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Shares of the company rose 4.6% to $110.70 in premarket trading.
Pandemic-induced demand for personal cars outpaced the supply of new vehicles, as automakers deal with tighter inventories, a semiconductor shortage and supply chain snarls.
A shortage of new car availability in the market has caused used cars sales to skyrocket.
Fort Lauderdale-based AutoNation said sales of used vehicles surged 47%, while retail unit sales of new vehicles fell 6% in the quarter due to a shortage of supply.
The company added that incoming new vehicle inventory, for the most part, has been pre-ordered by customers.
AutoNation’s Parts and Services segment, which provides automotive repair and maintenance services, reported revenue of $1 billion, up 18% from last year.
Excluding items, the company reported adjusted diluted earnings per share of $5.78, beating estimates of $5.25 per share, according to Refinitiv IBES data.
AutoNation’s net income was $362.1 million, or $5.78 per share, for the quarter ended March 31, compared with $239.4 million, or $2.85 per share, a year earlier.
Revenue rose 14.4% to $6.75 billion, above estimates of $6.48 billion.
