OPENLANE Tightens 2026 Outlook as Q3 Adjusted EBITDA Rises 23%

OPENLANE (OPLN) tightened its full-year 2026 guidance after third-quarter revenue rose 13% and adjusted EBITDA increased 23%, supported by higher marketplace activity and continued growth in its automotive finance business. The wholesale vehicle marketplace operator also reported stronger cash generation, although GAAP net income declined from a year earlier.

For the quarter ended September 30, revenue increased to $561.2 million from $498.4 million. Adjusted EBITDA reached $106.8 million, compared with $87.1 million a year earlier, while adjusted EBITDA margin expanded 150 basis points to 19.0%.

Net income fell 7% to $44.7 million from $47.9 million, but diluted net income per share increased to $0.36 from $0.25. Operating adjusted EPS, which excludes acquired amortization and certain other items, rose 23% to $0.43.

Cash flow from operating activities increased 34% to $97.1 million. Free cash flow was $83.3 million, while adjusted free cash flow rose to $124.2 million from $4.6 million. Trailing-12-month adjusted free cash flow conversion was 90%, up from 61% in the prior-year period.

Marketplace GMV reaches $10 billion

OPENLANE’s Marketplace segment generated $446.5 million in revenue and $57.8 million in adjusted EBITDA, up from $389.4 million and $43.6 million, respectively. The segment’s adjusted EBITDA margin increased to 12.9% from 11.2%.

Marketplace gross merchandise value rose 38% to $10 billion. U.S. dealer-to-dealer vehicle volume increased 22%, while commercial volume grew 46%. Excluding the addition of the company’s latest commercial customer, commercial volume increased 17%.

Auction and related fees rose to $253.2 million from $215.2 million. SaaS and other revenue increased to $73.9 million from $65.3 million, while purchased-vehicle sales advanced to $119.4 million from $108.9 million.

Management said it expects to benefit from an upward trend in off-lease vehicle availability. The company also plans to use its relationships with AFC’s independent dealers and franchise dealers participating in private-label programs to support its dealer-to-dealer marketplace. OPENLANE said recent changes in the competitive landscape could provide an opportunity to gain market share, though the presentation did not quantify the potential impact.

AFC loan activity and earnings increase

The Finance segment, which includes AFC, recorded revenue of $114.7 million, compared with $109.0 million a year earlier. Adjusted EBITDA increased 13% to $49.0 million, and adjusted EBITDA margin rose to 42.7% from 39.9%.

AFC’s loan transactions grew 7%, while its loan loss rate was 1.1%. The business provides floorplan financing and related services to independent vehicle dealers and manages about $2.5 billion in average receivables on a trailing-12-month basis.

Full-year guidance tightened

OPENLANE revised its full-year adjusted EBITDA forecast to a range of $390 million to $400 million, compared with its previous range of $385 million to $400 million.

The company now expects operating adjusted EPS of $1.45 to $1.52, up from its prior forecast of $1.40 to $1.50. The revised outlook is based on projected net income of $169 million to $177 million and diluted net income per share of $1.27 to $1.34. Previous guidance called for net income of $163 million to $176 million and diluted EPS of $1.23 to $1.33.

Capital expenditure guidance remained unchanged at $55 million to $60 million.

OPENLANE cautioned that its projections are based on management’s current assumptions and are subject to substantial risks and uncertainties, including factors described in its regulatory filings. The company noted that many of those factors are outside its control and could cause actual results to differ materially from its expectations.