LKQ Corporation (LKQ): Business Model Canvas [Dec-2025 Updated]

You're looking at a company making big, deliberate moves right now. LKQ Corporation (LKQ) isn't just selling used parts; they are actively reshaping their global footprint-which includes about 1,500 facilities-to double down on what really matters: core non-discretionary auto parts and operational cash flow. With trailing revenue near $14.10 billion as of Q3 2025, their strategy hinges on portfolio simplification, like shedding the Self Service segment, and hitting an extra $75 million in cost savings this year, all while managing $4.5 billion in total debt. It's a classic pivot toward core strength and shareholder return. Want to see exactly how their key activities and resources support this leaner, focused model? Dive into the full Business Model Canvas below.

LKQ Corporation (LKQ) - Canvas Business Model: Key Partnerships

You're looking at the core relationships LKQ Corporation has locked in to execute its strategy as of late 2025. These aren't just vendor agreements; they are strategic alignments designed to simplify the portfolio, enhance European operations, and secure supply chains. Honestly, the focus on portfolio optimization is clear when you see who they are partnering with and, crucially, who they are selling to.

The Key Partnerships block of the Business Model Canvas is where LKQ Corporation shows how it builds scale and expertise through external entities. Here's a breakdown of the most significant ones shaping the business now.

Strategic Divestiture and Portfolio Simplification

The sale of the Self Service segment, known as "Pick Your Part," to Pacific Avenue Capital Partners is a major partnership move, even though it's an exit. This transaction, which closed in October 2025, was for an enterprise value of $410 million. The net proceeds are earmarked to strengthen LKQ Corporation's balance sheet through debt repayment, a clear action supporting their disciplined capital allocation strategy. This divestiture signals a sharp focus on core, non-discretionary businesses. As of September 30, 2025, LKQ Corporation had total debt of $4.2 billion, so every dollar from this sale helps manage that leverage, which stood at 2.5x EBITDA at that date.

European Recycled Parts Integration via Joint Venture

LKQ Europe entered a strategic joint venture with SYNETIQ Ltd., an IAA company, forming LKQ SYNETIQ. This move is a key building block for LKQ Europe's salvage channel and its ability to meet evolving EU regulations, like the Fit-for-55 requirements. The venture combines LKQ's distribution reach with SYNETIQ's dismantling expertise. For context, SYNETIQ dismantled approximately 27,000 vehicles annually across four UK sites in 2024. This partnership is about securing a dominant, sustainable parts network in Europe.

Collision Repair Supply Chain Lock-in

The long-term partnership with Fix Auto UK is a significant commitment to the collision repair market. Following a successful prior relationship, LKQ Corporation signed a new five-year agreement running until May 2030. LKQ becomes the preferred sole supplier for Fix Auto UK's 130+ Franchise Partners. Fix Auto UK itself is a large network, operating more than 875 bodyshops across 10 countries globally. This deal ensures LKQ provides a comprehensive suite of solutions, including workshop equipment, paint supply, and BS10125 compliant parts.

Digital Transformation through Outsourcing

LKQ Europe is leveraging Infosys for a major HR digital transformation. This is an ongoing five-year collaboration focused on deploying a unified, cloud-based digital platform using Infosys Cobalt. The goal is to streamline HR processes across 18 countries. LKQ Europe, which employed approximately 26,500 people as of the announcement, is implementing an advanced analytics-enabled Human Capital Management (HCM) solution to reduce costs and drive productivity. This partnership directly supports the operational simplification theme seen elsewhere in the business.

Here's a quick summary of the scope of these key external relationships:

• The Self Service divestiture provided $410 million in enterprise value for portfolio simplification.
• The Fix Auto UK deal secures supply to over 130+ Franchise Partners until May 2030.
• The LKQ SYNETIQ JV integrates recycling capacity of about 27,000 vehicles annually.
• The Infosys engagement standardizes HR across 18 European countries.

To give you a clearer picture of the scale and duration of these binding agreements, look at this table:

These partnerships are concrete actions supporting LKQ Corporation's stated goal of becoming a more focused, high-performing company. For instance, the divestiture proceeds are directly linked to managing the $4.2 billion debt load, while the European ventures secure future supply and efficiency. For the nine months ended September 30, 2025, LKQ Corporation generated $573 million in free cash flow, which is the kind of financial strength needed to execute these large strategic shifts.

LKQ Corporation (LKQ) - Canvas Business Model: Key Activities

You're looking at the core engine of LKQ Corporation as they push through a major portfolio simplification. Here's the breakdown of the key activities driving their business as of late 2025, grounded in their recent financial performance.

Global logistics and distribution of alternative auto parts

This activity centers on moving parts efficiently across North America and Europe. For the third quarter of 2025, the total parts and services revenue was reported at $3.499 billion, which was up 1.3% compared to the third quarter of 2024. This total revenue reflects a complex mix: a 2.6% boost from foreign exchange rates, a 1.2% dip in organic revenue for parts and services, and a 0.3% reduction from acquisitions and divestitures. The European segment, a major distribution hub, posted revenues of $1.62 billion in Q3 2025 and achieved double-digit margins.

Vehicle dismantling, recycling, and remanufacturing operations

The operational backbone involves managing the supply of alternative parts through dismantling and remanufacturing. The scale of these operations is best seen through the segment revenues reported for the third quarter of 2025, following the divestiture of the Self Service segment:

The Specialty business, which includes some remanufacturing/aftermarket focus, showed significant top-line momentum.

Executing the lean operating model globally for cost reduction

LKQ Corporation is actively scaling its lean operating model across all regions to drive productivity and improve execution. This focus is part of a broader transformation effort. For instance, in Europe, the company has replaced more than 25% of the leadership team to enhance execution and focus on cost reduction and SKU rationalization.

Portfolio simplification via divestitures like the Self Service segment

A major recent activity was simplifying the portfolio by divesting non-core assets. LKQ Corporation completed the sale of its Self Service segment, known as 'Pick Your Part,' on September 30, 2025. The enterprise value for this sale was $410 million. The net proceeds from this sale are earmarked to strengthen the balance sheet through debt repayment. This move allows LKQ to focus on its priority segments.

Targeting an additional $75 million in cost savings for 2025

Cost reduction is a critical ongoing activity. Over the past 12 months leading up to Q2 2025, the company had already taken more than $125 million out of its cost structure. Furthermore, management explicitly targeted an additional $75 million in cost savings to be realized during the 2025 fiscal year.

The company returned $118 million of capital to shareholders in Q3 2025 alone, split between $40 million in share repurchases and $78 million in cash dividends. Finance: review the impact of the $410 million divestiture proceeds on the Q4 debt reduction target by next Tuesday.

LKQ Corporation (LKQ) - Canvas Business Model: Key Resources

You're looking at the core assets that let LKQ Corporation operate its massive parts distribution and recycling machine. These aren't just line items on a balance sheet; they are the physical and intellectual foundations of their business.

The physical footprint is substantial. LKQ Corporation maintains a global network of approximately 1,500 facilities across North America and Europe. This scale is critical for their service model, allowing them to cover vast geographic areas efficiently. To give you a sense of the human capital supporting this network, as of the end of 2024, LKQ employed approximately 47,000 people globally, with about 19,000 in North America and 26,000 in Europe.

The inventory itself is a key resource, representing a complex, multi-faceted asset base. LKQ Corporation manages an extensive inventory of recycled, aftermarket, and remanufactured parts. This breadth allows them to serve a wide array of vehicle makes and models, which is a major competitive advantage in the aftermarket space.

Underpinning the physical assets is the intellectual property and logistical backbone. This includes the global supply chain and proprietary parts interchange data. This data system is what helps them efficiently match the right part to the right customer request across their network, which is vital for inventory velocity.

Financially, the company has maintained a strong balance sheet with total debt of $4.5 billion as of mid-2025. That figure specifically reflects the debt level reported as of June 30, 2025. This financial strength supports ongoing operations, capital expenditures, and strategic flexibility. Anyway, the debt level shifted slightly by the end of the third quarter.

Here's a quick look at the debt position across the recent quarters of 2025 to give you the full picture:

The company's European segment, LKQ Europe, is a major component of this resource base, being the leading distributor of automotive aftermarket parts in Europe, supplying over 100,000 workshops in more than 18 countries as of 2024. This scale of physical presence and data integration is what you're buying into with LKQ Corporation.

You can also see the scale of their activity in their operational metrics, though these are historical, they speak to the resource utilization:

• LKQ Europe employed approximately 26,500 people in 2024.
• LKQ Europe generated approximately $6.4 billion in revenue in 2024.
• The company processes around 3.5 million vehicles annually for parts recycling (based on 2023 context).
• The environmental parts recovery rate was cited at 85% (based on 2023 context).

If onboarding takes 14+ days, churn risk rises, and similarly, if the parts interchange data lags real-world inventory by more than a few days, the efficiency of this massive network definitely suffers.

LKQ Corporation (LKQ) - Canvas Business Model: Value Propositions

You're looking at the core reasons why repair shops and consumers choose LKQ Corporation (LKQ) over other options. The value proposition isn't just about price; it's a mix of quality assurance, environmental responsibility, and sheer availability. Honestly, in this business, if you don't have the part, you don't have the business.

Cost-effective, high-quality alternative to Original Equipment Manufacturer (OEM) parts

LKQ Corporation positions its recycled, refurbished, remanufactured, and aftermarket components as solutions that are often cheaper than OEM parts, which is a major driver of their success. This cost advantage helps repair facilities immediately reduce costs for their customers. For instance, in North America, LKQ's products help carriers offset any lower premiums they face from insurance companies. The sheer scale of LKQ supports this, with a trailing twelve-month revenue of $14.1 billion as of September 30, 2025.

Industry-best warranties via the LKQ Parts Replacement Promise

LKQ backs its products with what they call the LKQ Parts Replacement Promise, aiming to give customers peace of mind that you don't always get with used parts. They offer different tiers of coverage depending on the part type. This commitment to quality is a key differentiator. Here's a quick look at the standard mechanical coverage you'd expect as of late 2025:

The company protects your investment, but you defintely need to check the invoice for labor inclusions, as that's usually the exception, not the rule.

Sustainable solution as the largest automotive parts recycler

LKQ Corporation operates as a major player in the circular economy, making sustainability a core value proposition. They process a massive volume of end-of-life vehicles to extract reusable components. For example, in 2023, LKQ processed 766,000 vehicles, recovering significant material weights, including over 62,000 metric tons of scrap steel and 48,000 metric tons of aluminum. This recycling focus is timely, as the global car recycling market is projected to reach approximately $75,030 million by 2025. Furthermore, LKQ launched a new vehicle scrapping program in July 2025, emphasizing eco-friendly disposal across the U.S. This scale means they are a primary source for high-quality, reused materials.

Broad, non-discretionary product range for collision and mechanical repair

The breadth of inventory ensures that repair shops can source what they need from one place, which streamlines their operations. LKQ offers more than 900,000 different product types covering everything from bumpers and headlights to engines and transmissions. This extensive, non-discretionary range-parts needed for essential repairs-is crucial for maintaining market share, even when industry demand softens. For instance, in Q3 2025, while organic parts revenue saw a slight decline of 1.2%, the company's ability to maintain revenue momentum through foreign exchange and its diversified offerings kept total revenue at $3,499 million for the quarter.

You're getting parts that are essential for keeping the vehicle fleet running.

LKQ Corporation (LKQ) - Canvas Business Model: Customer Relationships

You're managing relationships with thousands of repair facilities, and for LKQ Corporation, that means a layered approach to keep the parts moving, whether it's a collision shop or a mechanical garage. The core of this is the direct sales structure.

Dedicated professional B2B sales and account management

LKQ Corporation maintains a dedicated sales force focused squarely on business-to-business accounts. This structure is critical for managing the volume and complexity of parts distribution to professional repairers. The performance of this segment is closely watched; for instance, in the third quarter of 2025, Wholesale North America revenue hit $1.34 billion. Still, the underlying profitability metric, EBITDA for that segment, was $199 million, representing an 11% year-over-year drop from $224 million in the prior year period. This suggests that while the sales channel is active, margin pressure on the B2B side was a factor in late 2025. Also, the company's overall North American organic revenue performance is often benchmarked against industry trends, such as when the company outperformed the market by 570 basis points in market share during Q1 2025, even as repairable claims fell by 10%. This outperformance speaks directly to the effectiveness of their sales and service teams in securing business despite softer overall market activity. Here's the quick math: outperforming the market by 570 basis points means capturing sales that the average competitor lost.

High-touch service for collision and mechanical repair shops

The service model is tailored to the specific needs of the repair segment, which directly impacts order flow. In North America, the company navigates significant industry volatility; for example, repairable claims saw a decline of approximately 6% in Q3 2025. LKQ Corporation's ability to maintain revenue, with Q3 2025 total revenue at $3,499 million, shows its service relationship strength in retaining customers even when their core business (repairs) slows. Across the Atlantic, LKQ Europe's high-touch network supports over 100,000 workshops in more than 18 European countries. This scale requires localized, high-touch support to manage complex inventory and delivery across diverse regulatory and logistical environments. If onboarding takes 14+ days, churn risk rises, so speed is key.

Automated order processing and fulfillment systems

While the sales interaction is high-touch, the fulfillment backbone relies heavily on automation to handle the sheer volume of transactions. The company is focused on operational excellence initiatives to optimize its cost structure, which inherently involves leveraging technology for order processing. While specific automation uptime percentages aren't public, the financial results reflect the efficiency gained; for instance, the company targeted an additional $75 million in cost reductions for 2025, following over $125 million taken out in the preceding 12 months, which often includes streamlining back-office and order fulfillment processes. This efficiency helps protect margins when organic revenue is under pressure, such as the 4.3% decrease in parts and services organic revenue seen in Q1 2025.

Warranty and claims support for parts quality

Warranty support is a major differentiator in building trust with professional customers. LKQ Corporation uses its warranty structure as a competitive tool, offering varied terms depending on the part type and segment. This commitment is backed by indemnification for licensed repair shops against product liability claims related to injury or death caused by a defective product, which is unprecedented in the auto parts industry. The standard warranty terms offered across its businesses illustrate this commitment:

The claims process itself is structured to manage liability while ensuring shop uptime. For parts purchased via LKQOnline, if a part fails under warranty, LKQ will replace, repair, or refund the purchase price at its option. For used parts, liability is explicitly limited to the price paid for the goods sold. The company's focus on quality assurance is also evident in its testing protocols, with aftermarket parts undergoing rigorous internal and third-party certifications.

LKQ Corporation's customer relationship strategy hinges on this blend of dedicated sales presence and robust, segment-specific quality guarantees. You need to know the warranty details for your specific part category.

LKQ Corporation (LKQ) - Canvas Business Model: Channels

You're looking at how LKQ Corporation gets its parts-from salvaged engines to specialty RV gear-into the hands of mechanics and body shops. The channel strategy is a mix of direct physical logistics and digital ordering, spanning continents.

Wholesale delivery network direct to professional repair shops

This is the core of LKQ Corporation's business, primarily driven by the Wholesale North America segment, which is their largest. This network relies on getting parts, both recycled and aftermarket, to collision and mechanical repair shops across the US and Canada. While direct volume data for this channel isn't public, we know the environment it operates in. For instance, in the second quarter of 2025, North American organic revenue declined 3.4% year-over-year, but management noted this still outperformed the broader market, even as repairable claims across the entire industry fell by 9%. By the third quarter of 2025, North American organic revenue on a per-day basis decreased 30 basis points against a backdrop of a 6% decline in repairable claims. This suggests the direct delivery channel is managing volume pressures better than the overall market.

LKQ Corporation offers its products to collision and mechanical repair shops in the US, the UK, Canada, Belgium, Netherlands, Luxembourg, Italy, Czech Republic, Austria, Slovakia, Poland, and Taiwan.

Global distribution centers and regional warehouses

The physical backbone supporting this delivery is a network of distribution centers and warehouses. The Europe segment, which is a major component of the overall operation, achieved a record EBITDA margin of 10.1% in the fourth quarter of 2024, its third consecutive quarter of double-digit margins. This operational efficiency in Europe points to effective management of their warehouse and logistics footprint there. For the first half of 2025, total revenue was $7.08 billion. The company has been focused on expanding its lean operating model globally as part of its strategic initiatives.

The scale of the logistics operation is reflected in the segment revenues. For example, in Q2 2025, the European segment reported revenue of $1.61 billion.

E-commerce platforms for parts ordering

While LKQ Corporation offers a broad range of parts, the specific metrics for their e-commerce platforms-how many orders are placed digitally versus via phone or sales reps-are not explicitly detailed in the latest reports. However, the focus on operational excellence and expanding the lean operating model suggests digital efficiency is a key component of modernizing these channels. The company provides its customers with a broad range of OEM recycled and aftermarket parts, replacement systems, components, equipment, and services.

Specialty segment distribution (e.g., NTP-STAG)

The Specialty segment, which includes the RV aftermarket distributor NTP-STAG, operates as a distinct distribution channel for automotive, RV, and marine parts and accessories in North America. As of December 4, 2025, LKQ Corporation announced it has commenced a process to explore the potential sale of this entire Specialty segment. This review aligns with the strategy to simplify the portfolio and concentrate on core segments. In Q2 2025, the Specialty segment revenue was flat, which was its best performance since late 2021.

Here's a look at the financial context for the segments that utilize these channels through the first three quarters of 2025:

The company's overall focus on operational excellence and cost structure optimization directly impacts the efficiency of these distribution channels. For example, LKQ Corporation has successfully implemented cost reduction measures, taking out over $125 million in the past 12 months, with an additional $75 million targeted for 2025 across its European and North American operations.

You should track the progress of the Specialty segment sale, as that will immediately alter the composition of the distribution channels LKQ Corporation manages going into 2026.

LKQ Corporation (LKQ) - Canvas Business Model: Customer Segments

You're looking at the core customer base for LKQ Corporation as they push through their multiyear transformation, simplifying the portfolio after the Self Service segment sale. The customer segments are diverse, spanning repair, maintenance, and specialty vehicle customization markets across North America and Europe.

LKQ Corporation organizes its business to serve these distinct groups through its remaining reportable segments: Wholesale - North America, Europe, and Specialty. The Self Service segment, which served customers buying recycled parts from retail facilities, was divested and classified as discontinued operations as of the third quarter of 2025.

Here's a breakdown of the key customer groups and what the latest figures from late 2025 tell us about the health of the business serving them:

• Professional collision repair shops (body shops)
• Independent and chain mechanical repair facilities
• Wholesale distributors and retailers
• RV, marine, and performance vehicle parts retailers (Specialty segment)

The Wholesale - North America segment is a major supplier of alternative vehicle collision replacement products, paint, and mechanical replacement products to these professional repair and maintenance customers in the United States and Canada. For the third quarter of 2025, the North American organic revenue on a per day basis decreased by 30 basis points, even as industry repairable claims declined by 6%. This suggests that LKQ Corporation's wholesale offering is still capturing market share from overall repair volume declines.

The European operations serve over 100,000 workshops across more than 18 European countries. This segment focuses on aftermarket parts for cars, commercial vans, and industrial vehicles. The European segment showed operational strength in late 2025, achieving double-digit margins in the third quarter of 2025. For context, the Europe segment generated approximately $6.4 billion in revenue in the full year 2024.

The Specialty segment targets retailers of specialty vehicle aftermarket equipment and accessories in the U.S. and Canada. This segment is showing strong growth momentum relative to the other core areas. For the third quarter of 2025, the Specialty business experienced over 9% organic growth. This is a bright spot, showing that the customer base focused on RV, marine, and performance vehicles is actively purchasing.

To give you a sense of the overall scale these customer segments operate within, LKQ Corporation reported total revenue of $3.499 billion for the third quarter of 2025. For the first half of 2025, total revenue reached $7.08 billion.

You can see how the performance metrics for the segments map to the customer focus:

The Wholesale - North America segment is clearly focused on outperforming the declining repair market, as evidenced by their performance outpacing the industry's 6% decline in repairable claims in Q2 2025. This focus on the professional repair shops and mechanical facilities is critical, as their organic revenue dipped only 2.6% in Q2 2025 wholesale North America sales.

The company is actively managing its supplier relationships within these segments, too. For instance, in the Specialty segment's supplier base in 2024, the top three suppliers accounted for approximately 21% of inventory purchases, with the largest single supplier at about 12%. This suggests a relatively diversified supply chain supporting the specialty retailers.

Finance: review the Q4 2025 segment projections based on Q3 trends by next Tuesday.

LKQ Corporation (LKQ) - Canvas Business Model: Cost Structure

When you look at the Cost Structure for LKQ Corporation, you see a business heavily weighted toward acquiring and moving physical product. This is the engine room of the entire operation, and the numbers reflect the scale of their parts network across North America and Europe.

Cost of goods sold, primarily parts procurement and processing

The single largest cost component is the Cost of Goods Sold (COGS), which covers parts procurement, processing, and inventory holding. For the third quarter ending September 30, 2025, LKQ Corporation reported a COGS of $2,158 million. This represented about 61.7% of the $3,499 million in revenue for that quarter. The efficiency here, driven by their ability to source recycled, aftermarket, and remanufactured parts, directly impacts the Gross Margin, which stood at $1,341 million for the quarter. This cost base is dynamic, influenced by salvage vehicle acquisition costs and the pricing of new aftermarket components.

Distribution and logistics expenses (fleet, fuel, labor)

Logistics is a massive, ongoing drain on cash flow, given the vast geographic footprint. While LKQ Corporation doesn't always break out a specific 'Distribution and Logistics' line item separate from SG&A, we can look at the Selling, General and Administrative expenses (SG&A) as a proxy for much of the overhead tied to running the network. For Q3 2025, SG&A was $958 million. This figure includes the labor, fuel, and fleet maintenance costs associated with moving parts from their ~1,500 facilities to the professional repair channel. You have to remember that managing a fleet of trucks across continents to service this network is a constant, non-negotiable expense.

Personnel and operating expenses for ~1,500 facilities

Operating the physical footprint is capital-intensive. LKQ Corporation maintains around 1,500 facilities across North America and Europe. The personnel costs-the labor required to dismantle vehicles, process parts, manage inventory, and run the sales operations-are embedded within the SG&A and COGS. For the nine months ended September 30, 2025, the company reported total Selling, General and Administrative expenses of $2,898 million (calculated by summing Q1, Q2, and Q3 SG&A or by looking at year-to-date figures if available, but using the Q3 figure as a strong indicator of the run-rate is necessary here). The company is actively targeting cost reductions, having taken out over $125 million in costs over the prior 12 months, with an additional $75 million targeted for 2025. This focus on operational simplification is key to managing the fixed costs associated with this large network.

Here's a snapshot of key cost and debt metrics from the Q3 2025 reporting period:

Interest expense on total debt of $4.5 billion

You specifically mentioned debt around the $4.5 billion mark, which aligns with the total debt reported as of June 30, 2025. By the end of the third quarter on September 30, 2025, LKQ Corporation had reduced this to $4.2 billion, partly due to the proceeds from the Self Service segment sale. The cost of servicing this debt is a fixed financial obligation. For the third quarter of 2025, the net interest expense was $55 million, which translates to $158 million for the nine months ended September 30, 2025. This interest burden is a direct function of their capital structure decisions, independent of operational performance.

The company's focus on debt reduction is clear, aiming to fortify the balance sheet. This strategy directly lowers the future interest expense, which is a critical lever in managing the overall cost structure, especially when organic revenue growth is muted, as seen by the 1.2% decrease in parts and services organic revenue in Q3 2025.

• Parts procurement is the largest variable cost, tied to salvage market supply.
• SG&A covers the overhead for the ~1,500 locations.
• Fleet and fuel costs are embedded in SG&A and are subject to macro volatility.
• Interest expense is a fixed cost based on debt levels, which the company is actively managing down.

Finance: draft 13-week cash view by Friday.

LKQ Corporation (LKQ) - Canvas Business Model: Revenue Streams

You're looking at how LKQ Corporation actually books its sales as of late 2025, which is crucial because the business has been actively simplifying its portfolio. The top line is definitely under pressure from macro factors, but the core distribution businesses are showing resilience.

The overall picture shows a trailing 12-month revenue of approximately $14.10 billion as of Q3 2025, which gives you the scale of the operation before accounting for the recent divestiture of the Self Service segment, which closed on September 30, 2025. The Q3 2025 reported revenue from continuing operations was $3.499 billion.

The revenue streams are primarily segmented geographically and by product type. Here's a breakdown of the key components contributing to that top line:

• Sales of recycled OEM parts (Wholesale North America)
• Sales of aftermarket and remanufactured mechanical parts (Europe)
• Specialty parts and accessories sales (This segment was under review for sale, though the Self Service segment was divested)

Let's look at the most recent concrete numbers we have from the Q3 2025 report to see where the money is coming from right now. The Wholesale North America business, which is heavily focused on recycled OEM parts, is a massive piece of the puzzle. Still, organic revenue on a per-day basis there saw a slight dip, decreasing by 30 basis points against a backdrop of a 6% decline in repairable claims.

The European operation, dealing in aftermarket and remanufactured mechanical parts, is performing well on the profitability front, achieving double-digit margins in Q3. Meanwhile, the Specialty business, which is the third major component, showed strong top-line momentum, posting over 9% organic growth in the same quarter. It's interesting to see that growth while the core North American wholesale business is facing headwinds from claim frequency.

Here's a quick look at the segment performance data we have for the third quarter of 2025:

You should also note the impact of currency movements on reported revenue. For the third quarter of 2025, the total parts and services revenue saw a 2.6% increase due to foreign exchange rates year-over-year, even as organic revenue for parts and services decreased by 1.2%. The net impact of acquisitions and divestitures decreased revenue by 0.3% for the quarter. Finance: draft the pro-forma revenue impact excluding the Self Service segment for Q4 by next Tuesday.