AN · AutoNation, Inc.

AutoNation's first quarter 2026 results showed resilience despite a 2% revenue decline to $6.6 billion, driven by lower new vehicle sales volume (-7.9% unit sales) partially offset by higher used vehicle revenue (+2.2%) and parts and service growth (+4.9%). Net income rose 17% to $205.4 million, benefiting from a $51.2 million other income gain (primarily net gains on equity investments). GAAP EPS of $5.85 increased 31% year-over-year, while adjusted EPS of $4.69 was essentially flat. The company achieved record first-quarter after-sales gross profit and record Customer Financial Services (CFS) gross profit per unit of $2,855, up 5.6% year-over-year. Management highlighted sequential improvements in new and used vehicle unit profitability. AutoNation Finance continued to scale, with its portfolio reaching $2.4 billion and completing a $749.2 million asset-backed securitization at a 4.25% weighted-average rate. The company returned $300 million to shareholders via share repurchases (1.5 million shares at $201 per share), reducing the diluted share count by 11% year-over-year. Adjusted free cash flow was $256 million, representing 155% of adjusted net income. The company ended the quarter with $1.6 billion in liquidity and a covenant leverage ratio of 2.57x. No forward guidance was provided in the release.