PENSKE AUTOMOTIVE GROUP, INC.

Previous wording

This Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those discussed in Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024, Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, and those in our other periodic reports filed with the Securities and Exchange Commission, and "Forward-Looking Statements." We have acquired and initiated a number of businesses during the periods presented and addressed in this Management's Discussion and Analysis of Financial Condition and Results of Operations. Our financial statements include the results of operations of those businesses from the date acquired or when they commenced operations. Our period-to-period results of operations may vary depending on the dates of acquisitions or disposals.

Current wording

This Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those discussed in Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024, Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, and Part II, Item 1A. "Risk Factors" in this Quarterly Report on Form 10-Q, and those in our other periodic reports filed with the Securities and Exchange Commission, and "Forward-Looking Statements." We have acquired, disposed, and initiated a number of businesses during the periods presented and addressed in this Management's Discussion and Analysis of Financial Condition and Results of Operations. Our financial statements include the results of operations of those businesses from the date acquired or when they commenced operations. Our period-to-period results of operations may vary depending on the dates of acquisitions or disposals.

Previous wording

We are a diversified international transportation services company and one of the world's premier automotive and commercial truck retailers. We operate dealerships in the United States, the United Kingdom, Canada, Germany, Italy, Japan, and Australia, and we are one of the largest retailers of commercial trucks in North America for Freightliner. We also distribute and retail commercial vehicles, diesel and gas engines, power systems, and related parts and services principally in Australia and New Zealand. We employ over 28,400 people worldwide. Additionally, we own 28.9% of Penske Transportation Solutions, a business that employs nearly 44,000 people worldwide, manages one of the largest, most comprehensive and modern trucking fleets in North America with over 414,000 trucks, tractors, and trailers under lease, rental, and/or maintenance contracts, and provides innovative transportation, supply chain, and technology solutions to its customers.

Current wording

We are a diversified international transportation services company and one of the world's premier automotive and commercial truck retailers. We operate dealerships in the United States, the United Kingdom, Canada, Germany, Italy, Japan, and Australia, and we are one of the largest retailers of commercial trucks in North America for Freightliner. We also distribute and retail commercial vehicles, diesel and gas engines, power systems, and related parts and services principally in Australia and New Zealand. We employ over 28,300 people worldwide. Additionally, we own 28.9% of Penske Transportation Solutions, a business that employs nearly 43,000 people worldwide, manages one of the largest, most comprehensive and modern trucking fleets in North America with over 405,000 trucks, tractors, and trailers under lease, rental, and/or maintenance contracts, and provides innovative transportation, supply chain, and technology solutions to its customers.

Previous wording

During the six months ended June 30, 2025, our business generated $15.3 billion in total revenue, which is comprised of approximately $13.1 billion from retail automotive dealerships, $1.8 billion from retail commercial truck dealerships, and $412.7 million from commercial vehicle distribution and other operations. We generated $2.6 billion in gross profit, which is comprised of $2.2 billion from retail automotive dealerships, $284.6 million from retail commercial truck dealerships, and $88.4 million from commercial vehicle distribution and other operations.

Current wording

During the nine months ended September 30, 2025, our business generated $23.0 billion in total revenue, which is comprised of approximately $19.7 billion from retail automotive dealerships, $2.7 billion from retail commercial truck dealerships, and $619.3 million from commercial vehicle distribution and other operations. We generated $3.8 billion in gross profit, which is comprised of $3.3 billion from retail automotive dealerships, $420.9 million from retail commercial truck dealerships, and $134.9 million from commercial vehicle distribution and other operations.

Previous wording

Retail Automotive. We are one of the largest global automotive retailers as measured by the $26.2 billion in total retail automotive dealership revenue we generated in 2024. We are diversified geographically with 57% of our total retail automotive dealership revenues in the six months ended June 30, 2025, generated in the U.S. and Puerto Rico and 43% generated outside of the U.S. We offer over 40 vehicle brands with 73% of our retail automotive franchised dealership revenue generated from premium brands, such as Audi, BMW, Land Rover, Mercedes-Benz, and Porsche, and 21% of revenue generated from volume non-U.S. brands such as Toyota and Honda in the six months ended June 30, 2025. As of June 30, 2025, we operated 353 retail automotive franchised dealerships, of which 148 are located in the U.S. and 205 are located outside of the U.S., principally in the U.K. As of June 30, 2025, we also operated 15 used vehicle dealerships, with six dealerships in the U.S. operating under the brand name CarShop, eight dealerships in the U.K. operating under the brand name Sytner Select, and one dealership in Australia operating under the brand name Penske Select. We retailed and wholesaled, including agency units, more than 280,000 vehicles in the six months ended June 30, 2025.

Current wording

Retail Automotive. We are one of the largest global automotive retailers as measured by the $26.2 billion in total retail automotive dealership revenue we generated in 2024. We are diversified geographically with 58% of our total retail automotive dealership revenues in the nine months ended September 30, 2025, generated in the U.S. and Puerto Rico and 42% generated outside of the U.S. We offer over 40 vehicle brands with 73% of our retail automotive franchised dealership revenue generated from premium brands, such as Audi, BMW, Land Rover, Mercedes-Benz, and Porsche, and 20% of revenue generated from volume non-U.S. brands such as Toyota and Honda in the nine months ended September 30, 2025. As of September 30, 2025, we operated 356 retail automotive franchised dealerships, of which 147 are located in the U.S. and 209 are located outside of the U.S., principally in the U.K. As of September 30, 2025, we also operated 15 used vehicle dealerships, with six dealerships in the U.S. operating under the brand name CarShop, eight dealerships in the U.K. operating under the brand name Sytner Select, and one dealership in Australia operating under the brand name Penske Select. We retailed and wholesaled, including agency units, more than 418,000 vehicles in the nine months ended September 30, 2025.

Previous wording

During the six months ended June 30, 2025, we sold one retail automotive franchise and opened one retail automotive franchise in the U.S., and we sold one used vehicle dealership in the U.K. In July 2025, we acquired one retail automotive franchise in Italy. Retail automotive dealerships represented 85.7% of our total revenues and 85.5% of our total gross profit in the six months ended June 30, 2025.

Current wording

During the nine months ended September 30, 2025, we sold two retail automotive franchises and opened one retail automotive franchise in the U.S. We also sold one used vehicle dealership and opened three retail automotive franchises in the U.K., and we acquired one retail automotive franchise in Italy. Retail automotive dealerships represented 85.6% of our total revenues and 85.4% of our total gross profit in the nine months ended September 30, 2025.

Previous wording

Retail Commercial Truck Dealership. We operate Premier Truck Group ("PTG"), a heavy- and medium-duty truck dealership group offering primarily Freightliner and Western Star trucks (both Daimler brands), with locations across 10 U.S. states and the Canadian provinces of Ontario and Manitoba. As of June 30, 2025, PTG operated 45 locations selling new and/or used trucks, performing service and parts operations, or offering collision repair services. We retailed and wholesaled 10,203 new and used trucks in the six months ended June 30, 2025. This business represented 11.6% of our total revenues and 11.1% of our total gross profit in the six months ended June 30, 2025.

Current wording

Retail Commercial Truck Dealership. We operate Premier Truck Group ("PTG"), a heavy- and medium-duty truck dealership group offering primarily Freightliner and Western Star trucks (both Daimler brands), with locations across 10 U.S. states and the Canadian provinces of Ontario and Manitoba. As of September 30, 2025, PTG operated 45 locations selling new and/or used trucks, performing service and parts operations, or offering collision repair services. We retailed and wholesaled 15,393 new and used trucks in the nine months ended September 30, 2025. This business represented 11.7% of our total revenues and 11.0% of our total gross profit in the nine months ended September 30, 2025.

Previous wording

Penske Australia. Penske Australia is the exclusive importer and distributor of Western Star heavy-duty trucks (a Daimler brand), MAN heavy- and medium-duty trucks and buses (a VW Group brand), and Dennis Eagle refuse collection vehicles, together with associated parts, across Australia, New Zealand, and portions of the Pacific. In most of these same markets, we are also a leading distributor of diesel and gas engines and power systems, principally representing MTU (a Rolls-Royce solution), Detroit Diesel, Allison Transmission, and Bergen Engines. Penske Australia offers products across the on- and off-highway markets, including in the trucking, mining, power generation, energy solutions, defense, marine, rail, and construction sectors and supports full parts and aftersales service through a network of branches, field service locations, and dealers across the region. These businesses represented 2.7% of our total revenues and 3.4% of our total gross profit in the six months ended June 30, 2025.

Current wording

Penske Australia. Penske Australia is the exclusive importer and distributor of Western Star heavy-duty trucks (a Daimler brand), MAN heavy- and medium-duty trucks and buses (a VW Group brand), and Dennis Eagle refuse collection vehicles, together with associated parts, across Australia, New Zealand, and portions of the Pacific. In most of these same markets, we are also a leading distributor of diesel and gas engines and power systems, principally representing MTU (a Rolls-Royce solution), Detroit Diesel, Allison Transmission, and Bergen Engines. Penske Australia offers products across the on- and off-highway markets, including in the trucking, mining, power generation, energy solutions, defense, marine, rail, and construction sectors and supports full parts and aftersales service through a network of branches, field service locations, and dealers across the region. These businesses represented 2.7% of our total revenues and 3.6% of our total gross profit in the nine months ended September 30, 2025.

Previous wording

Penske Transportation Solutions. We hold a 28.9% ownership interest in Penske Truck Leasing Co., L.P. ("PTL"). PTL is owned 41.1% by Penske Corporation, 28.9% by us, and 30.0% by Mitsui & Co., Ltd. ("Mitsui"). We account for our investment in PTL under the equity method, and we therefore record our share of PTL's earnings on our statements of income under the caption "Equity in earnings of affiliates," which also includes the results of our other equity method investments. Penske Transportation Solutions ("PTS") is the universal brand name for PTL's various business lines through which it is capable of meeting customers' needs across the supply chain with a broad product offering that includes full-service truck leasing, truck rental, and contract maintenance along with logistics services, such as dedicated contract carriage, distribution center management, freight management, and dry van truckload carrier services. We recorded $86.7 million and $85.4 million in equity earnings from this investment for the six months ended June 30, 2025 and 2024, respectively.

Current wording

Penske Transportation Solutions. We hold a 28.9% ownership interest in Penske Truck Leasing Co., L.P. ("PTL"). PTL is owned 41.1% by Penske Corporation, 28.9% by us, and 30.0% by Mitsui & Co., Ltd. ("Mitsui"). We account for our investment in PTL under the equity method, and we therefore record our share of PTL's earnings on our statements of income under the caption "Equity in earnings of affiliates," which also includes the results of our other equity method investments. Penske Transportation Solutions ("PTS") is the universal brand name for PTL's various business lines through which it is capable of meeting customers' needs across the supply chain with a broad product offering that includes full-service truck leasing, truck rental, and contract maintenance along with logistics services, such as dedicated contract carriage, distribution center management, freight management, and dry van truckload carrier services. We recorded $145.1 million and $145.7 million in equity earnings from this investment for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

In addition, although representatives of the U.K. government have proposed a ban on the sale of internal combustion engines in new cars and new vans beginning in 2030, the phase out has been recently moderated to allow hybrid cars to be sold until 2035, with limited exceptions to the ZEV mandate for certain lower volume manufacturers. The status of, and any impact to our business from, these executive, legislative, and regulatory efforts remains uncertain.

Current wording

Electric Vehicle Regulation. Federal and state governments and regulators in our markets have placed various restrictions on new retail automotive and commercial vehicles, in many cases requiring vehicle manufacturers to achieve progressively higher penetration of EVs or lower emissions of new internal combustion engine vehicle sales. See below for further discussion. The U.S. has recently reduced its regulations and various manufacturers have begun to produce or have announced plans to produce more vehicles with internal combustion engines. The U.K. government, however, continues to propose a ban on the sale of internal combustion engines in new cars and new vans beginning in 2030, with some moderation to allow hybrid cars to be sold until 2035 and limited exceptions to the ZEV mandate for certain lower volume manufacturers. These U.K. regulations continue to effect the profitability and mix of vehicles sold by our U.K. dealerships. For an additional discussion of certain risks associated with our business related to the environmental regulations, see Item 1A. Risk Factors, "Vehicle Emissions and Other Environmental Regulations" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Previous wording

On July 4, 2025, H.R. 1, commonly referred to as the One Big Beautiful Bill Act ("OBBBA"), was signed into law. The bill provides consumers with a tax deduction for the interest on loans for certain U.S.-assembled vehicles and eliminates federal Electric Vehicle ("EV") tax credits for vehicles purchased or leased after September 30, 2025. The OBBBA also reinstates 100% bonus depreciation for qualified property placed in service after January 19, 2025. This provision allows for immediate expensing for income tax purposes of the full cost of eligible tangible assets, including certain machinery, equipment and building improvements. Further, the OBBBA has effectively eliminated fines for automotive manufacturers who fail to meet federal fuel efficiency standards for vehicles dating back to model year 2022, which is expected to result in significant savings for vehicle manufacturers. We are currently evaluating the impact of the OBBBA on our consolidated financial statements and the cash flow implications. For an additional discussion of certain risks associated with our business related to the environmental regulations, see Item 1A. Risk Factors, "Vehicle Emissions and Other Environmental Regulations" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

On July 4, 2025, H.R. 1, commonly referred to as the One Big Beautiful Bill Act ("OBBBA"), was signed into law. The bill provides consumers with a tax deduction for the interest on loans for certain U.S.-assembled vehicles and eliminates federal Electric Vehicle ("EV") tax credits for vehicles purchased or leased after September 30, 2025. The OBBBA also reinstates 100% bonus depreciation for qualified property placed in service after January 19, 2025. This provision allows for immediate expensing for income tax purposes of the full cost of eligible tangible assets, including certain machinery, equipment and building improvements, which will benefit the tax treatment of PTS vehicle purchases. Further, the OBBBA has effectively eliminated fines for automotive manufacturers who fail to meet federal fuel efficiency standards for vehicles dating back to model year 2022, which is expected to result in significant savings for vehicle manufacturers. While we expect lower U.S. EV new vehicle sales as a result of the elimination of the EV tax credit, we continue to evaluate the impact of the OBBBA on our consolidated financial statements and the cash flow implications.

Previous wording

Retail Automotive. During the six months ended June 30, 2025, U.S. industry new light vehicle sales increased 3.2%, to 8.1 million units, including a 5.1% increase in retail sales, partially offset by a 2.1% decrease in fleet sales, as compared to the same period last year. New vehicle sales were positively impacted by continued strong consumer demand in the U.S., particularly in April and May 2025 in response to tariff announcements. Although U.K. new vehicle registrations increased 3.5% to 1.0 million registrations, including a 2.8% increase in fleet sales and a 5.0% increase in retail sales, as compared to the same period last year, the sale of new premium brand vehicles across the U.K., representing a significant portion of our U.K. portfolio, decreased 6.8% over such period. New vehicle sales were positively impacted by continued strong consumer demand in the U.S. Our new vehicle days' supply is 57 as of June 30, 2025, compared to 49 as of December 31, 2024. Our used vehicle days' supply is 44 as of June 30, 2025, compared to 47 as of December 31, 2024. We continue to expect strong demand for our service and parts operations driven by increased vehicle sales in recent years, increased average age of vehicles, recall campaigns, increased miles driven, and vehicle complexity.

Current wording

Retail Automotive. During the nine months ended September 30, 2025, U.S. industry new light vehicle sales increased 4.3%, to 12.3 million units, including a 5.0% increase in retail sales and a 3.1% increase in fleet sales, as compared to the same period last year. In the U.S., we believe new vehicle sales were positively impacted by continued strong consumer demand and the expiration of the electric vehicle tax credit at the end of September 2025. Although U.K. new vehicle registrations increased 4.2% to 1.6 million registrations, including a 3.8% increase in fleet sales and a 4.8% increase in retail sales, as compared to the same period last year, the sale of new premium brand vehicles across the U.K., representing a significant portion of our U.K. portfolio, decreased 5.6% over such period. We believe the decline in premium-branded vehicles is driven by macroeconomic pressures from inflation, as well as higher business taxes, labor costs, and the JLR cybersecurity incident discussed above. Our new vehicle days' supply is 51 as of September 30, 2025, compared to 49 as of December 31, 2024. Our used vehicle days' supply is 43 as of September 30, 2025, compared to 47 as of December 31, 2024. We expect lower EV sales in the U.S. due to the elimination of EV tax credits and strong demand for our service and parts operations driven by increased vehicle sales in recent years, increased average age of vehicles, recall campaigns, increased miles driven, and vehicle complexity.

Previous wording

Retail Commercial Truck Dealership. During the six months ended June 30, 2025, North American sales of Class 6-8 medium- and heavy-duty trucks, the vehicles sold by our PTG business, decreased 6.9% from the same period last year to 208,600 units. The Class 6-7 medium-duty truck market increased 0.8% from the same period last year to 73,613 units, and Class 8 heavy-duty trucks, the largest North American market, decreased 10.6% from the same period last year to 134,987 units. As discussed above, the new trucks sold by PTG, are subject to the Reciprocal Tariffs and other tariffs which have been or may be announced. We believe that, although PTG may experience increased demand for its service and parts operations and used trucks as a result of the tariffs, ongoing tariff volatility combined with general economic and freight market uncertainty may suppress new and used commercial vehicle demand. As of June 30, 2025, the Class 6-8 medium- and heavy-duty truck backlog is 140,938 units according to data published by ACT Research compared to 215,156 as of June 30, 2024, and a decrease of 27.4% since the prior quarter.

Current wording

Retail Commercial Truck Dealership. During the nine months ended September 30, 2025, North American sales of Class 6-8 medium- and heavy-duty trucks, the vehicles sold by our PTG business, decreased 11.4% from the same period last year to 309,294 units. The Class 6-7 medium-duty truck market decreased 4.6% from the same period last year to 109,971 units, and Class 8 heavy-duty trucks, the largest North American market, decreased 14.7% from the same period last year to 199,323 units. We believe the decline in sales is due to the prolonged recessionary freight rate environment. As discussed above, certain new trucks sold by PTG, are subject to the Truck Tariffs and other tariffs which have been or may be announced. We believe that, although PTG may experience increased demand for its service and parts operations as a result of the tariffs, ongoing tariff volatility combined with general economic and freight market uncertainty may suppress new and used commercial vehicle demand. As of September 30, 2025, the Class 6-8 medium- and heavy-duty truck backlog is 136,527 units according to data published by ACT Research compared to 190,602 as of September 30, 2024, and a decrease of 3.1% since the prior quarter.

Previous wording

Commercial Vehicle Distribution and Other. During the six months ended June 30, 2025, the Australian heavy-duty truck market reported sales of 7,142 units, representing a decrease of 18.6% from the same period last year, while the New Zealand market reported sales of 1,140 units, representing a decrease of 40.7% from the same period last year. Our power system operations continue to grow through sales in the off-highway segments such as energy solutions, which provide power systems for large data centers, mining, and military applications.

Current wording

Commercial Vehicle Distribution and Other. During the nine months ended September 30, 2025, the Australian heavy-duty truck market reported sales of 10,563 units, representing a decrease of 17.8% from the same period last year, while the New Zealand market reported sales of 1,743 units, representing a decrease of 37.8% from the same period last year. Our power system operations continue to grow through sales in the off-highway segments such as energy solutions, which provide power systems for large data centers, mining, and military applications.

Previous wording

Penske Transportation Solutions. A majority of PTS' revenue is generated by multi-year contracts for full-service leasing, contract maintenance, and logistics services. PTS also rents additional trucks to commercial customers in response to demand for freight as well as consumer customers. With a managed fleet of over 414,000 vehicles at June 30, 2025, PTS regularly sells trucks in order to maintain a low fleet age as well as in response to changes in demand for truck leasing and records a gain or loss on those sales. PTS has experienced an increase in revenue from its leasing and maintenance business, though it has experienced a decline in truck rental revenue and lower gain on sale of used trucks associated with continued weakness in the freight market. In response, PTS has decreased the size of its consumer and commercial rental fleets, aimed at improving the utilization rate of the fleet and has implemented certain operational improvements to mitigate the prolonged recessionary freight environment. PTS could also be negatively impacted by the tariffs discussed above, which could increase its costs of acquiring vehicles and parts as well as negatively impact the general freight environment.

Current wording

Penske Transportation Solutions. A majority of PTS' revenue is generated by multi-year contracts for full-service leasing, contract maintenance, and logistics services. PTS also rents additional trucks to commercial customers in response to demand for freight as well as consumer customers. With a managed fleet of over 405,000 vehicles at September 30, 2025, PTS regularly sells trucks in order to maintain a low fleet age as well as in response to changes in demand for truck leasing and records a gain or loss on those sales. PTS has experienced a decrease in earnings during the third quarter as continued weakness in the freight market drove a decline in rental revenue, coupled with an increase in bad debt expense and lower gain on the sale of used trucks. In response, PTS has decreased the size of its consumer and commercial rental fleets, aimed at improving the utilization rate of the fleet and has implemented certain operational improvements to mitigate the challenges associated with the prolonged recessionary freight rate environment. PTS could also be negatively impacted by the tariffs discussed above, which could increase its costs of acquiring vehicles and parts.

Previous wording

As described in "Forward-Looking Statements," there are a number of factors that could cause actual results to differ materially from our expectations, including those discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024, Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, and our other periodic reports filed with the Securities and Exchange Commission.

Current wording

As described in "Forward-Looking Statements," there are a number of factors that could cause actual results to differ materially from our expectations, including those discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024, Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, Item 1A. "Risk Factors" in this Quarterly Report on Form 10-Q, and our other periodic reports filed with the Securities and Exchange Commission.

Previous wording

Automotive and commercial truck dealerships represent 97.3% of our revenue and 85.1% of our earnings before taxes during the six months ended June 30, 2025. Income from our PTS investment represents 12.9% of our earnings before taxes during the six months ended June 30, 2025. New and used vehicle revenues typically include sales to retail customers, agency customers, fleet customers, and leasing companies providing consumer leasing. We generate finance and insurance revenues from sales of third-party extended service contracts, sales of third-party insurance policies, commissions relating to the sale of finance and lease contracts to third parties, and the sales of certain other products. Service and parts revenues include fees paid by customers for repair, maintenance and collision services, and the sale of replacement parts and other aftermarket accessories as well as warranty repairs that are reimbursed directly by vehicle manufacturers.

Current wording

Automotive and commercial truck dealerships represent 97.3% of our revenue and 82.4% of our earnings before taxes during the nine months ended September 30, 2025. Income from our PTS investment represents 15.0% of our earnings before taxes during the nine months ended September 30, 2025. New and used vehicle revenues typically include sales to retail customers, agency customers, fleet customers, and leasing companies providing consumer leasing. We generate finance and insurance revenues from sales of third-party extended service contracts, sales of third-party insurance policies, commissions relating to the sale of finance and lease contracts to third parties, and the sales of certain other products. Service and parts revenues include fees paid by customers for repair, maintenance and collision services, and the sale of replacement parts and other aftermarket accessories as well as warranty repairs that are reimbursed directly by vehicle manufacturers.

Previous wording

Across our consolidated business, total revenue decreased $34.4 million, or 0.4%, and gross profit increased $32.5 million, or 2.6%, during the three months ended June 30, 2025. For the six months ended June 30, 2025, total revenue increased $122.3 million, or 0.8%, and gross profit increased $56.3 million, or 2.2%, compared to the same periods in 2024.

Current wording

Across our consolidated business, total revenue increased $104.5 million, or 1.4%, and gross profit increased $5.9 million, or 0.5%, during the three months ended September 30, 2025. For the nine months ended September 30, 2025, total revenue increased $226.8 million, or 1.0%, and gross profit increased $62.2 million, or 1.7%, compared to the same periods in 2024.

Previous wording

As exchange rates fluctuate, our revenue and results of operations as reported in U.S. Dollars fluctuate. For example, if the British Pound were to weaken against the U.S. Dollar, our U.K. results of operations would translate into less U.S. Dollar reported results. Foreign currency average rate fluctuations increased revenue and gross profit by $136.6 million and $20.2 million, respectively, for the three months ended June 30, 2025, and increased revenue and gross profit by $96.2 million and $13.3 million, respectively, for the six months ended June 30, 2025, compared to the same periods in 2024. Foreign currency average rate fluctuations increased earnings per share by approximately $0.03 per share for the three months ended June 30, 2025, and increased earnings per share by approximately $0.02 per share for the six months ended June 30, 2025, compared to the same periods in 2024. Excluding the impact of foreign currency average rate fluctuations, aggregate revenue and gross profit decreased 2.2% and increased 1.0%, respectively, for the three months ended June 30, 2025, and increased 0.2% and increased 1.7%, respectively, for the six months ended June 30, 2025, compared to the same periods in 2024.

Current wording

As exchange rates fluctuate, our revenue and results of operations as reported in U.S. Dollars fluctuate. For example, if the British Pound were to weaken against the U.S. Dollar, our U.K. results of operations would translate into less U.S. Dollar reported results. Foreign currency average rate fluctuations increased revenue and gross profit by $92.8 million and $13.4 million, respectively, for the three months ended September 30, 2025, and increased revenue and gross profit by $189.0 million and $26.7 million, respectively, for the nine months ended September 30, 2025, compared to the same periods in 2024. Foreign currency average rate fluctuations increased earnings per share by approximately $0.02 per share for the three months ended September 30, 2025, and increased earnings per share by approximately $0.02 per share for the nine months ended September 30, 2025, compared to the same periods in 2024. Excluding the impact of foreign currency average rate fluctuations, aggregate revenue and gross profit increased 0.2% and decreased 0.6%, respectively, for the three months ended September 30, 2025, and increased 0.2% and increased 0.9%, respectively, for the nine months ended September 30, 2025, compared to the same periods in 2024.

Previous wording

The future success of our business is dependent upon, among other things, macro-economic, geo-political, and industry conditions and events, including their impact on sales of new and used vehicles, service and parts, and repair and maintenance services, the availability of consumer credit, changes in consumer demand, consumer confidence levels, fuel prices, demand for trucks to move freight with respect to PTS and PTG and other freight metrics such as spot rates or miles driven, personal discretionary spending levels, interest rates, foreign currency exchange rates, and unemployment rates; our ability to obtain vehicles and parts from our manufacturers, especially in light of supply chain disruptions due to natural disasters, tariffs and non-tariff trade barriers, any shortages of vehicle components, international conflicts, challenges in sourcing labor or labor strikes or work stoppages, or other disruptions; the control our manufacturer partners can exert over our operations and our reliance on them for various aspects of our business; risks to our reputation and those of our manufacturer partners; changes in the retail model from direct sales by manufacturers, a transition to an agency model of sales, sales by online competitors, or from the expansion of EVs; disruptions to the security and availability of our information technology systems and those of our third party providers, which systems are increasingly threatened by ransomware and other cyber attacks; the effects of a pandemic on the global economy, including our ability to react effectively to changing business conditions in light of any pandemic; the impact of tariffs targeting imported vehicles and parts, as well as changes or increases in tariffs, trade restrictions, trade disputes, or non-tariff trade barriers; the rate of inflation, including its impact on vehicle affordability; changes in interest rates and foreign currency exchange rates; our ability to consummate, integrate, and realize returns on our acquisitions; with respect to PTS, changes in the financial health of its customers, labor strikes, or work stoppages by its employees, a reduction in PTS' asset utilization rates, continued availability from truck manufacturers and suppliers of vehicles and parts for its fleet, including with respect to the effect of various government mandates concerning the electrification of its vehicle fleet, changes in values of used trucks which affects PTS' profitability on truck sales and regulatory risks and related compliance costs; our ability to realize returns on our significant capital investments in new and upgraded dealership facilities; our ability to navigate a rapidly changing automotive and truck landscape; our ability to respond to new or enhanced regulations in both our domestic and international markets relating to dealerships and vehicles sales, including those related to the sales process, emissions standards or electrification, as well as changes in consumer sentiment …

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Current wording

The future success of our business is dependent upon, among other things, macro-economic, geo-political, and industry conditions and events, including their impact on sales of new and used vehicles, service and parts, and repair and maintenance services, the availability of consumer credit, changes in consumer demand, consumer confidence levels, fuel prices, demand for trucks to move freight with respect to PTS and PTG and other freight metrics such as spot rates or miles driven, personal discretionary spending levels, interest rates, foreign currency exchange rates, and unemployment rates; our ability to obtain vehicles and parts from our manufacturers, especially in light of supply chain disruptions due to natural disasters, tariffs and non-tariff trade barriers, any shortages of vehicle components, international conflicts, challenges in sourcing labor or labor strikes or work stoppages, or other disruptions; the control our manufacturer partners can exert over our operations and our reliance on them for various aspects of our business; risks to our reputation and those of our manufacturer partners; changes in the retail model from direct sales by manufacturers, a transition to an agency model of sales, sales by online competitors, or from the expansion of EVs; disruptions to the security and availability of our information technology systems and those of our third party providers, which systems are increasingly threatened by ransomware and other cyber attacks; the effects of a pandemic on the global economy, including our ability to react effectively to changing business conditions in light of any pandemic; the impact of tariffs targeting imported vehicles and parts, as well as changes or increases in tariffs, trade restrictions, trade disputes, or non-tariff trade barriers; the rate of inflation, including its impact on vehicle affordability; changes in interest rates and foreign currency exchange rates; our ability to consummate, integrate, and realize returns on our acquisitions; with respect to PTS, changes in the financial health of its customers, labor strikes or work stoppages by its employees, a reduction in PTS' asset utilization rates, the cost of acquiring and the continued availability from truck manufacturers and suppliers of vehicles and parts for its fleet, including with respect to the effect of various regulations concerning its vehicle fleet, changes in values of used trucks which affects PTS' profitability on truck sales and regulatory risks and related compliance costs; our ability to realize returns on our significant capital investments in new and upgraded dealership facilities; our ability to navigate a rapidly changing automotive and truck landscape; our ability to respond to new or enhanced regulations in both our domestic and international markets relating to dealerships and vehicles sales; the success of our distribution of commercial vehicles, engines, and power systems; natural disasters, including those related to…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

Our results for the six months ended June 30, 2025, include a gain of $52.3 million from the sale of one retail automotive franchise in the U.S. in the first quarter of 2025, resulting in an after-tax gain of $38.9 million, or $0.58 per share. This gain was partially offset by impairments and other charges in the first quarter of 2025 of $25.2 million (none of which was individually material), resulting in an after-tax expense of $20.9 million, or $0.31 per share. This resulted in a net after-tax gain of $18.0 million, or $0.27 per share.

Current wording

Our results for the nine months ended September 30, 2025, include a gain of $52.3 million from the sale of one retail automotive franchise in the U.S. in the first quarter of 2025, resulting in an after-tax gain of $38.9 million, or $0.58 per share. This gain was partially offset by impairments and other charges in the first quarter of 2025 of $25.2 million (none of which was individually material), resulting in an after-tax expense of $20.9 million, or $0.31 per share. This resulted in a net after-tax gain of $18.0 million, or $0.27 per share.

Previous wording

Retail unit deliveries of new vehicles decreased from 2024 to 2025 due to a 2,963 unit, or 5.0%, decrease in same-store new retail unit deliveries, coupled with a 494 unit decrease from net dealership acquisitions/dispositions throughout the second half of 2024. Same-store retail units delivered decreased 0.2% in the U.S. and decreased 11.0% internationally. Overall, new retail unit deliveries increased 0.6% in the U.S. and decreased 13.3% internationally. We believe the decrease in same-store retail unit deliveries is primarily due to a comparative decrease in the sale of premium branded vehicles across the U.K. and decreased manufacturer incentives and other programs, partially offset by increased consumer demand in the U.S. in response to tariff announcements.

Current wording

Retail unit deliveries of new vehicles increased from 2024 to 2025 due to a 2,204 unit, or 3.9%, increase in same-store new retail unit deliveries, partially offset by a 1,478 unit decrease from net dealership dispositions. Same-store retail units delivered increased 8.9% in the U.S. and decreased 2.1% internationally. Overall, new retail unit deliveries increased 6.4% in the U.S. and decreased 5.2% internationally. We believe the increase in same-store retail unit sales in the U.S. is primarily due to increased EV sales in the U.S. due to the expiration of certain tax credits during the quarter and continued strong consumer demand. We believe the decrease in same-store retail unit deliveries internationally is primarily due to a comparative decrease in the sale of premium-branded vehicles across the U.K. driven by macroeconomic pressures from inflation, coupled with an increase in social program costs, and the JLR cybersecurity incident discussed above.

Previous wording

Retail unit sales of used vehicles decreased from 2024 to 2025 due to a 14,749 unit, or 11.8%, decrease in same-store used retail unit sales, coupled with a 6,602 unit decrease from net dealership dispositions. Our same-store units decreased 1.0% in the U.S. and decreased 20.6% internationally. Overall, our used units decreased 0.8% in the U.S. and decreased 27.1% internationally. Same-store unit sales were impacted by the transition of our U.K. CarShop locations to Sytner Select dealerships which sell fewer units. Excluding the decrease of 12,340 units across the U.K. Sytner Select dealerships, same-store used retail unit sales of used vehicles decreased by 2,409 units. Excluding the U.K. Sytner Select dealerships from both periods, used vehicles retailed decreased 5.0% internationally and decreased 2.7% overall and same-store used units decreased 3.9% internationally and decreased 2.3% overall. In addition to the impact from net dealership dispositions, we believe the decrease in same-store retail sales of used units was driven largely by a change in inventory management strategy of our used vehicles internationally, coupled with challenges in sourcing lower mileage, higher quality used vehicles and comparatively fewer lease returns in the U.S.

Current wording

Retail unit sales of used vehicles decreased from 2024 to 2025 due to a 1,600 unit decrease from net dealership acquisitions/dispositions, coupled with a 1,430 unit, or 2.6%, decrease in same-store used retail unit sales. Our same-store units increased 0.9% in the U.S. and decreased 5.9% internationally. Overall, our used units decreased 0.6% in the U.S. and decreased 9.7% internationally. Same-store unit sales were impacted by the transition of our U.K. CarShop locations to Sytner Select dealerships during the third quarter of 2024 which sell fewer units. Excluding the decrease of 1,123 units across the U.K. Sytner Select dealerships, same-store used retail unit sales of used vehicles decreased by 307 units. Excluding the U.K. Sytner Select dealerships from both periods, used vehicles retailed decreased 3.9% internationally and decreased 2.1% overall and same-store used units decreased 2.4% internationally and decreased 0.6% overall. In addition to the impact from net dealership dispositions, we believe the decrease in same-store retail sales of used units was driven largely by a change in inventory management strategy of our used vehicles internationally, coupled with challenges related to the availability of lower mileage, higher quality used vehicles and comparatively fewer lease returns primarily in the U.S.

Previous wording

Used vehicle retail sales revenue decreased from 2024 to 2025 due to a $108.5 million, or 2.5%, decrease in same-store revenues, coupled with a $102.5 million decrease from net dealership dispositions. Excluding $53.4 million of favorable foreign currency fluctuations, same-store used retail revenue decreased 3.7%. The decrease in same-store revenue is due to the decrease in same-store used retail unit sales discussed above, which decreased revenue by $514.5 million, partially offset by a $3,685 per unit increase in same-store comparative average selling price (including a $485 per unit increase attributable to favorable foreign currency fluctuations), which increased revenue by $406.0 million. We believe the increase in same-store comparative average selling price is primarily due to the transition of our former U.K. CarShop locations to Sytner Select dealerships which focus on lower volume, higher priced and higher margin inventory, coupled with affordability and availability concerns with respect to new vehicles due to tariff implications.

Current wording

Used vehicle retail sales revenue increased from 2024 to 2025 due to a $153.6 million, or 7.5%, increase in same-store revenues, partially offset by a $34.7 million decrease from net dealership acquisitions/dispositions. Excluding $43.7 million of favorable foreign currency fluctuations, same-store used retail revenue increased 5.4%. The increase in same-store revenue is due to a $3,858 per unit increase in same-store comparative average selling price (including an $816 per unit increase attributable to favorable foreign currency fluctuations), which increased revenue by $206.8 million, partially offset by the decrease in same-store used retail unit sales discussed above, which decreased revenue by $53.2 million. We believe the increase in same-store comparative average selling price is primarily due to the transition of our former U.K. CarShop locations to Sytner Select dealerships which focus on lower volume, higher priced and higher margin inventory, coupled with lower availability of used vehicles.

Previous wording

Retail gross profit from used vehicle sales increased from 2024 to 2025 due to a $5.9 million, or 2.5%, increase in same-store gross profit, partially offset by a $1.7 million decrease from net dealership dispositions. Excluding $3.0 million of favorable foreign currency fluctuations, same-store gross profit increased 1.2%. The increase in same-store gross profit is due to a $310 per unit increase in same-store comparative average gross profit (including a $27 per unit increase attributable to favorable foreign currency fluctuations), which increased gross profit by $34.2 million, partially offset by the decrease in same-store used retail unit sales, which decreased gross profit by $28.3 million. We believe the increase in same-store comparative average gross profit per unit is primarily due to a change in inventory management strategy internationally and the transition of our U.K. CarShop locations to Sytner Select dealerships which focus on lower volume, higher priced and higher margin inventory, coupled with the increase in gross profit per unit as a result of a decreased supply of used vehicles in the U.S. from declining lease renewals as well as increased consumer demand for used vehicles in response to tariff announcements.

Current wording

Retail gross profit from used vehicle sales increased from 2024 to 2025 due to a $6.1 million, or 5.7%, increase in same-store gross profit, coupled with a $0.9 million increase from net dealership acquisitions/dispositions. Excluding $2.2 million of favorable foreign currency fluctuations, same-store gross profit increased 3.6%. The increase in same-store gross profit is due to a $165 per unit increase in same-store comparative average gross profit (including a $42 per unit increase attributable to favorable foreign currency fluctuations), which increased gross profit by $8.8 million, partially offset by the decrease in same-store used retail unit sales, which decreased gross profit by $2.7 million. We believe the increase in same-store comparative average gross profit per unit is primarily due to a change in inventory management strategy internationally and the transition of our U.K. CarShop locations to Sytner Select dealerships which focus on lower volume, higher priced and higher margin inventory, coupled with the increase in gross profit per unit as a result of a decreased supply of used vehicles in the U.S. from declining lease renewals, partially offset by a change in the brand mix of units sold in the U.S.

Previous wording

Finance and insurance revenue decreased from 2024 to 2025 due to a $5.1 million decrease from net dealership dispositions, coupled with a $3.1 million, or 1.5%, decrease in same-store revenue. Excluding $3.6 million of favorable foreign currency fluctuations, same-store finance and insurance revenue decreased 3.3%. Same-store revenue (excluding agency) decreased due to the decrease in combined same-store new and used retail unit sales, which decreased revenue by $19.8 million, partially offset by a $162 per unit increase in same-store comparative average finance and insurance retail revenue (including a $35 per retail unit increase attributable to favorable foreign currency fluctuations), which increased revenue by $16.1 million. Same-store finance and insurance revenue per unit (excluding agency) increased 4.6% in the U.S. and increased 14.4% in the U.K. We believe the increase in same-store finance and insurance revenue per unit (excluding agency) is primarily due to the increase in average selling price of both new and used vehicles, coupled with enhanced product offerings internationally and our efforts to increase product penetration across the markets we serve.

Current wording

Finance and insurance revenue increased from 2024 to 2025 due to a $6.7 million, or 3.6%, increase in same-store revenue, partially offset by a $3.9 million decrease from net dealership dispositions. Excluding $2.3 million of favorable foreign currency fluctuations, same-store finance and insurance revenue increased 2.3%. Same-store revenue (excluding agency) increased due to an $85 per unit increase in same-store comparative average finance and insurance retail revenue (including a $22 per retail unit increase attributable to favorable foreign currency fluctuations), which increased revenue by $8.6 million, partially offset by the decrease in combined same-store new and used retail unit sales, which decreased revenue by $2.3 million. Same-store finance and insurance revenue per unit (excluding agency) increased 0.9% in the U.S. and increased 9.9% in the U.K. We believe the increase in same-store finance and insurance revenue per unit (excluding agency) is primarily due to the increase in average selling price of both new and used vehicles, coupled with enhanced product offerings internationally and our efforts to increase product penetration across the markets we serve.

Previous wording

Service and parts revenue increased from 2024 to 2025, with an increase of 7.1% in the U.S. and an increase of 7.2% internationally. The increase in service and parts revenue is due to an $80.7 million, or 5.5%, increase in same-store revenues, coupled with a $26.4 million increase from net dealership acquisitions. Excluding $12.9 million of favorable foreign currency fluctuations, same-store revenue increased 4.6%. The increase in same-store revenue is due to a $49.7 million, or 16.0%, increase in warranty revenue and a $32.5 million, or 3.0%, increase in customer pay revenue, partially offset by a $1.5 million, or 1.6%, decrease in vehicle preparation and body shop revenue. We believe the increase in same-store revenue is primarily due to additional warranty opportunities due to manufacturer recalls, vehicles remaining on the road longer due to affordability considerations, including in light of tariff announcements, and increasing vehicle complexity, as well as increases in labor rates, repair orders, and the price of parts.

Current wording

Service and parts revenue increased from 2024 to 2025, with an increase of 5.6% in the U.S. and an increase of 4.6% internationally. The increase in service and parts revenue is due to a $37.1 million, or 4.9%, increase in same-store revenues, coupled with a $3.2 million increase from net dealership acquisitions/dispositions. Excluding $11.6 million of favorable foreign currency fluctuations, same-store revenue increased 3.4%. The increase in same-store revenue is due to a $27.6 million, or 5.1%, increase in customer pay revenue, a $5.2 million, or 3.0%, increase in warranty revenue, and a $4.3 million, or 9.0%, increase in vehicle preparation and body shop revenue. We believe the increase in same-store revenue is primarily due to an increase in customer pay revenue from vehicles remaining on the road longer due to affordability considerations, additional warranty opportunities due to manufacturer recalls, and increasing vehicle complexity, as well as increases in labor rates, repair orders, and the price of parts.

Previous wording

Service and parts gross profit increased from 2024 to 2025 due to a $37.9 million, or 8.8%, increase in same-store gross profit, coupled with a $3.5 million increase from net dealership acquisitions. Excluding $8.8 million of favorable foreign currency fluctuations, same-store gross profit increased 6.7%. The increase in same-store gross profit is due to the increase in same-store revenues, which increased gross profit by $30.3 million, coupled with a 1.1% increase in same-store gross margin from 58.1% to 59.2%, which increased gross profit by $7.6 million. The increase in same-store gross profit is due to an $18.0 million, or 7.1%, increase in customer pay gross profit, a $13.5 million, or 16.1%, increase in warranty gross profit, and a $6.4 million, or 6.9%, increase in vehicle preparation and body shop gross profit. We believe the increase in same-store gross margin is primarily due to a change in the mix of warranty and customer pay, particularly in the U.S.

Current wording

$6.2 million of favorable foreign currency fluctuations, same-store gross profit increased 6.2%. The increase in same-store gross profit is due to the increase in same-store revenues, which increased gross profit by $21.9 million, coupled with a 1.4% increase in same-store gross margin from 57.7% to 59.1%, which increased gross profit by $11.3 million. The increase in same-store gross profit is due to a $17.9 million, or 7.0%, increase in customer pay gross profit, an $11.2 million, or 5.2%, increase in vehicle preparation and body shop gross profit, and a $4.1 million, or 4.4%, increase in warranty gross profit. We believe the increase in same-store gross margin is primarily due to a change in the mix of warranty and customer pay.

Previous wording

Retail unit sales of new trucks increased from 2024 to 2025 due to a 629 unit increase from net dealership acquisitions, partially offset by a 226 unit, or 2.8%, decrease in same-store new retail unit sales. We believe the decrease in same-store unit sales is primarily due to replacement demand cycles, coupled with a prolonged recessionary freight rate environment.

Current wording

Retail unit sales of new trucks decreased from 2024 to 2025 due to a 1,107 unit, or 20.5%, decrease in same-store new retail unit sales. We believe the decrease in same-store unit sales is due to replacement demand cycles, coupled with the prolonged recessionary freight rate environment.

Previous wording

New commercial truck retail sales revenue increased from 2024 to 2025 due to a $47.1 million increase from net dealership acquisitions, partially offset by a $6.9 million, or 1.1%, decrease in same-store revenues. The decrease in same-store revenue is due to the decrease in same-store new retail unit sales, which decreased revenue by $21.1 million, partially offset by a $3,299 per unit increase in same-store comparative average selling price, which increased revenue by $14.2 million. We believe the increase in same-store comparative average selling price is primarily due to manufacturer price increases.

Current wording

New commercial truck retail sales revenue decreased from 2024 to 2025 due to a $134.5 million, or 17.8%, decrease in same-store revenues. The decrease in same-store revenue is due to the decrease in same-store new retail unit sales, which decreased revenue by $154.7 million, partially offset by a $4,689 per unit increase in same-store comparative average selling price, which increased revenue by $20.2 million. We believe the increase in same-store comparative average selling price is primarily due to manufacturer price increases, in part due to tariffs.

Previous wording

New commercial truck retail gross profit decreased from 2024 to 2025 due to a $10.2 million, or 13.9%, decrease in same-store gross profit, partially offset by a $6.4 million increase from net dealership acquisitions. The decrease in same-store gross profit is due to a $1,052 per unit decrease in same-store comparative average gross profit, which decreased gross profit by $8.1 million, coupled with the decrease in same-store new retail unit sales, which decreased gross profit by $2.1 million. We believe the decrease in same-store comparative average gross profit per unit is primarily due to a shift in the sales mix, coupled with a prolonged recessionary freight rate environment.

Current wording

New commercial truck retail gross profit decreased from 2024 to 2025 due to an $11.3 million, or 24.6%, decrease in same-store gross profit. The decrease in same-store gross profit is due to the decrease in same-store new retail unit sales, which decreased gross profit by $9.5 million, coupled with a $428 per unit decrease in same-store comparative average gross profit, which decreased gross profit by $1.8 million. We believe the decrease in same-store comparative average gross profit per unit is primarily due to a shift in the sales mix towards fleet sales, coupled with a prolonged recessionary freight rate environment.

Previous wording

Service and parts revenue increased from 2024 to 2025 due to a $5.9 million increase from net dealership acquisitions, coupled with a $1.6 million, or 0.7%, increase in same-store revenues. Customer pay work represented 79.1%, warranty represented 18.0%, and collision repair represented 2.9% of PTG's service and parts revenue. The increase in same-store revenue is due to a $2.2 million, or 1.3%, increase in customer pay revenue, partially offset by a $0.4 million, or 5.8%, decrease in body shop revenue and a $0.2 million, or 0.5%, decrease in warranty revenue. We believe the increase in same-store service and parts revenue is primarily due to the favorable comparison against June 2024, when revenue was negatively impacted by the CDK outage that disrupted our ability to sell retail parts and service vehicles.

Current wording

Service and parts revenue decreased from 2024 to 2025 due to a $4.6 million, or 2.0%, decrease in same-store revenues, coupled with a $1.2 million decrease from net dealership dispositions. Customer pay work represented 79.4%, warranty represented 17.5%, and collision repair represented 3.1% of PTG's service and parts revenue. The decrease in same-store revenue is due to a $4.6 million, or 10.4%, decrease in warranty revenue and a $0.1 million, or 0.1%, decrease in customer pay revenue, partially offset by a $0.1 million, or 1.4%, increase in body shop revenue. We believe the decrease in same-store service and parts revenue is primarily due to customers delaying maintenance costs due to the prolonged recessionary freight rate environment.

Previous wording

Penske Australia primarily distributes and services commercial vehicles, engines, and power systems. This business generated $201.2 million of revenue during the three months ended June 30, 2025, compared to $189.0 million of revenue in the prior year, an increase of 6.5%. This business also generated $44.2 million of gross profit during the three months ended June 30, 2025, compared to $44.6 million of gross profit in the prior year, a decrease of 0.9%.

Current wording

Penske Australia primarily distributes and services commercial vehicles, engines, and power systems. This business generated $206.6 million of revenue during the three months ended September 30, 2025, compared to $186.8 million of revenue in the prior year, an increase of 10.6%. This business also generated $46.5 million of gross profit during the three months ended September 30, 2025, compared to $44.6 million of gross profit in the prior year, an increase of 4.3%.

Previous wording

Excluding $5.6 million of unfavorable foreign currency fluctuations, revenue increased 9.4% primarily due to an increase in higher value power generation units sold, partially offset by a decrease in commercial vehicle units sold. Excluding $1.2 million of unfavorable foreign currency fluctuations, gross profit increased 2.2% primarily due to an increase in higher value power generation units sold, partially offset by a decrease in commercial vehicle units sold related to the decline in the Australian heavy-duty truck market.

Current wording

Excluding $5.1 million of unfavorable foreign currency fluctuations, revenue increased 13.5% primarily due to an increase in higher value power generation units sold, partially offset by a decrease in commercial vehicle units sold. Excluding $1.1 million of unfavorable foreign currency fluctuations, gross profit increased 7.5% primarily due to an increase in higher value power generation units sold, partially offset by a decrease in commercial vehicle units sold related to the decline in the Australian and New Zealand heavy-duty truck market.

Previous wording

Selling, general, and administrative expenses ("SG&A") increased from 2024 to 2025 due to a $16.3 million, or 1.9%, increase in same-store SG&A, coupled with a $2.5 million increase from net acquisitions. Excluding $16.5 million of unfavorable foreign currency fluctuations, same-store SG&A decreased 0.1%. SG&A as a percentage of gross profit was 69.9%, a decrease of 30 basis points compared to 70.2% in the prior year. SG&A expenses as a percentage of total revenue were 11.8% and 11.5% in the three months ended June 30, 2025 and 2024, respectively. We believe the increase in SG&A expenses is primarily due to increases in personnel expenses related to an increase in overall gross profit, and rent and related expenses.

Current wording

Selling, general, and administrative expenses ("SG&A") increased from 2024 to 2025 due to a $31.2 million, or 3.6%, increase in same-store SG&A, partially offset by an $8.9 million decrease from net dealership dispositions. Excluding $11.2 million of unfavorable foreign currency fluctuations, same-store SG&A increased 2.3%. SG&A expenses as a percentage of gross profit was 72.7%, an increase of 150 basis points compared to 71.2% in the prior year. SG&A expenses as a percentage of total revenue were 11.8% and 11.7% in the three months ended September 30, 2025 and 2024, respectively. We believe the increase in SG&A expenses as a percentage of gross profit is primarily due to increases in personnel expenses, rent and related expenses, other general overhead expenses, as well as the impact of the freight environment on PTG's earnings and the JLR cybersecurity incident discussed above.

Previous wording

Depreciation increased from 2024 to 2025 due to a $3.1 million, or 8.3%, increase in same-store depreciation due to capital expenditures, coupled with a $0.4 million increase from net dealership acquisitions.

Current wording

Depreciation increased from 2024 to 2025 due to a $2.2 million, or 5.6%, increase in same-store depreciation due to capital expenditures, coupled with a $0.1 million increase from net dealership acquisitions.

Previous wording

Floor plan interest expense decreased from 2024 to 2025 due to a $10.4 million, or 11.6%, decrease in same-store floor plan interest expense, partially offset by a $3.8 million increase from net acquisitions. The overall decrease is due to decreases in applicable rates, partially offset by increases in average amounts outstanding under floor plan arrangements due to increasing levels of inventory.

Current wording

Floor plan interest expense decreased from 2024 to 2025 due to a $7.6 million, or 15.5%, decrease in same-store floor plan interest expense, coupled with a $0.3 million decrease from net dealership dispositions. The overall decrease is due to decreases in applicable rates, coupled with decreases in average amounts outstanding under floor plan arrangements due to decreasing levels of inventory.

Previous wording

Other interest expense increased from 2024 to 2025 due to increases in average revolver borrowing amounts outstanding under our credit agreements, partially offset by decreases in applicable rates.

Current wording

Other interest expense decreased from 2024 to 2025 due to decreases in applicable rates, partially offset by increases in average revolver borrowing amounts outstanding under our credit agreements primarily due to our repayment in full at scheduled maturity of our $550 million of 3.50% senior subordinated notes due September 1, 2025.

Previous wording

Equity in earnings of affiliates decreased from 2024 to 2025 due to the decrease in earnings from our joint ventures primarily due to the sale of our 50% interest in certain German dealerships in the fourth quarter of 2024, partially offset by a $1.3 million, or 1.5%, increase in earnings from our investment in PTS. We believe the increase in our PTS equity earnings is primarily due to an increase in revenue from PTS' leasing and maintenance business, partially offset by the continued decline in truck rental revenue and lower gain on sale of used trucks associated with weakness in the freight market.

Current wording

Equity in earnings of affiliates decreased from 2024 to 2025 due to a $1.8 million, or 3.0%, decrease in earnings from our investment in PTS, coupled with the decrease in earnings from our joint ventures primarily due to the sale of our 50% interest in certain German dealerships in the fourth quarter of 2024. We believe the decrease in our PTS equity earnings is primarily due to continued weakness in the freight market which drove a decline in rental revenue, coupled with an increase in bad debt expense and lower gain on the sale of used trucks.

Previous wording

Income taxes increased from 2024 to 2025 primarily due to an $11.4 million increase in our pre-tax income compared to the prior year. Our effective tax rate was 25.5% during the three months ended June 30, 2025, compared to 25.4% during the three months ended June 30, 2024, primarily due to fluctuations in our geographic pre-tax income mix.

Current wording

Income taxes increased from 2024 to 2025 despite a $12.2 million decrease in our pre-tax income compared to the prior year. Our effective tax rate was 26.9% during the three months ended September 30, 2025, compared to 25.4% during the three months ended September 30, 2024, primarily due to annual refinement of U.S. and state tax provisional estimates and fluctuations in our geographic pre-tax income mix.

Previous wording

Retail unit deliveries of new vehicles increased from 2024 to 2025 due to a 1,398 unit, or 1.2%, increase in same-store new retail unit deliveries, partially offset by a 1,166 unit decrease from net dealership acquisitions/dispositions throughout the second half of 2024. Same-store retail units delivered increased 3.4% in the U.S. and decreased 1.4% internationally. Overall, new retail unit deliveries increased 4.1% in the U.S. and decreased 4.4% internationally. We believe the increase in same-store retail unit sales in the U.S. is primarily due to increased inventory availability and continued strong consumer demand, coupled with increased consumer demand in the U.S. in response to the tariff announcements. We believe the decrease in same-store retail unit deliveries internationally is primarily due to a comparative decrease in the sale of premium branded vehicles across the U.K., coupled with decreased manufacturer incentives and other programs and other economic impacts.

Current wording

Retail unit deliveries of new vehicles increased from 2024 to 2025 due to a 3,738 unit, or 2.2%, increase in same-store new retail unit deliveries, partially offset by a 2,780 unit decrease from net dealership acquisitions/dispositions. Same-store retail units delivered increased 5.3% in the U.S. and decreased 1.5% internationally. Overall, new retail unit deliveries increased 4.9% in the U.S. and decreased 4.7% internationally. We believe the increase in same-store retail unit sales in the U.S. is primarily due to increased EV sales in the U.S. due to the expiration of certain tax credits during the third quarter and continued strong consumer demand. We believe the decrease in same-store retail unit deliveries internationally is primarily due to a comparative decrease in the sale of premium-branded vehicles across the U.K. driven by macroeconomic pressures from inflation and an increase in social program costs.