Driven Brands provides update on Auto Glass Now, reports 7% overall company revenue growth

Driven Brands leadership emphasized that Auto Glass Now is “in incubation,” and reported favorable Q2 collision and overall company earnings, including 7% revenue growth.

In 2022, Driven Brands Holdings announced it would “migrate” its glass services to the Auto Glass Now brand beginning in January 2023. And in March 2025, Driven Brands CEO Danny Rivera told investors the company’s early-stage glass businesses, which operate in the retail, commercial, and insurance spaces under Auto Glass Now, would be moved into its “corporate” and “other” segment. At the time, Rivera called them “smaller lines of business until they reach the scale to become a standalone segment.” He said those businesses would be managed “until they reach the scale to become a standalone segment.”

Now, Rivera shared during the company’s Q2 earnings call on Aug. 6 that Driven Brands has “meaningful opportunity” to expand Auto Glass Now across its retail, commercial, and insurance channels, growing share over time.

Auto Glass Now delivered same-store sales growth of 2.6% in Q2, and continued to make steady progress, he added.

“Since entering the automotive glass market, we have scaled Auto Glass Now into the second-largest operator in the industry; we see a long growth runway ahead,” Rivera said. “The glass market is large, fragmented, and growing… As a reminder, this business remains in its incubation period; performance will be uneven from quarter to quarter.”

Mike Diamond, Driven Brands executive vice president and CFO, noted that lower-than-expected EBITDA margin for Auto Glass Now was largely driven by a one-off out-of-period expense of roughly $4 million related to balance sheet cleanup from 2024 and prior.

“We hit it this quarter,” Diamond said. “We called it out because it’s significant to the segment and wanted to make sure that people understand we don’t view the $3.5 million number as the run rate earnings power of the business in Q2. That said, as we work through our remediation, we’re committed to doing things right and wanted to be transparent with that charge we took.”

Driven Brands previously discussed reported material errors and restatement during its delayed 2025 Q4 earnings call held May 19.

Rivera said the review identified additional items requiring adjustment. This included revenue reduction of $12 million in 2023, $4 million in 2024, and $5 million in 2025. EBITA adjustments included $57 million in 2023, $12 million in 2024, and $8 million in 2025.

A majority of the issues are from 2023, 2022, and prior, he said. He added that the company expanded two new verticals, car wash and glass, and launched a new digital solution for Driven Advantage during this time period.

In June, investors were reminded during the Q1 earnings call of Driven Brands’ non-compliance with Nasdaq Listing Rule 5250(c)(1) due to the delayed filing of its quarterly report on Form 10-Q for the period ended March 28, 2026, and that a remedy was in the works.

During Q2 in collision, Rivera told investors last week that Driven Brands continued to outperform, running 200 basis points ahead of the industry, while the broader industry remained under pressure.

“Maaco, our most discretionary brand, also remains under pressure, consistent with the trends we have previously discussed,” he said. “This segment continues to be a dependable source of cash that funds our growth.”

Overall, Rivera reported that Driven Brands delivered another quarter of positive same-store sales and continued growth, led again by Take 5.

“Our Franchise Brands segment continued to serve as a reliable, high-margin cash generator,” Rivera said. “We further strengthened the balance sheet during the quarter, reducing net leverage to 3.1 times. For the quarter, compared to [the] prior year, systemwide sales grew 5% to $1.6 billion, [and] revenue grew 7% to $507 million.”

It was also reported that adjusted EBITDA was $107 million and consolidated same-store sales increased 1.4%. Driven Brands’ total footprint grew 5% to more than 4,300 locations in the quarter, and 192 net new stores have been added over the last 12 months, with growth again led by Take 5, according to Rivera.

“Our strategy remains consistent. Drive strong growth through Take 5 and generate reliable free cash flow from Franchise Brands,” Rivera said. “That combination of growth and cash allows us to invest in our highest return opportunities while continuing to strengthen the business. The operating environment remains dynamic and is being shaped by several factors, starting with a K-shaped consumer economy in which lower-income households remain under significant pressure.

“Moreover, renewed conflict in the Middle East has disrupted energy markets, driving volatility in oil prices and supply, and pushing gas prices higher, which weighs directly on consumers and demand. While the broader industry is facing supply chain pressure, our scale and strong supplier relationships mean we do not foresee near-term supply concerns absent a significant change in conditions. Our largely non-discretionary portfolio is built to perform in exactly this kind of environment. That said, resilient does not mean impervious, so we are approaching the back half of the year with caution and a disciplined focus on execution.”

When asked about expectations for the Franchise Brands segment for the remainder of the year compared to the broader market, Rivera said the segment is doing exactly what it should — generating cash.

“We want to see really nice margins out of that business, which again, we saw 59% margins for the quarter,” River said.

He added that the segment is up 0.5% from a comparables perspective.

“We don’t give segment-level guidance for the year,” Rivera said. “Mike [Diamond] and I, obviously, in our prepared remarks, we reiterated our outlook for the full year at the Driven level. That should give you kind of a sense of how we’re thinking about the back half of the year.”

However, he did add that Meineke had a strong Q1 that continued into Q2, and will likely end the year strong.

“Maaco has been softer,” Rivera said. “We expect it to continue to be a bit soft in the back half of the year. …it’s certainly impacted by what we’re seeing with the lower-income consumer.

“Around collision, the overall industry has been soft. What I said, I think, last quarter is that we expect this year to be a year of stabilization versus bounce back; I think that that’s what’s playing out. For our part, we continue to outperform the overall industry anywhere between 100 to 300 basis points, depending on any given quarter. I’d say generally speaking, those are the headlines for Franchise Brands.”

As for outlook, the company reiterated its full-year 2026 outlook ranges, with Rivera stating that the focus continues to be on scaling Take 5, generating consistent cash flow, and further reducing leverage.

When asked about Driven Brands’ recent rejection of an acquisition proposal, Rivera said the Board of Directors’ decision was made “consistent with its fiduciary duties and in consultation with advisors.”

The board announced last week that it unanimously rejected a non-binding, unsolicited proposal from ADW Capital Management, which it called highly conditional and without a credible basis for the company to proceed.

“Additionally, the Board concluded that ADW Capital’s proposal significantly undervalues the company in light of its long-term value-creation opportunities and is therefore not in the best interest of Driven Brands and its shareholders,” an Aug. 3 press release states.

The investor who raised questions about the rejection during the earnings call wanted Rivera to share the operational or financial milestones that gave the board confidence to state that the overall business value is higher than its stock is trading.

“[W]hen we look at the underlying business, our strategy, our long-term value creation opportunities, the board and the management team continue to believe in our ability to add shareholder value and to disciplined execution of our strategies,” Rivera said.

Further details on Driven Brands’ Q2 earnings are located here.

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Featured image credit: Shutthiphong Chandaeng/iStock

Chart/accompanying information in graphic provided by Driven Brands