REV Group Ignites Q3 2025: Strong Performance Fueled by Specialty Vehicle Demand

REV Group (NYSE: REVg) delivered a robust performance in the third quarter of fiscal year 2025, demonstrating resilience and strategic execution amidst evolving market dynamics. The specialty vehicle manufacturer reported impressive financial results, largely driven by unwavering demand in its critical Fire & Emergency segments and sustained operational efficiencies across its diversified portfolio.

Management highlighted significant progress on key strategic initiatives, reinforcing confidence in the company's long-term growth trajectory and profitability.

For the third quarter, REV Group announced net sales reaching an impressive $650 million, surpassing analyst expectations and reflecting a healthy year-over-year increase of 8%.

This growth was primarily attributed to strong order intake and execution in the Fire & Emergency segment, where essential public services continue to invest in vital equipment. The company's adjusted EBITDA surged to $68 million, representing a significant 15% increase compared to the prior year, underscoring enhanced profitability and effective cost management.

Diluted earnings per share (EPS) also saw a substantial rise, climbing to $0.75, a testament to the company's strong operational leverage.

Digging deeper into segment performance, the Fire & Emergency division continued to be a stellar performer. With an robust backlog, the segment capitalized on strong demand for fire apparatus and ambulances, contributing significantly to both revenue and profitability.

Operational improvements and efficient production schedules allowed the company to meet customer needs effectively, maintaining its leadership position in these critical markets. Management emphasized the long-term stability and predictability of this segment, driven by non-discretionary municipal spending.

The Commercial segment, encompassing transit buses, school buses, and terminal trucks, showed stable performance, navigating a competitive landscape with strategic orders.

While not experiencing the same growth rates as Fire & Emergency, disciplined execution and targeted market penetration allowed the segment to maintain healthy margins. The Recreation segment, which includes RVs, demonstrated signs of stabilization. Despite lingering macroeconomic headwinds impacting consumer discretionary spending, REV Group's premium brands and dealer partnerships helped it maintain market share and manage inventory levels prudently.

The company is cautiously optimistic about a gradual recovery in the recreation market as consumer confidence improves.

Beyond financial figures, REV Group made significant strides in its strategic objectives. The company continued its focus on portfolio optimization, ensuring that resources are allocated to high-growth, high-margin opportunities.

Investments in manufacturing technology and supply chain enhancements further bolstered operational efficiency, contributing to improved profitability. Additionally, REV Group emphasized its commitment to disciplined capital allocation, prioritizing debt reduction and shareholder returns. The management team reiterated its confidence in achieving its full-year guidance, driven by a strong backlog, ongoing operational improvements, and a favorable demand environment in key segments.

Looking ahead, REV Group provided an optimistic outlook for the remainder of fiscal year 2025.

The company reaffirmed its full-year guidance, projecting net sales in the range of $2.55 billion to $2.65 billion and adjusted EBITDA between $250 million and $265 million. This projection is supported by sustained demand in Fire & Emergency, anticipated stabilization in Recreation, and continued benefits from strategic initiatives aimed at enhancing efficiency and profitability.

REV Group remains well-positioned to leverage its market leadership and robust operational framework to deliver long-term value to its shareholders, reinforcing its position as a dominant force in the specialty vehicle industry.