Xpel Stock Earnings Reports

Q3 2025 highlights: XPEL reported a record quarterly revenue of $125.4M, up 11.1% YoY, driven by strong U.S. performance ($71.7M, +11.1%) and a 28.8% increase in Europe ($16.5M). The company closed its acquisition of its Chinese distributor in early September (integration underway), which added roughly $22M of inventory and caused elevated SG&A in the quarter from acquisition-related fees and the first month of ownership. Q3 gross margin was pressured (~170 bps) by outsized supplier price increases, which management says have been mitigated and should begin reversing in Q4, with meaningful margin improvement expected once acquired China inventory sells through (management expects record consolidated gross margins in Q1–Q2 2026). Q4 revenue is guided to $123M–$125M; management expects full-year 2025 revenue growth of about 13%–14%. SG&A remains elevated (28.4% of revenue in Q3) as the company invests in international channels and distribution, but management expects leverage to emerge as those investments mature. Strategic priorities: (1) invest in core manufacturing/supply chain to raise gross margin ~10 percentage points to ~52%–54% by end of 2028 and drive operating margins into the mid–high 20% range (management anticipates $75M–$150M of investment capacity over this period), (2) continue targeted M&A in dealership/service adjacencies, and (3) potential shareholder returns (share repurchases) when appropriate. Product and technology: colored films rollout and personalization/referral platform are progressing well; DAP SaaS work continues but was deprioritized temporarily. Cash flow remained strong (operating cash flow $33.2M in Q3) and balance sheet remains healthy.