Lithia Motors Inc. (LAD): 2Q26 earnings recap: Solid EPS beat highlighted by structural changes to drive improved profitability

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Lithia Motors Inc. (LAD): 2Q26 earnings recap: Solid EPS beat highlighted by structural changes to drive improved profitability

Equity Research

29 July 2026 | 9:30PM EDT

Lithia Motors Inc. (LAD): 2Q26 earnings recap: Solid EPS beat

highlighted by structural changes to drive improved profitability

Lithia Motors traded higher (+19.3% vs. -1.5% for the S&P 500) and outperformed Mark Jordan, CFA

+1(617)772-7951 |

its peer average (+3.7% for public auto dealers) after reporting a sizable EPS beat mark.jordan@gs.com

Goldman Sachs & Co. LLC

($10.03 vs. GS/FactSet consensus of $8.80/$8.73) led by improved cost control and

Kate McShane, CFA

lower provisioning needs for their financing portfolio. In our view, the 2Q print +1(212)902-6740 |

highlights what we expect to be a step change in cost structure and profitability that kate.mcshane@gs.comGoldman Sachs & Co. LLC

should remain a tailwind going forward, benefiting from a reduced SG&A footprint Emily Ghosh

and with DFC set to be a more meaningful profit driver in the near term. +1(713)658-2632emily.ghosh@gs.com|

Key takeaways from the quarter include: (1) structural improvements in Lithia’s cost Nishi Agarwal

base should continue to benefit the company’s SG&A-to-gross profit metric going +1(332)245-7668nishi.agarwal@gs.com|

forward; (2) strong used retail GPUs were a surprise in 2Q, and should remain Goldman Sachs India SPL

Cheefavorable assuming the company continues to focus on profitability over volume; and Grace +1(212)357-9730 | grace.chee@gs.com

(3) income from financing operations improved significantly on lower provisioning Goldman Sachs & Co. LLC

needs, and management raised their mid-term outlook for income from financing Samantha Chiang

+1(212)357-7992 |