Driven Brands (DRVN) to restate 2023-2025 results after control weaknesses

Rhea-AI Filing Summary

Driven Brands Holdings Inc. disclosed that investors should no longer rely on its previously issued financial statements for fiscal years 2023 and 2024, as well as quarterly results through September 27, 2025, due to material errors that will require a restatement.

The company identified problems in lease accounting, cash reconciliations that affected cash balances, revenue and selling, general and administrative expense, expense classifications within operating expenses, and other issues including income taxes, supply and other revenue, fixed assets, cloud computing and misclassified balance sheet and income statement items, plus inappropriately recognized revenue in its ATI business.

Management concluded there are material weaknesses in internal control over financial reporting and disclosure controls as of December 27, 2025 and is taking steps to remediate them. Driven Brands plans to file a Form 12b-25 to extend the deadline for its 2025 Form 10-K by fifteen days and may identify additional material errors as its review continues.

Positive

• None.

Negative

• Non-reliance and restatement across multiple periods: The audit committee and management determined that full-year 2023 and 2024 financial statements, plus several 2025 interim periods, contain material errors and should not be relied upon, requiring a broad Restatement.
• Material weaknesses in internal controls: Management concluded internal control over financial reporting and disclosure controls and procedures were not effective as of December 27, 2025 due to material weaknesses identified during the review.
• Errors in key accounting areas: Identified issues include lease accounting, unreconciled cash differences that affected cash, revenue and selling, general and administrative expense, expense misclassification, tax and fixed asset errors, and inappropriately recognized ATI revenue.
• Delay in filing Form 10-K: The company expects to file a Form 12b-25 to extend by fifteen days the deadline to file its 2025 Form 10-K, signaling timing pressure around completing the restatement and control evaluation.

Insights

Accounting & Reporting Analyst

Broad restatement, control weaknesses, and delayed 10-K are materially negative.

Driven Brands is restating financial statements for fiscal years 2023 and 2024 and multiple 2025 quarters after its audit committee and management found material errors. Non-reliance on past statements is a serious event because it calls prior reported revenue, expenses, and cash flows into question.

The errors span lease accounting, cash reconciliations, expense classification, tax, fixed assets, and certain ATI revenue, suggesting issues across several accounting areas rather than a single technical mistake. Management has identified material weaknesses in internal control over financial reporting and disclosure controls as of December 27, 2025.

The company plans to reflect the adjustments in its 2025 Form 10-K and to file a Form 12b-25 for a fifteen-day extension to submit that report. Actual impact will depend on the final restated figures and the effectiveness of remediation measures described in the upcoming 10-K.

8-K Event Classification

2 items: 4.02, 9.01

2 items

Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report Governance

Previously issued financial statements should no longer be relied upon due to errors or restatements.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Understanding 8-K Material Events →

0001804745FALSE00018047452026-02-252026-02-25

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________

FORM 8-K

_________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): February 25, 2026

Commission file number: 001-39898

_________________________________

Driven Brands Holdings Inc.

(Exact name of Registrant as specified in its charter)

_________________________________

Delaware

(State or other jurisdiction of incorporation or organization)

139898

(Commission File Number)

47-3595252

(I.R.S. Employer Identification No.)

440 South Church Street, Suite 700

Charlotte, North Carolina

(Address of principal executive offices)

28202

(Zip Code)

(704) 377-8855

(Registrant’s Telephone Number, Including Area Code)

_________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Common Stock, $0.01 par value

Trading Symbol

DRVN

Name of each exchange on which registered

The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.

On February 23, 2026, the Audit Committee of the Board of Directors, after consultation with the Company’s management, concluded there were material errors in our previously issued consolidated financial statements for the fiscal year ended December 28, 2024 (“fiscal year 2024”) and the fiscal year ended December 30, 2023 (“fiscal year 2023”) contained in the Company’s Annual Report on Form 10-K for the fiscal year 2024, and in our previously issued unaudited condensed consolidated financial statements for each of the quarterly and year-to-date periods within fiscal year 2024 as well as the quarterly and year-to-date periods for the periods ended September 27, 2025, June 28, 2025 and March 29, 2025, and concluded that such financial statements should not be relied upon and required restatement (the “Restatement”). Additionally, the Report of our Independent Registered Public Accounting Firm on the financial statements and internal control over financial reporting should not be relied upon.

As of February 25, 2026, the following reflects the primary categories of errors that have been identified in connection with the preparation of the Company’s Annual Report on Form 10-K for the year ended December 27, 2025 (“fiscal year 2025”).

Lease Adjustments

Certain errors were identified relating to the completeness and accuracy of recording leases. These errors primarily impact right of use assets and right of use liabilities recorded in the consolidated balance sheet as of December 28, 2024 and September 27, 2025.

Cash Adjustments

Certain errors were identified relating to unreconciled differences for cash accounts primarily originating in fiscal years 2023 and earlier. The errors affect the opening and ending cash balances and operating cash flows in the consolidated statement of cash flows and result in overstatements of cash and revenue and understatement of selling, general and administrative expense in the consolidated statement of operations for fiscal years 2023 and 2024.

Expense Classification

During fiscal years 2023 and 2024, within operating expenses certain supply and other expenses were presented as company-operated store expenses. This error resulted in company-operated store expenses to be overstated for fiscal years 2023 and 2024 and an equal understatement of supply and other expenses in the corresponding periods. This error did not result in any change in total operating expenses.

Other Errors

In addition, other errors were identified that primarily relate to fiscal years 2023 or 2024 related to the income tax provision, supply and other revenue, fixed assets, cloud computing, lease cash application, and balance sheet and income statement misclassifications, as well as inappropriately recognized revenue in our ATI business primarily related to fiscal year 2025. The impact of these errors and the lease adjustments, cash adjustments, and expense classification described above will be reflected in the Company’s Annual Report on Form 10-K for the fiscal year 2025.

In connection with the Restatement, management has identified material weaknesses in the Company’s internal control over financial reporting resulting in the conclusion that our internal control over financial reporting and disclosure controls and procedures were not effective as of December 27, 2025. Management has taken and is taking additional steps to remediate the material weaknesses in our internal control over financial reporting. Additional details regarding the material weaknesses will be reflected in the Company’s Annual Report on Form 10-K for the fiscal year 2025.

The Company expects to file a Form 12b-25 with the SEC later today to extend by fifteen calendar days the time period in which it has to timely file its Annual Report on Form 10-K for the fiscal year 2025.

The Company’s review of the financial statements and evaluation of its internal controls over financial reporting is ongoing and the Company may identify further material errors.

The Company has discussed the foregoing matters disclosed in this Item 4.02 with PricewaterhouseCoopers LLP, the Company’s independent registered public accounting firm.

Forward Looking Statements

This Current Report on Form 8-K contains a number of forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “will,” and variations of such words and similar expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding the Company's plans and expectations, materiality or significance of the misstatements and adjustments presented, which are management’s best estimates as of the date hereof, the restatement’s quantitative effects, the effectiveness of the restated financial statements and any anticipated conclusions of the Company, the Audit Committee, or the Board of Directors. These forward-looking statements are not guarantees of future performance and are subject to a number of risks and uncertainties, many of which are difficult to predict and beyond the control of the Company.

Important factors that may cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the risk that additional information may arise out of the continuing review of the financial statements and the evaluation of accounting practices, the preparation of the Company’s restated financial statements or other subsequent events that would require the Company to make additional adjustments, as well as inherent limitations in internal control over financial reporting. For other risk factors affecting the Company, see “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year 2024 as well as in our other filings with the SEC.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.						Description
104						Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

			DRIVEN BRANDS HOLDINGS INC.
Date: February 25, 2026			By:						/s/ Scott O’Melia
			Name:						Scott O’Melia
			Title:						Executive Vice President, Chief Legal Officer

FAQ

What did Driven Brands (DRVN) announce about its past financial statements?

Driven Brands announced that its financial statements for fiscal years 2023 and 2024, and interim 2025 periods through September 27, 2025, contain material errors and should not be relied upon. These periods will be restated and reflected in the company’s 2025 Form 10-K.

Which financial statement areas are affected by Driven Brands’ restatement?

The restatement affects lease accounting, cash reconciliations impacting cash balances, revenue and selling, general and administrative expense, expense classification, income taxes, supply and other revenue, fixed assets, cloud computing, various misclassifications, and inappropriately recognized ATI business revenue, mainly in fiscal years 2023–2025.

Did Driven Brands (DRVN) identify internal control problems?

Yes. Management identified material weaknesses in internal control over financial reporting and disclosure controls and procedures as of December 27, 2025. The company states it has taken and is taking additional steps to remediate these weaknesses, with more detail to be provided in its 2025 Form 10-K.

How will Driven Brands handle the timing of its 2025 Form 10-K filing?

Driven Brands expects to file a Form 12b-25 to extend the deadline to file its 2025 Form 10-K by fifteen calendar days. This extension provides additional time to complete the restatement and finalize its review of internal controls and financial statements.

What role did Driven Brands’ audit committee and auditor play in this decision?

The audit committee, after consulting with management, concluded the financial statements contained material errors and required restatement. The company has discussed these matters with PricewaterhouseCoopers LLP, its independent registered public accounting firm, whose prior reports on the affected financial statements should also not be relied upon.

Does Driven Brands expect more issues to emerge from this financial review?

Driven Brands notes that its review of financial statements and evaluation of internal controls is ongoing, and additional material errors may be identified. The company plans to detail final adjustments and control remediation efforts in its Annual Report on Form 10-K for fiscal year 2025.

Filing Exhibits & Attachments

3 documents

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