LKQ Q1 Earnings Meet Estimates, Sales Miss, FCF Negative

LKQ Corporation LKQ delivered adjusted earnings of 79 cents per share for first-quarter 2025, in line with the Zacks Consensus Estimate. However, earnings declined from 82 cents reported in the year-ago period. The aftermarket auto parts distributor registered quarterly revenues of $3.46 billion, missing the Zacks Consensus Estimate of $3.57 billion. The top line also fell from the year-ago level of $3.7 billion. Parts and Services organic revenues decreased 4.3% year over year.

LKQ currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Segment Highlights

In the reported quarter, revenues from the Wholesale North American segment totaled $1.41 billion, falling 5.8% year over year and lagging our estimate of $1.51 billion. The segment’s EBITDA was $222 million, which was below our forecast of $246 million as well as $244 million generated in the first quarter of 2024.

Revenues from the European segment were $1.52 billion, which fell 7.4% year over year and missed our estimate of $1.55 billion. The segment’s EBITDA came in at $141 million, which was down from the year-ago level of $143 million but marginally topped our forecast of $140 million.

Revenues from the Specialty segment came in at $394 million, which fell 7% year over year but topped our projection of $365 million. The segment’s EBITDA was $21 million, which inched down from the year-ago figure of $27 million and matched our forecast.

Revenues from the Self-Service segment totaled $136 million compared with $137 million in the first quarter of 2024. The metric exceeded our prediction of $124 million. The segment’s EBITDA was $20 million, which surpassed our estimate of $10.2 million and increased from $16 million reported in the year-ago period.

(Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)

Financial Position & Dividend

LKQ had cash and cash equivalents of $227 million as of March 31, 2025, down from $234 million recorded as of Dec. 31, 2024. The long-term obligations (excluding the current portion) amounted to $3.84 billion as of March 31, 2025, down from $4.13 billion recorded as of Dec. 31, 2024. As of March 31, 2025, LKQ’s balance sheet reflected a total debt of $4.4 billion.

In the first quarter of 2025, cash flow from operating activities and FCF were negative $3 million and negative $57 million, respectively.  

During the first quarter of 2025, the company repurchased 1 million shares worth $40 million. Since initiating the stock buyback program in late October 2018, it repurchased around 65.5 million shares for a total of $2.8 billion through March 31, 2025.

On April 22, 2025, LKQ announced a quarterly cash dividend of 30 cents per share. The dividend will be paid out on May 29, 2025, to stockholders of record at the close of business on May 15, 2025.

2025 Guidance

For 2025, the company anticipates parts and services organic revenue growth in the range of 0-2% year over year. It expects adjusted EPS in the range of $3.40-$3.70 compared with $3.48 in 2024. The company envisions operating cash flow in the range of $1.075-$1.275 billion. It expects free cash flow in the range of $750-$900 million.

Other Releases From the Auto Space

Genuine Parts Company GPC reported first-quarter 2025 adjusted earnings of $1.75 per share, which beat the Zacks Consensus Estimate of $1.66 but declined from the year-ago quarter’s earnings of $2.22 per share. Genuine Parts reported net sales of $5.87 billion, which surpassed the Zacks Consensus Estimate of $5.82 billion and inched up 1.4% year over year.

Genuine Parts had cash and cash equivalents worth $420.4 million as of March 31, 2025, down from $490 million as of Dec. 31, 2024. Long-term debt increased to $3.78 billion from $3.74 billion as of Dec. 31, 2024. For 2025, Genuine Parts expects year-over-year revenue growth of 2-4% for both automotive and industrial segments. Overall sales growth is projected in the range of 2-4% compared with growth of 1.6% in 2024.

Autoliv Inc. ALV reported first-quarter 2025 adjusted earnings of $2.15 per share, which beat the Zacks Consensus Estimate of $1.72 and rose 37% year over year. The company reported net sales of $2.58 billion in the quarter, which beat the Zacks Consensus Estimate of $2.47 billion but fell 1.4% year over year. Autoliv had cash and cash equivalents of $322 million as of March 31, 2025. Long-term debt totaled $1.57 billion

Autoliv reiterated its guidance for 2025. It expects 2025 organic sales growth of around 2% compared with 0.4% reported in 2024. The adjusted operating margin is anticipated to be in the range of 10-10.5%. Operating cash flow is expected to be $1.2 billion in 2025.

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