What changed in this filing

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Item 1. Financial Statements

2026-07-30 compared with 2026-04-30 · 265 added, 85 removed, 470 unchanged (43% of the section changed)

3 unchanged sentences

(In millions, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Revenue $ 3,408 $ 3,513 $ 6,877 $ 6,840

11 unchanged sentences

Provision for income taxes 48 67 92 128

Equity in losses of unconsolidated subsidiaries 46 1

Equity in (earnings) losses of unconsolidated subsidiaries ( 2 ) ( 1 ) 44 —

Income from continuing operations 134 186 211 344

1 unchanged sentence

Net income 136 193 215 362

net income attributable to continuing noncontrolling interest — 1 — 1

Net income attributable to LKQ stockholders $ 136 $ 192 $ 215 $ 361

Basic earnings per share:

2 unchanged sentences

Net income 0.53 0.75 0.84 1.40

net income attributable to continuing noncontrolling interest — — — —

Net income attributable to LKQ stockholders $ 0.53 $ 0.75 $ 0.84 $ 1.40

Diluted earnings per share:

2 unchanged sentences

Net income 0.53 0.75 0.84 1.40

net income attributable to continuing noncontrolling interest — — — —

Net income attributable to LKQ stockholders $ 0.53 $ 0.75 $ 0.84 $ 1.40

The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.

2 unchanged sentences

(In millions)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Net income $ 136 $ 193 $ 215 $ 362

net income attributable to continuing noncontrolling interest — 1 — 1

Net income attributable to LKQ stockholders 136 192 215 361

Other comprehensive (loss) income:

Foreign currency translation, net of tax ( 36 ) 268 ( 107 ) 368

Net change in unrealized gains/losses on cash flow hedges, net of tax 1 1 1 1

Net change in unrealized gains/losses on pension plans, net of tax — — — 1

Other comprehensive (loss) income from unconsolidated subsidiaries ( 5 ) 3

Other comprehensive income (loss) from unconsolidated subsidiaries 2 ( 7 ) ( 3 ) ( 4 )

Other comprehensive (loss) income ( 33 ) 262 ( 109 ) 366

Comprehensive income 103 455 106 728

comprehensive income attributable to continuing noncontrolling interest — 1 — 1

Comprehensive income attributable to LKQ stockholders $ 103 $ 454 $ 106 $ 727

The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.

2 unchanged sentences

(In millions, except per share data)

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Current assets:

28 unchanged sentences

Stockholders' equity:

Common stock, $ 0.01 par value, 1,000.0 shares authorized, 324.2 shares issued and 255.2 shares outstanding at March 31, 2026;

Common stock, $ 0.01 par value, 1,000.0 shares authorized, 324.3 shares issued and 253.4 shares outstanding at June 30, 2026;

324.0 shares issued and 255.0 shares outstanding at December 31, 2025

3 unchanged sentences

Treasury stock, at cost;

69.0 shares at March 31, 2026 and 69.0 shares at December 31, 2025

70.9 shares at June 30, 2026 and 69.0 shares at December 31, 2025

( 3,002 ) ( 2,948 )

7 unchanged sentences

(In millions)

Three Months Ended March 31,

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES (1) :

Net income $ 215 $ 362

Adjustments to reconcile net income to net cash used in operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 202 205

1 unchanged sentence

Stock-based compensation expense 18 17

Other 13 ( 1 )

Changes in operating assets and liabilities, net of effects from acquisitions and dispositions:

6 unchanged sentences

Operating lease assets and liabilities 4 ( 1 )

Net cash used in operating activities ( 56 ) ( 3 )

Net cash provided by operating activities 55 293

CASH FLOWS FROM INVESTING ACTIVITIES (1) :

6 unchanged sentences

Repayments under revolving credit facilities ( 566 ) ( 600 )

(Repayments) borrowings of other debt, net ( 8 ) 11

Repayments of other debt, net ( 11 ) ( 23 )

Dividends paid to LKQ stockholders ( 154 ) ( 156 )

1 unchanged sentence

Other financing activities, net ( 20 ) 7

Net cash provided by financing activities 111 40

Net cash provided by (used in) financing activities 51 ( 169 )

Effect of exchange rate changes on cash, cash equivalents and restricted cash ( 10 ) 29

Net increase (decrease) in cash, cash equivalents and restricted cash 7 ( 8 )

Net (decrease) increase in cash, cash equivalents and restricted cash ( 24 ) 54

Cash, cash equivalents and restricted cash of continuing operations, beginning of period (2)

11 unchanged sentences

(In millions, except per share data)

Three Months Ended March 31, 2026

Three Months Ended June 30, 2026

LKQ Stockholders

2 unchanged sentences

Shares Amount Shares Amount

Balance as of April 1, 2026 324.2 $ 3 ( 69.0 ) $ ( 2,948 ) $ 1,584 $ 7,960 $ ( 133 ) $ 24 $ 6,490

Net income — — — — — 136 — — 136

Other comprehensive loss — — — — — — ( 33 ) — ( 33 )

Purchase of treasury stock — — ( 1.9 ) ( 54 ) — — — — ( 54 )

Vesting of restricted stock units, net of shares withheld for employee tax 0.1 — — — — — — — —

Stock-based compensation expense — — — — 9 — — — 9

Dividends declared to LKQ stockholders ($0.30 per share) — — — — — ( 77 ) — — ( 77 )

Balance as of June 30, 2026 324.3 $ 3 ( 70.9 ) $ ( 3,002 ) $ 1,593 $ 8,019 $ ( 166 ) $ 24 $ 6,471

Three Months Ended June 30, 2025

LKQ Stockholders

Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated

Comprehensive Loss Noncontrolling Interest Total Stockholders' Equity

Shares Amount Shares Amount

Balance as of April 1, 2025 323.8 $ 3 ( 65.5 ) $ ( 2,827 ) $ 1,558 $ 7,753 $ ( 313 ) $ 15 $ 6,189

Net income — — — — — 192 — 1 193

Other comprehensive income — — — — — — 262 — 262

Purchase of treasury stock — — ( 1.0 ) ( 41 ) — — — — ( 41 )

Stock-based compensation expense — — — — 9 — — — 9

Dividends declared to LKQ stockholders ($0.30 per share) — — — — — ( 78 ) — — ( 78 )

Acquisition of a subsidiary with noncontrolling interest — — — — — — — 9 9

Balance as of June 30, 2025 323.8 $ 3 ( 66.5 ) $ ( 2,868 ) $ 1,567 $ 7,867 $ ( 51 ) $ 25 $ 6,543

The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.

LKQ CORPORATION AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Stockholders' Equity

(In millions, except per share data)

Six Months Ended June 30, 2026

LKQ Stockholders

Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated

Comprehensive Loss Noncontrolling Interest Total Stockholders' Equity

Shares Amount Shares Amount

Balance as of January 1, 2026 324.0 $ 3 ( 69.0 ) $ ( 2,948 ) $ 1,581 $ 7,958 $ ( 57 ) $ 24 $ 6,561

1 unchanged sentence

Other comprehensive loss — — — — — — ( 109 ) — ( 109 )

Purchase of treasury stock — — ( 1.9 ) ( 54 ) — — — — ( 54 )

Vesting of restricted stock units, net of shares withheld for employee tax 0.3 — — — ( 6 ) — — — ( 6 )

1 unchanged sentence

Dividends declared to LKQ stockholders ($0.60 per share) — — — — — ( 154 ) — — ( 154 )

Balance as of March 31, 2026 324.2 $ 3 ( 69.0 ) $ ( 2,948 ) $ 1,584 $ 7,960 $ ( 133 ) $ 24 $ 6,490

Three Months Ended March 31, 2025

Balance as of June 30, 2026 324.3 $ 3 ( 70.9 ) $ ( 3,002 ) $ 1,593 $ 8,019 $ ( 166 ) $ 24 $ 6,471

Six Months Ended June 30, 2025

LKQ Stockholders

9 unchanged sentences

Dividends declared to LKQ stockholders ($0.60 per share) — — — — — ( 156 ) — — ( 156 )

Balance as of March 31, 2025 323.8 $ 3 ( 65.5 ) $ ( 2,827 ) $ 1,558 $ 7,753 $ ( 313 ) $ 15 $ 6,189

Acquisition of a subsidiary with noncontrolling interest — — — — — — — 9 9

Balance as of June 30, 2025 323.8 $ 3 ( 66.5 ) $ ( 2,868 ) $ 1,567 $ 7,867 $ ( 51 ) $ 25 $ 6,543

The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.

29 unchanged sentences

We are currently evaluating the impact of adopting this ASU on our consolidated financial statements.

Business Combinations

We completed acquisitions of four businesses within our Europe segment, one business within our North America segment and one business within our Specialty segment, during the six months ended June 30, 2026.

Total acquisition date fair value of the consideration for these acquisitions was $ 104 million, composed primarily of $ 66 million of pre-existing loans and other receivables effectively settled upon acquisition, $ 30 million of cash paid (net of cash acquired) and $ 4 million of other purchase price obligations (non-interest bearing).

During the six months ended June 30, 2026, we recorded $ 36 million of goodwill related to these acquisitions, of which we expect an insignificant amount to be deductible for income tax purposes.

In the period between the acquisition dates and June 30, 2026, these acquisitions generated revenue of $ 14 million and an operating loss of $ 3 million.

On May 12, 2026, we acquired all of the equity interests of a supplier, RSI North America, Inc.

and Rock Solid Industries International (Pty) Ltd.

("RSI"), a leading manufacturer of modular stainless steel truck cap systems from facilities in the United States and South Africa.

The purchase price was $ 66 million and consisted of the acquisition-date fair value of pre-existing loans and other receivables between LKQ and RSI that were effectively settled upon acquisition.

The goodwill recorded for our acquisition of RSI, which is reported as part of our Specialty segment, represents the value of future technology and product development opportunities that are expected to enhance RSI's competitive position and support future growth, as well as the economic benefits attributable to LKQ's pre-existing relationship with RSI.

Our acquisitions are accounted for under the purchase method of accounting and are included in our consolidated financial statements from the dates of acquisition.

The purchase prices were allocated to the net assets acquired based upon estimated fair values at the dates of acquisition.

The purchase price allocations for the acquisitions made during the six months ended June 30, 2026 are preliminary as we are in the process of determining the following:

1) valuation amounts for certain receivables, inventories and fixed assets acquired;

2) valuation amounts for certain intangible assets acquired;

3) the acquisition date fair value of certain liabilities assumed;

and 4) the tax basis of the entities acquired.

We have recorded preliminary estimates for certain of the items noted above and will record adjustments, if any, to the preliminary amounts upon finalization of the valuations.

During the first six months of 2026, the measurement period adjustments recorded for acquisitions completed in prior periods were not material.

The purchase price allocations for the acquisitions completed during the six months ended June 30, 2026 are as follows (in millions):

Six Months Ended June 30, 2026

All Acquisitions

Receivables $ 6

Inventories 17

Prepaid expenses and other current assets 2

Property, plant and equipment 27

Operating lease assets 13

Other intangibles (1)

Other noncurrent assets 2

Current liabilities assumed ( 17 )

Long-term operating lease liabilities, excluding current portion ( 11 )

Debt assumed ( 17 )

Other purchase price obligations ( 4 )

Settlement of pre-existing balances (2)

Cash used in acquisitions, net of cash acquired $ 30

(1) The amount recorded for our acquisitions includes $ 18 million of developed technology ( 6 year weighted average useful life), $ 14 million of customer relationships ( 8.5 year weighted average useful life) and $ 9 million of trade names ( 9.3 year weighted average useful life).

(2) Amount primarily relates to the acquisition-date fair value of pre-existing loans and other receivables between LKQ and RSI that were effectively settled upon acquisition.

The fair value of our intangible assets is based on a number of inputs, including projections of future cash flows, assumed royalty rates and customer attrition rates, all of which are Level 3 inputs.

The fair value of our property, plant and equipment is determined using inputs such as market comparables and current replacement or reproduction costs of the asset, adjusted for physical, functional and economic factors;

these adjustments to arrive at fair value use unobservable inputs in which little or no market data exists, and therefore, these inputs are considered to be Level 3 inputs.

See Note 14, "Fair Value Measurements" for further information regarding the tiers in the fair value hierarchy.

The primary objectives of our acquisitions completed during the six months ended June 30, 2026 were to create economic value for our stockholders by enhancing our position as a leading source for alternative collision and mechanical repair products and to expand into other product lines and businesses that may benefit from our operating strengths.

When we identify potential acquisitions, we attempt to target companies with a leading market presence, experienced management team and workforce, high synergies and/or that add critical capabilities with opportunity for future consolidation and growth.

For certain of our acquisitions, we have identified cost savings and synergies as a result of integrating the company with our existing business that provide additional value to the combined entity.

In many cases, acquiring companies with these characteristics will result in purchase prices that include a significant amount of goodwill.

Unaudited Pro Forma Financial Information

The following unaudited pro forma financial information presents the effect of the businesses acquired during the six months ended June 30, 2026 as though the businesses had been acquired as of January 1, 2025.

The unaudited pro forma financial information is based upon accounting estimates and judgments that we believe are reasonable.

The unaudited pro forma financial information includes the effect of purchase accounting adjustments, such as the adjustment of inventory acquired to fair value, adjustments to depreciation on acquired property, plant and equipment, adjustments to rent expense for above or below market leases, adjustments to amortization on acquired intangible assets, adjustments to interest expense, and the related tax effects.

These pro forma results are not necessarily indicative of what would have occurred if the acquisitions had been in effect for the periods presented or of future results.

The unaudited pro forma financial information is as follows (in millions):

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Revenue $ 3,411 $ 3,544 $ 6,901 $ 6,901

Income from continuing operations 131 183 199 340

The following table summarizes the significant non-cash investing and financing activities related to our acquisitions (in millions):

Six Months Ended June 30,

Settlement of pre-existing balances (1)

(1) Amount primarily relates to the acquisition-date fair value of pre-existing loans and other receivables between LKQ and RSI that were effectively settled upon acquisition.

Discontinued Operations

7 unchanged sentences

The following table summarizes the comparative financial results of discontinued operations which are presented in Net income from discontinued operations in the Unaudited Condensed Consolidated Statements of Income (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Revenue $ — $ 129 $ — $ 265

2 unchanged sentences

Gain on disposal of business (1)

( 1 ) — ( 4 ) —

Selling, general and administrative expenses — 40 — 80

6 unchanged sentences

Income from discontinued operations before provision for income taxes 1 8 4 24

Provision for income taxes 1 5

(Benefit) provision for income taxes ( 1 ) 1 — 6

Net income from discontinued operations $ 2 $ 7 $ 4 $ 18

(1) During the three months ended March 31, 2026, we recorded a gain upon finalizing the working capital adjustment for Self Service.

(1) During the six months ended June 30, 2026, we recorded a gain upon finalizing the working capital adjustment for Self Service.

The following table summarizes the significant non-cash operating activities and capital expenditures of the Company’s discontinued operations related to the Self Service segment (in millions):

Three Months Ended March 31,

Six Months Ended June 30,

Depreciation and amortization $ — $ 7

2 unchanged sentences

Allowance for Credit Losses

Our allowance for credit losses was $ 63 million and $ 53 million as of March 31, 2026 and December 31, 2025, respectively.

The provision for credit losses was $ 16 million and $ 5 million for the three months ended March 31, 2026 and 2025, respectively.

Our allowance for credit losses was $ 48 million and $ 53 million as of June 30, 2026 and December 31, 2025, respectively.

The provision for credit losses was $ 10 million and $ 2 million for the three months ended June 30, 2026 and 2025 and $ 26 million and $ 7 million for the six months ended June 30, 2026 and 2025, respectively.

Intangible Assets

1 unchanged sentence

During our annual goodwill and indefinite-lived intangible assets impairment test performed in the fourth quarter of 2025 , we determined the carrying value of our Specialty reporting unit exceeded the fair value estimate and an impairment charge was recorded.

In connection with our previously announced plan to explore a potential sale of our Specialty reporting unit, we determined that as of March 31, 2026 it was more likely than not, defined as a likelihood of more than 50 percent, though not probable, that the Specialty reporting unit will be sold which constitutes a triggering event.

As such, we performed an interim impairment test for our Specialty reporting unit as of March 31, 2026.

In connection with our previously announced plan to explore a potential sale of our Specialty reporting unit, we performed an interim impairment test for our Specialty reporting unit as of March 31, 2026.

Based on the results of this interim goodwill impairment test, the Specialty reporting unit had a fair value estimate which exceeded the carrying value by 11 % and, therefore, no further impairment existed.

We will continue to monitor each of our reporting units for any risk of future impairments.

For our North America and Europe reporting units, we did not identify any triggering events or other indicators of impairment in the first three months of 2026 that necessitated an interim test of goodwill impairment or indefinite-lived intangible assets impairment.

For the three months ended June 30, 2026, we did not identify any triggering events or other indicators of impairment that necessitated any further interim test of goodwill impairment or indefinite-lived intangible assets impairment for our Specialty reporting unit.

For our North America and Europe reporting units, we did not identify any triggering events or other indicators of impairment in the first six months of 2026 that necessitated an interim test of goodwill impairment or indefinite-lived intangible assets impairment.

Equity Method Investments

The carrying value of our Equity method investments were as follows (in millions):

Segment Ownership as of March 31, 2026

March 31, 2026 December 31, 2025

Segment Ownership as of June 30, 2026

June 30, 2026 December 31, 2025

Europe 26.6 % $ 112 $ 157

1 unchanged sentence

(1) Equity in losses and earnings from our investment in MEKO AB ("Mekonomen") are reported on a one quarter lag and are excluded from the calculation of Segment EBITDA.

As of March 31, 2026, the Level 1 fair value of our investment in Mekonomen was $ 113 million based on the quoted market price for Mekonomen's common stock using the same foreign exchange rate as the carrying value.

We evaluated our investment in Mekonomen for impairment and concluded that events occurring in Q1 2026 signaled the decline in fair value was other-than-temporary, specifically the change in financial condition, including the significant increase in their leverage ratio and discontinuation of their dividend, in combination with the prolonged significant stock price decrease and operational underperformance due to difficult economic conditions.

Therefore, we recognized an other-than-temporary impairment of $ 44 million, which represented the difference in the carrying value and the fair value of our investment in Mekonomen.

As of June 30, 2026, the Level 1 fair value of our investment in Mekonomen was $ 121 million based on the quoted market price for Mekonomen's common stock using the same foreign exchange rate as the carrying value.

During the three months ended March 31, 2026, we evaluated our investment in Mekonomen for impairment and concluded that events occurring during the quarter signaled the decline in fair value was other-than-temporary, specifically the change in financial condition, including the significant increase in their leverage ratio and discontinuation of their dividend, in combination with the prolonged significant stock price decrease and operational underperformance due to difficult economic conditions.

Therefore, we recognized an other-than-temporary impairment charge of $ 44 million, which represented the difference in the carrying value and the fair value of our investment in Mekonomen.

The fair value of our investment in Mekonomen was determined using the Mekonomen share price of SEK 69 as of March 31, 2026.

The impairment charges are recorded in Equity in losses of unconsolidated subsidiaries in our Unaudited Condensed Consolidated Statements of Income.

As a result of the impairment charge in the first quarter, the Level 1 fair value of our equity investment in the publicly traded Mekonomen common stock at March 31, 2026 approximated the carrying value of $ 113 million.

The impairment charges are recorded in Equity in (earnings) losses of unconsolidated subsidiaries in our Unaudited Condensed Consolidated Statements of Income.

During the three months ended June 30, 2026, we evaluated our investment in Mekonomen for other-than-temporary impairment and determined there was no additional impairment.

Revenue Recognition

11 unchanged sentences

The following table sets forth our revenue disaggregated by category and reportable segment (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

North America $ 1,371 $ 1,362 $ 2,712 $ 2,698

3 unchanged sentences

North America 95 80 194 156

Europe 8 6 16 13

Other 103 86 210 169

Total revenue $ 3,408 $ 3,513 $ 6,877 $ 6,840

1 unchanged sentence

Amounts related to variable consideration on our Unaudited Condensed Consolidated Balance Sheets are as follows (in millions):

Classification March 31, 2026 December 31, 2025

Classification June 30, 2026 December 31, 2025

Return asset Prepaid expenses and other current assets $ 66 $ 66

4 unchanged sentences

The following table sets forth our revenue by geographic area (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

United States $ 1,627 $ 1,600 $ 3,196 $ 3,145

9 unchanged sentences

Additionally, initiatives can change or expand based on the information obtained while executing on the initiative and when additional actions are identified.

We anticipate we will incur approximately $ 70 million of cost in 2026 executing on the approved actions in connection with this initiative.

We anticipate we will incur approximately $ 90 million of costs in 2026 executing on the approved actions in connection with these initiatives.

The following table sets forth the expenses incurred related to our Strategic Restructuring and Transformation Initiatives (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Expense Type 2026 2025 (1)

2026 2025 (1)

Employee related costs $ 6 $ 5 $ 24 $ 12

Facility exit costs 3 3 13 5

Other costs 2 1

Other costs (benefits) 1 ( 1 ) 3 —

Total $ 10 $ 7 $ 40 $ 17

(1) Includes costs previously included in the 2024 Global Plan.

Expenses incurred for the three months ended March 31, 2026 were related to the closing of underperforming locations and the elimination of inefficient cost structures primarily in our Europe segment.

(1) Includes costs previously included in the 2024 Global Plan and 1 LKQ Europe Plan.

Expenses incurred for the six months ended June 30, 2026 were related to the closing of underperforming locations and the elimination of inefficient cost structures primarily in our Europe and North America segments.

Acquisition Integration Plans

1 unchanged sentence

These costs are typically incurred within a year from the acquisition date and vary in magnitude depending on the size and complexity of the related integration activities.

There are no material Acquisition Integration Plans as of March 31, 2026.

We incurred expenses totaling $ 1 million for each of the three months ended March 31, 2026 and 2025.

There are no material Acquisition Integration Plans as of June 30, 2026.

We incurred expenses totaling an insignificant amount for each of the three months ended June 30, 2026 and 2025, respectively, and we incurred expenses totaling $ 1 million for each of the six months ended June 30, 2026 and 2025, respectively.

Transaction Related Expenses

During the three months ended March 31, 2026 and 2025, we incurred expenses totaling $ 2 million and an insignificant amount, respectively, for legal, accounting and advisory services related to completed and potential transactions.

During the three months ended June 30, 2026 and 2025, we incurred expenses totaling $ 4 million and $ 1 million, respectively, and during the six months ended June 30, 2026 and 2025, we incurred expenses totaling $ 6 million and $ 1 million, respectively, for legal, accounting and advisory services related to completed and potential transactions.

Earnings Per Share

The following chart sets forth the computation of earnings per share (in millions, except per share amounts):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Income from continuing operations $ 134 $ 186 $ 211 $ 344

9 unchanged sentences

The components of Accumulated Other Comprehensive Income (Loss) are as follows (in millions):

Three Months Ended March 31, 2026

Three Months Ended June 30, 2026

Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges (1)

Unrealized Gain (Loss) on Pension Plans Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss)

Balance as of April 1, 2026

$ ( 135 ) $ ( 7 ) $ 10 $ ( 1 ) $ ( 133 )

Pretax loss ( 36 ) — — — ( 36 )

Reclassification of unrealized loss — 1 — — 1

Other comprehensive income from unconsolidated subsidiaries — — — 2 2

Balance as of June 30, 2026

$ ( 171 ) $ ( 6 ) $ 10 $ 1 $ ( 166 )

Three Months Ended June 30, 2025

Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges (1)

Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss)

Balance as of April 1, 2025

$ ( 311 ) $ ( 9 ) $ 7 $ ( 313 )

Pretax income 268 1 — 269

Income tax effect — ( 1 ) — ( 1 )

Reclassification of unrealized loss — 1 — 1

Other comprehensive loss from unconsolidated subsidiaries — — ( 7 ) ( 7 )

Balance as of June 30, 2025

$ ( 43 ) $ ( 8 ) $ — $ ( 51 )

Six Months Ended June 30, 2026

Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges (1)

Unrealized Gain (Loss) on Pension Plans Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries Accumulated Other Comprehensive Income (Loss)

Balance as of January 1, 2026

1 unchanged sentence

Pretax loss ( 107 ) — — — ( 107 )

Reclassification of unrealized loss — 1 — — 1

Other comprehensive loss from unconsolidated subsidiaries — — — ( 3 ) ( 3 )

Balance as of March 31, 2026

Balance as of June 30, 2026

$ ( 171 ) $ ( 6 ) $ 10 $ 1 $ ( 166 )

Three Months Ended March 31, 2025

Six Months Ended June 30, 2025

Foreign Currency Translation Unrealized Gain (Loss) on Cash Flow Hedges (1)

1 unchanged sentence

Balance as of January 1, 2025

$ ( 411 ) $ ( 9 ) $ ( 1 ) $ 4 $ ( 417 )

Pretax income 368 1 — — 369

Income tax effect — ( 1 ) — — ( 1 )

Reclassification of unrealized loss — 1 — — 1

Reclassification of deferred income taxes — — 1 — 1

Other comprehensive income from unconsolidated subsidiaries — — — 3 3

Balance as of March 31, 2025

Other comprehensive loss from unconsolidated subsidiaries — — — ( 4 ) ( 4 )

Balance as of June 30, 2025

$ ( 43 ) $ ( 8 ) $ — $ — $ ( 51 )

9 unchanged sentences

We utilize voluntary supply chain finance programs to support our efforts in negotiating payment term extensions with suppliers as a part of our goal to improve our operating cash flows.

As of March 31, 2026 and December 31, 2025, we had $ 457 million and $ 481 million of Accounts payable outstanding under the arrangements, respectively.

As of June 30, 2026 and December 31, 2025, we had $ 433 million and $ 481 million of Accounts payable outstanding under the arrangements, respectively.

Long-Term Obligations

Long-term obligations consist of the following (in millions):

March 31, 2026

June 30, 2026

December 31, 2025

1 unchanged sentence

Senior Unsecured Credit Agreement:

Term loan payable January 2027 5.14 % $ 500 5.19 % $ 500

Term loan payable (1)

January 2027 5.12 % $ 500 5.19 % $ 500

Revolving credit facilities December 2030 5.14 % (2)

10 unchanged sentences

Other debt Various through December 2030 78.79 % (2) (3)

10 3.21 % (2)

Total debt 3,961 3,695

3 unchanged sentences

Long-term debt, net of debt issuance costs and unamortized bond discounts $ 3,388 $ 3,631

(1) On July 29, 2026, we prepaid the term loan payable under our Senior Unsecured Credit Agreement with borrowings from our revolving credit facilities.

(2) Interest rate derived via a weighted average.

Cash paid for interest was $ 54 million and $ 60 million for the three months ended March 31, 2026 and 2025, respectively.

(3) Increase in interest rate as of June 30, 2026 is due to the annualization effect of a short-term borrowing.

Cash paid for interest was $ 120 million and $ 137 million for the six months ended June 30, 2026 and 2025, respectively.

Derivative Instruments and Hedging Activities

5 unchanged sentences

The agreements included a total $ 300 million notional amount that matured in February 2026.

Changes in the fair value of the interest rate swaps were recorded in Accumulated other comprehensive loss and reclassified to Interest expense when the hedged interest payments affected earnings.

Changes in the fair value of the interest rate swaps were recorded in Accumulated other comprehensive loss and reclassified to Interest expense when the hedged interest payments affected

The activity related to the interest rate swaps was classified in operating activities in our Unaudited Condensed Consolidated Statements of Cash Flows as the activity related to normal recurring settlements to match interest payments.

As of March 31, 2026, there are no derivative instruments designated as cash flow hedges outstanding.

As of June 30, 2026, there are no derivative instruments designated as cash flow hedges outstanding.

All of our interest rate swap contracts were executed with counterparties that we believe are creditworthy, and we closely monitor the credit ratings of these counterparties.

3 unchanged sentences

Interest rate swap agreements $ 300 Other accrued expenses $ —

The activity related to our cash flow hedges is included in Note 9, "Accumulated Other Comprehensive Income (Loss)." As of March 31, 2026, we estimate that $ 1 million of derivative losses (net of tax) included in Accumulated other comprehensive loss will be reclassified into our Unaudited Condensed Consolidated Statements of Income within the next 12 months.

The activity related to our cash flow hedges is included in Note 10, "Accumulated Other Comprehensive Income (Loss)." As of June 30, 2026, we estimate that $ 1 million of derivative losses (net of tax) included in Accumulated other comprehensive loss will be reclassified into our Unaudited Condensed Consolidated Statements of Income within the next 12 months.

Fair Value Measurements

Financial Assets and Liabilities Measured at Fair Value

We use the market and income approaches to estimate the fair value of our financial assets and liabilities, and during the three months ended March 31, 2026, there were no significant changes in valuation techniques or inputs related to the financial assets or liabilities that we have historically recorded at fair value.

The following table presents information about our financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs we utilized to determine such fair value as of March 31, 2026 and December 31, 2025 (in millions):

March 31, 2026 December 31, 2025

We use the market and income approaches to estimate the fair value of our financial assets and liabilities, and during the three and six months ended June 30, 2026, there were no significant changes in valuation techniques or inputs related to the financial assets or liabilities that we have historically recorded at fair value.

June 30, 2026 December 31, 2025

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

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Investments in debt and equity securities relate to our captive insurance subsidiary and are included in Other noncurrent assets on the Unaudited Condensed Consolidated Balance Sheets.

For contingent consideration liabilities, at both March 31, 2026 and December 31, 2025, the entire portion was current and was included in Other current liabilities on the Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the related payments.

For contingent consideration liabilities, at both June 30, 2026 and December 31, 2025, the entire portion was current and was included in Other current liabilities on the Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the related payments.

Our contingent consideration liabilities are related to our business acquisitions.

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The fair value measurements of the borrowings under the credit agreement are classified as Level 2 within the fair value hierarchy since they are determined based upon significant inputs observable in the market, including interest rates on recent financing transactions with similar terms and maturities.

We estimated the fair value by calculating the upfront cash payment a market participant would require at March 31, 2026 and December 31, 2025 to assume these obligations.

We estimated the fair value by calculating the upfront cash payment a market participant would require at June 30, 2026 and December 31, 2025 to assume these obligations.

The fair values of the U.S.

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Notes (2033), the 4.13% senior notes due April 2028 (the "Euro Notes (2028)") and the 4.13% senior notes due March 2031 (the "Euro Notes (2031)") are determined based upon observable market inputs including quoted market prices in markets that are not active, and therefore are classified as Level 2 within the fair value hierarchy.

Based on market conditions as of March 31, 2026 and December 31, 2025, the fair value of the borrowings under the Senior Unsecured Credit Agreement reasonably approximated the carrying values of $ 712 million and $ 501 million, respectively.

As of March 31, 2026 and December 31, 2025, the fair value of the borrowings under the Senior Unsecured Term Loan Credit Agreement ("CAD Note") reasonably approximated the carrying values of $ 503 million and $ 510 million, respectively.

The following table provides the carrying and fair value for our other financial instruments as of March 31, 2026 and December 31, 2025 (in millions):

As of March 31, 2026

Based on market conditions as of June 30, 2026 and December 31, 2025, the fair value of the borrowings under the Senior Unsecured Credit Agreement reasonably approximated the carrying values of $ 790 million and $ 501 million, respectively.

As of June 30, 2026 and December 31, 2025, the fair value of the borrowings under the Senior Unsecured Term Loan Credit Agreement ("CAD Note") reasonably approximated the carrying values of $ 493 million and $ 510 million, respectively.

The following table provides the carrying and fair value for our other financial instruments as of June 30, 2026 and December 31, 2025 (in millions):

As of June 30, 2026

As of December 31, 2025

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The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the tax environment changes.

Our effective income tax rate for the three months ended March 31, 2026 was 26.4 %, compared to 27.8 % for the three months ended March 31, 2025.

The decrease in the effective tax rate for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 is primarily attributable to the 1.2 % year over year favorable impact of discrete items, mostly related to a return to provision adjustment.

Net income taxes paid were $ 30 million and $ 31 million for the three months ended March 31, 2026 and 2025, respectively.

Our effective income tax rate for the six months ended June 30, 2026 was 26.6 %, compared to 27.1 % for the six months ended June 30, 2025.

The decrease in the effective tax rate for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 is primarily attributable to a favorable impact from changes in the Company's geographic distribution of income.

Net income taxes paid were $ 125 million and $ 106 million for the six months ended June 30, 2026 and 2025, respectively.

Cash, Cash Equivalents and Restricted Cash

The following table provides a reconciliation of Cash and cash equivalents as reported on the Unaudited Condensed Consolidated Balance Sheets to Cash, cash equivalents and restricted cash shown in the Unaudited Condensed Consolidated Statements of Cash Flows (in millions):

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Cash and cash equivalents $ 301 $ 319

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(1) Represents cash held with our captive insurance subsidiary for payments on self-insured claims.

Commitments and Contingencies

We are from time to time subject to various claims and lawsuits incidental to our business.

Some of these claims may involve complex issues that are subject to substantial uncertainties.

However, in the opinion of management, based on currently available information, we do not expect that any currently outstanding claims and lawsuits will, individually or in the aggregate, have a material adverse effect on our financial position, results of operations or cash flows.

On April 22, 2026, a purported stockholder of LKQ filed a putative class action (the “Securities Action”) in the United States District Court for the Middle District of Tennessee against LKQ Corporation and certain of its officers.

The complaint generally alleges that LKQ made certain materially false and misleading statements and omitted certain material information regarding LKQ’s acquisition and integration of Uni-Select Incorporated ("Uni-Select") and Uni-Select’s U.S.

operating subsidiary FinishMaster, which artificially inflated the market price of LKQ common stock.

The complaint seeks, among other things, unspecified compensatory damages.

On June 22, 2026, the court entered an order extending Defendants’ time to respond to the complaint until after a lead plaintiff has been appointed by the court.

An evidentiary hearing on pending motions to appoint a lead plaintiff has been scheduled for August 13, 2026.

On May 26, 2026, a derivative action (“Derivative Action 1”) was filed in the United States District Court for the Middle District of Tennessee that largely mirrors the Securities Action but is filed by a purported shareholder on behalf of nominal defendant LKQ Corporation against certain current and former directors and officers, asserting both a federal securities claim and breach of fiduciary duty claims relating to the same alleged misconduct during the same purported class period as the Securities Action.

Plaintiff seeks, on behalf of LKQ, unspecified monetary damages, disgorgement, and other relief.

On July 24, 2026, Derivative Action 1 was stayed pending resolution of LKQ’s anticipated motion to dismiss the Securities Action.

On July 29, 2026, a second derivative action (“Derivative Action 2”) that largely mirrors Derivative Action 1 was filed in the United States District Court for the Middle District of Tennessee by another purported shareholder on behalf of nominal defendant LKQ Corporation against certain current and former directors and officers.

At this time, the Company is unable to predict the outcome or reasonably estimate a range of loss, if any, that could result from an unfavorable outcome relating to the Securities Action, Derivative Action 1, or Derivative Action 2.

Segment and Geographic Information

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North America Europe Specialty Eliminations Consolidated

Three Months Ended March 31, 2026

Three Months Ended June 30, 2026

Third Party $ 1,466 $ 1,455 $ 487 $ — $ 3,408

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$ 46 $ 48 $ 9 $ — $ 103

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Third Party $ 1,442 $ 1,607 $ 464 $ — $ 3,513

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$ 50 $ 44 $ 8 $ — $ 102

North America Europe Specialty Eliminations Consolidated

Six Months Ended June 30, 2026

Third Party $ 2,906 $ 3,076 $ 895 $ — $ 6,877

Intersegment — — 2 ( 2 ) —

Total segment revenue $ 2,906 $ 3,076 $ 897 $ ( 2 ) $ 6,877

Cost of goods sold 1,672 1,882 673

Selling, general and administrative expenses 830 976 178

Other segment items (2)

( 6 ) ( 17 ) ( 5 )

Segment EBITDA $ 410 $ 235 $ 51 $ — $ 696

Total depreciation and amortization (3)

$ 91 $ 94 $ 17 $ — $ 202

Six Months Ended June 30, 2025

Third Party $ 2,854 $ 3,129 $ 857 $ — $ 6,840

Intersegment — — 2 ( 2 ) —

Total segment revenue $ 2,854 $ 3,129 $ 859 $ ( 2 ) $ 6,840

Cost of goods sold 1,608 1,919 646

Selling, general and administrative expenses 816 933 158

Other segment items (2)

( 11 ) ( 15 ) ( 5 )

Segment EBITDA $ 441 $ 292 $ 60 $ — $ 793

Total depreciation and amortization (3)

$ 99 $ 83 $ 16 $ — $ 198

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker ("CODM").

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The table below provides a reconciliation of Net Income to Segment EBITDA (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Net income $ 136 $ 193 $ 215 $ 362

net income attributable to continuing noncontrolling interest — 1 — 1

Net income attributable to LKQ stockholders 136 192 215 361

net income from discontinued operations 2 7 4 18

Income from continuing operations 77 158

Net income from continuing operations attributable to LKQ stockholders 134 185 211 343

Depreciation and amortization 103 102 202 198

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Provision for income taxes 48 67 92 128

Equity in losses of unconsolidated subsidiaries (1)

Equity in (earnings) losses of unconsolidated subsidiaries (1)

( 2 ) ( 1 ) 44 —

Equity investment fair value adjustments — — — ( 1 )

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The following table presents capital expenditures by reportable segment (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Capital Expenditures

North America

$ 24 $ 16 $ 36 $ 38

Europe 23 32 49 59

Specialty 4 4 6 7

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The following table presents assets by reportable segment (in millions):

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Receivables, net of allowance for credit losses

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The following table sets forth our tangible long-lived assets by geographic area (in millions):

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Long-lived assets

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Total long-lived assets $ 2,727 $ 2,784

Subsequent Event

Securities Class Action Lawsuit

On April 22, 2026, a purported stockholder of LKQ filed a putative class action against LKQ Corporation and certain of its officers.

operating subsidiary FinishMaster, which artificially inflated the market price of LKQ common stock.

The complaint seeks, among other things, unspecified compensatory damages.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements