CDK outage fuels 86% drop in Asbury Q2 net income

Lost business and one-time costs related to the CDK Global outage contributed to an 86 percent drop in Asbury Automotive Group Inc.'s second-quarter net income, according to the dealership group, though the retailer managed to post record revenue of $4.2 billion.

Net income: $28.1 million, down 86 percent from a year earlier.

Revenue: $4.2 billion, up 13 percent and a record, as Asbury enjoyed the benefit of a larger footprint following the purchase of Jim Koons Automotive Cos. late last year.

Adjusted net income: $129 million, down 31 percent. Asbury adjusted for $101.3 million in asset impairments, $2.7 million in revenue from divestitures and $2.3 million in losses from hail damage.

Vehicle sales: 42,679 new vehicles, up 12 percent; 38,534 used vehicles, up 22 percent.

CDK Global took its software offline as a precautionary measure following cyberattacks June 19, hindering operations and earnings for Asbury and other large publicly traded franchised groups. Asbury, which posted $1.39 in diluted earnings per share, estimated it lost from 95 cents to $1.15 per share because of its CDK issues.

"I am proud of our team members rising up to meet an unprecedented challenge for our business and our industry," Asbury CEO David Hult said in a statement. "Our results were impacted by the CDK cyber incident, both from lost business and one-time expenses related to the outage and recovery of the systems that service most of our stores."

Hult said Asbury's online auto retail platform Clicklane helped it cushion the blow. The system had record sales of 15,201 vehicles during the second quarter, up 33 percent from a year earlier, he said.

Asbury, of Duluth, Ga., ranks No. 5 on Automotive News' list of the top 150 dealership groups based in the U.S., with retail sales of 149,509 new vehicles in 2023.