ARKO Corp. Reports 11.8% Revenue Decline and Increased Net Loss in Q1 2025

ARKO Corp. reported a decline in financial performance for the first quarter of 2025, with total revenues of $1.83 billion, down 11.8% from $2.07 billion in the same period last year. The decrease was primarily driven by a significant drop in fuel revenue, which fell to $1.45 billion from $1.63 billion, reflecting lower average fuel prices and fewer gallons sold due to adverse weather conditions and a challenging macroeconomic environment. Merchandise revenue also decreased by 14.5% to $354.5 million, attributed to reduced sales from closed or converted retail stores and a decline in same-store sales.

Operating expenses decreased to $1.84 billion from $2.07 billion, largely due to lower fuel and merchandise costs, which fell by 11.8% and 15.3%, respectively. Despite these reductions, ARKO reported an operating loss of $11.8 million, compared to a loss of $4.9 million in the prior year. The company’s net loss attributable to common shareholders was $14.1 million, or $0.12 per share, compared to a loss of $2.0 million, or $0.02 per share, in the first quarter of 2024.

Strategically, ARKO has been implementing a multi-year transformation plan, which includes converting retail stores to dealer sites within its wholesale segment. In the first quarter, the company converted 59 retail locations, with plans for further conversions throughout 2025. The company also completed the acquisition of 21 SpeedyQ Markets convenience stores in April 2024, contributing to its growth strategy. As of March 31, 2025, ARKO operated 1,329 retail convenience stores and supplied fuel to 1,961 dealer locations across more than 30 states.

Operationally, ARKO's loyalty program, fas REWARDS®, saw an increase in membership, reaching approximately 2.32 million enrolled members, a 10.9% rise from the previous year. The company continues to focus on enhancing its foodservice offerings and improving customer experience as part of its growth strategy. However, the company faces challenges from inflation, rising interest rates, and competitive pressures in the convenience store market, which could impact future performance.

Looking ahead, ARKO remains committed to its transformation plan and anticipates further store conversions and strategic investments to enhance profitability. The company maintains a strong liquidity position with approximately $847 million available, including cash and credit lines, which it plans to utilize for ongoing operations and potential acquisitions. The board has declared a quarterly dividend of $0.03 per share, reflecting its commitment to returning value to shareholders while navigating the current economic landscape.