025
 %(1)Interest and fee income$116.4  8.9  $98.8  9.2  $226.9  8.9  $193.2  9.3 Interest expense (53.5) (4.1)  (49.8) (4.7)  (105.2) (4.1)  (97.9) (4.7)Total interest margin$62.9  4.8  $49.0  4.5  $121.7  4.8  $95.3  4.5 Lease income 26.4     23.7     50.3     44.2   Lease costs (22.5)    (18.6)    (42.7)    (35.4)  Lease income, net 3.9     5.1     7.6     8.8   Provision expense (15.8) (1.2)  (21.2) (2.0)  (42.2) (1.7)  (46.7) (2.2)Other financing operations expenses (14.5) (1.1)  (12.8) (1.2)  (29.3) (1.2)  (24.8) (1.2)Finance operations income$36.5    $20.1    $57.8    $32.6                   Total average managed finance receivables$5,271.4    $4,287.6    $5,140.2    $4,196.6    (1)   Annualized percentage of total average managed finance receivables

LAD
Condensed Consolidated Balance Sheets (Unaudited)
(In millions)

 June 30, 2026
 December 31, 2025
Cash, restricted cash, and cash equivalents$363.9  $341.8 Trade receivables, net 1,124.9   1,134.1 Inventories, net 6,516.8   6,119.6 Other current assets 267.7   262.5 Total current assets$8,273.3  $7,858.0       Property and equipment, net 5,031.6   4,936.0 Finance receivables, net 5,281.6   4,755.1 Intangibles 5,320.5   5,254.1 Other non-current assets 2,338.8   2,304.0 Total assets$26,245.8  $25,107.2       Floor plan notes payable 6,387.4   5,008.9 Other current liabilities 1,861.5   1,687.8 Total current liabilities$8,248.9  $6,696.7       Long-term debt, less current maturities 6,690.9   7,274.9 Non-recourse notes payable, less current maturities 2,688.9   2,404.2 Other long-term liabilities and deferred revenue 2,189.7   2,103.0 Total liabilities$19,818.4  $18,478.8       Equity 6,427.4   6,628.4 Total liabilities and equity$26,245.8  $25,107.2          LAD
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In millions)

 Six months ended June 30,Cash flows from operating activities:2026
 2025
Net income$363.7  $469.4 Adjustments to reconcile net income to net cash (used in) provided by operating activities 326.6   266.7 Changes in:   Inventories (433.8)  (19.7)Finance receivables (534.5)  (432.1)Floor plan notes payable 12.6   26.4 Other operating activities 91.3   20.7 Net cash (used in) provided by operating activities (174.1)  331.4 Cash flows from investing activities:   Capital expenditures (153.4)  (148.8)Cash paid for acquisitions, net of cash acquired (221.7)  (278.6)Proceeds from sales of stores 21.0   104.4 Other investing activities 2.3   7.5 Net cash used in investing activities (351.8)  (315.5)Cash flows from financing activities:   Net borrowings on floor plan notes payable, non-trade 1,409.2   (141.2)Net borrowings on non-recourse notes payable 267.4   (67.4)Net borrowings on other debt and finance lease liabilities (568.3)  552.2 Proceeds from issuance of common stock 14.0   13.6 Repurchase of common stock (534.0)  (263.3)Dividends paid (25.7)  (28.2)Other financing activity (7.5)  (79.2)Net cash provided by (used in) financing activities 555.1   (13.5)Effect of exchange rate changes on cash and restricted cash (3.3)  7.4 Change in cash, restricted cash, and cash equivalents 25.9   9.8 Cash, restricted cash, and cash equivalents at beginning of period 391.3   445.8 Cash, restricted cash, and cash equivalents at end of period 417.2   455.6          LAD
Reconciliation of Non-GAAP Cash Flow from Operations (Unaudited)
(In millions)

 Six months ended June 30,Net cash provided by operating activities2026
 2025
As reported$(174.1) $331.4 Floor plan notes payable, non-trade, net(1) 1,409.2   (141.2)Adjust: finance receivables activity 534.5   432.1 Less: Borrowings on floor plan notes payable, non-trade associated with acquired new vehicle inventory (21.8)  (45.6)Adjusted$1,747.8  $576.7  (1) Includes the impact of converting inventory‑secured revolvers to floorplan facilities during 2026, increasing net floorplan borrowings and adjusted operating cash flows $1,138.3 million.

LAD
Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)
(In millions, except for per share data)

 Three Months Ended June 30, 2026 As reported Net gain on disposal of stores Investment gain Insurance reserves Acquisition expenses Tax attribute AdjustedSelling, general and administrative 1,014.7   15.1   —   (2.3)  (0.4)  —   1,027.1 Operating income 448.3   (15.1)  —   2.3   0.4   —   435.9 Other income (expense), net 36.2   —   (28.2)  —   —   —   8.0               Income before income taxes 352.1   (15.1)  (28.2)  2.3   0.4   —   311.5 Income tax (provision) benefit (90.5)  4.1   6.4   (0.6)  (0.1)  (3.2)  (83.9)Net income$261.6  $(11.0) $(21.8) $1.7  $0.3  $(3.2) $227.6 Net income attributable to non-controlling interests (1.6)  —   —   —   —   —   (1.6)Net income attributable to LAD$260.0  $(11.0) $(21.8) $1.7  $0.3  $(3.2) $226.0               Diluted earnings per share attributable to LAD$11.54  $(0.49) $(0.96) $0.07  $0.01  $(0.14) $10.03 Diluted share count 22.5                               Three Months Ended June 30, 2025 As reported Net loss on disposal of stores Investment gain(1) Insurance reserves Acquisition expenses Tax attribute AdjustedSelling, general and administrative$1,014.7  $(7.2) $—  $(2.4) $(0.1) $—  $1,005.0 Operating income 425.3   7.2   —   2.4   0.1   —   435.0 Other income (expense), net 48.5   —   (36.4)  —   —   —   12.1               Income before income taxes 352.1   7.2   (36.4)  2.4   0.1   —   325.4 Income tax (provision) benefit (93.9)  1.8   9.5   (0.6)  —   (1.3)  (84.5)Net income$258.2  $9.0  $(26.9) $1.8  $0.1  $(1.3) $240.9 Net income attributable to non-controlling interests$(2.1) $—  $—  $—  $—  $—  $(2.1)Net income attributable to LAD$256.1  $9.0  $(26.9) $1.8  $0.1  $(1.3) $238.8               Diluted earnings per share attributable to LAD$9.87  $0.35  $(1.04) $0.07  $—  $(0.05) $9.20 Diluted share count 25.9                              LAD
Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)
(In millions, except for per share data)

 Six Months Ended June 30, 2026 As reported Net gain on disposal of stores Investment loss Insurance reserves Acquisition expenses Contract buyouts Tax attribute AdjustedSelling, general and administrative$2,052.1  $15.0  $—  $(2.3) $(0.7) $(20.3) $—  $2,043.8 Operating income 784.1   (15.0)  —   2.3   0.7   20.3   —   792.4 Other income (expense), net (31.5)  —   45.2   —   —   —   —   13.7                 Income before income taxes 494.1   (15.0)  45.2   2.3   0.7   20.3   —   547.6 Income tax (provision) benefit (130.4)  4.0   (12.1)  (0.6)  (0.1)  (5.1)  (2.0)  (146.3)Net income$363.7  $(11.0) $33.1  $1.7  $0.6  $15.2  $(2.0) $401.3 Net income attributable to non-controlling interests (3.3)  —   —   —   —   —   —   (3.3)Net income attributable to LAD$360.4  $(11.0) $33.1  $1.7  $0.6  $15.2  $(2.0) $398.0                 Diluted earnings per share attributable to LAD$15.68  $(0.48) $1.44  $0.07  $0.03  $0.66  $(0.08) $17.32 Diluted share count 23.0                 Six Months Ended June 30, 2025 As reported Net gain on disposal of stores Investment gain(1) Insurance reserves Acquisition expenses Tax attribute AdjustedSelling, general and administrative$1,967.4  $2.2  $—  $(2.8) $(0.3) $—  $1,966.5 Operating income 831.6   (2.2)  —   2.8   0.3   —   832.5 Other income (expense), net 49.3   —   (26.7)  —   —   —   22.6               Income before income taxes 636.7   (2.2)  (26.7)  2.8   0.3   —   610.9 Income tax (provision) benefit (167.3)  4.3   7.0   (0.7)  (0.1)  (2.3)  (159.1)Net income$469.4  $2.1  $(19.7) $2.1  $0.2  $(2.3) $451.8 Net income attributable to non-controlling interests (3.8)  —   —   —   —   —   (3.8)Net income attributable to LAD$465.6  $2.1  $(19.7) $2.1  $0.2  $(2.3) $448.0               Diluted earnings per share attributable to LAD$17.80  $0.08  $(0.76) $0.08  $0.01  $(0.09) $17.12 Diluted share count 26.2                              LAD
Adjusted EBITDA and Net Debt to Adjusted EBITDA (Unaudited)
(In millions)

 Three months ended
June 30,
 % Six months ended
June 30, %  Increase  Increase 2026
 2025
 (Decrease) 2026
 2025
 (Decrease)EBITDA and Adjusted EBITDA           Net income$261.6  $258.2  1.3% $363.7  $469.4  (22.5)%Flooring interest expense 69.7   55.0  26.7   125.6   112.0  12.1 Other interest expense 62.7   66.7  (6.0)  132.9   132.2  0.5 Financing operations interest expense 53.5   49.8  7.4   105.2   97.9  7.5 Income tax expense 90.5   93.9  (3.6)  130.4   167.3  (22.1)Depreciation and amortization 70.9   65.2  8.7   140.7   129.0  9.1 EBITDA$608.9  $588.8  3.4% $998.5  $1,107.8  (9.9)%            Other adjustments:           Less: flooring interest expense$(69.7) $(55.0) 26.7  $(125.6) $(112.0) 12.1 Less: financing operations interest expense (53.5)  (49.8) 7.4   (105.2)  (97.9) 7.5 Less: used vehicle line of credit interest —   (4.4) (100.0)  (1.4)  (7.5) (81.3)Add: acquisition expenses 0.4   0.1  NM  0.7   0.3  NMAdd: (gain) loss on disposal of stores (15.1)  7.2  NM  (15.0)  (2.2) NMAdd: investment (gain) loss(1) (28.2)  (36.4) NM  45.2   (26.7) NMAdd: insurance reserves 2.3   2.4  NM  2.3   2.8  NMAdd: contract buyouts —   —  NM  20.3   —  NMAdjusted EBITDA$445.1  $452.9  (1.7)% $819.8  $864.6  (5.2)% NM - not meaningful
(1) Investment (gains) losses retrospectively included in adjusted non-GAAP financial measures presented

 As of % June 30, IncreaseNet Debt to Adjusted EBITDA2026
 2025
 (Decrease)Floor plan notes payable$6,387.4  $4,888.0  30.7%Used and service loaner vehicle inventory financing facility 3.5   1,011.3  (99.7)Revolving lines of credit 1,889.8   1,792.1  5.5 Warehouse facilities 1,459.0   1,241.0  17.6 Non-recourse notes payable 2,741.4   2,042.0  34.3 4.625% Senior notes due 2027 400.0   400.0  — 3.875% Senior notes due 2029 800.0   800.0  — 5.500% Senior notes due 2030 600.0   —  — 4.375% Senior notes due 2031 550.0   550.0  — Real estate mortgages, finance lease obligations, and other debt 1,106.7   986.4  12.2 Unamortized debt issuance costs (25.1)  (20.6) 21.8 Total debt$15,912.7  $13,690.2  16.2%      Less: Inventory related debt$(6,390.9) $(5,899.3) 8.3%Less: Financing operations related debt (4,200.4)  (3,283.0) 27.9 Less: Unrestricted cash and cash equivalents (110.3)  (202.8) (45.6)Less: Marketable securities (67.0)  (52.1) 28.6 Less: Availability on used vehicle and service loaner financing facilities (0.5)  (29.9) (98.3)Net Debt$5,143.6  $4,223.1  21.8%      TTM Adjusted EBITDA$1,621.7  $1,670.6  (2.9)%      Net debt to Adjusted EBITDA3.17x 2.53x   NM - not meaningful

July 14, 2026 05:30 ET  | Source: Lithia & Driveway

MEDFORD, Ore., July 14, 2026 (GLOBE NEWSWIRE) -- Lithia & Driveway (NYSE: LAD) today announced its second quarter 2026 results will be released before the market opens on Wednesday, July 29, 2026. A conference call to discuss the earnings results is scheduled for the same day at 10:00 a.m. Eastern Time.

How to Participate

The conference call may be accessed by telephone at (877) 407-8029. To listen live on our website, or for replay, visit investors.lithiadriveway.com and click on quarterly earnings.

About Lithia & Driveway (LAD)
Lithia & Driveway (NYSE: LAD) is the largest global automotive retailer making Auto Done Easy by providing simple, transparent, and convenient experiences throughout the ownership lifecycle. LAD helps customers take care of any vehicle need through a comprehensive network of physical locations, e-commerce platforms, captive finance solutions, fleet management offerings, and other synergistic adjacencies. Celebrating 80 years in business in 2026, LAD consistently delivers profitable growth in a massive and unconsolidated industry. Its highly diversified and competitively differentiated design provides LAD with the flexibility and scale to pursue its vision to modernize personal transportation solutions wherever, whenever and however consumers desire.

The 80th Celebration
https://www.lithiadriveway.com/80-years

Connect with Us!
All Cars: https://www.lithia.com
Driveway.com (Buy, sell, trade, or finance entirely online): https://www.driveway.com
GreenCars (All things sustainable vehicles): https://www.greencars.com
DFC (Auto Financing): https://www.drivewayfinancecorp.com
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