- **Revenue Growth**: Q3 revenue up 5.2% YoY to $101.3 million, driven by 21.4% pre-need cemetery sales growth and 61% increase in insurance-funded funeral commissions.
- **Profitability**: Adjusted EBITDA margin expanded 160 bps to 32.1%, with EPS up 17.2% to $0.75.
- **Strategic Initiatives**: AI tools (Sales Edge 2.0, Titan) to accelerate pre-need sales, targeting 10%-20% annual growth. Q4 2025 guidance: revenue $413-$417 million, EPS $3.25-$3.30.
- **M&A Activity**: Completed $19 million divestiture, acquired two businesses, and expects Q1 2026 pipeline activity at 7-8x EBITDA multiples.
- **Volume Outlook**: 1-2% funeral volume growth in 2026, with Q4 2025 volumes returning to normal after July/August weakness.

**【CEO Summary Section】**
- Total operating revenue for Q3 2025 was $101.3 million, up 5.2% YoY, driven by a 21.4% increase in pre-need cemetery sales and 61% growth in general agency commission revenue tied to insurance-funded pre-arranged funeral sales.
- Funeral segment revenue declined 1.3% YoY due to lower volume in July and August, but September volumes returned to normal, with October trending positively. Cemetery segment revenue grew 12.6% YoY to $35.6 million.
- Pre-need funeral sales reached an all-time high of $7 million in September, accounting for 50.5% of year-over-year growth in financial revenue. The company expects 1-2% funeral volume growth in 2026.
- Launched Sales Edge 2.0 (CRM with marketing module) and Titan (AI-powered sales agent) to accelerate pre-need cemetery sales, targeting 10%-20% annual growth.
- Adjusted consolidated EBITDA rose 7.3% YoY to $33 million, with a margin expansion of 160 basis points to 32.1%. Adjusted EPS increased 17.2% to $0.75.

**【CFO Financial Commentary】**
- GAAP net income was $10.4 million, while adjusted EBITDA was $33 million (32.1% of revenue), up 7.3% YoY. Free cash flow increased 7.7% YoY, and the leverage ratio improved to 4.1x.
- Completed divestitures of seven non-core assets, generating $19 million in proceeds and reducing EBITDA by $2.4 million. Reinvested proceeds into debt reduction and strategic acquisitions.
- Updated 2025 guidance: revenue $413-$417 million, EBITDA $130-$132 million, EPS $3.25-$3.30, and free cash flow $44-$48 million.

**【Q&A Key Highlights】**
- **Volume Recovery**: July/August volume decline (~2% YoY) was offset by strong September and October trends, with Q4 expected to normalize. 2026 funeral volume growth target is 1-2%.
- **Pre-need Cemetery Growth**: Permit delays in key cemeteries impacted Q1/Q2, but Q3 sales rebounded 21.4% YoY. Technology (Sales Edge 2.0, Titan) will sustain 10%-20% annual growth.
- **M&A Pipeline**: Acquired two businesses in Q3 ($15 million+ revenue) and expects Q1 2026 activity. Multiples for high-quality assets range 7-8x EBITDA, with flexibility for strategic fits.
- **Trinity Implementation**: Ongoing costs for funeral home rollout will persist into 2026, with full network implementation by 2027. Synergies expected from 2027 onward.
- **Demographic Trends**: Aging population (oldest baby boomers ~80) and flu season dynamics may influence death rates, but long-term growth is supported by favorable demographics.

Carriage Services, Inc. (CSV) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

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Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

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Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

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Net Income

Net Income Attributable to Minority Interests

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Other Adjustments

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Other Comprehensive Income

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CSV

CSV fundamentals

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