SONIC AUTOMOTIVE INC

Previous wording

Unless otherwise noted, all discussion of increases or decreases are for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023. The following discussion of Franchised Dealerships Segment new vehicles, used vehicles, wholesale vehicles, parts, service and collision repair, and finance, insurance and other, net is on a same store basis, except where otherwise noted. All currently operating franchised dealership stores are included within the same store group as of the first full month following the first anniversary of the store’s opening or acquisition. The following discussion of EchoPark Segment used vehicles, wholesale vehicles, and finance, insurance and other, net is on a reported basis, except where otherwise noted. All currently operating EchoPark stores in a local geographic market are included within the same market group as of the first full month following the first anniversary of the market’s opening or acquisition. The following discussion of Powersports Segment new vehicles, used vehicles, wholesale vehicles, parts, service and collision repair, and finance, insurance and other, net is on a reported basis, except where otherwise noted. All currently operating stores in the Powersports Segment are included within the same store group as of the first full month following the first anniversary of the store’s opening or acquisition.

Current wording

Unless otherwise noted, all discussion of increases or decreases are for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023. The following discussion of Franchised Dealerships Segment new vehicles, used vehicles, wholesale vehicles, parts, service and collision repair, and finance, insurance and other, net is on a same store basis, except where otherwise noted. All currently operating franchised dealership stores are included within the same store group as of the first full month following the first anniversary of the store’s opening or acquisition. The following discussion of EchoPark Segment used vehicles, wholesale vehicles, and finance, insurance and other, net is on a reported basis, except where otherwise noted. All currently operating EchoPark stores in a local geographic market are included within the same market group as of the first full month following the first anniversary of the market’s opening or acquisition. The following discussion of Powersports Segment new vehicles, used vehicles, wholesale vehicles, parts, service and collision repair, and finance, insurance and other, net is on a reported basis, except where otherwise noted. All currently operating stores in the Powersports Segment are included within the same store group as of the first full month following the first anniversary of the store’s opening or acquisition.

Previous wording

We are one of the largest automotive retailers in the U.S. (as measured by reported total revenue). As a result of the way we manage our business, we had three reportable segments as of June 30, 2024: (1) the Franchised Dealerships Segment; (2) the EchoPark Segment; and (3) the Powersports Segment. For management and operational reporting purposes, we group certain businesses together that share management and inventory (principally used vehicles) into “stores.” As of June 30, 2024, we operated 107 stores in the Franchised Dealerships Segment, 18 stores in the EchoPark Segment and 13 stores in the Powersports Segment. The Franchised Dealerships Segment consists of 131 new vehicle franchises (representing 25 different brands of cars and light trucks) and 16 collision repair centers in 18 states. The EchoPark Segment consists of 18 stores in 10 states. The Powersports Segment consists of nine franchises and four retail outlets in two states.

Current wording

We are one of the largest automotive retailers in the U.S. (as measured by reported total revenue). As a result of the way we manage our business, we had three reportable segments as of September 30, 2024: (1) the Franchised Dealerships Segment; (2) the EchoPark Segment; and (3) the Powersports Segment. For management and operational reporting purposes, we group certain businesses together that share management and inventory (principally used vehicles) into “stores.” As of September 30, 2024, we operated 106 stores in the Franchised Dealerships Segment, 18 stores in the EchoPark Segment and 13 stores in the Powersports Segment. The Franchised Dealerships Segment consists of 131 new vehicle franchises (representing 25 different brands of cars and light trucks) and 16 collision repair centers in 17 states. The EchoPark Segment consists of 18 stores in 10 states. The Powersports Segment consists of nine franchises and four authorized retail outlets in two states.

Previous wording

The U.S. retail automotive industry’s total new vehicle (retail and fleet combined) seasonally adjusted annual rate of unit sales volume (the “total new vehicle SAAR”) increased 1% for both the three and six months ended June 30, 2024, to approximately 15.7 million and 15.6 million vehicles, respectively, compared to approximately 15.6 million and 15.4 million vehicles for the three and six months ended June 30, 2023, respectively, according to the Power Information Network (“PIN”) from J.D. Power. We currently estimate the 2024 new vehicle industry volume will be between 15.5 million vehicles (flat compared to 2023) and 16.0 million vehicles (an increase of 3% compared to 2023). The effects of interest rates, changes in consumer confidence, availability of consumer financing, manufacturer inventory production levels, incentive levels from automotive manufacturers or shifts in such levels, or timing of consumer demand as a result of economic conditions, natural disasters or other unforeseen circumstances could cause the actual 2024 new vehicle industry volume to vary from expectations. Many factors, including brand and geographic concentrations as well as the industry sales mix between retail and fleet new vehicle unit sales volume, have caused our past results to differ from the industry’s overall trend. Our new vehicle sales strategy focuses on our retail new vehicle sales (as opposed to fleet new vehicle sales) and, as a result, we believe it is appropriate to compare our retail new vehicle unit sales volume to the industry retail new vehicle seasonally adjusted annual rate of unit sales volume (the “retail new vehicle SAAR”) (which excludes fleet new vehicle sales). According to PIN from J.D. Power, the retail new vehicle SAAR remained flat at approximately 12.7 million vehicles for both the three and six months ended June 30, 2024 from approximately 12.8 million and 12.7 million vehicles for the three and six months ended June 30, 2023, respectively.

Current wording

The U.S. retail automotive industry’s total new vehicle (retail and fleet combined) seasonally adjusted annual rate of unit sales volume (the “total new vehicle SAAR”) increased 1% for both the three and nine months ended September 30, 2024, to approximately 15.6 million vehicles, compared to approximately 15.5 million vehicles for both the three and nine months ended September 30, 2023, according to the Power Information Network (“PIN”) from J.D. Power. We currently estimate the 2024 new vehicle industry volume will be between 15.5 million vehicles (flat compared to 2023) and 15.7 million vehicles (an increase of 1% compared to 2023). The effects of interest rates, changes in consumer confidence, availability of consumer financing, manufacturer inventory production levels, incentive levels from automotive manufacturers or shifts in such levels, or timing of consumer demand as a result of economic conditions, natural disasters or other unforeseen circumstances could cause the actual 2024 new vehicle industry volume to vary from expectations. Many factors, including brand and geographic concentrations as well as the industry sales mix between retail and fleet new vehicle unit sales volume, have caused our past results to differ from the industry’s overall trend. Our new vehicle sales strategy focuses on our retail new vehicle sales (as opposed to fleet new vehicle sales) and, as a result, we believe it is appropriate to compare our retail new vehicle unit sales volume to the industry retail new vehicle seasonally adjusted annual rate of unit sales volume (the “retail new vehicle SAAR”) (which excludes fleet new vehicle sales). According to PIN from J.D. Power, the retail new vehicle SAAR increased 2% and 1% to approximately 12.9 million and 12.8 million vehicles for the three and nine months ended September 30, 2024, respectively, from approximately 12.6 million and 12.7 million vehicles for the three and nine months ended September 30, 2023, respectively.

Previous wording

On June 19, 2024, CDK Global (“CDK”), a third-party provider of certain information systems, notified us that CDK had suspended certain systems used by us in response to a cybersecurity incident impacting CDK (the “CDK Outage”). As a result, we experienced disruptions to our dealer management system (“DMS”), our customer relationship management system (“CRM”) and other systems that support sales, inventory and accounting functions (collectively with the DMS and CRM the “Affected Systems”). On June 26, 2024, CDK began restoring access to those systems. We performed internal risk assessments and data validation procedures on the Affected Systems, and beginning June 30, 2024, we resumed processing transactions in the DMS. As of the date of this filing, we have regained access to the Affected Systems, including the DMS and CRM.

Current wording

On June 19, 2024, CDK Global (“CDK”), a third-party provider of certain information systems, notified us that CDK had suspended certain systems used by us in response to a cybersecurity incident impacting CDK (the “CDK outage”). As a result, we experienced disruptions to our dealer management system (the “DMS”), our customer relationship management system (the “CRM”) and other systems that support sales, inventory and accounting functions (collectively with the DMS and CRM the “Affected Systems”). On June 26, 2024, CDK began restoring access to certain of the Affected Systems. We performed internal risk assessments and data validation procedures on the Affected Systems, and beginning June 30, 2024, we resumed processing transactions in the DMS. As of July 31, 2024, we regained access to all of the Affected Systems, including the CRM and inventory management applications.

Previous wording

Since the onset of the CDK outage, all of our dealerships have remained open and operating, utilizing workaround solutions to minimize the disruption caused by the CDK outage. However, the lack of access to the DMS disrupted the efficient execution of our dealership operations and affected our ability to deliver vehicles and complete transactions with customers in a typical transaction timeframe. Despite the workarounds employed by the Company, the CDK outage significantly impaired our ability to sell both new and used vehicles within both our Franchised Dealership and EchoPark Segments. The lower volume of vehicles sold as a result of the CDK outage also negatively impacted F&I revenue within both segments. Additionally, our Fixed Operations revenue within the Franchised Dealership Segment was negatively impacted by the lack of access to certain systems used to process services during the affected period. We estimate the disruption from the CDK outage negatively impacted reported income before taxes by approximately $30.0 million during the quarter ended June 30, 2024, which includes approximately $11.6 million in additional compensation expenses incurred as a result of the incident. While the CRM remained, and certain CDK applications continue to remain unavailable into the third quarter, we do not anticipate a material impact to our business, including our results of operations or financial condition, beyond those experienced in the quarter ended June 30, 2024.

Current wording

During the CDK outage, all of our dealerships remained open and operating, utilizing workaround solutions to minimize the disruption caused by the CDK outage. However, the lack of access to the Affected Systems disrupted the efficient execution of our dealership operations and affected our ability to manage inventory, track customer leads, deliver vehicles and complete transactions with customers in a typical transaction timeframe. Despite the workarounds employed by the Company, the CDK outage significantly impaired our ability to sell both new and used vehicles within both our Franchised Dealership and EchoPark Segments in June and July 2024. The lower volume of vehicles sold as a result of the CDK outage also negatively impacted F&I revenue within both segments during these periods. Additionally, our Fixed Operations revenue within the Franchised Dealership Segment was negatively impacted by the lack of access to certain systems used to process services during these periods. We estimate the disruption from the CDK outage negatively impacted reported income before taxes by approximately $30.0 million and $17.2 million during the three months June 30 and September 30, 2024, respectively, which includes approximately $11.6 million and $1.8 million in additional compensation expenses incurred as a result of the incident, respectively. We do not anticipate a material impact to our business, including our results of operations or financial condition, beyond those experienced in the quarter ended September 30, 2024.

Previous wording

Same store retail new vehicle revenue decreased 2% and remained flat during the three and six months ended June 30, 2024, respectively, driven primarily by a 2% decrease and 1% increase in retail new vehicle unit sales volume, respectively. The CDK outage also had a significant adverse impact on new vehicle unit sales volume during the three and six months ended June 30, 2024. Retail new vehicle gross profit decreased 30% and 29% during the three and six months ended June 30, 2024, respectively, due primarily to increased price competition as a result of higher levels of available inventory and higher inventory invoice cost, which combined to drive lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $1,443 per unit, or 29%, to $3,590 per unit during the three months ended June 30, 2024, and decreased $1,601 per unit, or 30%, to $3,653 per unit during the six months ended June 30, 2024. On a trailing quarter cost of sales basis, our reported Franchised Dealerships Segment new vehicle inventory days’ supply was approximately 59 and 31 days as of June 30, 2024 and 2023, respectively, as a result of increased manufacturer production levels and a slower rate of sales in the period ended June 30, 2024 due to the CDK outage.

Current wording

Same store retail new vehicle revenue was flat during the three and nine months ended September 30, 2024, driven primarily by a 2% increase in retail new vehicle unit sales volume in both periods. The CDK outage also had a significant adverse impact on new vehicle unit sales volume during the three and nine months ended September 30, 2024. Retail new vehicle gross profit decreased 33% and 31% during the three and nine months ended September 30, 2024, respectively, due primarily to increased price competition as a result of higher levels of available inventory and higher inventory invoice cost, which combined to drive lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $1,633 per unit, or 35%, to $3,049 per unit during the three months ended September 30, 2024, and decreased $1,615 per unit, or 32%, to $3,446 per unit during the nine months ended September 30, 2024. On a trailing quarter cost of sales basis, our reported Franchised Dealerships Segment new vehicle inventory days’ supply was approximately 57 as of September 30, 2024, compared to 33 days as of September 30, 2023, as a result of increased manufacturer production levels.

Previous wording

Same store retail used vehicle revenue decreased 5% and 4% during the three and six months ended June 30, 2024, respectively, driven primarily by a 7% decrease in retail used vehicle average selling prices for both the three and six months ended June 30, 2024, partially offset by a 3% increase and 4% increase in retail used vehicle unit sales volume, respectively. Retailed used vehicle unit sales volume during the three and six months ended June 30, 2024 were also significantly adversely affected by the CDK outage. Retail used vehicle gross profit decreased 12% and 6% during the three and six months ended June 30, 2024, respectively, primarily due to lower retail used vehicle gross profit per unit. Retail used vehicle gross profit per unit decreased $255 per unit, or 14%, to $1,524 per unit during the three months ended June 30, 2024 and decreased $150 per unit, or 9%, to $1,555 per unit during the six months ended June 30, 2024 due primarily to higher inventory acquisition costs and lower selling prices due to increased price competition as a result of ongoing consumer affordability challenges, including the effect of higher interest rates. Same store wholesale vehicle gross profit (loss) remained flat and worsened $2.0 million during the three and six months ended June 30, 2024, respectively, on flat wholesale vehicle gross profit (loss) per unit during the three months ended June 30, 2024 and a $191 per unit, or 146%, worsening of wholesale vehicle gross profit (loss) per unit during the six months ended June 30, 2024. We generally focus on maintaining Franchised Dealerships Segment used vehicle inventory days’ supply in the 25- to 35-day range, which may fluctuate seasonally, in order to limit our exposure to market pricing volatility. On a trailing quarter cost of sales basis, our reported Franchised Dealerships Segment used vehicle inventory days’ supply was approximately 30 and 31 days as of June 30, 2024 and 2023, respectively.

Current wording

Same store retail used vehicle revenue decreased 10% and 6% during the three and nine months ended September 30, 2024, respectively. The 10% decrease in the three months ended September 30, 2024 was driven primarily by an 8% decrease in retail used vehicle average selling prices and a 2% decrease in retail used vehicle sales volume. The 6% decrease in the nine months ended September 30, 2024 was driven primarily by an 8% decrease in retail used vehicle average selling prices, partially offset partially by a 2% increase in retail used vehicle unit sales volume. Retail used vehicle unit sales volume during the three and nine months ended September 30, 2024 was also adversely affected by the CDK outage. Retail used vehicle gross profit decreased 18% and 10% during the three and nine months ended September 30, 2024, respectively, primarily due to lower retail used vehicle gross profit per unit. Retail used vehicle gross profit per unit decreased $283 per unit, or 17%, to $1,386 per unit during the three months ended September 30, 2024 and decreased $189 per unit, or 11%, to $1,505 per unit during the nine months ended September 30, 2024 due primarily to higher inventory acquisition costs and lower selling prices due to increased price competition as a result of ongoing consumer affordability challenges, including the effect of higher interest rates. Same store wholesale vehicle gross profit (loss) remained flat and worsened $1.8 million during the three and nine months ended September 30, 2024, respectively, on flat wholesale vehicle gross profit (loss) per unit during the three months ended September 30, 2024 and a $124 per unit worsening of wholesale vehicle gross profit (loss) per unit during the nine months ended September 30, 2024. We generally focus on maintaining Franchised Dealerships Segment used vehicle inventory days’ supply in the 25- to 35-day range, which may fluctuate seasonally, in order to limit our exposure to market pricing volatility. On a trailing quarter cost of sales basis, our reported Franchised Dealerships Segment used vehicle inventory days’ supply was approximately 34 and 28 days as of September 30, 2024 and 2023, respectively.

Previous wording

Same store Fixed Operations revenue increased 1% and 3% during the three and six months ended June 30, 2024, respectively, driven primarily by higher parts and labor costs that were passed along to consumers, despite being negatively affected by the CDK outage. Fixed Operations gross profit increased 2% and 4% during the three and six months ended June 30, 2024, respectively, driven primarily by higher warranty gross margin. Fixed Operations gross margin increased 80 basis points, to 50.4%, during the three months ended June 30, 2024, and increased 70 basis points, to 50.2%, during the six months ended June 30, 2024, primarily driven by an increase in warranty revenue contribution and higher warranty gross margin.

Current wording

Same store Fixed Operations revenue increased 7% and 4% during the three and nine months ended September 30, 2024, respectively, driven primarily by higher parts and labor costs that were passed along to consumers, despite being negatively affected by the CDK outage. Fixed Operations gross profit increased 8% and 6% during the three and nine months ended September 30, 2024, respectively, driven primarily by higher warranty revenue contribution and higher warranty gross margin. Fixed Operations gross margin increased 50 basis points, to 50.2%, during the three months ended September 30, 2024, and increased 60 basis points, to 50.2%, during the nine months ended September 30, 2024, primarily driven by an increase in warranty revenue contribution and higher warranty gross margin.

Previous wording

F&I revenue decreased 5% and 1% during the three and six months ended June 30, 2024, respectively, driven by lower average retail new and used vehicle unit selling prices. F&I revenues were also adversely affected by the CDK outage’s adverse effect on new and used vehicle sales volume. F&I gross profit per retail unit decreased $146 per unit, or 6%, to $2,380 per unit during the three months ended June 30, 2024, and decreased $85 per unit, or 3%, to $2,366 per unit during the six months ended June 30, 2024.

Current wording

F&I revenue decreased 3% and 2% during the three and nine months ended September 30, 2024, respectively, driven by lower gross profit per finance contract as a result of lower average retail new and used vehicle unit selling prices. F&I revenues were also adversely affected by the CDK outage’s adverse effect on new and used vehicle unit sales volume, which reduced the number of finance, service and aftermarket contracts we sold. F&I gross profit per retail unit decreased $72 per unit, or 3%, to $2,339 per unit during the three months ended September 30, 2024, and decreased $82 per unit, or 3%, to $2,358 per unit during the nine months ended September 30, 2024.

Previous wording

Reported total revenues decreased 14% for both the three and six months ended June 30, 2024, driven primarily by a 3% and 7% decrease in retail used vehicle unit sales volume, respectively, and a 12% and 9% decrease in average retail used vehicle unit selling prices, respectively. Retail used vehicle unit sales volume during the three and six months ended June 30, 2024 were also adversely affected by the CDK outage. Reported total gross profit increased 91% and 57% during the three and six months ended June 30, 2024, respectively, primarily due to a 133% and 138% increase in retail used vehicle gross profit, respectively.

Current wording

Reported total revenues decreased 13% and 14% during the three and nine months ended September 30, 2024, respectively, driven primarily by a 7% decrease in retail used vehicle unit sales volume and a 9% decrease in average retail used vehicle unit selling prices in both periods. Retail used vehicle unit sales volume during the three and nine months ended September 30, 2024 were also adversely affected by the CDK outage. Reported total gross profit increased 5% and 34% during the three and nine months ended September 30, 2024, respectively. The 5% increase during the three months ended September 30, 2024 was primarily driven by a 12% increase in F&I revenue, and the 34% increase during the nine months ended September 30, 2024 was primarily driven by a 177% increase in retail used vehicle gross profit.

Previous wording

Same market total revenues increased 11% during both the three and six months ended June 30, 2024, primarily attributable to a 23% and 18% increase in total retail used vehicle unit sales volume, respectively. Same market total gross profit increased 81% and 80% during the three and six months ended June 30, 2024, respectively, driven primarily by a 191% and 163% increase in retail used vehicle gross profit per unit, respectively.

Current wording

Same market total revenues decreased 3% and increased 6% during the three and nine months ended September 30, 2024, respectively. The 3% decrease during the three months ended September 30, 2024 was primarily attributable to a 7% decrease in used retail vehicle unit prices, partially offset by a 2% increase in total retail used vehicle unit sales volume. The 6% increase during the nine months ended September 30, 2024 was primarily attributable to a 12% increase in total retail used vehicle unit sales volume. Same market total gross profit increased 21% and 54% during the three and nine months ended

Previous wording

Reported wholesale vehicle gross profit decreased approximately $0.1 million and $1.8 million during the three and six months ended June 30, 2024, respectively, primarily due to a 300% and 156% decrease in wholesale vehicle gross profit per unit, respectively. We generally focus on maintaining EchoPark Segment used vehicle inventory days’ supply in the 30- to 40-day range, which may fluctuate seasonally, in order to limit our exposure to market pricing volatility. On a trailing quarter cost of sales basis, our reported EchoPark Segment used vehicle inventory days’ supply was approximately 38 and 39 days as of June 30, 2024 and 2023, respectively.

Current wording

Reported wholesale vehicle gross profit (loss) worsened approximately $0.2 million and $2.0 million during the three and nine months ended September 30, 2024, respectively, primarily due to a 143% and 155% worsening in wholesale vehicle gross profit (loss) per unit, respectively. We generally focus on maintaining EchoPark Segment used vehicle inventory days’ supply in the 30- to 40-day range, which may fluctuate seasonally, in order to limit our exposure to market pricing volatility. On a trailing quarter cost of sales basis, our reported EchoPark Segment used vehicle inventory days’ supply was approximately 33 and 37 days as of September 30, 2024 and 2023, respectively.

Previous wording

Reported retail new vehicle revenue decreased 13% and 18% during the three and six months ended June 30, 2024, respectively, primarily driven by a 15% and 19% decrease in retail new vehicle unit sales volume, respectively. Retail new vehicle gross profit decreased 36% and 39% during the three and six months ended June 30, 2024, respectively, as a result of a 24% and 25% decrease in retail new vehicle gross profit per unit, respectively, and lower retail new vehicle unit sales volume. Retail new vehicle gross profit per unit decreased $769 per unit, or 24%, to $2,466 per unit for the three months ended June 30, 2024, and decreased $832 per unit, or 25%, to $2,553 for the six months ended June 30, 2024, primarily due to higher invoice costs. On a trailing quarter cost of sales basis, our reported Powersports Segment new vehicle inventory days’ supply was approximately 187 and 111 days as of June 30, 2024 and 2023, respectively, varying based on manufacturer production levels and consumer demand.

Current wording

Reported retail new vehicle revenue remained flat during the three months ended September 30, 2024 primarily due to a 9% decrease in retail new vehicle unit sales volume, offset by a 10% increase in retail new vehicle average selling prices. Reported retail new vehicle revenue decreased 11% during the nine months ended September 30, 2024, primarily driven by a 15% decrease in retail new vehicle unit sales volume. Retail new vehicle gross profit decreased 31% and 35% during the three and nine months ended September 30, 2024, respectively, as a result of a 23% decrease in retail new vehicle gross profit per unit and lower retail new vehicle unit sales volume in both periods. Retail new vehicle gross profit per unit decreased $964 per unit, or 23%, to $3,249 per unit for the three months ended September 30, 2024, and decreased $860 per unit, or 23%, to $2,820 per unit for the nine months ended September 30, 2024, primarily due to higher inventory costs. On a trailing quarter cost of sales basis, our reported Powersports Segment new vehicle inventory days’ supply was approximately 121 and 107 days as of September 30, 2024 and 2023, respectively, varying based on manufacturer production levels and consumer demand.

Previous wording

Reported retail used vehicle revenue decreased 28% and 29% during the three and six months ended June 30, 2024, respectively, primarily driven by a 24% and 18% decrease in retail used vehicle unit sales volume, respectively. Retail used vehicle gross profit remained flat and decreased 8% during the three and six months ended June 30, 2024, respectively, as a result of lower retail used vehicle unit sales volume. Retail used vehicle gross profit per unit increased $481 per unit, or 25%, to $2,423 per unit for the three months ended June 30, 2024, and increased $225 per unit, or 11%, to $2,318 for the six months ended June 30, 2024, primarily due to lower invoice costs. On a trailing quarter cost of sales basis, our reported Powersports Segment used vehicle inventory days’ supply was approximately 96 and 50 days as of June 30, 2024 and 2023, respectively.

Current wording

Reported retail used vehicle revenue increased 84% and 3% during the three and nine months ended September 30, 2024, respectively, primarily driven by a 99% and 19% increase in used unit prices, respectively. Retail used vehicle gross profit decreased 8% and 9% during the three and nine months ended September 30, 2024, respectively, as a result of lower retail used vehicle unit sales volume. Retail used vehicle gross profit per unit decreased $35 per unit, or 1%, to $2,798 per unit for the three months ended September 30, 2024, and increased $130 per unit, or 5%, to $2,537 per unit for the nine months ended September 30, 2024, primarily due to lower inventory costs. On a trailing quarter cost of sales basis, our reported Powersports Segment used vehicle inventory days’ supply was approximately 59 and 37 days as of September 30, 2024 and 2023, respectively.

Previous wording

Reported Fixed Operations revenue decreased 6% and 3% during the three and six months ended June 30, 2024, respectively, and Fixed Operations gross profit decreased 8% and 7% during the three and six months ended June 30, 2024, respectively, driven primarily by lower repair order volume. Fixed Operations gross margin decreased 110 basis points to 47% and decreased 170 basis points to 47% during the three and six months ended June 30, 2024, respectively, driven primarily by a decrease in customer pay revenue contribution and lower customer pay gross margin.

Current wording

Reported Fixed Operations revenue decreased 7% and 5% during the three and nine months ended September 30, 2024, respectively, and Fixed Operations gross profit decreased 10% and 8% during the three and nine months ended September 30, 2024, respectively, driven primarily by lower repair order volume. Fixed Operations gross margin decreased 120 basis points to 45.9% and decreased 140 basis points to 46.4% during the three and nine months ended September 30, 2024, respectively, driven primarily by a decrease in customer pay revenue contribution and lower customer pay gross margin.

Previous wording

Same store total revenues decreased 12% and 16% during the three and six months ended June 30, 2024, respectively, driven primarily by a 19% and 20% decrease in total vehicle unit sales volume for the three and six months ended June 30, 2024, respectively. Same store total gross profit decreased 17% and 21% during the three and six months ended June 30, 2024, respectively, driven primarily by a 24% and 26% decrease in retail new vehicle gross profit per unit, respectively.

Current wording

Same store total revenues increased 4% and decreased 8% during the three and nine months ended September 30, 2024, respectively. The 4% increase during the three months ended September 30, 2024 was driven primarily by a 99% increase in average retail used vehicle unit selling prices, partially offset by an 8% decrease in total vehicle unit sales volume. The 8% decrease during the nine months ended September 30, 2024 was driven primarily by a 15% decrease in total vehicle unit sales volume. Same store total gross profit decreased 15% and 18% during the three and nine months ended September 30, 2024, respectively, driven primarily by a 23% and 24% decrease in retail new vehicle gross profit per unit, respectively.

Previous wording

The following table depicts the breakdown of our Franchised Dealerships Segment new vehicle revenues by brand for the three and six months ended June 30, 2024 and 2023:

Current wording

The following table depicts the breakdown of our Franchised Dealerships Segment new vehicle revenues by brand for the three and nine months ended September 30, 2024 and 2023:

Previous wording

Wholesale vehicle revenues are affected by retail new and used vehicle unit sales volume and the associated trade-in volume, as well as short-term, temporary and seasonal fluctuations in wholesale auction pricing. In recent years, wholesale vehicle prices and supply at auction have experienced periods of volatility, impacting our wholesale vehicle revenues and related gross profit (loss), as well as our retail used vehicle revenues and related gross profit. We believe that wholesale vehicle pricing and volatility has begun to normalize in the first half of 2024 and expect that this trend will continue through the remainder of 2024. Wholesale vehicle revenues are also significantly affected by our corporate inventory management strategy and policies, which are designed to optimize our total used vehicle inventory and expected gross profit levels and minimize inventory carrying risks.

Current wording

Wholesale vehicle revenues are affected by retail new and used vehicle unit sales volume and the associated trade-in volume, as well as short-term, temporary and seasonal fluctuations in wholesale auction pricing. In recent years, wholesale vehicle prices and supply at auction have experienced periods of volatility, impacting our wholesale vehicle revenues and related gross profit (loss), as well as our retail used vehicle revenues and related gross profit. We believe that wholesale vehicle pricing and volatility have begun to normalize throughout 2024, and we expect this trend will continue through the remainder of the year. Wholesale vehicle revenues are also significantly affected by our corporate inventory management strategy and policies, which are designed to optimize our total used vehicle inventory and expected gross profit levels and minimize inventory carrying risks.

Previous wording

Retail new vehicle revenue was flat, due primarily to a 1% increase in retail new vehicle unit sales volume, despite being negatively affected by the CDK outage, partially offset by a 1% decrease in retail new vehicle average selling prices. Retail new vehicle gross profit decreased approximately $79.0 million, or 29%, as a result of lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $1,601 per unit, or 30%, to $3,653 per unit, due primarily to increased price competition as a result of higher levels of available inventory than in the prior year period and higher inventory invoice costs.

Current wording

Retail new vehicle revenue was flat, due primarily to a 2% increase in retail new vehicle unit sales volume, despite the adverse impact of the CDK outage, partially offset by a 2% decrease in retail new vehicle average selling prices. Retail new vehicle gross profit decreased approximately $41.9 million, or 33%, as a result of lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $1,633 per unit, or 35%, to $3,049 per unit, due primarily to increased price competition as a result of higher levels of available inventory than in the prior year period and higher inventory invoice costs.

Previous wording

Retail new vehicle revenue decreased 2%, due primarily to a 2% decrease in retail new vehicle unit sales volume, which was exacerbated by the CDK outage, as well as a 1% decrease in retail new vehicle average selling prices. Retail new vehicle gross profit decreased approximately $40.6 million, or 30%, as a result of lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $1,443 per unit, or 29%, to $3,590 per unit, due primarily to increased price competition as a result of higher levels of available inventory than in the prior year period and higher inventory invoice costs.

Current wording

Retail new vehicle revenue was flat, due primarily to a 2% increase in retail new vehicle unit sales volume, despite the adverse impact of the CDK outage, partially offset by a 2% decrease in retail new vehicle average selling prices. Retail new vehicle gross profit decreased approximately $120.6 million, or 31%, as a result of lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $1,615 per unit, or 32%, to $3,446 per unit, due primarily to increased price competition as a result of higher levels of available inventory than in the prior year period and higher inventory invoice costs.

Previous wording

Retail used vehicle revenue decreased approximately $62.8 million, or 4%, driven primarily by a 7% decrease in retail used vehicle average selling prices, partially offset by a 3% increase in retail used vehicle unit sales volume, despite being negatively affected by the CDK outage. Retail used vehicle gross profit decreased approximately $4.7 million, or 6%, driven primarily by a $150 per unit, or 9%, decrease in retail used vehicle gross profit per unit, partially offset by a 3% increase in retail used vehicle unit sales volume during the six months ended June 30, 2024, due primarily to higher inventory acquisition costs and increased price competition as a result of ongoing consumer affordability challenges.

Current wording

Retail used vehicle revenue decreased approximately $140.4 million, or 6%, driven primarily by an 8% decrease in retail used vehicle average selling prices, partially offset by a 2% increase in retail used vehicle unit sales volume, despite the adverse impact of the CDK outage. Retail used vehicle gross profit decreased approximately $12.3 million, or 10%, driven primarily by a $189 per unit, or 11%, decrease in retail used vehicle gross profit per unit, partially offset by a 2% increase in retail used vehicle unit sales volume during the nine months ended September 30, 2024, due primarily to higher inventory acquisition costs and increased price competition as a result of ongoing consumer affordability challenges.

Previous wording

Wholesale vehicle revenue decreased approximately $6.4 million, or 12%, driven primarily by a 9% decrease in wholesale vehicle revenue per unit and a 3% decrease in wholesale vehicle unit sales volume during the second quarter of 2024. Wholesale vehicle gross profit (loss) remained flat.

Current wording

Wholesale vehicle revenue decreased approximately $8.9 million, or 17%, driven primarily by a 15% decrease in wholesale vehicle revenue per unit and a 3% decrease in wholesale vehicle unit sales volume during the three months ended September 30, 2024. Wholesale vehicle gross loss remained flat.

Previous wording

Wholesale vehicle revenue decreased approximately $15.6 million, or 14%, driven primarily by a 10% decrease in wholesale vehicle revenue per unit and a 5% decrease in wholesale vehicle unit sales volume during the first six months of 2024. Wholesale vehicle gross profit (loss) worsened approximately $2.0 million, driven primarily by a $191 per unit, or 146%, worsening of wholesale vehicle gross profit (loss) per unit during the first six months of 2024, due primarily to lower wholesale auction prices.

Current wording

Wholesale vehicle revenue decreased approximately $24.5 million, or 15%, driven primarily by an 11% decrease in wholesale vehicle revenue per unit and a 4% decrease in wholesale vehicle unit sales volume during the first nine months of 2024. Wholesale vehicle gross profit (loss) worsened approximately $1.8 million, driven primarily by a $124 per unit worsening of wholesale vehicle gross profit (loss) per unit during the first nine months of 2024, due primarily to lower wholesale auction prices.

Previous wording

Despite the disruptions caused by the CDK outage in June 2024, Fixed Operations revenue increased approximately $25.1 million, or 3%, and Fixed Operations gross profit increased approximately $18.6 million, or 4%. Customer pay gross profit increased approximately $8.4 million, or 4%, warranty gross profit increased approximately $8.6 million, or 13%, wholesale parts gross profit decreased approximately $1.7 million, or 9%, and internal, sublet and other gross profit increased approximately $3.3 million, or 3%.

Current wording

Despite the disruptions caused by the CDK outage in July 2024, Fixed Operations revenue increased approximately $28.3 million, or 7%, and Fixed Operations gross profit increased approximately $16.3 million, or 8%. Customer pay gross profit increased approximately $4.4 million, or 4%, warranty gross profit increased approximately $10.5 million, or 29%, wholesale parts gross profit decreased approximately $0.4 million, or 4%, and internal, sublet and other gross profit increased approximately $1.8 million, or 3%.

Previous wording

Despite the disruptions caused by the CDK outage in June 2024, Fixed Operations revenue increased approximately $4.3 million, or 1%, and Fixed Operations gross profit increased approximately $5.3 million, or 2%. Customer pay gross profit increased approximately $1.9 million, or 2%, warranty gross profit increased approximately $4.3 million, or 13%, wholesale parts gross profit decreased approximately $1.0 million, or 11%, and internal, sublet and other gross profit increased approximately $0.1 million.

Current wording

Despite the disruptions caused by the CDK outage in June and July 2024, Fixed Operations revenue increased approximately $53.3 million, or 4%, and Fixed Operations gross profit increased approximately $34.9 million, or 6%. Customer pay gross profit increased approximately $12.6 million, or 4%, warranty gross profit increased approximately $19.2 million, or 18%, wholesale parts gross profit decreased approximately $2.1 million, or 7%, and internal, sublet and other gross profit increased approximately $5.2 million, or 3%.

Previous wording

Finance contract revenue for combined retail new and used vehicles decreased 7%, due primarily to an 8% decrease in gross profit per finance contract, offset slightly by a 40-basis point increase in the finance contract penetration rate. Service contract revenue for combined retail new and used vehicles decreased 9%, due primarily to an 8% decrease in gross profit per service contract and a 90-basis point decrease in the service contract penetration rate. Other aftermarket contract revenue for combined retail new and used vehicles was flat, due primarily to a 5% increase in gross profit per other aftermarket contract that was offset by an 890-basis point decrease in the other aftermarket contract penetration rate.

Current wording

Finance contract revenue for combined retail new and used vehicles decreased 2%, due primarily to a 3% decrease in gross profit per finance contract, offset slightly by a 60-basis point increase in the finance contract penetration rate. Service contract revenue for combined retail new and used vehicles decreased 6%, due primarily to a 2% decrease in gross profit per service contract, a 5% decrease in service contract volume and a 260-basis point decrease in the service contract penetration rate. Other aftermarket contract revenue for combined retail new and used vehicles was flat, due primarily to a 4% increase in gross profit per other aftermarket contract that was offset by a 5% decrease in other aftermarket contract volume.

Previous wording

F&I revenue decreased approximately $2.8 million, or 1%, due primarily to a 3% decrease in F&I gross profit per retail unit, offset partially by an increase in total combined retail new and used vehicle unit sales volume. F&I gross profit per retail unit decreased $85 per unit, or 3%, to $2,366 per unit, due primarily to a decrease in the other aftermarket contract penetration rate.

Current wording

F&I revenue decreased approximately $6.3 million, or 2%, due primarily to a 3% decrease in F&I gross profit per retail unit, offset partially by a 2% increase in total combined retail new and used vehicle unit sales volume, despite the adverse impact of the CDK outage. F&I gross profit per retail unit decreased $82 per unit, or 3%, to $2,358 per unit, due primarily to lower gross profit per finance contract and a decrease in service and other aftermarket contract penetration rates.

Previous wording

Finance contract revenue for combined retail new and used vehicles decreased 4%, due primarily to an 8% decrease in gross profit per finance contract, offset partially by a 140-basis point increase in the finance contract penetration rate. Service contract revenue for combined retail new and used vehicles increased 2%, due primarily to a 2% increase in service contract volume. Other aftermarket contract revenue for combined retail new and used vehicles increased 4%, due primarily to a 6% increase in gross profit per other aftermarket contract, partially offset by a 780-basis point decrease in the other aftermarket contract penetration rate.

Current wording

Finance contract revenue for combined retail new and used vehicles decreased 3%, due primarily to a 6% decrease in gross profit per finance contract, offset partially by a 3% increase in finance contract volume. Service contract revenue for combined retail new and used vehicles decreased 1%, due primarily to a 1% decrease in service contract volume. Other aftermarket contract revenue for combined retail new and used vehicles increased 2%, due primarily to a 6% increase in gross profit per other aftermarket contract, offset partially by a 790-basis point decrease in the other aftermarket contract penetration rate.

Previous wording

On June 22, 2023, Sonic announced a plan to indefinitely suspend operations at eight EchoPark locations and 14 related delivery/buy centers. In addition, during the third quarter of 2023, we closed three Northwest Motorsport locations within the EchoPark Segment. In January 2024, we closed the remaining seven Northwest Motorsport stores. In light of these closures, we believe the following discussion of EchoPark Segment results on a same market basis provides a meaningful year-over-year comparison.

Current wording

On June 22, 2023, Sonic announced a plan to indefinitely suspend operations at eight EchoPark locations and 14 related delivery/buy centers. In addition, during the third quarter of 2023, we closed three Northwest Motorsport locations within the EchoPark Segment. In January 2024, we closed the remaining seven Northwest Motorsport stores. In light of these closures, we believe the following discussion of EchoPark Segment results on a same market basis provides a more meaningful year-over-year comparison.

Previous wording

Our EchoPark operating strategy focuses on maximizing total used vehicle-related gross profit (based on a combination of retail used vehicle unit sales volume, front-end retail used vehicle gross profit (loss) per unit and F&I gross profit per retail unit) rather than realizing traditional levels of front-end retail used vehicle gross profit per unit. As such, we believe the best per unit measure of gross profit performance at our EchoPark stores is a combined total gross profit (loss) per retail unit, which includes both front-end retail used vehicle gross profit (loss) and F&I gross profit per retail unit sold. See the discussion under the heading “Results of Operations - Consolidated” for additional discussion of the macro drivers of used vehicle revenues and F&I revenues.

Current wording

Our EchoPark operating strategy focuses on maximizing total used vehicle-related gross profit (based on a combination of retail used vehicle unit sales volume, front-end retail used vehicle gross profit (loss) per unit and F&I gross profit per retail unit sold) rather than realizing traditional levels of front-end retail used vehicle gross profit per unit. As such, we believe the best per unit measure of gross profit performance at our EchoPark stores is a combined total gross profit (loss) per retail unit, which includes both front-end retail used vehicle gross profit (loss) and F&I gross profit per retail unit sold. See the discussion under the heading “Results of Operations - Consolidated” for additional discussion of the macro drivers of used vehicle revenues and F&I revenues.

Previous wording

Retail used vehicle revenue increased approximately $38.9 million, or 9%, due primarily to a 23% increase in retail used vehicle unit sales volume, offset partially by an 11% decrease in retail used vehicle revenue per unit. Combined retail used vehicle gross profit and F&I revenue increased approximately $23.8 million, or 84%, due primarily to a $14.7 million, or 45%, increase in F&I revenue and a 50%, or $1,036, increase in combined retail used vehicle and F&I gross profit per unit. The increasein combined retail used vehicle and F&I gross profit per unit was due primarily to improvement in inventory acquisition cost as a result of lower wholesale auction prices, sourcing a higher percentage of inventory from non-auction sources, and expanding our inventory to include older vehicles, which typically earn a higher gross profit per unit.

Current wording

Retail used vehicle revenue decreased approximately $26.9 million, or 5%, due primarily to a 7% decrease in retail used vehicle revenue per unit, offset partially by a 2% increase in retail used vehicle unit sales volume. Combined retail used vehicle gross profit and F&I revenue increased approximately $10.1 million, or 22%, due primarily to a $10.4 million, or 25%, increase in F&I revenue and a 20%, or $524, increase in combined retail used vehicle and F&I gross profit per unit. The increasein combined retail used vehicle and F&I gross profit per unit was due primarily to higher F&I penetration rates, an improvement in inventory acquisition costs as a result of paying lower wholesale auction prices, sourcing a higher percentage of inventory from non-auction sources, and expanding our inventory to include older vehicles, which typically earn a higher gross profit per unit.

Previous wording

Retail used vehicle revenue increased approximately $78.4 million, or 9%, due primarily to an 18% increase in retail used vehicle unit sales volume, offset partially by a 7% decrease in retail used vehicle revenue per unit. Combined retail used vehicle gross profit and F&I revenue increased approximately $48.4 million, or 85%, due primarily to a $23.9 million, or 34%, increase in F&I revenue and a 57%, or $1,118, increase in combined retail used vehicle and F&I gross profit per unit. The increasein combined retail used vehicle and F&I gross profit per unit was due primarily to improvement in inventory acquisition cost as a result of lower wholesale auction prices, sourcing a higher percentage of inventory from non-auction sources, and expanding our inventory to include older vehicles, which typically earn a higher gross profit per unit.

Current wording

Retail used vehicle revenue increased approximately $51.5 million, or 4%, due primarily to a 12% increase in retail used vehicle unit sales volume, offset partially by a 7% decrease in retail used vehicle revenue per unit. Combined retail used vehicle gross profit and F&I revenue increased approximately $58.4 million, or 57%, due primarily to a $34.3 million, or 31%, increase in F&I revenue and a 41%, or $893, increase in combined retail used vehicle and F&I gross profit per unit. The increasein combined retail used vehicle and F&I gross profit per unit was due primarily to higher F&I penetration rates, an improvement in inventory acquisition costs as a result of paying lower wholesale auction prices, sourcing a higher percentage of inventory from non-auction sources, and expanding our inventory to include older vehicles, which typically earn a higher gross profit per unit.

Previous wording

Same market wholesale vehicle revenue decreased approximately $4.4 million, or 17%, due primarily to a 23% decrease in wholesale vehicle revenue per unit, offset partially by an 8% increase in wholesale vehicle unit sales volume. As we adjust the inventory mix of nearly new versus older model year vehicles sold at retail going forward, the levels of wholesale vehicle revenue and gross profit may vary.

Current wording

Same market wholesale vehicle revenue decreased approximately $0.4 million, or 2%, due primarily to a 10% decrease in wholesale vehicle revenue per unit, offset partially by a 9% increase in wholesale vehicle unit sales volume. As we adjust the inventory mix of nearly new versus older model year vehicles sold at retail going forward, the levels of wholesale vehicle revenue and gross profit may vary.

Previous wording

Same market wholesale vehicle revenue increased approximately $3.2 million, or 7%, due primarily to a 19% increase in wholesale vehicle unit sales volume, offset partially by a 10% decrease in wholesale vehicle revenue per unit. As we adjust the inventory mix of nearly new versus older model year vehicles sold at retail going forward, the levels of wholesale vehicle revenue and gross profit may vary.

Current wording

Same market wholesale vehicle revenue increased approximately $2.8 million, or 4%, due primarily to a 15% increase in wholesale vehicle unit sales volume, offset partially by a 10% decrease in wholesale vehicle revenue per unit. As we adjust the inventory mix of nearly new versus older model year vehicles sold at retail going forward, the levels of wholesale vehicle revenue and gross profit may vary.

Previous wording

Retail new vehicle revenue decreased 19%, due primarily to a 19% decrease in retail new vehicle unit sales volume. Retail new vehicle gross profit decreased approximately $3.3 million, or 39%, as a result of lower retail new vehicle unit sales volume and lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $871 per unit, or 26%, to $2,502 per unit, due primarily to higher inventory invoice cost and changes in brand mix.

Current wording

Retail new vehicle revenue was flat, due primarily to a 10% increase in retail new vehicle average selling prices, partially offset by a 9% decrease in retail new vehicle unit sales volume. Retail new vehicle gross profit decreased approximately $1.8 million, or 31%, as a result of lower retail new vehicle unit sales volume and lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $964 per unit, or 23%, to $3,249 per unit, due primarily to higher inventory invoice costs and changes in brand mix.

Previous wording

Retail new vehicle revenue decreased 13%, due primarily to a 15% decrease in retail new vehicle unit sales volume, partially offset by a 2% increase in retail new vehicle average selling prices. Retail new vehicle gross profit decreased approximately $1.6 million, or 36%, as a result of lower retail new vehicle unit sales volume and lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $769 per unit, or 24%, to $2,466 per unit, due primarily to higher inventory invoice cost and changes in brand mix.

Current wording

Retail new vehicle revenue decreased 12%, due primarily to a 15% decrease in retail new vehicle unit sales volume, partially offset by a 5% increase in retail new vehicle average selling prices. Retail new vehicle gross profit decreased approximately $5.1 million, or 36%, as a result of lower retail new vehicle unit sales volume and lower retail new vehicle gross profit per unit. Retail new vehicle gross profit per unit decreased $884 per unit, or 24%, to $2,790 per unit, due primarily to higher inventory invoice costs and changes in brand mix.

Previous wording

Same store wholesale vehicle revenue increased approximately $0.7 million, due to higher wholesale vehicle average selling prices. Same store wholesale vehicle gross profit (loss) remained flat.

Current wording

Same store wholesale vehicle revenue decreased approximately $0.2 million, due to lower wholesale vehicle average selling prices. Same store wholesale vehicle gross loss remained flat.

Previous wording

Same store wholesale vehicle revenue increased approximately $0.5 million, due to higher wholesale vehicle average selling prices. Same store wholesale vehicle gross profit (loss) worsened approximately $0.1 million.

Current wording

Same store wholesale vehicle revenue increased approximately $0.4 million, due to higher wholesale vehicle average selling prices. Same store wholesale vehicle gross profit loss increased approximately $0.2 million.

Previous wording

Same Store Fixed Operations revenue decreased approximately $0.9 million, or 5%, and same store Fixed Operations gross profit decreased approximately $0.8 million, or 10%, primarily due to lower parts and accessories volume and higher inventory costs of parts and accessories. Customer pay revenue decreased approximately $2.5 million or 42%, and customer pay gross profit decreased approximately $2.3 million, or 72%. Warranty revenue increased approximately $1.0 million, or 143%, and warranty gross profit increased approximately $1.0 million, or 250%. Wholesale parts revenue increased approximately $0.1 million, or 33%, and wholesale parts gross profit remained flat. Internal, sublet and other revenue increased approximately $0.5 million, or 5%, and internal, sublet and other gross profit increased approximately $0.5 million, or 11%.

Current wording

Same store Fixed Operations revenue decreased approximately $1.5 million, or 7%, and same store Fixed Operations gross profit decreased approximately $1.0 million, or 10%, primarily due to lower parts and accessories volume and higher inventory costs of parts and accessories. Customer pay revenue decreased approximately $1.7 million, or 38%, and customer pay gross profit decreased approximately $1.4 million, or 52%. Warranty revenue increased approximately $0.6 million, or 120%, and warranty gross profit increased approximately $0.5 million, or 167%. Wholesale parts revenue increased approximately $0.1 million, or 50%, and wholesale parts gross profit increased approximately $0.1 million, or 100%. Internal, sublet and other revenue decreased approximately $0.5 million, or 3%, and internal, sublet and other gross profit decreased approximately $0.2 million, or 3%.

Previous wording

Same store Fixed Operations revenue decreased approximately $0.6 million, or 6%, and same store Fixed Operations gross profit decreased approximately $0.4 million, or 8%, primarily due to lower parts and accessories volume and higher inventory costs of parts and accessories. Customer pay revenue decreased approximately $1.8 million, or 51%, and customer pay gross profit decreased approximately $1.7 million, or 89%. Warranty revenue increased approximately $0.8 million, or 200%, and warranty gross profit increased approximately $0.8 million, or 267%. Wholesale parts revenue remained flat and wholesale parts gross profit increased approximately $0.1 million, or 100%. Internal, sublet and other revenue increased approximately $0.4 million, or 6%, and internal, sublet and other gross profit increased approximately $0.4 million, or 14%.

Current wording

Same store Fixed Operations revenue decreased approximately $2.4 million, or 6%, and same store Fixed Operations gross profit decreased approximately $1.6 million, or 9%, primarily due to lower parts and accessories volume and higher inventory costs of parts and accessories. Customer pay revenue decreased approximately $4.2 million, or 40%, and customer pay gross profit decreased approximately $3.7 million, or 63%. Warranty revenue increased approximately $1.5 million, or 115%, and warranty gross profit increased approximately $1.5 million, or 214%. Wholesale parts revenue increased approximately $0.2 million, or 40%, and wholesale parts gross profit increased approximately $0.1 million, or 100%. Internal, sublet and other revenue increased approximately $0.1 million and internal, sublet and other gross profit increased approximately $0.5 million, or 4%.