AutoNation beats profit estimates as new-vehicle demand improves

February 17, 2023 11:40 PM AEDT | By Reuters
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(Reuters) -Top U.S. auto retailer AutoNation Inc reported a better-than-expected quarterly profit on Friday as demand for new vehicles, spare parts and services offset a poor performance in the used-vehicle segment.

Shares of the company rose 3% to $145.56 in premarket trading.

The automotive industry is starting to show signs of a gradual recovery from a global supply-chain crisis that had curtailed production, enabling dealers such as AutoNation to boost their new-vehicle deliveries to customers.

"We expect consumer demand for personal vehicle ownership to remain strong for the foreseeable future," AutoNation Chief Executive Mike Manley said.

AutoNation's revenue from new vehicles and after-sales rose 8% and 7%, while used-vehicle sales fell 8%.

Used-car retailer CarMax Inc had also reported an 86% slump in third-quarter profit in December, along with pausing some hiring, halting certain share buybacks and cutting expenses.

Excluding items, AutoNation earned $6.37 per share, ahead of analysts' average estimate of $5.83 per share, according to Refinitiv IBES data.

Its overall fourth-quarter revenue rose 2% to $6.7 billion, compared with estimates of $6.52 billion.

(Reporting by Priyamvada C in Bengaluru; Editing by Devika Syamnath)


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