Dominick Zarcone
President and Chief Executive Officer at LKQ
Thank you, Joe. Good morning to everybody, and thank you for joining us on the call to discuss our third quarter results. Last month, we announced a couple of important leadership changes, including Varun Laroyia moving from the CFO chair to become the CEO of our European operations; and Rick Galloway succeeding Varun. Since that move happened with just a few weeks left in the quarter, after I provide some high-level comments, Varun and Rick will tag team on the financial details and the updated guidance for 2022.
I will then provide some closing comments before opening the call to your questions. Once again, LKQ recorded strong operating results, notwithstanding a very difficult macro environment. The pandemic is still creating challenges, the labor market remains tight and the supply chain is less than optimal, though finally starting to show some signs of improvement. The war continues in Europe and the economies around the globe are showing signs of softness, as many governments try to curb the runaway inflation created by the monetary stimulus utilized to support economies during the early days of the pandemic. But the biggest current headwind is in the foreign exchange market, with the U.S. dollar reaching levels we haven't seen in over 20 years.
While we can hedge much of our transactional exposure, with about 46% of our revenue being sourced from our European segment, we cannot hedge the translation exposure. To put things into perspective, the euro and pound sterling fell approximately 7% relative to the dollar during Q3 and have fallen about 15% since the start of 2022. The volatility in exchange rates on a year-over-year basis had a material impact on our reported results during the quarter, reducing revenue by $228 million and adjusted EPS by about $0.07 a share during the third quarter.
I believe when you focus on our local currency results, you will agree that our company is performing extremely well, and we are quite pleased to achieve our EPS goals in light of the ongoing and challenging environment. The leadership changes announced in mid-September are moving forward in a seamless manner and clearly demonstrate the depth and breadth of our talent. As discussed in each of the past three Investor Day events, talent management has been a key priority for LKQ and the benefits of that focus shine through at times like this. Overall, it was a strong quarterly result, and we continue to be optimistic about the future.
Our decision to increase the dividend reflects the confidence that we have in our business. Now on to the quarter. Revenue for the third quarter of 2022 was $3.1 billion, a decrease of about 5.9% as compared to $3.3 billion in the third quarter of 2021. On a constant currency basis, third quarter revenue grew by about 1% to a little over $3.3 billion. Parts and services organic revenue increased 4.8%, while the net impact of acquisitions and divestitures decreased revenue by 2.3%, and the foreign exchange rates decreased revenue by 7.4% for a total parts and services revenue decrease of 5%. Other revenue fell 17.4% due to changes in commodity prices relative to the same period in 2021. And as a reminder, PGW was included in our third quarter 2021 results. Net income for the quarter was $261 million as compared to $284 million for the same period in 2021. Diluted earnings per share for the quarter was $0.95 compared to $0.96 for the same period of 2021, a decrease of 1%.
On an adjusted basis, net income for the quarter was $266 million as compared to $300 million for the same period of 2021, a decrease of 11.4%. Adjusted diluted earnings per share for the quarter was $0.97 as compared to $1.02 for the same period of 2021, a decrease of 4.9%. Importantly, please note that FX volatility and lower metals prices collectively created a $0.16 per share headwind in the third quarter of 2022 when compared to the 2021 results. Now let's turn to the quarterly segment highlights. In North America, organic revenue for parts and services of our North American segment increased 10.9% in the quarter on a year-over-year basis, which exceeded our expectations.
The impact of divestitures, primarily PGW, reduced revenue by 10.6% in the quarter. This organic growth performance is outstanding when you consider that the industry data suggests that collision liability-related auto claims were up only 2%. Also, North America delivered these results in the midst of decreasing miles driven, which is largely due to the increase in fuel prices. According to the U.S. Department of Transportation, miles driven decreased 3.3% in July and was up only 0.07% in August. That said, the long-term trends for North America continue to be very favorable. Continued technician shortages will benefit our diagnostics business as shops look to outsource their diagnostic repairs. Total loss rates trending down into the high teens, parts per claim reaching over 12 parts per vehicle, a 20% increase from the third quarter of 2018, and office occupancy hitting nearly a three-year high, which ultimately lead to more congestion in claims frequency.
During the quarter, we were encouraged by the upward trend in our aftermarket volumes. During the quarter, we experienced some relief in the aftermarket supply chain relative to Q2, which translated into an increase in our fill rates. The biggest challenge exists on the domestic side of the supply chain, including the rail carriers and truckers, all of which are out of our control. In talking with several third-party experts, they generally expect these domestic challenges will continue into the first half of 2023. The spot market pricing for containers used in ocean freight has softened immeasurably and our team is laser-focused on active rate reductions from our contracted carriers. Now on to our self-service segment. Organic revenue for parts and services for our self-service segment increased 7.2% for the third quarter.
The softness in commodity prices resulted in a decline in other revenue of 24.8%. The soft metal prices also had a significant impact on segment EBITDA margins on a year-over-year basis. This was anticipated given the lag effect that Varun touched on during our second quarter call. Moving on to our European segment. Organic revenue for parts and services in the third quarter increased 4.8% on a reported basis and 5.8% on a per day basis. Acquisitions added 0.05% growth in the quarter, while the exchange rates resulted in a 14.7% decline on a year-over-year basis. I am quite pleased with the organic growth, albeit mostly driven by price in an environment facing high inflation, continued supply chain hurdles and an energy crisis in Europe.
All of our European regional platforms recorded strong local currency organic revenue gains with some being in the low double digits. The only decline on a year-over-year basis related to the sale of product to Russian-based jobbers, which as previously mentioned, we completely stopped back in February when the war commenced. Now let's move on to our specialty segment. Organic parts and services revenue for specialty declined 9.1% in the quarter, a sequential improvement from Q2, but still down and below our expectations. You may recall, this segment reported 14% organic growth in Q3 of last year. So on a two-year stack, the annual revenue growth is still positive. The impact of acquisitions had a 6.6% positive impact on revenue growth in specialty, while as a predominantly U.S. business, the exchange rates had a negligible impact.
During the quarter, certain product groups, such as towing that have some exposure to new unit volume, again underperformed in the quarter as the new RV unit sales have decreased year-to-date by over 23% through August. As a reminder, the majority of our RV parts are replacement parts that are not tied to new unit volume but are largely related to the size of the RV park, which is still running at record levels. Also, some of the softness that the SEMA-related products faced in the quarter was due to a year-over-year decrease in light truck and SUV vehicle sales in the United States, an important vehicle category for our specialty offerings. Total U.S. light vehicle sales were flat year-over-year. Importantly, I would like to congratulate our specialty team for receiving the RV Industry Association award as their 2022 Distributor of the Year. This is the second year in a row for this recognition, further validation that our people are truly our greatest asset.
Let's move on to initial Q4 revenue trends. Revenue for our North America wholesale operations has gone off to a solid start, largely driven by the improvement in aftermarket fill rates, though we don't anticipate we will continue to run at these very high levels, particularly as we lap the pricing movements initiated last year. Our European segment is also witnessing a good start with growth rates continuing at Q3 levels. Specialty revenue is also trending similar to the Q3 performance, and will have easier comps in the fourth quarter compared to the rest of this year. From a corporate development perspective, in the third quarter, we divested our Florida shredder. As part of this transaction, we entered into a supply agreement to which our Florida self-service yards will sell or offer to sell its crushed vehicles to the new acquirer.
We also divested our equity interest in a small subsidiary of STAHLGRUBER. Neither of these divestitures are material. Our employees sit at the center of our ESG efforts, and we are in the process of working through our second employee engagement survey. We just completed surveying all of our North American employees and are in process in Europe. We have a lot of data to analyze, but the North American team had a 93% participation rate. Our independent adviser has mentioned this is extremely high for these types of activities and is generally indicative of a high level of engagement across the workforce. I look forward to sharing more on this topic once the process is complete.
And I will now turn the discussion over to Varun and Rick.
