Genuine Parts Steers Through Tariff Turbulence, Lowers 2025 Outlook Despite Solid Q2

Genuine Parts Company (NYSE:GPC) shares are trading lower in the premarket session on Tuesday.

The company reported second-quarter adjusted earnings per share of $2.10, beating the analyst consensus estimate of $2.07.

Quarterly sales of $6.164 billion (+3.4% year over year) outpaced the Street view of $6.103 billion.

Also Read: General Motors Faces Tariffs Heat, Margins Shrink

The improvement is attributable to:

• A 2.6% benefit from acquisitions
• A 0.6% net favorable impact of foreign currency
• And a 0.2% increase in comparable sales.

Global Automotive sales were $3.9 billion, up 5.0% from the same period in 2024. Industrial sales were $2.3 billion, up 0.7% year over year.

“Our outlook considers the impact of current U.S. tariffs along with our updated views on the market environment,” said Bert Nappier, Executive Vice President and Chief Financial Officer.

“The evolving tariff landscape brings with it a degree of uncertainty, and as a result, we expect to see a more moderated improvement in market conditions than we projected in February.”

Quarterly gross margin improved 110 basis points year over year to 37.7%, while adjusted EBITDA fell 3.8% to $547 million. Adjusted EBITDA margin fell 60 basis points to 8.9%.

As of June 30, the company had $458 million in cash and equivalents. It also has $2 billion in undrawn capacity under its Revolving Credit Agreement, before taking into account commercial paper borrowings.

Long-term debt at the end of the quarter totaled $3.744 billion, compared with $3.742 billion as of December 31, 2024.

Outlook: Genuine Parts lowered its FY25 adjusted EPS guidance from $7.75–$8.25 to $7.50–$8.00 per share, below the $7.72 consensus estimate.

The company now expects total sales to grow 1%–3%, down from its prior forecast of 2%–4%.

Price Action: GPC shares are trading lower by 2.82% to $120.40 premarket at last check Tuesday.

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