10-Q: Camping World Navigates RV Market Shifts, Reports Q3 Loss

Camping World Holdings, Inc. reported a net loss of $40.4 million for the third quarter of 2025, driven by significant income tax expenses and a Tax Receivable Agreement adjustment, despite revenue growth.

Summary

• Net loss attributable to Camping World Holdings, Inc. was $40.4 million for the third quarter of 2025, a significant decline from net income of $5.5 million in Q3 2024.
• Total revenue increased 4.7% to $1.81 billion in Q3 2025 from $1.72 billion in Q3 2024, and 6.1% to $5.20 billion for the nine months ended September 30, 2025.
• Used vehicle revenue surged 31.7% in Q3 2025, while new vehicle revenue decreased 7.0% due to an 8.6% drop in average selling price.
• Good Sam Services and Plans revenue increased 3.3% in Q3 2025, but gross profit and margin decreased due to higher claims and new program costs.
• Income tax expense was $207.5 million in Q3 2025, primarily due to a $175.4 million valuation allowance against deferred tax assets and a $37.3 million expense from a Tax Receivable Agreement liability remeasurement.
• Adjusted EBITDA increased 41.8% to $95.7 million in Q3 2025 and 48.4% to $269.1 million for the nine months ended September 30, 2025.
• Adjusted Earnings Per Share Diluted was $0.43 in Q3 2025, up from $0.13 in Q3 2024.
• The company operated 197 locations as of September 30, 2025, a decrease of 10 locations from September 30, 2024.
• Active Customers decreased by 8.4% to 4,229,138, and Good Sam Club members decreased by 10.9% to 1,608,107 (excluding free basic plan members).
• A material weakness in the design and operation of income tax controls remains unremediated as of September 30, 2025.

Sentiment

Score: 4

Explanation: While revenue grew and Adjusted EBITDA showed strong improvement, the substantial net loss driven by non-recurring tax adjustments and the persistent material weakness in internal controls present significant concerns. The decline in new vehicle sales and Good Sam Club members also indicates underlying challenges.

Positives

• Total revenue increased 4.7% to $1.81 billion in Q3 2025 and 6.1% to $5.20 billion for the nine months ended September 30, 2025.
• Used vehicle revenue increased significantly by 31.7% in Q3 2025 and 25.1% for the nine months, driven by higher unit sales.
• Used vehicle gross margin slightly improved by 16 basis points in Q3 2025 and 86 basis points for the nine months.
• Finance and insurance, net revenue increased 7.2% in Q3 2025 and 9.9% for the nine months, due to increased vehicle unit sales and new product offerings.
• Floor plan interest expense decreased by 19.3% in Q3 2025 and 26.5% for the nine months, due to lower average borrowing rates.
• Other interest expense, net decreased by 13.6% in Q3 2025 and 14.6% for the nine months, due to reduced interest rates and borrowings.
• Adjusted EBITDA increased 41.8% to $95.7 million in Q3 2025 and 48.4% to $269.1 million for the nine months.
• Long-lived asset impairment charges decreased significantly by 68.3% in Q3 2025 and 90.0% for the nine months.
• The company successfully acquired assets of multiple RV dealerships (8 locations) during the nine months ended September 30, 2025.
• Legal proceedings (Weissmann and Tumbleweed complaints) concluded in favor of FR Holdco, CW, and Marcus A. Lemonis, with judgments entered in July 2025.

Negatives

• Net loss attributable to Camping World Holdings, Inc. was $40.4 million in Q3 2025, a significant decline from net income of $5.5 million in Q3 2024.
• Net loss attributable to Camping World Holdings, Inc. for the nine months ended September 30, 2025, was $22.5 million, compared to a loss of $7.0 million in the prior year.
• Income tax expense was $207.5 million in Q3 2025 and $222.3 million for the nine months, primarily due to a $175.4 million valuation allowance against deferred tax assets and a $37.3 million expense from Tax Receivable Agreement liability remeasurement.
• New vehicle revenue decreased 7.0% in Q3 2025 and 1.1% for the nine months, primarily due to an 8.6% decrease in the average selling price per new vehicle.
• New vehicle gross profit decreased 12.6% in Q3 2025 and 7.0% for the nine months, with gross margin decreasing by 81 basis points in Q3 and 86 basis points for the nine months.
• Good Sam Services and Plans gross profit and margin decreased due to incremental roadside assistance claims costs and new tire rescue program costs.
• Good Sam Club revenue and gross profit decreased due to a 10.9% decrease in members (excluding free basic plan members) and increased digital marketing expenses.
• Active Customers decreased by 8.4% to 4,229,138 as of September 30, 2025.
• Good Sam Club members decreased by 10.9% to 1,608,107 (excluding free basic plan members).
• Cash provided by operating activities decreased significantly by $313.3 million to $95.2 million for the nine months ended September 30, 2025.
• Net cash used in investing activities increased to $226.1 million for the nine months ended September 30, 2025, from $57.1 million in the prior year.
• A material weakness in the design and operation of income tax controls remains unremediated as of September 30, 2025.

Risks

• General economic conditions, including inflation and interest rates, and the health of the RV industry.
• Availability and cost of financing to the company and its customers.
• Fuel shortages, high prices for fuel, or changes in energy sources.
• Dependence on the well-being and reputation of manufacturers, particularly Thor Industries, Inc. and Forest River, Inc.
• Changes in consumer preferences for products or failure to gauge those preferences.
• Competition in the market for services, protection plans, products, and resources targeting the RV lifestyle.
• Expansion into new, unfamiliar markets, businesses, or product lines or categories, as well as delays in opening new RV dealership locations.
• Unforeseen expenses, difficulties, and delays encountered in connection with acquisitions.
• Ability to maintain the strength and value of brands.
• Ability to successfully order and manage inventory to reflect consumer demand in a volatile market and anticipate changing consumer preferences and buying trends.
• Fluctuations in same store revenue and whether such revenue will be a meaningful indicator of future performance.
• The cyclical and seasonal nature of the business.
• Ability to operate and expand the business and to respond to changing business and economic conditions, which depends on the availability of adequate capital.
• Restrictive covenants imposed by Senior Secured Credit Facilities and Floor Plan Facility.
• Ability to execute and achieve the expected benefits of cost-cutting initiatives.
• Reliance on fulfillment and distribution centers, which may be susceptible to natural disasters or other serious disruptions.
• Natural disasters, unusual weather conditions, epidemic outbreaks, terrorist acts, and political events.
• Dependence on relationships with third-party providers of services, protection plans, products, and resources.
• Delays, new or increased tariffs, increased cost, or quality control deficiencies in the importation of products manufactured abroad.
• Whether third-party lending institutions and insurance companies will continue to provide financing for RV purchases, insurance, and extended service contracts.
• Ability to retain senior executives and attract and retain other qualified employees.
• Risks associated with leasing substantial amounts of space.
• Private brand offerings exposing the company to various risks.
• Potential asset impairment charges for goodwill, intangible assets, or other long-lived assets.
• Business is subject to numerous federal, state, and local regulations and litigation risk.
• Risks related to a failure in e-commerce operations, security breaches, and cybersecurity risks.
• Inability to maintain or upgrade information technology systems or convert to alternate systems efficiently.
• Risks related to disruptions or breaches involving information technology systems or confidential information.
• Material weaknesses in internal control over financial reporting.
• Risks relating to organizational structure and to ownership of shares of Class A common stock.
• Uncertainty regarding the extent and duration of additional tariffs that have or may be imposed on imports from countries like China, Mexico, and Canada.
• Inability to collect amounts owed pursuant to the Arbitration Award in the Weissmann and Tumbleweed legal proceedings due to appeals.
• Potential for significant payments under the Tax Receivable Agreement if tax benefits underlying the agreement become realizable in the future.
• Market conditions can impact the viability of financial institutions where cash and cash equivalents are maintained, potentially limiting access to uninsured funds.

Future Outlook

RV wholesale shipments are projected to be approximately 337,000 in 2025, a 1.0% increase over 2024. Used vehicle revenue and unit sales are expected to outpace comparative 2024 periods for the remainder of 2025, though to a lesser degree in the fourth quarter. The company plans to expand existing and new dealerships through construction and acquisition, with expected costs between $63.0 million and $81.0 million over the next twelve months. A payment of $1.2 million is expected under the Tax Receivable Agreement during the year ending December 31, 2026, but future cash tax benefits underlying further payments are not currently estimated to be realizable. Management believes current liquidity and capital sources will be sufficient for operations, growth, dividends, and expenses for at least the next twelve months.

Management Comments

• "We are closely monitoring U.S. trade policy developments with countries from which we source product and equipment, such as China, Mexico, and Canada."
• "We made adjustments to our procurement practices to partially mitigate certain of the potential negative effects that additional tariffs may impose on the sourcing of our inventory and equipment."
• "Management believes that no events have occurred as of September 30, 2025 that would trigger a subjective acceleration clause" (regarding debt facilities).
• "Management is committed to maintaining a strong internal control environment" (regarding remediation efforts for material weakness).

Industry Context

The RV industry is experiencing mixed signals, with wholesale shipments up 4.2% for the first nine months of 2025, but new RV registrations declining by 0.3% and used RV registrations by 2.9% over the twelve months ended August 31, 2025. This indicates a softening in retail demand for both new and used RVs. The market is also seeing a shift towards lower-cost, entry-level travel trailers, leading to decreased average selling prices for new vehicles. Camping World's strategy to increase used vehicle procurement in late 2024 was a direct response to these market dynamics, aiming to align with evolving consumer pricing expectations.

Comparison to Industry Standards

• NA

Corporate Governance

Legal Proceedings

• **Weissmann Complaint:** An arbitrator issued a final award of $4,990,006 in favor of FR Holdco, CW, Marcus A. Lemonis, NBCUniversal, and Machete, with Weissmann jointly and severally liable for $4,106,884. A judgment was entered on July 8, 2025, but Weissmann and Tumbleweed filed a notice of appeal on August 21, 2025.
• **Tumbleweed Complaint:** An arbitrator issued a final award of $3,793,455 in attorneys' fees and $626,611 in costs in favor of FR Holdco, CW, and Lemonis, and also awarded $4,990,006 in favor of FR Holdco. A judgment was entered on July 8, 2025, but Weissmann and Tumbleweed filed a notice of appeal on August 21, 2025.
• The company is involved in other litigation arising in the normal course of business, but management does not believe the disposition of these matters is likely to have a material adverse effect on the company's financial statements.

Related Party Transactions

• ML Acquisition Company, LLC, indirectly controlled by Chairman and CEO Marcus A. Lemonis, is a Continuing Equity Owner.
• Brent L. Moody, Andris A. Baltins, and K. Dillon Schickli, members of the Board of Directors, are Former Profits Unit Holders and Continuing Equity Owners.
• The Tax Receivable Agreement involves payments to Continuing Equity Owners and Crestview Partners II GP, L.P.
• Marcus A. Lemonis personally guaranteed the Lincolnshire Lease (previous corporate headquarters) which expired in March 2024.
• Marcus A. Lemonis received an award of 600,000 Restricted Stock Units (RSUs) and 750,000 Performance Stock Units (PSUs) in January 2025.

Stakeholder Impact

• **Shareholders:** Experienced a net loss, but Adjusted EPS improved. Quarterly cash dividends of $0.125 per share of Class A common stock were paid. A stock repurchase program with $120.2 million available remains in place.
• **Employees:** Stock-based compensation expense increased. Employee cash compensation costs decreased in Q3 but increased for the nine months.
• **Customers:** Good Sam Club members decreased, potentially impacting loyalty programs. Increased roadside assistance claims costs and new tire rescue program costs were noted.
• **Suppliers:** The company is monitoring U.S. trade policy and potential tariffs from China, Mexico, and Canada, which could impact procurement costs. A Supplier Agreement requires purchasing $250.0 million of product over 10 years.
• **Creditors:** The company was in compliance with all financial debt covenants as of September 30, 2025. Interest rates on debt facilities have decreased, reducing interest expenses.

Next Steps

• Continue efforts to remediate the material weakness in income tax controls, including implementing specific controls, redesigning reports, and developing training.
• Monitor U.S. trade policy developments with China, Mexico, and Canada, and adjust procurement practices as needed to mitigate tariff impacts.
• Expand existing and new dealerships through construction and acquisition, with expected costs between $63.0 million and $81.0 million over the next twelve months.
• Update cost estimates for future locations in periodic reports as developments occur.
• Address the appeal filed by Weissmann and Tumbleweed regarding the arbitration award.

Key Dates

Recommendation

While Camping World demonstrated revenue growth and improved Adjusted EBITDA, the substantial net loss driven by non-recurring tax adjustments and the persistent material weakness in internal controls introduce significant uncertainty and risk. The decline in new vehicle sales and Good Sam Club membership also warrants caution. The stock repurchase program and consistent dividends offer some support, but the unresolved legal appeals and macroeconomic uncertainties suggest a 'Hold' stance until the material weakness is remediated and the tax impact is clearer.

Keywords

RV Retail, Camping World, Good Sam, Recreational Vehicles, SEC Filing, 10-Q, Financial Results, Q3 2025, RV Industry, Financial Performance, Tax Receivable Agreement, Acquisitions, Inventory Management, Capital Expenditures, Corporate Governance, Internal Controls, Share Repurchase, Dividends