SAH earnings analysis
What we found in SAH's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Sonic Automotive reported first quarter 2026 revenues of $3.69 billion, slightly down 1% from the prior quarter's $3.87 billion, with an EPS of $1.62, exceeding analyst expectations of $1.41. The company faced some challenges in margins but showed resilience with a gross margin of 15.6% and a solid operating income of $118 million.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- EPS Exceeds Estimates
- The diluted EPS for Q1 2026 was $1.62, surpassing expectations of $1.41, resulting in an EPS surprise of 14.89%.
- Stable Revenue Performance
- Revenue for the quarter was $3.688 billion, down slightly by 0.5% from the previous quarter's $3.87 billion.
- Gross Margin Maintained at 15.6%
- Gross margin remained steady at 15.6%, compared to 15.5% in the prior quarter.
- Operating Income at $118M
- Operating income was reported at $118 million, reflecting strong operational performance despite revenue challenges.
- Strong Free Cash Flow
- The company generated $151 million in free cash flow for the quarter.
- Impact of Share Buybacks
- Sonic repurchased 2.1 million shares during the quarter, indicating management's confidence in the company's value.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Interest Rate Exposure
- The company has a total of $2.2 billion in variable rate debt, exposing it to interest rate fluctuations potentially impacting expenses by $5.5 million for each 1% change.
- Weakness in Operating Margin
- Operating margin decreased slightly to 3.2%, down from 3.4% in the previous quarter, indicating pressure on profitability.
- Inventory Management
- Any fluctuations in inventory levels may impact the liquidity and working capital management strategies.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $1.62
- Gross margin
- 15.6%
- Operating margin
- 3.2%
What they said about what is next.
Outlook deferred to earnings press release / call.
The filing reads about the same as the one before it.
What came before.
- 10-K · February 23, 2026
- Sonic Automotive (SAH) describes a strategy focused on higher-margin Fixed Operations and F&I sales, EchoPark expansion (pre-owned specialty retail) and an omnichannel guest experience while optimizing its brand…
- 10-Q · August 8, 2024
- Sonic Automotive reported Q2 revenue of $3,453.0 million, down from $3,652.9 million in Q2 2023 (−$199.9M, −5.5%), while diluted EPS rose to $1.18 from $0.65. Gross profit declined to $539.1 million but operating income…
- 10-Q · October 26, 2023
- Sonic Automotive reported Q3 revenue of $3,643.5 million, up from $3,448.1 million in Q3 2022, while diluted EPS declined to $1.92 from $2.23. Gross profit was essentially flat at $582.2 million, but operating income…
- 10-K · February 17, 2023
- Sonic Automotive describes itself as "one of the largest automotive retailers in the United States (as measured by reported total revenue)" and is pursuing a dual strategy of growing franchise dealerships while…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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