Key Highlights

  • Adjusted EPS of USD 1.30 trailed the consensus estimate of USD 1.66, and GAAP diluted EPS was USD 1.28.
  • Revenue of USD 3.99 billion edged up from USD 3.97 billion but missed the consensus estimate of USD 4.03 billion.
  • Gross profit reached a record USD 617.5 million, but Operating Income fell to USD 112.4 million from USD 122.7 million.
  • Powersports Revenue jumped 35% to a record USD 113.7 million, while EchoPark retail used units grew 22%.

Sonic Automotive, Inc. (NYSE:SAH) reported third quarter 2026 adjusted Earnings Per Share of USD 1.30, below the consensus estimate of USD 1.66, while GAAP diluted EPS was USD 1.28 compared with USD 1.33 a year earlier. Total revenues of USD 3,988.8 million rose from USD 3,973.8 million and set a quarterly record, yet fell short of the consensus estimate of USD 4.03 billion. Net Income was USD 41.1 million versus USD 46.8 million, as selling, general and administrative expenses climbed to USD 466.8 million from USD 451.6 million.

Segment Mix Shifts Toward EchoPark and Powersports

Chairman and Chief Executive Officer David Smith highlighted franchised dealership revenue of USD 3.3 billion, down 3%, with same store new vehicle units down 7% on a tough comparison with last year EV pull forward. The company estimated that about 2,200 extra EV retail units sold a year ago accounted for a USD 5 million Gross Profit decline. Fixed operations gross profit set a record at USD 265.4 million, up 2%, while F&I gross profit slipped 3% to USD 142.6 million.

EchoPark revenue grew 14% to USD 596 million and segment gross profit rose 8% to a third quarter record of USD 58.9 million. Retail used units climbed 22% to 19,923, although gross profit per unit fell 12% to USD 2,972 on lower F&I earnings tied to a heavier mix of electric and higher mileage vehicles. Powersports gross profit rose 26% to USD 29.3 million, and the segment sold a record 1,135 motorcycles at the Sturgis rally.

Cost Pressure and Guidance Commentary

The Chief Financial Officer said each USD 5.5 million to USD 6 million of expense equals roughly 100 basis points of SG&A as a share of gross profit. Service loaners, fuel costs and customer related items accounted for almost 100 basis points of the year over year change, and about USD 2 million of incremental information technology spending supported an AI initiative. SG&A represented 75.6% of gross profit in the quarter, and management said the figure remains within its full year guidance range despite lower than projected fixed operations growth in the second and third quarters.

For the fourth quarter, EchoPark adjusted EBITDA is guided to USD 2 million to USD 4 million, which includes USD 5 million to USD 7 million of added Brand Marketing spend. Management also narrowed its full year front end Margin range after new vehicle gross profit per unit held at USD 3,048 on a reported basis, up 2%.

Data Points Behind the Next Report

Several items are scheduled or quantified. An EchoPark store in Orlando opens in December, and two to four more EchoPark locations are planned for 2027. The board declared a Cash Dividend of USD 0.41 per share, payable January 15, 2027 to holders of record on December 15, 2026, and USD 528 million remains under the share repurchase authorization.

Management pegged same store fixed operations gross profit growth near 3% and cited warranty repair order Volume up 4% year over year. Liquidity stood at about USD 585 million, including roughly USD 201 million of cash and floor plan deposits.