Sonic Automotive Inc - Class A
Q2 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.27%.
Did SAH Beat Earnings? Q2 2025 Results
Sonic Automotive delivered a standout second quarter, with adjusted earnings per share of $2.19 beating the $1.60 consensus estimate by 36.58%, even as a $172.40 million non-cash franchise asset impairment charge pushed the company to a GAAP net loss of $1.34 per diluted share. Revenue reached $3.66 billion, up 5.9% year-over-year and essentially in line with expectations, with the headline profit beat driven by a 49% surge in adjusted net income to $76.20 million, aided partly by the absence of the CDK Global software outage that had weighed on the prior-year quarter. The company's franchised dealership segment stood out for its fixed operations strength, where gross profit hit an all-time quarterly record with same-store margins expanding 90 basis points to 51.3%, reflecting the broader industry trend of public dealers leaning heavily into service and parts growth. EchoPark posted its second consecutive record segment income of $11.70 million. Looking ahead, Sonic targets EchoPark adjusted EBITDA of $50.00 to $55.00 million for full-year 2025, with four newly acquired Jaguar Land Rover dealerships expected to contribute roughly $500.00 million in annualized revenues.
- All-time record quarterly fixed operations gross profit in Franchised Dealerships, up 12% same-store YoY
- All-time record quarterly F&I gross profit in Franchised Dealerships, up 15% same-store YoY with GPU of $2,718, up 14%
- EchoPark achieved all-time record quarterly segment income and adjusted EBITDA of $16.4 million, up 128% YoY
- EchoPark total GPU per unit of $3,747, up 22% YoY driven by F&I optimization and used vehicle margin improvement
- Same-store new vehicle retail unit volume up 5% YoY in Franchised Dealerships
- Warranty gross profit up 34% same-store in Franchised Dealerships
- Prior year quarter negatively impacted by CDK Global software outage reducing Q2 2024 net income by an estimated $22.2 million
- Consolidated adjusted SG&A expenses as a percentage of gross profit improved to 69.2% from 70.7% YoY
“I am very proud of our team's effort in the second quarter, driving record second quarter consolidated revenues and another all-time record quarterly adjusted EBITDA in our EchoPark Segment. These results validate our efforts to deliver an outstanding experience for our guests and teammates, grow our long-term EchoPark volume and profitability, gain market share in our franchised dealerships and powersports segments, and optimize our expense structure in order to create long-term value for our stakeholders.”
Sonic Automotive CEO, on the earnings call
Forward Guidance & Outlook
Sonic updated FY 2025 guidance amid tariff uncertainty. Franchised Dealerships: new vehicle GPU expected in the $2,800-$3,200 range (depending on tariff impacts), used vehicle GPU in the $1,300-$1,500 range, mid-single-digit growth in fixed operations gross profit, F&I GPU in the $2,500-$2,750 range, and adjusted SG&A as a % of gross profit in the low 70% range. EchoPark: adjusted EBITDA expected between $50-$55 million, mid-single-digit used retail unit sales volume growth, total GPU in the $3,400-$3,800 range, and SG&A as a % of gross profit in the low 70% range. Powersports: adjusted EBITDA expected between $6-$8 million with majority in Q3. Used vehicle supply is projected to reach its lowest point in late 2025 before gradually expanding. EchoPark expects to resume disciplined footprint expansion in 2026. The four Jaguar Land Rover dealerships acquired June 30, 2025 are expected to add approximately $500 million in annualized revenues.
SAH YoY Financials
SAH Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.