REV Group, Inc. (REVG): BCG Matrix [Dec-2025 Updated]

You're looking for a clear map of REV Group, Inc.'s portfolio, and the Boston Consulting Group Matrix is the perfect tool to see where capital should flow and where to cut. Here's the quick math on their core segments as of late 2025: The Fire & Emergency (F&E) segment is clearly the Star, backed by a massive $4.3 billion backlog, while the Commercial Vehicles units act as reliable Cash Cows, delivering a strong 13.4% Adjusted EBITDA margin. On the flip side, we've successfully pruned the Dogs by exiting the Bus and Lance Camper businesses, but the Recreational Vehicles (RV) segment remains a major Question Mark, showing a 13.8% drop in Q3 Adjusted EBITDA despite guidance near $650 million in revenue. Dive in below to see exactly where REV Group, Inc. needs to deploy its $140 million to $150 million in expected Free Cash Flow.

Background of REV Group, Inc. (REVG)

REV Group, Inc. (REVG) is a United States-based designer and manufacturer of specialty vehicles and related aftermarket parts and services, serving a diverse customer base primarily within the United States. The company operates through two main segments: Specialty Vehicles and Recreational Vehicles. You should know that REV Group trades on the NYSE under the symbol REVG.

The Specialty Vehicles Segment focuses on customized vehicle solutions for essential public services, such as ambulances and fire apparatus, as well as commercial infrastructure needs, including terminal trucks and industrial sweepers. This segment has been a major driver of recent financial performance, with management highlighting increased shipments of fire apparatus and ambulance units. For instance, in the third quarter of fiscal 2025, fire unit shipments increased 11% and ambulance unit shipments increased 7% versus the third quarter of 2024.

The Recreational Vehicles Segment manufactures a variety of RVs, ranging from Class B vans to Class A motorhomes. This segment has faced some headwinds; for example, its net sales declined in the first quarter of fiscal 2025 compared to the prior year, primarily due to decreased unit shipments and increased dealer assistance. To streamline its focus, REV Group completed the sale of the Lance Camper business during the third quarter of fiscal 2025, concentrating the RV portfolio on Indiana-based motorized RVs.

Financially, as of the third quarter of fiscal 2025, REV Group updated its full-year outlook, projecting consolidated net sales between $2.4 billion and $2.45 billion. The company also raised its Adjusted EBITDA guidance to a range of $220.0 million to $230.0 million for fiscal 2025. As of July 31, 2025, the company reported net debt of $54.0 million, with $36.0 million in cash on hand. You'll want to note that the company is investing in capacity expansion, including a major facility expansion at Spartan Emergency Response in Brandon, South Dakota, which will increase fire apparatus production capacity by 40% upon completion.

REV Group, Inc. (REVG) - BCG Matrix: Stars

You're looking at the business units that are currently driving REV Group, Inc.'s top-line momentum and future revenue visibility, which squarely places them in the Star quadrant of the BCG Matrix. These are the segments operating in high-growth markets where REV Group, Inc. holds a leading market share.

The Fire & Emergency (F&E) portion of the Specialty Vehicles segment is the prime example here. Its strength is fundamentally tied to essential public service demand, which is a market characteristic that supports high growth rates, even if the market itself isn't growing at a blistering pace across the board. The fact that management is projecting full-year revenue growth in the mid-teens for the entire Specialty Vehicles segment, against a 2024 pro forma revenue base of $1.56 billion, signals this high-growth environment for the F&E business.

The sheer size of the order book provides incredible revenue visibility, a key indicator for a Star. As of the end of the third quarter of fiscal 2025, the Specialty Vehicles segment backlog stood at $4,275.5 million, which is nearly $4.3 billion. This massive backlog ensures high future revenue visibility, as these are orders that will convert to sales over the coming quarters.

To capitalize on this demand and secure market leadership, REV Group, Inc. is actively investing in capacity. This is the cash burn characteristic of a Star-reinvesting heavily to maintain share. Specifically, you see this commitment in the strategic capacity expansion projects:

• The groundbreaking for a $20 million expansion at the Spartan Emergency Response facility in Brandon, South Dakota.
• This Spartan expansion is designed to increase fire apparatus production capacity by 40% upon completion.
• The project adds 56,000 square feet of manufacturing footprint.
• Horton Emergency Vehicles is also noted for expanding manufacturing capacity.

These investments are necessary to convert that substantial backlog into realized revenue and maintain the high market share required to keep the segment classified as a Star. If REV Group, Inc. successfully executes these throughput improvements, this segment is positioned to mature into a Cash Cow when the current high-growth cycle in public safety procurement eventually moderates.

Here are some of the key financial metrics underpinning the Specialty Vehicles segment's Star status as of the third quarter of fiscal 2025:

The growth in Adjusted EBITDA to $64.6 million, a 45.8% increase, shows that the pricing actions and improved mix are helping offset the cash consumption needed for growth and capacity expansion. Finance: draft 13-week cash view by Friday.

REV Group, Inc. (REVG) - BCG Matrix: Cash Cows

The Cash Cow quadrant for REV Group, Inc. is anchored by the Specialty Vehicles Segment, which encompasses essential public service and commercial infrastructure vehicles like terminal trucks and industrial sweepers. These units operate in mature markets where REV Group maintains a high market share, resulting in superior profitability and cash generation.

You see this stability reflected clearly in the third quarter of fiscal 2025 results. The segment delivered net sales of $483.3 million in Q3 2025, driving significant cash flow that supports the entire corporation. This segment's operational efficiency is a key driver, evidenced by its Adjusted EBITDA margin expanding to 13.4% in Q3 2025.

The strength of these core businesses is what allows REV Group, Inc. to fund riskier ventures and maintain shareholder returns. The company raised its full-year fiscal 2025 consolidated revenue guidance to a range of $2.4 billion to $2.45 billion, underpinned by this segment's performance. Furthermore, the full-year free cash flow guidance was raised to $140 million to $150 million for FY 2025, a direct benefit from milking these high-share, stable assets.

To give you a clearer picture of the cash generation disparity, look at how the Specialty Vehicles Segment stacks up against the Recreational Vehicles Segment in the third quarter of 2025:

The focus on operational improvements within these Cash Cows is evident in the unit shipment data for Q3 2025 compared to the prior year quarter. Fire unit shipments increased by 11%, and ambulance unit shipments grew by 7%. These production increases, coupled with price realization, directly translate to the robust cash flow figures.

The cash generated here is essential for corporate needs. You can see the resulting financial health:

• Strong consolidated Free Cash Flow guidance for FY 2025: $140 million to $150 million.
• Net debt stood at $54.0 million as of July 31, 2025.
• Cash on hand was $36.0 million as of July 31, 2025.
• These units fund the higher-risk Recreational Vehicles segment, which saw its Q3 2025 Adjusted EBITDA decline to $8.1 million.

Management's strategy is to maintain this productivity through targeted infrastructure investment, such as the groundbreaking for a major facility expansion in South Dakota, which is set to increase fire apparatus production capacity by 40% upon completion. This investment is designed to improve efficiency and secure future cash flow from these established market leaders. It's about milking the cow efficiently, not just letting it graze. Finance: draft 13-week cash view by Friday.

REV Group, Inc. (REVG) - BCG Matrix: Dogs

The designation of Dogs within REV Group, Inc. (REVG) is best illustrated by the recent strategic divestitures and the underperforming components of the Recreational Vehicles segment that management has actively addressed as of 2025.

The recently divested Bus Manufacturing Businesses, which included Collins Bus Corporation and the winding down of ElDorado National-California (ENC), were clear candidates for removal from the core portfolio due to their drag on consolidated results and low-growth market dynamics. For instance, in the first quarter of fiscal 2024, the Bus Manufacturing Businesses contributed $76.6 million to net sales, and in the second quarter of fiscal 2024, they contributed $32.9 million to net sales. Their removal immediately improved core segment performance; for example, excluding the Bus Manufacturing Businesses, Adjusted EBITDA for the Specialty Vehicles segment in Q2 2025 increased by 74.3% compared to Q2 2024.

The sale of the Lance Camper business in June 2025 represents a successful exit from a non-core, low-return asset. At the time of the sale announcement, Lance Camper's assets were listed at $17.1 million and debts at $11.6 million in the fiscal second quarter filing. REV Group, Inc. expected a non-cash loss of $30 million on this business, underscoring its underperformance relative to strategic targets. This exit aligns with the strategy of concentrating on scalable operations with stronger competitive positioning.

The financial impact of these exited businesses, which operated as Dogs, can be quantified by their contribution to the prior year's figures:

The remaining areas that fit the Dog profile are likely certain legacy, low-volume product lines within the Recreational Vehicles segment that management is actively streamlining or exiting. The RV segment itself has shown low growth; for example, its net sales in the second quarter of 2025 were $175.3 million, a 2.4% decrease year-over-year. Furthermore, the RV segment's Adjusted EBITDA for the third quarter 2025 was $8.1 million, representing a 13.8% decrease from $9.4 million in the third quarter 2024. These units are defintely units that consume time and capital without providing meaningful returns, as evidenced by the segment's declining profitability.

• The RV segment backlog at the end of Q3 2025 was $224.3 million, down $16.0 million from Q3 2024.
• The RV segment net sales in Q2 2025 were $175.3 million.
• The RV segment Adjusted EBITDA in Q3 2025 was $8.1 million.
• The expected full-year fiscal 2025 Adjusted EBITDA guidance range is $220.0 to $230.0 million.

REV Group, Inc. (REVG) - BCG Matrix: Question Marks

You're looking at the Recreational Vehicles (RV) segment of REV Group, Inc. (REVG) as a classic Question Mark. This area operates in a market that still shows potential for growth, but the segment itself is struggling to capture significant, profitable market share right now. Honestly, it's consuming resources while delivering uncertain returns.

The company has maintained its full-year fiscal 2025 guidance for this segment, expecting net sales to land between $625,000,000 and $650,000,000. That revenue target suggests the market isn't totally dead, but the profitability picture tells a different story. For the third quarter of fiscal 2025, the segment's Adjusted EBITDA was only $8.1 million. That's a year-over-year drop of 13.8% from the $9.4 million reported in the third quarter of 2024. Here's the quick math: the margin contracted significantly, falling from 6.4% in Q3 2024 to just 5.0% in Q3 2025. What this estimate hides is the pressure from external factors and internal costs.

The uncertainty about future demand is signaled by the decreasing backlog. At the end of the third quarter of 2025, the segment backlog stood at $224.3 million. That represents a 7% decrease year-over-year from $240.3 million at the end of the third quarter of 2024. This decline is primarily related to soft end market demand and dealer caution when placing new orders.

The segment definitely requires significant investment to turn this around, which is why it's burning cash relative to its low return. Management pointed to specific drains that need addressing:

• Increased dealer assistance on certain models, like Class B vans.
• The impact of tariffs related to the import of luxury vans.
• General inflationary pressures.

To give you a clearer picture of the segment's recent financial standing versus the stronger Specialty Vehicles segment, check out these Q3 2025 figures:

The strategic move to streamline the portfolio, including the completion of the Lance Camper sale, shows REV Group, Inc. is making decisions about which Question Marks to back heavily. They are investing in production capabilities elsewhere, like the Spartan Emergency Response facility expansion, but for the RV segment, the pressure is on to quickly gain share or face becoming a Dog. If onboarding dealer assistance doesn't quickly translate to higher-margin sales, that $625 million to $650 million revenue guidance won't be enough to justify the cash burn.

Finance: draft a sensitivity analysis on the impact of a sustained 5.0% margin on the full-year RV segment revenue projection by next Tuesday.