Dorman Products Inc. reported its fourth‑quarter 2025 earnings on February 25, 2026, posting an adjusted diluted earnings per share of $2.17 versus the consensus estimate of $2.15, a $0.02 beat. The company’s GAAP diluted EPS was $0.38, heavily impacted by a $51.1 million non‑cash goodwill impairment related to its Heavy Duty segment. Revenue for the quarter was $537.9 million, falling short of the $573.38 million estimate by $35.48 million.
The earnings beat was driven by disciplined cost management and a favorable product mix. Light Duty sales held steady at $428.6 million, while Heavy Duty sales grew 6% to $55.8 million, albeit with a thin 3.4% margin. Specialty Vehicle sales were flat at $53.5 million. Adjusted gross profit margin expanded to 42.6% from 41.7% in Q4 2024, reflecting pricing power and supplier diversification that offset inflationary pressures.
Revenue missed expectations because of softer end‑market demand and a significant inventory adjustment by a large customer that reduced orders during the quarter. The Heavy Duty segment’s goodwill impairment further weighed on GAAP results. Management cut its 2026 adjusted EPS guidance to $8.10–$8.50, well below the consensus of $9.45, citing a $1.25‑per‑share tariff headwind and ongoing tariff‑related headwinds that are expected to persist.
On a full‑year basis, Dorman Products achieved net sales of $2.13 billion, up 6% from $2.00 billion in 2024, and adjusted diluted EPS of $8.87, a 24% increase. While the company’s margin expansion and product innovation underpin a solid long‑term foundation, the Q4 revenue slowdown and the downward revision of 2026 guidance signal near‑term challenges that could affect investor confidence.
Kevin Olsen, President and CEO, said, “The fourth quarter capped an outstanding year with strong top‑ and bottom‑line growth. During the year, we delivered record new product sales, advanced our operational and supply‑chain diversification initiatives, and made strategic investments in organic growth opportunities.” David Hession, Chief Financial Officer, added, “Our net sales performance was largely driven by pricing initiatives. In addition to the tough comparison we had in Q4 2024, volume this year was impacted by a larger customer that significantly changed their ordering pattern during the quarter to reduce inventory.”
Investors focused on the weak 2026 guidance and the Q4 revenue miss, with tariff headwinds cited as a primary concern. The company’s guidance revision reflects management’s caution about the near‑term outlook, while its full‑year results and margin expansion suggest resilience in the face of ongoing market pressures.
Overall, Dorman Products’ Q4 2025 results demonstrate effective cost control and a strong product mix, but the revenue miss and guidance cut highlight the impact of tariff headwinds and inventory adjustments. The company’s long‑term strategy of innovation, supply‑chain diversification, and operational excellence remains intact, though investors will monitor how the firm navigates the near‑term challenges highlighted in the earnings release.
The content on EveryTicker is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.