LKQ shares slip as Q3 revenue misses estimates, guidance lowered

ANTIOCH, Tenn. - LKQ Corporation (NASDAQ:LKQ ) reported third quarter results that fell short of expectations on the top line and lowered its full-year outlook, sending shares down 1.3% in premarket trading Thursday.

The auto parts distributor posted adjusted earnings per share of $0.88 for Q3, in line with analyst estimates. However, revenue of $3.58 billion missed the consensus forecast of $3.66 billion.

LKQ saw organic revenue for parts and services decline 2.8% YoY, or 4.3% on a per day basis. The company cited "softer overall volumes" and "uncontrollable market headwinds" impacting results.

"Our third quarter results reflect softer overall volumes, which underscore the importance of executing on our strategic transformation," said Justin Jude, President and CEO of LKQ.

For the full year 2024, LKQ lowered its adjusted EPS guidance to a range of $3.38-$3.52, down from its previous outlook of $3.50-$3.70 and below the $3.53 analyst consensus. The company now expects organic revenue for parts and services to decline 2.75% to 1.75% YoY, compared to its prior forecast of -1.25% to +0.25% growth.

"The revenue headwinds we experienced across our global operations have been more impactful than projected in our prior guidance, and we currently do not expect these headwinds to abate in the fourth quarter," noted CFO Rick Galloway.

Despite the challenges, LKQ maintained its free cash flow guidance of $850 million for the year. The company repurchased $125 million of stock in Q3 and announced a $1 billion increase to its share repurchase program.

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Source: Investing.com