ARKO exhibits structural margin fragility with operating margins frequently dipping below 1% and a recent 12.47% year-over-year revenue decline highlighting top-line erosion.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 |
|---|
| Sales/Revenue | 7.59B | 7.64B | 8.73B | 9.41B | 9.14B | 7.42B | 4.01B | 4.13B | 4.06B | 3.04B | 1.94B | 1.73B | 1.62B | 1.43B | 1.18B |
| Revenue Growth % | -10.63% | -12.47% | -7.23% | 2.95% | 23.26% | 84.96% | -2.87% | 1.57% | 33.66% | 56.92% | 11.8% | 6.94% | 13.28% | 21.73% | - |
| Cost of Goods Sold | 4.98B | 7.25B | 8.33B | 8.99B | 8.72B | 7.05B | 3.75B | 3.99B | 3.92B | 2.96B | 1.55B | 1.41B | 1.4B | 1.27B | 1.05B |
| COGS % of Revenue | - | 94.83% | 95.45% | 95.5% | 95.42% | 95.05% | 93.56% | 96.69% | 96.53% | 97.48% | 79.76% | 81.61% | 86.22% | 88.52% | 89.46% |
| Gross Profit | 838.74M | 395.5M | 397.22M | 423.63M | 418.55M | 367.48M | 258.36M | 136.77M | 141.2M | 76.71M | 392.33M | 318.82M | 223.31M | 164.24M | 123.93M |
| Gross Margin % | 11.06% | 5.17% | 4.55% | 4.5% | 4.58% | 4.95% | 6.44% | 3.31% | 3.47% | 2.52% | 20.24% | 18.39% | 13.78% | 11.48% | 10.54% |
| Gross Profit Growth % | - | -0.43% | -6.24% | 1.21% | 13.9% | 42.23% | 88.9% | -3.14% | 84.06% | -80.45% | 23.06% | 42.77% | 35.96% | 32.52% | - |
| Operating Expenses | 899.9M | 293.2M | 303.19M | 305.62M | 251.54M | 225.4M | 178.05M | 135.45M | 105.29M | 46.03M | 374.27M | 302M | 218.19M | 169.37M | 123.55M |
| OpEx % of Revenue | - | 3.84% | 3.47% | 3.25% | 2.75% | 3.04% | 4.44% | 3.28% | 2.59% | 1.51% | 19.31% | 17.42% | 13.46% | 11.84% | 10.51% |
| Selling, General & Admin | 164.1M | 165.71M | 162.92M | 165.29M | 139.97M | 124.67M | 94.42M | 69.31M | 62.02M | 46.03M | 366.87M | 294.93M | 212.96M | 165.2M | 118.91M |
| SG&A % of Revenue | - | 2.17% | 1.87% | 1.76% | 1.53% | 1.68% | 2.35% | 1.68% | 1.53% | 1.51% | 18.93% | 17.01% | 13.14% | 11.55% | 10.12% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 4M | 127.49M | 140.27M | 140.33M | 111.57M | 100.73M | 83.62M | 66.14M | 43.27M | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Income | 131.63M | 102.3M | 94.03M | 118.01M | 167.01M | 142.08M | 80.31M | 1.32M | 35.91M | 30.69M | 25.46M | 23.88M | 10.35M | -964.93K | 5.02M |
| Operating Margin % | 1.74% | 1.34% | 1.08% | 1.25% | 1.83% | 1.92% | 2% | 0.03% | 0.88% | 1.01% | 1.31% | 1.38% | 0.64% | -0.07% | 0.43% |
| Operating Income Growth % | - | 8.8% | -20.33% | -29.34% | 17.55% | 76.91% | 5966.01% | -96.31% | 17.03% | 20.53% | 6.6% | 130.78% | 1172.54% | -119.21% | - |
| EBITDA | 263.56M | 236.75M | 226.44M | 245.61M | 268.77M | 239.28M | 154.71M | 63.73M | 89.73M | 68.87M | 53.71M | 47.61M | 28.14M | 13.46M | 16.07M |
| EBITDA Margin % | 3.47% | 3.1% | 2.59% | 2.61% | 2.94% | 3.23% | 3.86% | 1.54% | 2.21% | 2.26% | 2.77% | 2.75% | 1.74% | 0.94% | 1.37% |
| EBITDA Growth % | 18.34% | 4.55% | -7.81% | -8.62% | 12.32% | 54.66% | 142.77% | -28.98% | 30.28% | 28.22% | 12.81% | 69.23% | 109.09% | -16.25% | - |
| D&A (Non-Cash Add-back) | 131.94M | 134.45M | 132.41M | 127.6M | 101.75M | 97.19M | 74.4M | 62.4M | 53.81M | 38.19M | 28.25M | 23.73M | 17.79M | 14.42M | 11.05M |
| EBIT | 123.98M | 121.83M | 124.62M | 138.29M | 170.19M | 145.09M | 82.08M | 2.77M | 45.93M | 21.27M | 25.46M | 23.88M | 10.35M | -964.93K | 5.02M |
| Net Interest Income | -39.31M | -73.32M | -67.16M | -71.24M | -59.41M | -71.21M | -49.91M | -41.81M | -19.93M | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 9.21M | 19.53M | 30.59M | 20.27M | 3.18M | 3M | 1.77M | 1.45M | 10.02M | 19.91M | 12.95M | 9.8M | 3.96M | 3.04M | 3.05M |
| Interest Expense | 48.52M | 92.86M | 97.75M | 91.52M | 62.58M | 74.21M | 51.67M | 43.26M | 29.95M | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | -85.05M | -73.22M | -67.04M | -71.28M | -59.48M | -71.02M | -51.17M | -42.32M | -19.93M | -39.22M | -20.34M | -16.87M | -9.19M | -7.21M | -7.69M |
| Pretax Income | 46.57M | 29.09M | 26.99M | 46.73M | 107.53M | 71.06M | 29.14M | -40.99M | 15.98M | -8.53M | 5.12M | 7.02M | 1.16M | -8.17M | -2.67M |
| Pretax Margin % | 0.61% | 0.38% | 0.31% | 0.5% | 1.18% | 0.96% | 0.73% | -0.99% | 0.39% | -0.28% | 0.26% | 0.4% | 0.07% | -0.57% | -0.23% |
| Income Tax | 19.21M | 6.34M | 6.14M | 12.17M | 35.56M | 11.63M | -1.5M | 6.17M | -7.93M | -9.73M | 2.51M | 3.38M | 886.48K | 1.64M | 2.43M |
| Effective Tax Rate % | 41.26% | 21.8% | 22.76% | 26.03% | 33.07% | 16.37% | -5.14% | -15.04% | -49.64% | 114.09% | 49.05% | 48.22% | 76.48% | -20.12% | -91.18% |
| Net Income | 27.36M | 22.74M | 20.84M | 34.37M | 71.75M | 59.2M | 13.71M | -43.54M | 10.97M | -5.83M | -5.43M | 1.82M | -2.87M | -3.8M | 1.17M |
| Net Margin % | 0.36% | 0.3% | 0.24% | 0.37% | 0.78% | 0.8% | 0.34% | -1.05% | 0.27% | -0.19% | -0.28% | 0.11% | -0.18% | -0.27% | 0.1% |
| Net Income Growth % | 212.05% | 9.11% | -39.35% | -52.1% | 21.2% | 331.79% | 131.49% | -497.04% | 288.13% | -7.35% | -397.86% | 163.54% | 24.52% | -425.77% | - |
| Net Income (Continuing) | 27.36M | 22.74M | 20.84M | 34.57M | 71.98M | 59.43M | 30.64M | -47.16M | 23.91M | 1.2M | -5.43M | 1.82M | -2.87M | -3.8M | 1.17M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -11K | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 64.65M | 0 | 0 | 16K | 56K | 224K | -161K | 129.12M | 134.77M | 133.69M | 106.26M | 32.74M | 31.18M | 24.89M | 32.86M |
| EPS (Diluted) | 0.25 | 0.15 | 0.13 | 0.24 | 0.53 | 0.42 | 0.07 | -0.11 | 0.01 | -0.01 | -0.01 | 0.00 | -0.01 | -0.01 | 0.00 |
| EPS Growth % | 549.66% | 15.38% | -45.83% | -54.72% | 26.19% | 491.55% | 164.55% | -869.23% | - | - | - | - | - | - | - |
| EPS (Basic) | - | 0.15 | 0.13 | 0.24 | 0.54 | 0.43 | 0.07 | -0.11 | 0.01 | -0.01 | -0.01 | 0.00 | -0.01 | -0.01 | 0.00 |
| Diluted Shares Outstanding | 111.32M | 114.98M | 116.95M | 119.61M | 123.22M | 125.44M | 442.33M | 442.33M | 766.18M | 759.43M | 592.33M | 579.7M | 578.74M | 487.39M | 350.13M |
| Basic Shares Outstanding | 111.32M | 113.31M | 116.14M | 118.78M | 121.48M | 124.41M | 442.23M | 442.23M | 766.19M | 767.31M | 592.33M | 579.74M | 578.75M | 487.41M | 350.13M |
| Dividend Payout Ratio | - | 59.89% | 67.23% | 41.53% | 15.18% | - | - | - | - | - | - | - | - | - | - |
High leverage and margin compression
As reported in recent financial filings, ARKO has experienced a sustained period of top-line erosion, with quarterly revenue growth consistently negative, including a 12.47% year-over-year decline that highlights the structural challenges of maintaining volume in a volatile fuel price environment across its regional footprint.
The consistent negative revenue growth suggests that the company's roll-up strategy may be struggling to offset organic volume declines in its core fuel business. Investors should monitor whether this contraction reflects a strategic exit from lower-margin sites or a broader loss of market share to more efficient, modern convenience store operators.
Based on the provided income statement data, ARKO operates with razor-thin profitability, as evidenced by a net margin that frequently hovers near zero or enters negative territory, leaving the company with virtually no buffer to absorb fluctuations in fuel procurement costs or rising operational expenses.
The company's reliance on thin-margin fuel sales creates a high-sensitivity environment where minor shifts in cents-per-gallon spreads directly impact the bottom line. This lack of margin depth suggests that the business model is highly susceptible to external shocks, necessitating a focus on inside-store merchandise growth to stabilize overall profitability.
According to historical income statements, ARKO's operating income has failed to scale consistently with revenue, as the company's fixed cost base, including significant lease obligations, often consumes the majority of gross profit, resulting in an operating margin that frequently dips below 1% during periods of volatility.
The inability to demonstrate meaningful operating leverage suggests that the company's decentralized portfolio of regional brands may be incurring excessive overhead relative to the revenue generated. This warrants further investigation into whether the promised synergies from its acquisition-heavy strategy are being realized or if they are being offset by rising administrative and lease costs.
While management continues to pursue an aggressive M&A-driven expansion, the company's reported Debt/Equity ratio of 10.76 indicates a highly levered capital structure that may limit future flexibility, particularly if the current trend of negative net income persists in a sustained high-interest-rate environment.
Short-sellers would likely focus on the potential for a 'pincer effect' where declining fuel volumes and high fixed-rent obligations from sale-leaseback transactions squeeze cash flow. The reliance on financial engineering to drive growth appears to mask underlying operational weaknesses that could become more pronounced if the acquisition pipeline slows.
Quick answers to the most common questions about buying ARKO stock.
For fiscal year 2025, Arko Corp. (ARKO) reported total revenue of $7.64B. This represents a 550.3% increase compared to $1.18B in 2012.
Arko Corp. (ARKO) is profitable, generating $22.7M in net income for the fiscal year ending 2025 with a net profit margin of 0.3%.
Arko Corp. (ARKO) reported an operating income of $102.3M, resulting in an operating profit margin of 1.3%. This margin reflects the operational efficiency of the business before interest and taxes.
Arko Corp. (ARKO) generated $395.5M in gross profit for the year, representing a gross profit margin of 5.2%. This demonstrates the company's core pricing power and production efficiency.