Slides
Page 1
Third Quarter 2026 Earnings Release October 30, 2026
Page 2
New locations Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Words such as “anticipates,” “expects,” “estimates,” “intends,” “goals,” “targets,” “projects,” “plans,” “believes,” “continues,” “may,” “will,” “could,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Statements regarding our strategic initiatives, partnerships, and investments, including AutoNation Finance, statements regarding our expectations for the future performance of our business and the automotive retail industry, including with respect to After-Sales, Customer Financial Services, new and used vehicle volume and profitability, SG&A as a percentage of total gross profit, earnings per share and shareholder returns, as well as other statements that describe our objectives, goals, or plans, are forward- looking statements. Our forward-looking statements reflect our current expectations concerning future results and events, and they involve known and unknown risks, uncertainties, and other factors that are difficult to predict and may cause our actual results, performance, or achievements to be materially different from any future results, performance, and achievements expressed or implied by these statements. These risks, uncertainties, and other factors include, among others: economic conditions, including changes in tariffs, unemployment, interest, and/or inflation rates, consumer demand, and fuel prices; our ability to implement successfully our strategic acquisitions, initiatives, partnerships, and investments; our ability to maintain or improve gross profit margins; our ability to maintain or gain market share; safety recalls; legal, reputational, and financial risks resulting from cyber incidents and the potential impact on our operating results; the receipt of any insurance or other recoveries in connection with any cyber incidents; our ability to successfully implement and maintain expense controls; our ability to maintain and enhance our retail brands and reputation and to attract consumers to our own digital channels; our ability to acquire and integrate successfully new acquisitions; restrictions imposed by vehicle manufacturers and our ability to obtain manufacturer approval for franchise acquisitions; the success and financial viability and the incentive and marketing programs of vehicle manufacturers and distributors with which we hold franchises; natural disasters and other adverse weather events; the resolution of legal and administrative proceedings; changes in automotive laws and regulations affecting our business, including fuel economy requirements; factors affecting our goodwill and other intangible asset impairment testing; and other factors described in our news releases and filings made under the securities laws, including, among others, our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. Forward-looking statements contained in this presentation speak only as of the date of this presentation, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. 2
Page 3
New locations Shareholder Value 3 Growing Recurring Earnings and Intrinsic Value Customer Focus and Execution Relationship focus to meet all customer mobility needs and interests Durable After-Sales growth: recurring business with continued traffic-driven profit growth Exceptional Cash Generation Relentless balance sheet focus 141% cash conversion Meaningful, predictable and sustained cash flow Customer Financial Services Platform AutoNation controls placement among partners and our captive, creating upfront and long-term earnings streams $2.9B AN Finance portfolio, 24% ROE, rapidly- growing earnings stream with disciplined credit performance, driving deeper relationships Disciplined Capital Allocation Disciplined investment in existing sites to maintain and enhance competitive position (reduced 2026 Cap Ex to $280M-290M) Remaining free cash flow allocated to where it can best grow shareholder value per share
Page 4
New locations Adjusted EPS and Free Cash Flow Resilient Model Continues to Drive Strong Earnings and Cash Performance 4 $5.01 $5.11 Q3 2025 Q3 2026 • After-Sales and AN Finance are operational drivers of growth • EPS enhanced by share repurchases Adjusted EPS • FCF Conversion 141% • ~84% of FCF deployed to share repurchases Adjusted FCF ($M) / Conversion % Refer to the Appendix for Non-GAAP Reconciliations Conversion % $746 $739 $40 $786 $739 128% 141% Q3 '25 YTD Q3 '26 YTD Recurring Adjusted FCF ($M) Business Interruption Insurance ($M)
Page 5
New locations Adjusted EPS Walk 5 $5.01 ($0.52) ($0.28) $0.38 $0.27 $0.64 ($0.39) $5.11 Q3 2025 Vehicle Volume Vehicle PVR After-Sales AN Finance Share Count All Other Q3 2026 Demonstrated Durability in a Softer Operating Environment Refer to the Appendix for Non-GAAP Reconciliations
Page 6
New locations Durable Earnings Streams Anchor Q3 Performance Q3 Drivers 6 $597 $617 Q3 2025 Q3 2026 • Customer Pay and Warranty each +5% • Traffic up 5% for Customer Pay and 13% for Warranty • Ninth consecutive quarter of record YoY gross profit • YTD ‘26 Profit $36M vs. $4M prior year • Q3 ’26 ROE ~24% 86% 91% $2,020 $2,865 Q3 2025 Q3 2026 Non-Recourse Debt AN Equity(51% of AN Gross Profit) • Total units decreased by 4% • AN Finance growth shifts earnings mix toward recurring finance income After-Sales Gross Profit ($M) AN Finance Portfolio CFS Gross Profit ($M) $375 $349 Q3 2025 Q3 2026 (29% of AN Gross Profit)
Page 7
New locations Capital Deployment and Leverage 7 Q3 25 YTD Q3 26 YTD Repurchases CapEx M&A • ~84% of FCF deployed to share repurchases • $1B additional repurchase authorization ($1.4B currently available) • M&A adds $600M annualized revenue • Leverage stable from Q2 2026; Investment Grade Rating • Well-structured debt maturity ladder (and covenant light) Capital Allocation ($M) $1.0 B $1.1 B Capital Allocation Favors Share Repurchases in Current Environment Refer to the Appendix for Non-GAAP Reconciliations
Page 8
New locations After-Sales • Revenue growth driven by Customer Pay +6% and Wholesale Parts +16% • Record Gross Profit of $617M up 3% y/y • Customer Pay and Warranty Gross profit each up 5% - increased traffic • Gross margin rate impacted by mix (more Wholesale Parts) $1,226 $1,290 48.7% 47.8% Q3 2025 Q3 2026 Revenue ($M) Gross Profit Margin (%) 5% 8 Revenue ($M) & Gross Margin (%) Record After-Sales Gross Profit Driven by Customer Retention and Traffic Growth
Page 9
New locations Portfolio earnings building recurring revenue base Allocation Platform Customer Financial Services Platform Origination flows and value creation · Q3 2026 AN operates a full origination hub and allocation platform, yielding a scaled AN Finance portfolio and attractive shareholder returns. TOTAL ORIGINATIONS $3.9B 93k Units ~73% finance penetration Non-OEM Channel $2.1B · 53% of originations OEM channel $1.8B · 47% of originations AN Finance $0.5B · 12% of originations Preferred Partners $1.6B· 41% of originations F U T U R E V A L U E AutoNation Finance portfolio Originations (current period) $0.5B Amortization & Liquidation ($0.3B) Net portfolio expansion (current period) +0.2B Net portfolio C U R R E N T V A L U E AN Finance & CFS earnings, current period Earnings IMPACT AN Finance Operating Profit $15M CFS Earnings Non-OEM Channel Base Margin $239M $2,572 PVR OEM Channel Base Margin Total AN Finance & CFS $364M Mix of Origination hub earnings ANF 4% Channel Base Margin 66% Total CFS Earnings $349M $2,698 PVR Other – Cash or outside channel $23M $636 PVR Other 6% Origination Hub and Allocation Platform Fees $87M $674 PVR Platform Fees 24% Origination Hub Origination Platform Creates Immediate Earnings and Long-Term Portfolio Value RoE 24% $2.9B 9
Page 10
New locations AutoNation Finance 86% 91% Q3 2025 Q3 2026 AN Equity Funding (%) Non-Recourse Debt Funded (%) • Healthy interest margin reflecting improved portfolio quality • Stable expenses and delinquencies • Cash generation in Q3 of $33M; YTD of $~93M; on track for $~120M FY ‘26 $2 $15 Q3 2025 Q3 2026 $2,020 $2,865 10 Recurring Earnings Platform with 24% ROE Profitability ($M) Portfolio Balance ($M) • 91% funded with non-recourse debt • Enhanced warehouse funding • 24% ROE in Q3 despite current rate environment
Page 11
New locations Customer Financial Services $375 $349 $2,775 $2,698 Q3 2025 Q3 2026 • Product attachment remains robust – New 2.2, Used 1.6 • Pricing stable • Gross profit primarily reflects lower unit volume • AN Finance growth shifts a portion of economics from upfront commissions to recurring finance income Gross Profit ($M) Gross Profit per Unit 11 Gross Profit ($M) & Unit Profitability
Page 12
New locations Vehicle Sales 12 Vehicle Performance Stabilizing Despite YoY Market Headwinds 66,189 63,929 $2,281 $2,176 Q3 2025 Q3 2026 -3% • Market share stable with first half 2026 • BEV units down 60% y/y – combined ICE & Hybrid up 2% • Gross per unit up sequentially in both Aug. and Sept. Retail Units Gross Profit per Unit New Vehicles Used Vehicles • Stronger volume performance on higher-priced units • Retail unit profitability remained stable • Inventory mix and aging actions underway -5% 68,896 65,410 $1,489 $1,524 Q3 2025 Q3 2026 Stable Unit Profitability / Inventory Positioned for Opportunity Ahead (11% of AN Gross Profit) (9% of AN Gross Profit)
Page 13
New locations Free Cash Flow • Consistent, attractive cash conversion profile (100+%) • Continued working capital and cycle time focus • Expect full year Cap-Ex $280M to $290M (down from $325M previously) Conversion % 13 Adj. FCF ($M) & Conversion (%) Execution Leading to Strong Cash Conversion Refer to the Appendix for Non-GAAP Reconciliations $746 $739 $40 $786 $739 128% 141% Q3 '25 YTD Q3 '26 YTD Recurring Adjusted FCF ($M) Business Interruption Insurance ($M)
Page 14
New locations Commentary & Outlook • After-Sales contributes half of AN gross profit • The Customer Finance Hub and AN Finance are emerging as a meaningful earnings engine • Cash generation continues to exceed reported earnings • Investment grade balance sheet provides funding efficiency and flexibility • Capital allocation favors share repurchases in current environment • Expect typical Q4 Premium Luxury seasonal mix • Positioned for continued EPS and value per share growth 14 Well-Positioned to Deliver Continued EPS and Value-Per-Share Growth
Page 15
New locations Investment Thesis 15 Growing Recurring Earnings and Intrinsic Value Customer Focus and Execution Relationship focus to meet all customer mobility needs and interests Durable After-Sales growth: recurring business with continued traffic-driven profit growth Exceptional Cash Generation Relentless balance sheet focus 141% cash conversion Meaningful, predictable and sustained cash flow Customer Financial Services Platform AutoNation controls placement among partners and our captive, creating upfront and long-term earnings streams $2.9B AN Finance portfolio, 24% ROE, rapidly- growing earnings stream with disciplined credit performance, driving deeper relationships Disciplined Capital Allocation Disciplined investment in existing sites to maintain and enhance competitive position (reduced 2026 Cap Ex to $280M-290M) Remaining free cash flow allocated to where it can best grow shareholder value per share
Page 16
Appendix
Page 17
New locations Global Financial Crisis to Present 17 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 LTM FY Avg. New Light Vehicle SAAR (M) 13.1 10.3 11.5 12.6 14.3 15.4 16.4 17.4 17.5 17.1 17.2 17.0 14.5 14.9 13.7 15.6 15.9 16.3 16.0 15.0 Retail SAAR (M) 10.6 8.6 9.2 10.3 11.7 12.8 13.6 14.2 14.2 14.1 13.9 13.7 12.4 13.1 11.7 12.7 13.0 13.5 13.0 12.4 Ending LV Inventory (M) 3.2 1.9 2.3 2.4 3.0 3.4 3.5 3.5 3.9 3.7 3.8 3.5 2.7 1.1 1.7 2.3 2.8 2.6 2.6 2.9 New Unit Sales (k) 255.8 183.4 206.5 224.0 267.8 292.9 318.0 339.1 337.6 329.1 310.8 282.6 249.7 262.4 230.0 244.5 254.7 259.3 249.5 ASP ($k) $30.3 $31.2 $32.3 $33.5 $33.3 $34.0 $34.5 $35.4 $36.3 $37.0 $37.8 $39.5 $41.7 $46.0 $51.1 $52.2 $51.2 $52.1 $52.4 Gross PVR $1,997 $2,106 $2,185 $2,445 $2,164 $2,104 $2,044 $1,985 $1,883 $1,788 $1,660 $1,783 $2,340 $4,579 $5,942 $4,342 $3,045 $2,564 $2,364 $2,609 Margin 6.6% 6.8% 6.8% 7.3% 6.5% 6.2% 5.9% 5.6% 5.2% 4.8% 4.4% 4.5% 5.6% 9.9% 11.6% 8.3% 5.9% 4.9% 4.5% 6.5% ASP Y/Y 3% 4% 4% -1% 2% 2% 3% 3% 2% 2% 5% 6% 10% 11% 2% -2% 2% 1% Days Supply 84 54 63 50 55 62 54 68 61 53 60 52 42 9 19 36 39 45 52 Used Unit Sales (k) 181.3 135.3 160.1 171.1 181.0 204.6 214.9 227.3 225.7 234.1 237.7 246.1 241.2 304.4 299.8 274.0 265.9 269.6 258.7 ASP ($k) $15.7 $16.3 $17.3 $17.8 $17.9 $18.1 $18.6 $19.2 $19.9 $19.5 $20.2 $21.0 $21.8 $26.5 $30.1 $27.9 $26.6 $27.0 $28.3 Gross PVR $1,583 $1,664 $1,612 $1,640 $1,623 $1,590 $1,690 $1,577 $1,484 $1,315 $1,378 $1,409 $1,719 $2,045 $1,795 $1,800 $1,558 $1,555 $1,536 $1,613 Margin 10.1% 10.2% 9.3% 9.2% 9.1% 8.8% 9.1% 8.2% 7.5% 6.7% 6.8% 6.7% 7.9% 7.7% 6.0% 6.5% 5.9% 5.8% 5.4% 7.9% ASP Y/Y 4% 6% 3% 0% 1% 3% 4% 3% -2% 3% 4% 4% 21% 14% -7% -5% 1% 6% Days Supply 30 41 42 31 35 35 38 43 44 43 42 39 39 40 31 39 37 38 43 Ratio Used : New Units 0.71 0.74 0.78 0.76 0.68 0.68 0.70 0.68 0.67 0.71 0.76 0.87 0.97 1.16 1.30 1.12 1.04 1.04 1.04 CFS PVR $1,104 $1,102 $1,143 $1,201 $1,273 $1,355 $1,409 $1,534 $1,588 $1,667 $1,789 $1,935 $2,158 $2,443 $2,713 $2,736 $2,612 $2,769 $2,810 PVR Y/Y 0% 4% 5% 6% 6% 4% 9% 4% 5% 7% 8% 12% 13% 11% 1% -5% 6% 3% After- Sales Gross ($M) $1,072 $935 $963 $970 $1,008 $1,106 $1,197 $1,338 $1,435 $1,491 $1,555 $1,623 $1,461 $1,673 $1,900 $2,139 $2,209 $2,355 $2,409 Gross Y/Y -13% 3% 1% 4% 10% 8% 12% 7% 4% 4% 4% -10% 15% 14% 13% 3% 7% 4% Adj. Cash From Ops ($M) $692 $268 $369 $417 $455 $573 $547 $494 $670 $670 $477 $635 $974 $1,364 $1,847 $1,379 $1,078 $1,355 $1,287 CapEx ($M) $90 $75 $150 $149 $161 $161 $209 $248 $245 $313 $401 $269 $156 $216 $329 $410 $329 $309 $288 M&A ($M) $32 - $73 $64 $142 $88 $205 $322 $410 $77 $67 $5 - $433 $192 $271 - $459 $427 Share Repurchase ($M) $54 $136 $524 $583 $581 $53 $485 $235 $497 $435 $100 $45 $382 $2,303 $1,710 $864 $460 $785 $970 *Data as reported of continuing operations.
Page 18
New locations Balance Sheet and Other Items ($ in millions) 1: Leverage ratio calculated in accordance with credit agreement in place at the time of filing. Balance Sheet and Other Highlights 9/30/25 9/30/26 Cash and cash equivalents $98 $51 Inventory 3,489 3,674 Floorplan notes payable 3,797 4,019 Auto loans receivable, net 1,954 2,784 Non-recourse debt (AN Finance Funding) 1,741 2,587 Non-vehicle debt 3,833 4,344 Equity 2,512 2,266 New days supply (industry standard of selling days) 47 52 Used days supply (trailing calendar month days) 37 43 Key Credit Agreement Covenant Compliance Calculations(1) 9/30/25 9/30/26 Leverage ratio Less than or equal to 3.75x 2.35x 2.71xCovenant Interest coverage ratio Greater than or equal to 3.00x 4.79x 4.61xCovenant 18
Page 19
New locations Non-GAAP Reconciliations – Comparable Basis(1) Operating Income Income Before Income Taxes Income Tax Provision(2) Effective Tax Rate Net Income Diluted Earnings Per Share(3) 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 As reported 372.4 314.6 287.6 215.5 72.5 53.2 25.2% 24.7% 215.1 162.3 5.65 4.87 Increase (decrease) in compensation expense related to market valuation changes in deferred compensation obligations(4) 7.7 (2.5) - - - - - - - - Self-insurance related losses(5) - 8.7 - 8.7 - 2.1 - 6.6 - 0.20 Customer journey transformation costs(6) - 1.9 - 1.9 - 0.5 - 1.4 - 0.04 Acquisition-related expenses 8.0 - 8.0 - 2.0 - 6.0 - 0.16 - Insurance recoveries associated with CDK outage(7) (40.0) - (40.0) - (9.8) - (30.2) - (0.79) - Adjusted $348.1 $322.7 $255.6 $226.1 $64.7 $55.8 25.3% 24.7% $190.9 $170.3 $5.01 $5.11 Three Months Ended September 30, 2025, and September 30, 2026 SG&A As a Percentage of Gross Profit (%) 2025 2026 2025 2026 As reported 850.1 849.1 68.6 70.3 Excluding: Increase (decrease) in compensation expense related to market valuation changes in deferred compensation obligations 7.7 (2.5) Self-insurance related losses - 8.7 Customer journey transformation costs - 1.9 Acquisition-related expenses 8.0 - Adjusted $834.4 $841.0 67.4 69.6 1. Please refer to the "Non-GAAP Financial Measures" section of the Press Release. 2. Tax expense is determined based on the amount of additional taxes or tax benefits associated with each individual item. 3. Diluted earnings per share amounts are calculated discretely and therefore may not add up to the total due to rounding. 4. Increases (decreases) in deferred compensation obligations, which are recorded in SG&A, are substantially offset by correspon ding gains related to changes in the cash surrender value of corporate -owned life insurance ("COLI") for deferred compensation plan participants as a result of changes in market performance of the underlying investments; therefore, the net impact to net income and earnings per share is de minimis. Gain s/Losses related to the COLI are recorded in non -operating Other Income (Loss), Net. 5. Primarily related to losses from hail storms and other natural catastrophes. 6. Represents third-party professional fees associated with discrete transformation initiatives that are incremental to our ongoing operations. 7. Insurance recoveries received under our cybersecurity insurance policies for business interruption and related losses caused by the CDK outage. 19
Page 20
New locations Non-GAAP Reconciliations – Comparable Basis(1) Operating Income Income Before Income Taxes Income Tax Provision(2) Effective Tax Rate Net Income Diluted Earnings Per Share(3) 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 2025 2026 As reported 926.0 947.9 660.0 735.0 183.0 185.2 27.7% 25.2% 477.0 549.8 12.36 16.12 Increase in compensation expense related to market valuation changes in deferred compensation obligations (4) 16.5 11.7 - - - - - - - - Self-insurance related losses(5) - 8.7 - 8.7 - 2.1 - 6.6 - 0.19 Customer journey transformation costs(6) - 1.9 - 1.9 - 0.5 - 1.4 - 0.04 Goodwill, franchise rights, and other asset impairments(7) 141.3 - 141.3 - 18.5 - 122.8 - 3.18 - Acquisition-related expenses 8.0 - 8.0 - 2.0 - 6.0 - 0.16 - Insurance recoveries associated with CDK outage (8) (40.0) - (40.0) - (9.8) - (30.2) - (0.78) - Net (gain) loss on equity investments - - 11.5 (54.0) 2.8 (13.2) 8.7 (40.8) 0.23 (1.20) Items related to property and store divestures Asset impairments, net of gain on sales - 3.2 - 3.2 - 0.8 - 2.4 - 0.07 Loss from operations of terminated stores - 4.1 - 4.3 - 1.0 - 3.3 - 0.10 Adjusted $1,051.8 $977.5 $780.8 $699.1 $196.5 $176.4 25.2% 25.2% $584.3 $522.7 $15.14 $15.33 Nine Months Ended September 30, 2025, and September 30, 2026 20 1. Please refer to the "Non-GAAP Financial Measures" section of the Press Release. 2. Tax expense is determined based on the amount of additional taxes or tax benefits associated with each individual item. 3. Diluted earnings per share amounts are calculated discretely and therefore may not add up to the total due to rounding. 4. Increases in deferred compensation obligations, which are recorded in SG&A, are substantially offset by corresponding gains r elated to changes in the cash surrender value of corporate -owned life insurance ("COLI") for deferred compensation plan participant s as a result of changes in market performance of the underlying investments; therefore, the net impact to net income and earnings per share is de minimis. Gains/Losses related to the COLI are recorded in non-operating Other Income, Net. 5. Primarily related to losses from hail storms and other natural catastrophes. 6. Represents third-party professional fees associated with discrete transformation initiatives that are incremental to our ongoing operations. 7. Primarily comprised of franchise rights impairment of $71.7 million, goodwill impairment of $65.3 million and other intangibl e asset impairments of $4.3 million. 8. Insurance recoveries received under our cybersecurity insurance policies for business interruption and related losses caused by the CDK outage. SG&A As a Percentage of Gross Profit (%) 2025 2026 2025 2026 As reported 2,526.7 2,547.6 67.7 69.8 Excluding: Increase in compensation expense related to market valuation changes in deferred compensation obligations 16.5 11.7 Self-insurance related losses - 8.7 Customer journey transformation costs - 1.9 Acquisition-related expenses 8.0 - Adjusted $2,502.2 $2,525.3 67.0 69.2
Page 21
New locations Free Cash Flow Reconciliation 21 Free Cash Flow Reconciliation Nine Months Ended Sept. 30 2025 2026 Net cash provided by (used in) operating activities ($38.6) $160.4 Net Proceeds from vehicle floorplan – non-trade 74.6 71.9 Increase in auto loans receivable, net 972.8 708.4 Adj. cash provided by operating activities 1,008.8 940.7 Capital expenditures (223.1) (201.7) Adj. Free Cash Flow $785.7 $739.0 Adj. Net Income $584.3 $522.7 Adj. FCF Conversion %(1) 128% 141% ($ in millions) (1) Excludes cybersecurity insurance recoveries of $40M in 2025