Dorman Products, Inc. Reports Second Quarter 2025 Results and Raises Full Year 2025 Guidance

Rhea-AI Summary

Dorman Products (NASDAQ:DORM) reported exceptional Q2 2025 results, with net sales reaching $541.0 million, up 7.6% year-over-year. The company achieved diluted EPS of $1.91, a 25% increase, and adjusted diluted EPS of $2.06, up 23% from the previous year.

Strong performance in the Light Duty segment drove growth, with segment sales increasing 10% to $424.4 million. The company's supply chain diversification, productivity, and automation initiatives contributed to improved margins, with gross profit margin expanding to 40.6% from 39.6%.

Based on strong H1 2025 performance, Dorman raised its full-year 2025 guidance, now expecting net sales growth of 7-9% and adjusted diluted EPS of $8.60-$8.90, representing 21-25% growth versus 2024.

Positive

• Net sales increased 7.6% to $541.0 million in Q2 2025
• Diluted EPS grew 25% to $1.91, with adjusted diluted EPS up 23% to $2.06
• Light Duty segment sales rose 10% with margin expansion of 140 basis points
• Gross profit margin improved to 40.6% from 39.6%
• Full-year 2025 guidance raised significantly for both sales and earnings
• Interest expense decreased from $10.2M to $7.2M year-over-year

Negative

• Heavy Duty segment profit margin declined significantly from 4.4% to 0.8%
• Specialty Vehicle segment sales decreased 3% with margin contraction
• SG&A expenses increased to 25.3% of net sales from 25.2%
• Inventory levels increased to $798.2M from $708.0M

Insights

Financial Analyst

Dorman reported strong Q2 results with 7.6% revenue growth and 25% EPS growth, raising full-year guidance significantly.

Dorman Products delivered exceptional Q2 2025 performance, with $541.0 million in revenue, increasing 7.6% year-over-year. The company's profitability metrics were particularly impressive, with diluted EPS reaching $1.91, up 25% from the prior year, while adjusted diluted EPS hit $2.06, representing a 23% increase.

Gross profit margins improved substantially to 40.6% from 39.6% in Q2 2024, demonstrating Dorman's enhanced operational efficiency. This margin expansion was driven by the company's supply chain diversification, productivity improvements, and automation initiatives.

The Light Duty segment was the standout performer with 10% sales growth and a 140 basis point improvement in profit margin to 18.5%. However, the Heavy Duty segment showed concerning weakness with nearly flat sales growth of just 1% and a significant margin contraction of 360 basis points to 0.8%. The Specialty Vehicle segment also experienced challenges with a 3% sales decline.

Most significantly, management has substantially raised its full-year 2025 guidance, now projecting net sales growth of 7-9% (up from 3-5%) and diluted EPS of $8.05-$8.35 (previously $7.00-$7.30). This represents expected year-over-year EPS growth of 31-36%. The adjusted diluted EPS forecast now stands at $8.60-$8.90, reflecting 21-25% growth.

The balance sheet remains solid with $56.8 million in cash and cash equivalents, while the company has reduced its debt position by paying down its revolving credit facility from $14.0 million at year-end 2024 to zero as of Q2 2025. However, inventory levels have increased to $798.2 million from $708.0 million at the end of 2024, which bears watching for potential cash flow implications.

While operating cash flow remains positive at $59.8 million for the first half of 2025, it represents a significant decrease from $115.3 million in the comparable period of 2024, largely due to the inventory build-up. This inventory increase appears strategic given supply chain challenges and the strong demand environment, but warrants monitoring in future quarters.

Highlights (All comparisons are to the prior year period unless otherwise noted):

• Net sales of $541.0 million for the quarter, up 7.6% compared to $503.0 million
• Diluted earnings per share (“EPS”) of $1.91, up 25% compared to $1.53
• Adjusted diluted EPS* of $2.06, up 23% compared to $1.67
• Raises its full year guidance for 2025

COLMAR, Pa., Aug. 04, 2025 (GLOBE NEWSWIRE) -- Dorman Products, Inc. (the “Company” or “Dorman”) (NASDAQ: DORM), a leading supplier in the motor vehicle aftermarket industry, today announced its financial results for the second quarter ended June 28, 2025.

Kevin Olsen, Dorman’s President and Chief Executive Officer, stated, “We had an outstanding second quarter, with top- and bottom-line growth exceeding our expectations. Strong demand in our Light Duty business drove total net sales growth of 7.6% compared to last year’s second quarter. Additionally, we continued to drive cost savings across the enterprise through our supply chain diversification, productivity, and automation initiatives, which contributed to a 25% increase in diluted EPS and a 23% increase in adjusted diluted EPS over the same period.

“With our strong performance through the first half of the year, along with our improved outlook, and the timing dynamics of when pricing and costs will be recognized from tariffs, we are raising our net sales and diluted EPS guidance ranges. For 2025, we now expect net sales growth to be in the range of 7% to 9%, diluted EPS to be in the range of $8.05 to $8.35, and adjusted diluted EPS to be in the range of $8.60 to $8.90.”

Second Quarter Financial Results
The Company reported second quarter 2025 net sales of $541.0 million, up 7.6% compared to net sales of $503.0 million in the second quarter of 2024.

Gross profit was $219.5 million in the second quarter of 2025, or 40.6% of net sales, compared to $199.4 million, or 39.6% of net sales, in the same quarter last year.

Selling, general, and administrative (“SG&A”) expenses were $137.0 million, or 25.3% of net sales, in the second quarter of 2025 compared to $126.9 million, or 25.2% of net sales, in the same quarter last year. Adjusted SG&A expenses* were $131.3 million, or 24.3% of net sales, in the second quarter of 2025, compared to $120.7 million, or 24.0% of net sales, in the same quarter last year.

Diluted EPS was $1.91 in the second quarter of 2025, up 25% compared to diluted EPS of $1.53 in the same quarter last year. Adjusted diluted EPS* was $2.06 in the second quarter of 2025, up 23% compared to adjusted diluted EPS* of $1.67 in the same quarter last year.

Segment results were as follows:

	Net Sales									Segment Profit Margin
($ in millions)	Q2 2025			Q2 2024			Change			Q2 2025			Q2 2024			Change
Light Duty	$	424.4		$	385.4		10	%		18.5	%		17.1	%		140 bps
Heavy Duty	$	62.1		$	61.2		1	%		0.8	%		4.4	%		-360 bps
Specialty Vehicle	$	54.5		$	56.4		-3	%		17.3	%		17.8	%		-50 bps

2025 Guidance
The Company updates its full year 2025 guidance as detailed in the table below, which includes the expected impact of tariffs enacted as of August 4, 2025. Our guidance excludes any potential impacts from tariff changes after August 4, 2025, supply chain disruptions, trade restrictions, significant inflation, future acquisitions and divestitures, interest rate changes, and share repurchases.

	Updated 2025 Guidance		Prior 2025 Guidance
Net Sales Growth vs. 2024	7% – 9%		3% – 5%
Diluted EPS	$8.05 – $8.35		$7.00 – $7.30
Growth vs. 2024	31% – 36%		14% – 19%
Adjusted Diluted EPS*	$8.60 – $8.90		$7.55 – $7.85
Growth vs. 2024	21% – 25%		6% – 10%
Tax Rate Estimate	24	%	24	%

Conference Call and Webcast
The Company will hold a conference call and webcast for investors on Tuesday, August 5, 2025, beginning at 8:00 a.m. Eastern time. The conference call can be accessed by telephone at (888) 440-4182 within the U.S. or +1 (646) 960-0653 outside the U.S. When prompted, enter the conference ID number 1698878. A live audio webcast and accompanying presentation materials can be accessed on the Company’s website at Dorman Products, Inc. - Events. After the call, a replay of the session will be available on the Investor section of the Company’s website.

About Dorman Products
Dorman gives professionals, enthusiasts, and owners greater freedom to fix motor vehicles. For over 100 years, we have been driving new solutions, releasing tens of thousands of aftermarket replacement products engineered to save time and money and increase convenience and reliability.

Founded and headquartered in the United States, we are a pioneering global organization offering an always-evolving catalog of products covering cars, trucks, and specialty vehicles, from chassis to body, from underhood to undercarriage, and from hardware to complex electronics.

*Non-GAAP Measures
In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release also contains Non-GAAP financial measures. The reasons why we believe these measures provide useful information to investors and a reconciliation of these measures to the most directly comparable GAAP measures and other information relating to these Non-GAAP measures are included in the supplemental schedules attached.

Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “should,” “likely,” “probably,” “anticipates,” “expects,” “intends,” “plans,” “projects,” “believes,” “views,” “estimates” and similar expressions are used to identify these forward-looking statements. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of the date such statements were made. Such forward-looking statements are based on current expectations that involve known and unknown risks, uncertainties, and other factors (many of which are outside of our control). Such risks, uncertainties and other factors relate to, among other things: competition in and the evolution of the motor vehicle aftermarket industry; changes in our relationships with, or the loss of, any customers or suppliers; our ability to develop, market and sell new and existing products; our ability to anticipate and meet customer demand; our ability to purchase necessary materials from our suppliers and the impacts of any related logistics constraints; widespread public health pandemics; political and regulatory matters, such as changes in trade policy, the imposition of tariffs and climate regulation; our ability to protect our information security systems and defend against cyberattacks; our ability to protect our intellectual property and defend against any claims of infringement; and financial and economic factors, such as our level of indebtedness, fluctuations in interest rates and inflation. More information on these risks and other potential factors that could affect the Company’s business, reputation, results of operations, financial condition, and stock price is included in the Company’s filings with the Securities and Exchange Commission (“SEC”), including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. The Company is under no obligation to, and expressly disclaims any such obligation to, update any of the information in this document, including but not limited to any situation where any forward-looking statement later turns out to be inaccurate, whether as a result of new information, future events, or otherwise.

Investor Relations Contact
Alex Whitelam, VP, Investor Relations
awhitelam@dormanproducts.com
(445) 448-9522

Visit our website at www.dormanproducts.com. The Investor Relations section of the website contains a significant amount of information about Dorman, including financial and other information for investors. Dorman encourages investors to visit its website periodically to view new and updated information.

DORMAN PRODUCTS, INC. Consolidated Statements of Operations (in thousands, except per-share amounts)
	Three Months Ended							Three Months Ended
(unaudited)	6/28/25				Pct.*			6/29/24				Pct. *
Net sales	$	540,959			100.0			$	502,951			100.0
Cost of goods sold		321,446			59.4				303,550			60.4
Gross profit		219,513			40.6				199,401			39.6
Selling, general, and administrative expenses		137,032			25.3				126,949			25.2
Income from operations		82,481			15.2				72,452			14.4
Interest expense, net		7,182			1.3				10,202			2.0
Other income, net		(1,544	)		(0.3	)			(136	)		(0.0	)
Income before income taxes		76,843			14.2				62,386			12.4
Provision for income taxes		18,134			3.4				14,976			3.0
Net income	$	58,709			10.9			$	47,410			9.4
Diluted earnings per share	$	1.91						$	1.53
Weighted average diluted shares outstanding		30,680							31,071
	Six Months Ended							Six Months Ended
(unaudited)	6/28/25				Pct.*			6/29/24				Pct. *
Net sales	$	1,048,651			100.0			$	971,652			100.0
Cost of goods sold		621,430			59.3				590,805			60.8
Gross profit		427,221			40.7				380,847			39.2
Selling, general, and administrative expenses		264,666			25.2				253,957			26.1
Income from operations		162,555			15.5				126,890			13.1
Interest expense, net		14,540			1.4				20,807			2.1
Other income, net		(2,905	)		(0.3	)			(96	)		(0.0	)
Income before income taxes		150,920			14.4				106,179			10.9
Provision for income taxes		34,706			3.3				25,941			2.7
Net income	$	116,214			11.1			$	80,238			8.3
Diluted earnings per share	$	3.78						$	2.58
Weighted average diluted shares outstanding		30,744							31,160

* Percentage of sales. Data may not add due to rounding.

DORMAN PRODUCTS, INC. Consolidated Balance Sheets (in thousands, except share data)
(unaudited)	6/28/25				12/31/24
Assets
Current assets:
Cash and cash equivalents	$	56,845			$	57,137
Accounts receivable, less allowance for doubtful accounts of $2,131 and $1,619		532,121				573,787
Inventories		798,211				707,977
Prepaids and other current assets		39,554				30,859
Total current assets		1,426,731				1,369,760
Property, plant, and equipment, net		166,606				164,499
Operating lease right-of-use assets		112,024				118,499
Goodwill		444,334				442,886
Intangible assets, net		267,830				278,213
Deferred tax assets		5,865				5,786
Other assets		48,075				44,878
Total assets	$	2,471,465			$	2,424,521
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	221,307			$	231,814
Accrued compensation		24,083				44,002
Accrued customer rebates and returns		203,167				204,355
Revolving credit facility		—				13,960
Current portion of long-term debt		31,250				28,125
Other accrued liabilities		40,267				41,546
Total current liabilities		520,074				563,802
Long-term debt		430,338				439,513
Long-term operating lease liabilities		97,720				105,142
Deferred tax liabilities		3,803				3,700
Other long-term liabilities		19,784				18,894
Commitments and contingencies
Shareholders’ equity:
Common stock, $0.01 par value; 50,000,000 shares authorized; 30,523,887 and 30,565,855 shares issued and outstanding in 2025 and 2024, respectively		305				306
Additional paid-in capital		121,914				119,077
Retained earnings		1,281,741				1,180,862
Accumulated other comprehensive loss		(4,214	)			(6,775	)
Total shareholders’ equity		1,399,746				1,293,470
Total liabilities and shareholders' equity	$	2,471,465			$	2,424,521

Selected Cash Flow Information (unaudited):
	Three Months Ended						Six Months Ended
(in thousands)	6/28/25			6/29/24			6/28/25			6/29/24
Cash provided by operating activities	$	8,548		$	63,349		$	59,785		$	115,329
Depreciation and amortization	$	13,919		$	14,352		$	27,762		$	28,203
Capital expenditures	$	8,450		$	11,935		$	19,435		$	22,690

DORMAN PRODUCTS, INC.
Non-GAAP Financial Measures
(in thousands, except per-share amounts)

Our financial results include certain financial measures not derived in accordance with generally accepted accounting principles (GAAP). Non-GAAP financial measures should not be used as a substitute for GAAP measures, or considered in isolation, for the purpose of analyzing our operating performance, financial position or cash flows. Additionally, these non-GAAP measures may not be comparable to similarly titled measures reported by other companies. However, we have presented these non-GAAP financial measures because we believe this presentation, when reconciled to the corresponding GAAP measure, provides useful information to investors by offering additional ways of viewing our results, profitability trends, and underlying growth relative to prior and future periods and to our peers. Management uses these non-GAAP financial measures in making financial, operating, and planning decisions and in evaluating our performance. Non-GAAP financial measures may reflect adjustments for charges such as fair value adjustments, amortization, transaction costs, severance, accelerated depreciation, and other similar expenses related to acquisitions as well as other items that we believe are not related to our ongoing performance.

Adjusted Net Income:
	Three Months Ended								Six Months Ended
(unaudited)	6/28/25*				6/29/24*				6/28/25*				6/29/24*
Net income (GAAP)	$	58,709			$	47,410			$	116,214			$	80,238
Pretax acquisition-related intangible assets amortization [1]		5,406				5,481				10,877				10,965
Pretax acquisition-related transaction and other costs [2]		341				448				833				931
Pretax reduction in workforce costs [3]		33				282				147				4,850
Tax adjustment (related to above items) [4]		(1,403	)			(1,644	)			(2,877	)			(4,161	)
Adjusted net income (Non-GAAP)	$	63,086			$	51,977			$	125,194			$	92,823
Diluted earnings per share (GAAP)	$	1.91			$	1.53			$	3.78			$	2.58
Pretax acquisition-related intangible assets amortization [1]		0.18				0.18				0.35				0.35
Pretax acquisition-related transaction and other costs [2]		0.01				0.01				0.03				0.03
Pretax reduction in workforce costs [3]		0.00				0.01				0.00				0.16
Tax adjustment (related to above items) [4]		(0.05	)			(0.05	)			(0.09	)			(0.13	)
Adjusted diluted earnings per share (Non-GAAP)	$	2.06			$	1.67			$	4.07			$	2.98
Weighted average diluted shares outstanding		30,680				31,071				30,744				31,160

* Amounts may not add due to rounding.
See accompanying notes at the end of this supplemental schedule.

Adjusted Gross Profit:
	Three Months Ended					Three Months Ended
(unaudited)	6/28/25			Pct.**		6/29/24			Pct.**
Gross profit (GAAP)	$	219,513		40.6		$	199,401		39.6
Pretax acquisition-related transaction and other costs [2]		—		—			2		0.0
Adjusted gross profit (Non-GAAP)	$	219,513		40.6		$	199,403		39.6
Net sales	$	540,959				$	502,951
	Six Months Ended					Six Months Ended
(unaudited)	6/28/25			Pct.**		6/29/24			Pct.**
Gross profit (GAAP)	$	427,221		40.7		$	380,847		39.2
Pretax acquisition-related transaction and other costs [2]		—		—			10		0.0
Adjusted gross profit (Non-GAAP)	$	427,221		40.7		$	380,857		39.2
Net sales	$	1,048,651				$	971,652

Adjusted SG&A Expenses:
	Three Months Ended							Three Months Ended
(unaudited)	6/28/25				Pct.**			6/29/24				Pct.**
SG&A expenses (GAAP)	$	137,032			25.3			$	126,949			25.2
Pretax acquisition-related intangible assets amortization [1]		(5,406	)		(1.0	)			(5,481	)		(1.1	)
Pretax acquisition-related transaction and other costs [2]		(341	)		(0.1	)			(446	)		(0.1	)
Pretax reduction in workforce costs [3]		(33	)		(0.0	)			(282	)		(0.1	)
Adjusted SG&A expenses (Non-GAAP)	$	131,252			24.3			$	120,740			24.0
Net sales	$	540,959						$	502,951
	Six Months Ended							Six Months Ended
(unaudited)	6/28/25				Pct.**			6/29/24				Pct.**
SG&A expenses (GAAP)	$	264,666			25.2			$	253,957			26.1
Pretax acquisition-related intangible assets amortization [1]		(10,877	)		(1.0	)			(10,965	)		(1.1	)
Pretax acquisition-related transaction and other costs [2]		(833	)		(0.1	)			(921	)		(0.1	)
Pretax reduction in workforce costs [5]		(147	)		(0.0	)			(4,850	)		(0.5	)
Adjusted SG&A expenses (Non-GAAP)	$	252,809			24.1			$	237,221			24.4
Net sales	$	1,048,651						$	971,652

* *Percentage of sales. Data may not add due to rounding.

[1] – Pretax acquisition-related intangible asset amortization results from allocating the purchase price of acquisitions to the acquired tangible and intangible assets of the acquired business and recognizing the cost of the intangible asset over the period of benefit. Such costs were $5.4 million pretax (or $4.1 million after tax) and $10.9 million pretax (or $8.2 million after tax) during the three and six months ended June 28, 2025, respectively. Such costs were $5.5 million pretax (or $4.1 million after tax) and $11.0 million pretax (or $8.2 million after tax) during the three and six months ended June 29, 2024, respectively.

[2] – Pretax acquisition-related transaction and other costs include costs incurred to complete and integrate acquisitions. During the three and six months ended June 28, 2025, we incurred charges included in selling, general, and administrative expenses to complete and integrate acquisitions of $0.3 million pretax (or $0.2 million after tax) and $0.8 million pretax (or $0.6 million after tax), respectively.

During both the three and six months ended June 29, 2024, we incurred charges included in cost of goods sold for integration costs of $0.0 million pretax (or $0.0 million after tax). During the three and six months ended June 29, 2024, we incurred charges included in selling, general, and administrative expenses to complete and integrate acquisitions of $0.4 million pretax (or $0.3 million after tax) and $0.9 million pretax (or $0.7 million after tax), respectively.

[3] – Pretax reduction in workforce costs represents costs incurred in connection with our planned workforce reduction including severance and other payroll-related costs, insurance continuation costs, modifications of share-based compensation awards, and other costs directly attributable to the action. During the three and six months ended June 28, 2025, the expenses were $0.0 million pretax (or $0.0 million after tax) and $0.1 million pretax (or $0.1 million after tax), respectively. During the three and six months ended June 29, 2024, the expenses were $0.3 million pretax (or $0.2 million after tax) and $4.9 million pretax (or $3.7 million after tax), respectively.

[4] – Tax adjustments represent the aggregate tax effect of all non-GAAP adjustments reflected in the table above and totaled $(1.4) million and $(2.9) million during the three and six months ended June 28, 2025, respectively, and $(1.6) million and $(4.2) million during the three and six months ended June 29, 2024, respectively. Such items are estimated by applying our statutory tax rate to the pretax amount, or an actual tax amount for discrete items.

2025 Guidance:

The Company provides the following updated guidance ranges related to its full year 2025 outlook:

	Year Ending 12/31/2025
(unaudited)	Low End*				High End*
Diluted earnings per share (GAAP)	$	8.05			$	8.35
Pretax acquisition-related intangible assets amortization		0.69				0.69
Pretax acquisition transaction and other costs		0.03				0.03
Tax adjustment (related to above items)		(0.17	)			(0.17	)
Adjusted diluted earnings per share (Non-GAAP)	$	8.60			$	8.90
Weighted average diluted shares outstanding		30,800				30,800

*Data may not add due to rounding.

FAQ

What were Dorman Products' Q2 2025 earnings results?

Dorman reported Q2 2025 net sales of $541.0 million, up 7.6%, with diluted EPS of $1.91 (up 25%) and adjusted diluted EPS of $2.06 (up 23%) compared to Q2 2024.

What is Dorman's updated guidance for full year 2025?

Dorman raised its 2025 guidance to 7-9% net sales growth and adjusted diluted EPS of $8.60-$8.90, representing 21-25% growth versus 2024.

How did Dorman's Light Duty segment perform in Q2 2025?

The Light Duty segment achieved 10% sales growth to $424.4 million, with profit margin improving by 140 basis points to 18.5%.

What drove Dorman's improved profitability in Q2 2025?

Profitability improvements came from supply chain diversification, productivity initiatives, and automation efforts, leading to gross margin expansion to 40.6% from 39.6%.

How did Dorman's Heavy Duty segment perform in Q2 2025?

The Heavy Duty segment showed modest 1% sales growth to $62.1 million, but experienced significant margin decline from 4.4% to 0.8%.