Shares of LKQ fell after the distributor of vehicle-repair parts cut its fiscal 2026 outlook and posted lower second-quarter revenue and profit.
The stock was down 17% to $21.81 and earlier hit a 52-week low of $21.17. Shares are down 27% from the start of the year.
LKQ reported net income of $136 million, or 53 cents a share, compared with $193 million, or 75 cents a share, a year earlier.
Income from continuing operations was $134 million, or 52 cents a share.
Adjusted earnings per share came to 67 cents. Analysts polled by FactSet expected 71 cents.
Revenue fell 3% to $3.41 billion. Analysts polled by FactSet expected $3.48 billion.
Chief Executive Justin Jude said the company's Europe business fell short of expectations due to enterprise-resource-planning, or ERP, implementation challenges. On an analyst call, Jude further cited softer performance in certain European markets and said the ERP challenges took longer to stabilize than expected, but that the company had taken steps to identify the issues and take recovery actions.
Jude said the company had delivered substantial cost reductions that largely offset lower volumes seen in the U.K. and Benelux regions. He added that the fundamentals of the business are improving, and that as market conditions recover, the company expects operational gains to translate to stronger financial performance.
LKQ lowered its full-year guidance for earnings per share to between $1.78 and $2.08 from the prior range of $2.16 to $2.46. It cut adjusted earnings-per-share guidance to between $2.60 and $2.90 from $2.90 to $3.20 previously.
It also now expects organic revenue for parts and services to sink 1% to 3% in 2026, down from the prior outlook of down 0.5% to up 1.5%.
The company said its operational results and financial condition have been and could continue to be adversely affected by economic and political conditions in North America, Europe, Taiwan and other countries.
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