RB GLOBAL INC. (RBA) Q1 2025 Earnings Summary

Executive Summary

Q1 2025 was mixed: revenue grew 4% to $1.109B while GTV fell 6% amid CC&T softness; adjusted EPS of $0.89 and revenue both beat S&P Global consensus, driven by a 150 bps take-rate expansion and strong inventory returns, offset by CC&T volume declines . EPS (adjusted) $0.89 vs $0.82 cons.; revenue $1.109B vs $1.024B cons. (S&P Global)*.
Management reaffirmed FY25 guidance (GTV growth 0–3%, adj. EBITDA $1.32–$1.38B, tax 25–28%, capex $350–$400M) and guided to a back-half weighted year; term loan repricing lowers spreads by ~85 bps, adding flexibility .
Auto remained a relative bright spot (GTV +2%; units +7%), with market share gains and a new U.K. win (Direct Line Group), though U.S. insurance ASPs fell ~3% on tariff-related buyer hesitancy and mix .
CC&T was the drag (GTV -18%) due to lapping large enterprise contracts and cautious customer behavior; take-rate strength and inventory return limited the adj. EBITDA decline to 1% YoY and lifted adj. EBITDA/GTV to 8.6% (from 8.1%) .
Potential stock catalysts: sustained take-rate expansion, auto share wins (U.K. Direct Line), tuck-in M&A (J.M. Wood), and de-risked balance sheet (1.6x TTM net debt/adj. EBITDA) against macro/tariff uncertainty .

What Went Well and What Went Wrong

What Went Well
- Take-rate expansion and efficiency: Service revenue take rate rose 150 bps to 22.3%, offsetting lower GTV; adj. EBITDA/GTV improved to 8.6% vs 8.1% YoY. “Our disciplined execution was evident… adjusted EBITDA declining 1% on a 6% decline in GTV” .
- Auto momentum and share gains: Auto GTV +2% with +7% unit growth; “we have gained market share globally in salvage” and won Direct Line Group in the U.K. (exclusive, multiyear) .
- Capital structure tailwinds: Repriced Term Loan A/revolver (-85 bps spread; extended to 2030) and TTM net debt/adj. EBITDA at 1.6x, enhancing flexibility .
What Went Wrong
- CC&T softness: CC&T GTV -18% YoY, -19% lots, as enterprise volumes lapped prior-year large contracts and customers adopted a wait-and-see stance; marketplace services revenue declined .
- ASP pressure in Auto: U.S. insurance ASPs down ~3% on tariff-related buyer hesitancy and mix, partially offset by international buyer strength and tech/process gains .
- Adjusted EPS slightly down YoY: Diluted adjusted EPS $0.89 vs $0.90, reflecting lower GTV and higher opex, partially offset by take-rate gains and inventory returns .

Financial Results

Overall performance (oldest → newest):

Metric	Q3 2024	Q4 2024	Q1 2025
Total Revenue ($USD Millions)	$981.8	$1,141.6	$1,108.6
GTV ($USD Millions)	$3,622.2	$4,101.2	$3,828.9
Diluted EPS (GAAP)	$0.36	$0.58	$0.55
Diluted Adjusted EPS	$0.71	$0.95	$0.89
Adjusted EBITDA ($USD Millions)	$283.7	$346.0	$327.9
Service Revenue Take Rate	21.5%	21.3%	22.3%
Inventory Rate	4.2%	5.7%	8.2%

Q1 2025 actual vs S&P Global consensus (EPS normalized and revenue):

Metric	Consensus*	Actual	Surprise (Abs.)
Revenue ($USD Millions)	$1,024.3*	$1,108.6	+$84.3
EPS Normalized ($)	$0.82*	$0.89	+$0.07

*Values retrieved from S&P Global.

Segment and mix:

GTV by Sector ($USD Millions)	Q1 2024	Q1 2025	YoY
Automotive	$2,105.0	$2,144.7	+2%
Commercial Construction & Transportation (CC&T)	$1,561.2	$1,276.7	-18%
Other	$411.2	$407.5	-1%
Total	$4,077.4	$3,828.9	-6%

Revenue Breakdown ($USD Millions)	Q1 2024	Q1 2025	YoY
Transactional Seller Revenue	$238.6	$216.8	-9%
Transactional Buyer Revenue	$525.4	$556.7	+6%
Marketplace Services Revenue	$85.1	$79.0	-7%
Total Service Revenue	$849.1	$852.5	—%
Inventory Sales Revenue	$215.6	$256.1	+19%
Total Revenue	$1,064.7	$1,108.6	+4%

KPIs and activity:

KPI	Q3 2024	Q4 2024	Q1 2025
Total Lots Sold (000s)	797.7	870.7	855.1
Auto Lots (000s)	553.8	611.1	625.6
CC&T Lots (000s)	103.1	102.2	87.6
Service Revenue Take Rate	21.5%	21.3%	22.3%
Inventory Rate	4.2%	5.7%	8.2%
Adj. EBITDA as % of GTV	—	8.4%	8.6%

Non-GAAP note: Adjusted net income to common was $165.2M vs GAAP net income to common $102.9M; add-backs included amortization of acquired intangibles ($68.3M), share-based payment expense ($14.4M), and other items .

Guidance Changes

Metric	Period	Previous Guidance (Q4 2024)	Current Guidance (Q1 2025)	Change
GTV Growth	FY 2025	0% to 3%	0% to 3%	Maintained
Adjusted EBITDA	FY 2025	$1,320–$1,380M	$1,320–$1,380M	Maintained
GAAP & Adjusted Tax Rate	FY 2025	25%–28%	25%–28%	Maintained
Capital Expenditures	FY 2025	$350–$400M	$350–$400M	Maintained
Dividend per Share	Quarterly	$0.29 declared (Q1 payout)	$0.29 declared (June 20 payout; record May 29)	Maintained

Additional liquidity actions: Term Loan A and revolver repriced (-85 bps spread), revolver increased to $1.3B, maturity extended to April 2030 .

Earnings Call Themes & Trends

Topic	Q3 2024 (Q-2)	Q4 2024 (Q-1)	Q1 2025 (Current)	Trend
Tariffs/Macro Uncertainty	Not prominent in release; focus on cost control and CAT readiness	“Wait-and-see” in CC&T; optimism but uncertainty persists	“Recently announced tariffs introduced a new level of uncertainty”; monitoring impacts	Uncertainty rising
AI/Technology Initiatives	—	Modern tech stack launch (rbauction.com); platform modernization	Launched AI-driven IAA Total Loss Predictor; routing optimization to reduce advanced charges	Increasing deployment
Automotive Performance	Auto GTV -1% YoY; lots flat	Auto GTV +4%; units +7%; ASP slightly down ex-CAT	Auto GTV +2%; units +7%; U.S. ASP ~-3% on tariff hesitancy/mix; global share gains	Volumes firm, ASP pressured
CC&T End-Market	GTV -10% YoY on ASP deflation	GTV -1% YoY; volumes +18%, ASP down	GTV -18% YoY; lots -19%; lapping large contracts; cautious customers	Weaker in Q1
Capital Structure	TTM net debt/adj. EBITDA 1.7x	1.6x; deleveraging progress	1.6x; loan repricing lowers spread by ~85 bps	Improving costs/flexibility
M&A/Expansion	—	Acquired Boom & Bucket (fixed-price channel)	Announced $235M J.M. Wood acquisition; U.K. Direct Line exclusive; Australia ramp mid-summer	Active tuck-ins, int’l wins

Management Commentary

Strategy and execution: “We have not changed our approach and are focused on factors we control to ensure we can consistently overdeliver on our commitments.” — CEO Jim Kessler .
Auto momentum and AI: “We are energized by the positive momentum in our automotive business… [U.K.] Direct Line Group… sole salvage provider… We recently launched IAA total loss predictor, a new AI-driven tool” .
Profit discipline and leverage: “Adjusted EBITDA as a percentage of GTV increased to 8.6% compared to 8.1% in the prior year… we repriced our Term Loan A and revolver… reduce our bank spread by approximately 85 bps” — CFO Eric Guerin .
CC&T posture: Customers “take a wait-and-see approach… uncertainty in the end markets” with lot volumes -19% offset by mix .

Q&A Highlights

CC&T outlook: Disposal timing is the issue; partners weighing rates, mega-projects, and tariffs; management focused on embedding value across services until volumes normalize .
FY25 cadence: Back-half weighted; Q1 had the toughest comp; guidance maintained for GTV +0–3% and adj. EBITDA $1.32–$1.38B .
Auto tariffs impact: Too early to quantify; short-term buyer hesitancy noted; management expects to leverage global liquidity; U.S. insurance ASPs down ~3% .
Take rate: No specific guidance; ongoing optimization across fees and commissions; comfortable with Q1 level .
M&A template: J.M. Wood brings geographic fill-in and municipal expertise; tuck-ins remain part of strategy alongside deleveraging and organic investment .

Estimates Context

Q1 2025 beats: Revenue $1.109B vs $1.024B consensus; EPS (normalized) $0.89 vs $0.82 consensus — both ahead (approx. +$84M revenue, +$0.07 EPS)*. Drivers: take-rate expansion, stronger inventory returns, auto share gains; offsets: CC&T GTV decline and marketplace services softness .
Outlook and revisions: FY25 guidance unchanged; commentary suggests H2 strength. Street models may lift near-term revenue/EPS on take-rate resilience and auto share wins, but CC&T caution and tariffs could temper quarterly phasing .
*Values retrieved from S&P Global.

Key Takeaways for Investors

Mix/take-rate cushioning GTV softness: Q1 showed the model can expand take-rate and protect EBITDA despite lower CC&T volumes; watch if 22%+ take-rate sustains .
Auto share and international growth: U.K. Direct Line win, rising international buyer participation, and Australia ramp provide multi-quarter growth levers .
CC&T normalization risk: Lapping large enterprise volumes and macro/tariff uncertainty weighed on Q1; back-half reacceleration is the hinge for the annual guide .
Capital structure improving: Repriced/extended facilities and 1.6x leverage reduce financing drag and support tuck-in M&A (e.g., J.M. Wood) .
Non-GAAP adjustments remain material: Intangible amortization and SBC are sizable; focus on adjusted-to-GAAP bridges and cash conversion .
Watch list for next quarter: CC&T volume inflection, take-rate trajectory, auto ASPs under tariff rhetoric, execution on U.K./Australia, and integration synergies/margin discipline .

Supporting detail and sources: Q1 2025 8‑K earnings release including outlook, KPIs, and reconciliations ; Q1 2025 earnings call transcript (prepared remarks and Q&A) ; Q4 2024 8‑K and call for prior-quarter comps and prior guidance baseline ; Q3 2024 8‑K for second prior quarter comps .