AutoNation's Q4 Earnings Surpass Estimates, Revenues Miss

AutoNation, Inc. AN reported fourth-quarter 2025 adjusted earnings of $5.08 per share, which increased 2% year over year and beat the Zacks Consensus Estimate of $4.91. Revenues amounted to $6.93 billion, which missed the Zacks Consensus Estimate of $7.14 billion. The top line declined from $7.21 billion reported in the fourth quarter of 2024.

AutoNation, Inc. Price, Consensus and EPS Surprise

AutoNation, Inc. price-consensus-eps-surprise-chart | AutoNation, Inc. Quote

Key Takeaways

In the reported quarter, new vehicle revenues fell 8.8% year over year to $3.44 billion and missed our estimate of $3.64 billion due to lower-than-expected sales volume. New vehicle retail units sold totaled 64,841 units (down 9.2% year over year), missing our projection of 73,642 units.

The ASP per new vehicle unit retailed was $53,073 (up 0.4% year over year), which outpaced our estimate of $49,384. Gross profit from the segment was $155.5 million, which declined 26.7% year over year and lagged our estimate of $171.1 million.

Retail used-vehicle revenues totaled $1.76 billion, which surpassed our projection of $1.71 billion due to less-than-expected volumes. Used vehicle retail units sold totaled 62,926 units (down 2.9% year over year), missing our projection of 66,669 units. ASP per used vehicle unit retailed totaled $27,933 (up 3% year over year) and surpassed our projection of $25,669. Gross profit from the segment was $90.5 million, which fell 9.2% year over year and missed our projection of $97.5 million.

Revenues from wholesale used vehicles were down 13.1% to $133.2 million and missed our estimate of $150.5 million. Gross profit rose to $7.3 million from $4.7 million and matched our estimate. 

Net revenues in the finance and insurance business amounted to $369.4 million, which increased 0.9% from the year-ago quarter but missed our projection of $370.4 million. Gross profit was $369.4 million, which increased 0.9% but missed our estimate of $370.4 million.

Revenues from the parts and service business went up 6.1% to $1.22 billion but missed our estimate of $1.23 billion. Gross profit from this segment was $591.8 million, which rose 6% year over year and beat our estimate of $577.2 million.

Segmental Details

Revenues from the Domestic segment rose 1.2% year over year to $1.89 billion but missed our projection of $1.91 billion. The segment’s income climbed 19.3% to $79.9 million but missed our estimate of $85.2 million.

Revenues from the Import segment fell 2.7% from the prior-year quarter’s level to $2.05 billion and missed our forecast of $2.19 billion. The segment’s income declined 11.4% to $106.8 million and lagged our model estimate of $136.7 million.  

Premium Luxury segment sales fell 8.9% to $2.64 billion, matching our projection. The segmental income declined 20.3% year over year to $165.4 million and missed our estimate of $196.1 million.

Financial Tidbits

As of Dec. 31, 2025, the company’s liquidity was $1.8 billion, including $59 million in cash and nearly $1.7 billion available under its revolving credit facility. The firm’s inventory was valued at $3.4 billion. At the end of the fourth quarter, non-vehicle debt was $3.98 billion. Capital expenditure in the quarter amounted to $86.3 million.

During the quarter, the company bought back 1.7 million shares for $350 million. Currently, AN has $968 million remaining under its share repurchase program.

AN’s Zacks Rank & Key Picks

AutoNation carries a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks in the auto space are Ford Motor F, Modine Manufacturing MOD and PHINIA Inc. PHIN, 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 F’s 2025 sales implies year-over-year growth of 0.3%. EPS estimate for 2025 and 2026 has improved 7 cents and 11 cents, respectively, in the past 30 days.

The Zacks Consensus Estimate for MOD’s fiscal 2026 sales and earnings implies year-over-year growth of 18.5% and 17.5%, respectively. The EPS estimate for fiscal 2026 and 2027 has improved 13 cents and 17 cents, respectively, in the past seven days.

The Zacks Consensus Estimate for PHIN’s 2025 sales and earnings implies year-over-year growth of 1.1% and 33.4%, respectively. The EPS estimate for 2025 and 2026 has improved 47 cents and 66 cents, respectively, in the past 60 days.

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This article originally published on Zacks Investment Research (zacks.com).

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