RideNow Reports $5.5M Transportation Revenue Drop and Q1 New Vehicle Growth
RideNow Group saw new vehicle unit growth in Q1 driven by higher tax refunds, while its Vehicle Transportation Services revenue fell $5.5 million following the year-end wind-down. Inventory stands at a three-month supply as interest rates dip slightly year-over-year and leverage targets span low-3x to 2x over five years.
1. Q1 Sales Trends
RideNow Group recorded strong growth in new vehicle sales during Q1 as higher tax refunds boosted consumer buying power and preferences shifted toward new models rather than pre-owned options. However, the Vehicle Transportation Services division contributed $5.5 million less revenue after being wound down at the end of 2025.
2. Inventory and Used Vehicle Outlook
Management aims to hold a three- to four-month supply of used vehicles and currently sits at the lower end of that target, with a three-month inventory. The company continues to deploy cash to build its used-vehicle stock, expecting higher gross margins as inventory levels stabilize.
3. Financial Position and Debt Strategy
Interest rates offered to buyers are slightly lower year-over-year, and consumer loan performance remains stable with no uptick in defaults. OEM partners are absorbing Section 232 tariffs for 2026, and leverage sits in the low-3x range, with a long-term goal of reducing to 2x through operational improvements and careful debt refinancing.