RideNow Group Q1 Earnings Call Highlights
RideNow Group (NASDAQ:RDNW) reported higher first-quarter revenue and adjusted EBITDA as the powersports retailer continued to cite improving same-store sales and benefits from operational changes that management described as part of an ongoing turnaround effort.
Chairman, Chief Executive Officer and President Michael Quartieri said first-quarter revenue totaled $260.4 million, up 6.4% from the prior year, while adjusted EBITDA rose 32.9% to $9.3 million. Quartieri said the quarter marked the company’s fourth consecutive period of year-over-year adjusted EBITDA improvement.
“The momentum we’ve created in our business over the back half of 2025 has continued into 2026,” Quartieri said on the company’s earnings call.
Same-store sales show continued gains
Management pointed to same-store sales as a key indicator of improving performance. Quartieri said same-store units sold increased 16.3% in the quarter, while same-store revenue rose 13.1%. Same-store gross profit increased 12.2%, which he said marked the fourth consecutive quarter of growth in that metric.
Chief Financial Officer Joshua Barsetti said same-store revenue was $259 million in the first quarter, compared with $228.9 million a year earlier. Same-store gross profit rose to $71.6 million from $63.8 million. Same-store unit sales totaled 14,449, compared with 12,422 in the prior-year quarter. Barsetti said the same-store figures exclude five stores permanently closed as of year-end 2025 and in-fleet related units.
Total company revenue increased to $260.4 million from $244.7 million in the prior-year quarter. Barsetti said the increase was driven by higher sales of new and pre-owned retail vehicles, partially offset by a $5.5 million decrease from the company’s vehicle transportation services business, which was wound down at the end of 2025. Excluding Wholesale Express, revenue increased 8.9% year over year, he said.
Unit sales rise, margins improve
RideNow sold 14,694 total major units during the quarter, an increase of 1,508 units, or 11.4%, from the same period last year. New powersports major unit sales totaled 9,322, up 1,309 units, or 16.3%. Pre-owned unit sales totaled 4,593, up 286 units, or 6.6%.
Barsetti said higher powersports unit sales and improved revenue across categories helped lift total gross profit by $5.5 million to $71.6 million. New unit gross margins improved to 14.2% from 13.6% a year earlier, while pre-owned gross margins increased to 16.9% from 16.2%.
The company’s fixed operations business, which includes parts, service and accessories, generated $46.7 million in revenue and $22 million in gross profit. Gross profit per unit for fixed operations was $1,581, down $107 from the prior-year quarter. Finance and insurance revenue totaled $21.8 million, with gross profit per unit of $1,571, down from $1,713 a year earlier.
Consolidated adjusted SG expenses were $60.4 million, or 84.3% of gross profit, compared with $57.5 million, or 85.6% of gross profit, in the same quarter last year.
Management cites operational discipline and balance sheet priorities
Quartieri said the company remains focused on execution, cost reduction and restoring discipline in store performance. He said RideNow is still in the “early innings” of its turnaround and emphasized getting “the right people in the right place at the right time.”
Quartieri also said the Securities and Exchange Commission concluded its investigation and recommended no enforcement action against the company. He added that RideNow continues to make progress on refinancing efforts and expects to share more details in the coming weeks.
Barsetti said RideNow ended the quarter with $46.4 million in total cash, including restricted cash. Non-vehicle net debt was $190.7 million, and availability under short-term revolving floor plan credit facilities totaled about $99.3 million. total available liquidity, defined as cash plus floor plan availability, was $145.7 million at quarter-end.
Cash outflows from operating activities were $27.6 million for the three months ended March 31, compared with $6.9 million in the prior-year period. Barsetti said the increased use of cash was primarily tied to additional inventory purchases to support revenue growth and prepare for the company’s higher selling season.
Consumer demand, inventory and tariffs discussed in Q
In response to a question from Texas Capital Securities analyst Eric Wold, Quartieri said RideNow expected growth in the first quarter because of easier comparisons in January and February, but was “pleasantly surprised” by March demand. He said higher tax refunds helped provide more buying power for the company’s middle-class consumer.
Quartieri said April demand was affected somewhat by higher gas prices tied to conflict in the Middle East, but the company was still seeing year-over-year growth on a comparable-store basis, though not at March’s pace.
On new versus used vehicles, Quartieri said he did not see “exceptionally different levels of promotion” on new products and characterized the shift as more about consumer preference. He said RideNow generally aims to carry three to four months of used inventory and is currently closer to three months. He added that the company would buy more used inventory if it could do so while protecting margins.
Asked by Baird analyst Craig Kennison about interest rates and consumer health, Quartieri said the rates offered to customers were slightly lower year over year. He said monthly payments remain a key factor for consumers and that RideNow has not seen deterioration in loan defaults or cancellations of extended service contracts and prepaid maintenance programs.
On tariffs, Quartieri said OEM partners have communicated that they are maintaining the status quo for 2026 and absorbing tariff costs themselves, at least for the foreseeable future.
Quartieri said RideNow is seeking refinancing flexibility for the next four to five years and expects to deleverage as operations and cash flow improve. He said the “right amount of leverage” for the business in a more normalized state would be around two times.
Looking ahead, Quartieri said RideNow expects to deliver higher adjusted EBITDA and increased free cash flow throughout 2026. He also said the company is positioned to return to growth through “highly accretive acquisitions,” which he described as a key pillar of RideNow’s value creation strategy.
About RideNow Group (NASDAQ:RDNW)
RideNow Group, Inc (NASDAQ: RDNW) is a leading U.S. retailer of powersports vehicles, offering both new and pre-owned inventory to enthusiasts and recreational riders. The company's dealerships carry a diverse lineup of motorcycles, all-terrain vehicles (ATVs), side-by-sides, personal watercraft and snowmobiles from major manufacturers. In addition to vehicle sales, RideNow Group provides comprehensive service and maintenance, aftermarket parts and accessories and a range of financing and protection plans tailored to powersports customers.
Founded in 2004 and headquartered in Houston, Texas, RideNow Group has grown through a combination of organic expansion and strategic acquisitions.
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