Driven Brands NASDAQ: DRVN reported higher fourth-quarter revenue and adjusted EBITDA while detailing a broad restatement of prior financial statements that management said stemmed largely from accounting, systems and control issues tied to earlier periods of rapid acquisition and integration.
On the company’s fourth-quarter 2025 earnings call, President and Chief Executive Officer Danny Rivera said Driven Brands identified issues during its 2025 year-end close related to lease accounting, Auto Glass Now cash accounting and expense mischaracterization within Driven Advantage. Rivera said the review was later expanded and led to a comprehensive restatement across multiple prior periods.
“We would prioritize accuracy and completeness over speed,” Rivera said, describing the company’s approach to the review. He said the restatement reduced revenue by $12 million in 2023, $4 million in 2024 and $5 million in 2025. Adjusted EBITDA was reduced by $57 million in 2023, $12 million in 2024 and $8 million in 2025.
Management Cites Acquisitions, Systems and Controls in Restatement
Rivera said the majority of issues traced back to 2023, 2022 and earlier, when Driven Brands expanded into car wash and glass and launched a new digital marketplace solution. He said the company’s growth outpaced “the scale and maturity of certain back office people, processes, and controls.”
Executive Vice President and Chief Financial Officer Mike Diamond said the restatement primarily affected 2023 and earlier periods. He outlined several areas of correction, including overstated cash balances dating back to 2022, understated lease-related assets and liabilities, misclassified operating expenses, understated accounts payable connected to the Driven Advantage platform, and accounts receivable balances that should have been reserved or corrected.
Diamond said the cash issue did not reflect actual cash leaving the company, but rather the reporting of cash balances following acquisitions, particularly at Auto Glass Now. He said the company has added accounting resources and strengthened finance leadership, including a new chief accounting officer hired in April 2025.
Rivera said the company is now “simpler, more focused,” following the divestitures of U.S. Car Wash, International Car Wash and PH Vitra, and the integration of Auto Glass Now. He said Driven Brands has not entered new verticals during that period.
Fourth-Quarter Revenue and Adjusted EBITDA Increase
For the fourth quarter, Driven Brands reported same-store sales growth of 0.5% and added 81 net new units. System-wide sales rose 2.1% to $1.5 billion, while total revenue increased 7.7% year over year to $460.1 million.
Operating income rose $62.4 million to $78.2 million, which Diamond attributed to higher revenue and lower selling, general and administrative expenses. Adjusted EBITDA increased 7.3% to $111.9 million, with an adjusted EBITDA margin of 24.3%.
Interest expense declined $7.4 million to $28.6 million, primarily due to debt paydown. Net income from continuing operations was $40.7 million, while adjusted net income from continuing operations was $56.4 million. Adjusted diluted earnings per share were $0.34.
Take 5 Leads Growth as Franchise Brands Face Collision Softness
Take 5 Oil Change remained the company’s primary growth driver. In the fourth quarter, Take 5 same-store sales rose 3.7%, and the business added 60 net new units. Adjusted EBITDA increased 8.4% to $107.3 million.
For the full year, Take 5 same-store sales grew 6.2%, and the brand added 161 units, including 94 company-owned stores and 67 franchise stores. Revenue increased 13.6% to $1.2 billion, and adjusted EBITDA rose 10.1% to $418.7 million. Adjusted EBITDA margin was 34.4%.
Rivera said Take 5 achieved its 22nd consecutive quarter of same-store sales growth in 2025. He also cited bay times consistently under 12 minutes, Net Promoter Scores in the high 70s, a 300-basis-point increase in premium mix and a 380-basis-point increase in ancillary attachment rates.
Franchise Brands reported a 1% fourth-quarter decline in same-store sales, which Diamond said was driven by continued softness in the broader collision industry. Adjusted EBITDA in the segment was $42.4 million, down $0.2 million from the prior year. For 2025, Franchise Brands same-store sales declined 1.1%, revenue fell 3.5%, and adjusted EBITDA declined $11.9 million to $178.8 million. The segment’s adjusted EBITDA margin was 62.7%.
Auto Glass Now reported fourth-quarter same-store sales growth of 6.3%, though adjusted EBITDA decreased $0.4 million to $3.2 million due to higher performance-based compensation. For the full year, Auto Glass Now same-store sales rose 7.9%, and adjusted EBITDA grew by $13.3 million. Its adjusted EBITDA margin improved 470 basis points to 10%.
Full-Year Results and Balance Sheet Actions
For 2025, Driven Brands reported system-wide sales growth of 2.7% to $6.1 billion, with same-store sales up 1% and 175 net new units added. Revenue increased 6.3% to $1.9 billion. Operating income rose $31.3 million to $231.1 million, and adjusted EBITDA grew 1.3% to $449.1 million. Diamond said adjusted EBITDA grew 3.7% on a pro forma basis excluding the PH Vitra divestiture.
Net income from continuing operations was $132.1 million, and adjusted net income from continuing operations was $199.2 million. Diluted EPS from continuing operations was $0.80, while adjusted diluted EPS from continuing operations was $1.21.
Driven Brands generated $180.9 million of free cash flow for the year, defined as operating cash flow less net capital expenditures, an increase of $174.2 million from 2024. Net capital expenditures were $149.7 million, including amounts tied to the company’s car wash businesses.
The company ended the fourth quarter with a net debt-to-adjusted EBITDA ratio of 3.7 times after paying down $58.7 million of net debt in the quarter. Rivera said the company paid down $545 million of debt during 2025. In January 2026, Driven Brands used proceeds from the sale of its International Car Wash business to repay more than $470 million of additional debt, reducing pro forma net leverage to 3.3 times.
2026 Outlook Includes Restatement Costs
For fiscal 2026, Driven Brands forecast revenue of $1.95 billion to $2.05 billion and adjusted EBITDA of $430 million to $460 million. Diamond said that adjusted EBITDA range includes $35 million to $45 million of estimated non-recurring restatement costs that the company does not intend to add back in 2026.
The company expects adjusted diluted EPS of $1.15 to $1.25, same-store sales ranging from flat to up 2%, and net store growth of 160 to 190 units. Net capital expenditures are expected to be approximately 6.5% of revenue, with about 60% supporting Take 5 company-operated unit growth. Driven Brands expects to generate $125 million to $145 million in free cash flow and continue directing cash toward debt reduction, with a goal of reaching 3 times net leverage by the end of 2026.
In preliminary first-quarter 2026 metrics, Diamond said the company expects consolidated same-store sales growth of 1.9% to 2.1% and Take 5 same-store sales growth of 4.3% to 4.5%. Revenue is expected between $475 million and $485 million. Adjusted EBITDA is expected to be moderately lower year over year due to increased corporate expenses from the financial restatement.
During the question-and-answer session, Rivera said Take 5 is seeing some moderation in traffic among newer and more value-oriented customers entering 2026, though average ticket remains strong. Diamond said the company has not taken systemwide or corporate-wide price increases through the first quarter, while noting that franchisees set their own pricing.
Rivera said Driven Brands’ long-term strategy remains centered on growth from Take 5, cash generation from franchise businesses, debt reduction and disciplined portfolio management focused on non-discretionary North American automotive services.
About Driven Brands NASDAQ: DRVN
Driven Brands Holdings Inc NASDAQ: DRVN is a leading North American provider of automotive aftermarket services, operating through a network of franchised and company-owned locations. The company's platform encompasses a diverse portfolio of car care and maintenance brands, including Meineke Car Care Centers, Maaco Collision Repair & Auto Painting, Take 5 Oil Change, and Carstar Collision Repair. Driven Brands delivers a full range of services from routine maintenance and oil changes to collision repair, paint protection, and vehicle customization.
Headquartered in Charlotte, North Carolina, Driven Brands serves both individual consumers and commercial clients across the United States and Canada.
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