Driven Brands Holdings Inc. DRVN used its first-quarter 2026 earnings call to reinforce a familiar message: Take 5 Oil Change remains the growth engine, while deleveraging and tighter execution remain the near-term priorities.
Management also struck a more measured tone on the near term, flagging softer traffic from newer and lower-income customers and warning that second-quarter sales and margins should moderate even as full-year guidance stays intact.
DRVN Keeps Leaning on Take 5
President and CEO Daniel Rivera said the first quarter supported the company’s growth-and-cash framework, with Take 5 again leading the portfolio and franchise operations contributing steady profitability. He also reiterated that management’s first capital allocation priority is reducing net leverage to 3x by year-end.
The quarter’s reported numbers backed that framing. Revenues rose 8.2% year over year to $484.4 million, surpassing the Zacks Consensus Estimate of $482.8 million by 0.3%. Adjusted EBITDA increased 1.7% to $104.1 million. The company reported adjusted earnings per share of 30 cents, which topped the Zacks Consensus Estimate of 25 cents, delivering a surprise of 20%.
Driven Brands Holdings Inc. Price, Consensus and EPS Surprise
Driven Brands Holdings Inc. price-consensus-eps-surprise-chart | Driven Brands Holdings Inc. Quote
Take 5 remained the central driver. The business posted 4.5% same-store sales growth, 10% revenue growth and 13.6% adjusted EBITDA growth, with Rivera highlighting premium mix, attachment rates and the stay-in-your-car service model as core advantages.
Driven Brands Flags Traffic Pressure
The clearest incremental takeaway from the call was management’s description of softer demand within two customer groups at Take 5: newer customers and more value-oriented households, especially those earning less than $50,000 annually. Rivera said the broader core customer base remains resilient.
In Q&A, Goldman Sachs pressed for more detail on whether that softness was spreading. Rivera said trends were stable rather than worsening and pointed to higher average repair orders, stronger attachment rates and premiumization as signs that the broader customer base is still holding up.
He added later in the call that the issue is no longer oil change intervals but greater churn among those two customer cohorts. That distinction matters because it frames the challenge as customer retention and targeting rather than a broader shift in service frequency.
DRVN Sees Franchise Stability, Not Rebound
Rivera described Franchise Brands as a cash generator first, even as the segment posted a modest 0.9% same-store sales gain and 60% adjusted EBITDA margin in the quarter. He said Meineke remained strong, while Maaco stayed soft despite some retail improvement.
The more cautious commentary centered on collision repair. In response to William Blair and Piper Sandler, Rivera said industry conditions improved sequentially from the fourth quarter, but management still views 2026 as a year of stabilization rather than a bounce back.
He also argued Driven Brands is positioned to outperform the broader collision market by 100 to 300 basis points and can capture more customer-pay work through Maaco when drivers try to avoid insurance claims.
Driven Brands Absorbs Restatement Costs
CFO Michael Diamond spent much of his prepared remarks on costs tied to the company’s restatement and control remediation work. He said first-quarter operating expenses included $9.1 million of nonrecurring restatement costs, below initial expectations because some work shifted into the second quarter.
Those costs are set to rise in the near term. Diamond said second-quarter restatement costs should exceed $15 million, pressuring adjusted EBITDA margin relative to the 21.5% reported in the first quarter, even though the company still expects full-year restatement costs of $35 million to $45 million.
Even with that drag, management reiterated 2026 guidance for revenues of $1.95 billion to $2.05 billion, adjusted EBITDA of $430 million to $460 million, adjusted EPS of $1.15 to $1.25, same-store sales from flat to 2% and free cash flow of $125 million to $145 million.
DRVN Maps Out Capital Priorities
The balance sheet remains central to the story. Driven Brands ended the quarter at 3.2x net leverage, and both Rivera and Diamond repeated that reaching 3x by year-end is the immediate focus before laying out a broader long-term capital allocation framework.
Asked by William Blair what comes after that milestone, Diamond said the company has multiple options, including continued investment in high-return Take 5 development and the possibility of returning cash to shareholders. He also said there is no catch-up capital spending need weighing on the business.
That answer did not commit the company to a single path, but it did show management is preparing for a post-deleveraging playbook instead of signaling more aggressive debt reduction beyond the current target.
Driven Brands Keeps a Disciplined Tone
The overall message coming out of the call was controlled rather than expansive. Rivera emphasized portfolio discipline, cash generation and selective investment, while highlighting a new chief marketing officer as part of a more centralized, data-driven approach to customer acquisition and retention.
That tone matched the quarter’s mix of strengths and cautions. Take 5 is still producing the cleanest growth signals, but management used the call to acknowledge macro pressure on parts of the customer base and to prepare investors for a tougher second quarter.
Zacks Signals on DRVN
DRVN carries a Zacks Rank #4 (Sell), alongside a Value Score of B, Growth Score of A, Momentum Score of F and VGM Score of A. Under the Zacks framework, Style Scores can help separate stocks by value, growth and momentum characteristics, but they are meant to complement, not override, the Zacks Rank. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
That combination points to solid value and growth attributes on paper, but the weak Zacks Rank and Momentum Score argue for caution. Zacks’ own guidance says stocks with a Zacks Rank #4 or #5 (Strong Sell) should not be bought even if Style Scores are favorable, and the rank itself can change as earnings estimate revisions move after the quarter.
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