Lithia & Driveway posts 54% jump in third-quarter EPS on record revenue

Lithia & Driveway (NYSE: LAD) reported third-quarter 2026 diluted earnings per share of $13.22, a 54% increase from the prior year, driven by record revenues of $9.9 billion. The automaker retailer also announced a 7% increase to its quarterly dividend and reported adjusted diluted earnings per share of $10.34, up 9% from the same period in 2025.

The company’s net income rose 34.0% to $292.9 million in the third quarter of 2026, compared to $218.6 million in the third quarter of 2025. However, adjusted net income, which excludes an unrealized gain on an investment in Pinewood Technologies Group PLC and other non-core items, decreased by 5% to $229.3 million from $240.9 million in the same period of 2025.

Bryan DeBoer, President and Chief Executive Officer, stated that the company’s ecosystem and people delivered record quarterly revenues and continued growth in earnings per share. He noted that used vehicle profitability strengthened, aftersales margins expanded, and Financing Operations delivered strong income growth on a high-quality credit portfolio. DeBoer added that the capital decisions of the past year are reflected in the financial results, with a lower share count magnifying earnings.

Operationally, used retail gross units per store increased by 11% year over year. Aftersales gross profit grew by 2.4%, with a same-store gross margin of 59.5%, representing a 100-basis point increase. Financing Operations income reached $32.3 million, a 69% increase year over year, supported by record originations of $937 million and a penetration rate of 18.3%.

For the first nine months of 2026, Lithia & Driveway reported revenues of $29.0 billion, a 2% increase from $28.4 billion in the same period of 2025. Diluted earnings per share for the nine-month period was $28.77, up 9% from $26.42 in 2025. Adjusted diluted earnings per share for the first nine months increased 4% to $27.61 from $26.60 in the prior year.

In corporate development, LAD bought two dealerships during the quarter that are projected to bring in $150 million in annualized sales, while selling two locations that accounted for $115 million in annualized sales. In October 2026, the company acquired two Hyundai and two Kia stores in Memphis, Tennessee, adding $250 million in expected annualized revenue. Year to date, LAD has acquired stores representing $1.17 billion in expected annualized revenues.

The Board of Directors approved a dividend of $0.75 per share for the third quarter of 2026, expected to be paid on November 20, 2026, to shareholders of record on November 6, 2026. During the third quarter, the company repurchased approximately 246,000 shares at a weighted average price of $345, representing 1.1% of outstanding shares in the quarter and 8.7% for the year 2026. Approximately $535 million remains available under the current share repurchase authorization as of September 30, 2026.

Effective October 19, 2026, the Board appointed Bryan B. DeBoer as Chairman of the Board, a role he will hold alongside his position as CEO. Sidney B. DeBoer will serve as Vice Chairman and continue on the Board, while Louis P. Miramontes will remain Lead Independent Director.