Driven Brands 2025 Q2 Earnings Strong Performance as Net Income Surges 58%

Driven Brands reported second-quarter 2025 earnings that exceeded expectations, with net income rising sharply and revenue growth outpacing the prior year. The company reaffirmed its full-year 2025 guidance, staying in line with consensus estimates. Shares initially surged after the report but settled with a modest gain.

Revenue

Driven Brands reported total revenue of $550.99 million for the second quarter of 2025, representing a 6.2% year-over-year increase from $518.80 million. Franchise royalties and fees contributed $49.18 million, while company-operated store sales totaled $333.28 million. Independently-operated store sales added $71.79 million, and advertising contributions brought in $27.04 million. Additionally, the supply and other revenue segment generated $69.70 million. These results reflect strong performance across multiple segments.

Earnings/Net Income

Driven Brands delivered a 61.1% year-over-year increase in earnings per share (EPS), from $0.18 to $0.29. Net income also rose significantly, climbing 57.7% to $47.56 million from $30.16 million in the prior year. The substantial gains in profitability underscore the company’s effective cost management and operational performance.

Price Action

During the latest trading day, shares of Driven Brands declined by 3.07%. However, the stock posted a 3.83% gain during the most recent full trading week and has fallen 2.20% month-to-date.

Post Earnings Price Action Review

A strategy of purchasing shares of Driven Brands following the positive earnings report and holding for 30 days underperformed significantly, yielding a return of -28.60% versus a benchmark of 48.58%. This resulted in an excess return of -77.18%. The strategy’s negative compound annual growth rate (CAGR) of -10.98%, coupled with a Sharpe ratio of -0.27, highlights the high risk and unattractive returns associated with the approach.

CEO Commentary

Danny Rivera, President and CEO of Driven Brands, emphasized the company’s strong Q2 performance, driven by consistent growth in same store sales, revenue, adjusted EBITDA, and adjusted earnings per share. He noted the progress made in reducing leverage, with a pro forma net leverage ratio of 3.9x following the sale of the U.S. car wash seller note. Rivera also highlighted the momentum behind Take 5 Oil Change’s 20th consecutive quarter of same store sales growth and expressed confidence in the company’s ability to sustain its performance.

Guidance

Driven Brands reaffirmed its 2025 full-year outlook, projecting revenue between $2.05 billion and $2.15 billion, adjusted EBITDA between $520 million and $550 million, and adjusted diluted EPS between $1.15 and $1.25. The company also expects same store sales growth of 1% to 3% and net store growth of 175 to 200 locations. Guidance excludes the impact of any potential M&A or divestitures beyond the completed sale of the U.S. car wash business.

Additional News

Shares of Driven Brands (NASDAQ:DRVN) jumped 3.4% in the morning session following the release of second-quarter financial results that beat Wall Street expectations for both revenue and adjusted profit. The company reported revenue of $551 million and adjusted earnings per share of $0.36, which exceeded analyst estimates. The stock later retreated to $17.35, up 2% from the previous close. This move reflects the market's recognition of the company’s strong performance, although it does not indicate a fundamental shift in perception. Driven Brands is up 8.3% year-to-date and currently trades near its 52-week high of $18.47.