v3.26.1
Segment Reporting
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
Segment Reporting

10. Segment Reporting

The reportable segments were determined based on information reviewed by the Company’s chief operating decision maker (“CODM”) for operational decision-making purposes, and the segment information is prepared on the same basis that the CODM reviews such financial information. The Company’s reportable segments are wholesale, fleet fueling and GPMP. Arie Kotler, the Company’s President, Chief Executive Officer, and Chairman of the Board, is the CODM. The CODM utilizes operating income from each segment to assess its operating performance and to make decisions about allocating resources to each segment. In reviewing segment operating income each month, the CODM compares actual results to budgets and prior-year performance. Based on this analysis, the CODM allocates incremental capital spending and prioritizes strategic and business development initiatives across the segments. The CODM also uses this measure to make decisions on budgets, acquisitions, capital expenditures, and management compensation.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies except that rent expenses for each segment are recognized and measured on the basis of cash payments.

The wholesale segment supplies fuel to dealers, sub-wholesalers and bulk and spot purchasers, on either a cost plus or consignment basis. For consignment arrangements, the Company retains ownership of the fuel inventory at the site, is responsible for the pricing of the fuel to the end consumer and shares the gross profit generated from the sale of fuel with the consignment dealers. For cost-plus arrangements, the Company sells fuel to dealers and bulk and spot purchasers on a fixed-fee basis. The sales price is determined according to the terms of the relevant agreement, which typically reflects the Company’s total fuel costs plus the cost of transportation, taxes and a fixed margin, with the Company generally retaining any prompt pay discounts and rebates.

The fleet fueling segment includes the operation of proprietary and third-party cardlock locations (unstaffed fueling locations), and commissions from the sales of fuel using proprietary fuel cards that provide customers access to a nationwide network of fueling sites.

The GPMP segment includes the sale and supply of fuel to substantially all ARKO Retail Sites, at the Company’s cost of fuel (including taxes and transportation) plus a fixed margin (through December 31, 2025, 5.0 cents per gallon; 6.0 cents per gallon thereafter), and a fixed fee (through December 31, 2025, 5.0 cents per gallon; 6.0 cents per gallon thereafter) charged to certain of ARKO Retail Sites which are not supplied by the Company. ARKO Retail Sites that sell fuel are classified as related party sites. In addition, the GPMP segment includes the sale of fuel to the Company’s locations in the wholesale segment and, beginning February 1, 2026, to the Company’s locations in the fleet fueling segment, at the Company’s cost of fuel (including taxes and transportation) plus a fixed margin (through December 31, 2025, 5.0 cents per gallon; 6.0 cents per gallon thereafter). Prior to February 1, 2026, the GPMP segment charged a fixed fee (through December 31, 2025, 5.0 cents per gallon; 6.0 cents per gallon thereafter) primarily to fleet fueling locations that were not supplied by the GPMP segment. These inter-segment transactions were eliminated in the interim financial statements. Through the second quarter of 2025, the GPMP segment also supplied fuel to a limited number of third-party dealers.

The “All Other” segment includes the results of non-reportable segments that do not meet both quantitative and qualitative criteria as defined under ASC 280, Segment Reporting.

The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. Inter-segment expenses were included within the amounts shown; however, the fuel costs in the wholesale and fleet fueling segments exclude the fixed margin or fixed fee paid to the GPMP segment for the cost of fuel.

The majority of general and administrative expenses, depreciation and amortization, net other expenses, income taxes and minor other income items are not allocated to the segments. Other segment expenses include utilities, telephone, upkeep and taxes, insurance, supplies, and certain other expenses. Other segment expenses in the GPMP segment also include general and administrative expenses, and depreciation and amortization.

With the exception of goodwill, assets and liabilities relevant to the reportable segments are generally not assigned to any particular segment, but rather, managed and reviewed by the CODM at the consolidated level. All reportable segment revenues were generated from sites within the U.S. and substantially all of the Company’s assets were within the U.S.

Inter-segment transactions primarily included the sale of fuel to all of the Company’s wholesale locations, and beginning February 1, 2026, to all the fleet fueling locations, at the Company’s cost of fuel plus a fixed margin. Until February 1, 2026, a fixed fee was charged by the GPMP segment primarily to sites that sold fuel in the fleet fueling segment that were not supplied by the GPMP segment. The effect of these inter-segment transactions was eliminated in the interim financial statements.

 

 

 

Wholesale

 

 

Fleet Fueling

 

 

GPMP

 

 

All Other

 

 

Total

 

For the Three Months Ended March 31, 2026

(in thousands)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fuel revenue

 

$

673,855

 

 

$

127,299

 

 

$

—

 

 

$

6,444

 

 

$

807,598

 

Fuel revenue – related party

 

 

—

 

 

 

—

 

 

 

514,484

 

 

 

—

 

 

 

514,484

 

Other revenues, net

 

 

16,530

 

 

 

2,241

 

 

 

171

 

 

 

160

 

 

 

19,102

 

Other revenues, net – related party

 

 

524

 

 

 

—

 

 

 

714

 

 

 

1,943

 

 

 

3,181

 

Total revenues from external customers

 

$

690,909

 

 

$

129,540

 

 

$

515,369

 

 

$

8,547

 

 

$

1,344,365

 

Inter-segment revenues

 

$

—

 

 

$

—

 

 

$

723,251

 

 

$

3,142

 

 

$

726,393

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fuel costs

 

$

650,964

 

 

$

110,554

 

 

$

—

 

 

 

 

 

 

 

Fuel costs – related party

 

 

 

 

 

 

 

 

503,519

 

 

 

 

 

 

 

Fuel costs – inter-segment

 

 

 

 

 

 

 

 

707,163

 

 

 

 

 

 

 

Credit card fees

 

 

1,522

 

 

 

1,410

 

 

 

 

 

 

 

 

 

 

Rent, including allocated expenses

 

 

12,952

 

 

 

2,972

 

 

 

 

 

 

 

 

 

 

Repairs and maintenance

 

 

1,267

 

 

 

990

 

 

 

 

 

 

 

 

 

 

Other segment expenses

 

 

1,192

 

 

 

1,659

 

 

 

2,322

 

 

 

11,545

 

 

 

 

Operating income from segments

 

$

23,012

 

 

$

11,955

 

 

$

25,616

 

 

$

144

 

 

$

60,727

 

Interest and other financial expenses, net

 

 

 

 

 

 

 

$

(5,521

)

 

 

 

 

$

(5,521

)

 

 

 

Wholesale

 

 

Fleet Fueling

 

 

GPMP

 

 

All Other

 

 

Total

 

For the Three Months Ended March 31, 2025

(in thousands)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fuel revenue

 

$

630,060

 

 

$

118,406

 

 

$

496

 

 

$

7,836

 

 

$

756,798

 

Fuel revenue – related party

 

 

—

 

 

 

—

 

 

 

574,416

 

 

 

—

 

 

 

574,416

 

Other revenues, net

 

 

10,352

 

 

 

2,118

 

 

 

155

 

 

 

332

 

 

 

12,957

 

Other revenues, net – related party

 

 

—

 

 

 

—

 

 

 

652

 

 

 

2,503

 

 

 

3,155

 

Total revenues from external customers

 

$

640,412

 

 

$

120,524

 

 

$

575,719

 

 

$

10,671

 

 

$

1,347,326

 

Inter-segment revenues

 

$

—

 

 

$

—

 

 

$

594,148

 

 

$

2,582

 

 

$

596,730

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fuel costs

 

$

610,013

 

 

$

103,104

 

 

$

496

 

 

 

 

 

 

 

Fuel costs – related party

 

 

 

 

 

 

 

 

563,833

 

 

 

 

 

 

 

Fuel costs – inter-segment

 

 

 

 

 

 

 

 

580,944

 

 

 

 

 

 

 

Credit card fees

 

 

1,669

 

 

 

1,045

 

 

 

 

 

 

 

 

 

 

Rent, included allocated expenses

 

 

8,656

 

 

 

2,854

 

 

 

 

 

 

 

 

 

 

Repairs and maintenance

 

 

991

 

 

 

918

 

 

 

 

 

 

 

 

 

 

Other segment expenses

 

 

453

 

 

 

1,611

 

 

 

2,668

 

 

 

12,273

 

 

 

 

Operating income from segments

 

$

18,630

 

 

$

10,992

 

 

$

21,926

 

 

$

980

 

 

$

52,528

 

Interest and other financial expenses, net

 

 

 

 

 

 

 

$

(7,478

)

 

 

 

 

$

(7,478

)

 

 

A reconciliation of operating income from reportable segments to income before income taxes on the condensed consolidated statements of operations is as follows:

 

 

 

For the Three Months
Ended March 31,

 

 

 

2026

 

 

2025

 

 

(in thousands)

 

Operating income from reportable segments

 

$

60,583

 

 

$

51,548

 

All other operating income

 

 

144

 

 

 

980

 

Intercompany charges by the GPMP segment 1

 

 

(16,088

)

 

 

(13,204

)

Interest and other financial expenses, net

 

 

(5,521

)

 

 

(7,478

)

Amounts not allocated to segments:

 

 

 

 

 

 

Site operating expenses, including allocated expenses

 

 

(185

)

 

 

(727

)

General and administrative expenses, including allocated expenses

 

 

(10,304

)

 

 

(9,920

)

Depreciation and amortization, including allocated expenses

 

 

(12,975

)

 

 

(11,663

)

Other expenses, net

 

 

(1,063

)

 

 

(1,195

)

Interest and other financial expenses, net

 

 

(3,506

)

 

 

(2,134

)

Income before income taxes

 

$

11,085

 

 

$

6,207

 

 

1 Represents the fixed margin or fixed fee (through December 31, 2025, 5.0 cents per gallon; 6.0 cents per gallon thereafter) paid to the GPMP segment for the cost of fuel and recorded by the GPMP segment as inter-segment revenues.