Sonic Automotive Inc - Class A
Q1 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +8.13%.
Did SAH Beat Earnings? Q1 2025 Results
Sonic Automotive kicked off 2025 with a solid beat on both top and bottom lines, as the Charlotte-based auto retailer posted adjusted earnings of $1.48 per diluted share in the first quarter, clearing the consensus estimate of $1.44 by 3.04%, while revenue of $3.65 billion topped expectations by 3.78% and grew 7.9% year-over-year. The standout driver behind the quarter's momentum was EchoPark, Sonic's pre-owned vehicle platform, which delivered all-time record quarterly gross profit of $63.90 million, up 21% year-over-year, swinging to segment income of $10.30 million from a $2.90 million loss a year ago. The Franchised Dealerships segment also contributed with record first-quarter revenues of $3.06 billion, though new vehicle gross profit per unit slipped 17% to $3,089 as industry pricing continues normalizing. Looking ahead, management struck a cautious note, adjusting its 2025 guidance to account for tariff-driven uncertainty that could pressure new and used vehicle volumes and pricing beginning in the second quarter, while projecting EchoPark adjusted EBITDA of $35 million to $40 million for the full year.
- Record first quarter consolidated revenues driven by 8% YoY growth
- EchoPark all-time record quarterly gross profit, segment income, and adjusted EBITDA
- Franchised Dealerships record first quarter total revenues, fixed operations gross profit, and F&I gross profit
- Same store retail new vehicle unit sales volume up 10% in Franchised Dealerships
- Same store warranty gross profit up 38% in Franchised Dealerships
- EchoPark total used vehicle and F&I GPU up 15% to $3,411
- $30 million pre-tax cyber insurance proceeds boosting reported net income
- Lower SG&A expenses as percentage of gross profit (67.1% reported vs 73.1% prior year)
“In the first quarter, our team continued to execute at a high level, driving record first quarter consolidated revenues and combined new and used retail unit sales volume, in addition to all-time record quarterly adjusted EBITDA in our EchoPark Segment. Going forward, we remain focused on delivering an outstanding experience for our guests and teammates, continuing to grow our EchoPark volume and profitability, gaining market share in our franchised dealerships and powersports segments, and optimizing our expense structure to drive sustained success. Despite uncertainty around the impact of tariffs on pricing, vehicle and parts inventory levels, gross margin, and consumer demand, our entire team remains focused on executing our strategy and continuing to grow our business, in order to create long-term value for our stakeholders.”
Sonic Automotive CEO, on the earnings call
Forward Guidance & Outlook
Sonic Automotive updated its FY 2025 guidance due to tariff uncertainty. The Franchised Dealerships Segment anticipates new vehicle GPU of $2,500-$3,000 per unit (depending on tariff impact), used vehicle GPU of $1,300-$1,500, mid-single-digit percentage growth in fixed operations gross profit, F&I GPU around $2,400, and adjusted SG&A as a % of gross profit in the low 70% range. The EchoPark Segment expects adjusted EBITDA of $35-$40 million, with mid-single-digit used retail unit sales volume growth and low-single-digit F&I GPU growth, targeting SG&A as a % of gross profit in the high 70% range. The Powersports Segment expects adjusted EBITDA of $6-$8 million with majority in Q3 due to seasonality. Management expects tariffs may create volatility in new and used vehicle pricing, volume, and GPU beginning in Q2 2025 and has withdrawn certain prior guidance items. Used vehicle supply is projected to reach its lowest point in late 2025 before expanding, which could benefit EchoPark longer-term.
SAH YoY Financials
SAH Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.