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- **Core Growth Accelerates**: 6.4% Q3 core revenue growth, driven by volume and pricing, with all divisions contributing.
- **Margin Expansion**: Gross margin up to 43.2%, adjusted EBITDA margin 19.6%, reflecting pricing discipline and operational improvements.
- **Debt Reduction Milestone**: Leverage below 4x for the first time since 2022, with $100 million debt prepayment.
- **Strategic Initiatives Pay Off**: $26 million from new products and margin optimization, supporting long-term growth.
- **Consumer Resilience**: Enthusiast demand remains strong, with no signs of slowdown despite macro challenges.

**【Management Opening Remarks】**
- Anthony Rozmus introduced the call, highlighting the review of Q3 2025 financial results and guidance for the full year. He emphasized the company's focus on disciplined execution and strategic initiatives.

**【CEO Commentary】**
- **Core Business Growth**: 6.4% year-over-year, driven by volume (4%) and pricing (1%), with growth across all divisions and channels.
- **Strategic Initiatives**: Generated $26 million in revenue, including $11.3 million from new products and $7.7 million from margin optimization.
- **Financial Milestones**: Net debt-to-EBITDA leverage dropped to 3.9x (first below 4x since 2022), with $100 million debt prepayment since September 2023.
- **Operational Improvements**: In-stock rates for top 2,500 products near 93%, past due orders down 20.7%, and $3 million efficiency gains.
- **Event Engagement**: Record merchandise sales despite lower attendance at LS Fest East, with digital audience growth supporting sales.

**【CFO Commentary】**
- **Net Sales**: $138.4 million (+3.2% YoY), first GAAP net sales growth in 2 years, with core business up 6.4%.
- **Gross Margin**: 43.2% (+422 bps YoY), driven by pricing and operational efficiency.
- **Adjusted EBITDA**: $27.1 million (+22.6% YoY), margin 19.6% (+309 bps YoY).
- **Free Cash Flow**: $5.5 million (vs. -$2.1 million YoY), year-to-date $30.3 million.
- **Debt Reduction**: $15 million prepayment in Q3, total $100 million since Q3 2023, leverage at 3.9x.
- **Updated Guidance**: Revenue $590-605 million (+3.8% YoY), adjusted EBITDA $120-127 million.

**【Q&A Highlights】**
- **Pricing Realization**: Lower than expected due to B2B sales mix and contractual delays, but no trade-down observed.
- **Inventory Management**: Increased visibility through consignment and bonded warehouse adjustments, temporarily higher on-hand.
- **SEMA Impact**: Strong booth engagement and product launches, with events supporting D2C and B2B sales.
- **Consumer Resilience**: Enthusiast passion driving share gains despite macro challenges, with no signs of spending slowdown.
- **Future Growth**: Focus on B2B partnerships, data sharing, and operational efficiency to sustain margin expansion.


Holley Inc. (HLLY) 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

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

HLLY

HLLY fundamentals

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