July 24 (Reuters) - Auto parts distributor LKQ Corp LKQ.O cut its full-year profit and revenue forecasts on Thursday, citing muted demand for auto parts and services in North America and Europe.

Shares of the company dropped 16% in premarket trading.

Tariff-related uncertainty and higher insurance costs have pressured LKQ’s margins and reduced the number of repairable insurance claims.

The company has replaced more than 25% of its leadership team in Europe as it continues to implement cost-saving measures.

LKQ now expects adjusted earnings per share between $3.00 and $3.30 for 2025, down from its previous outlook of $3.40 to $3.70.

The company now expects full-year revenue for parts and services to decline 1.5% to 3.5%, as compared to its previous forecast of 0% to 2% growth.

The Chicago, Illinois-based company reported an adjusted earnings per share of 87 cents for the second-quarter, as compared 98 cents, a year earlier.

LKQ, which also sells scrap and other materials to metal recyclers, second-quarter revenue fell 1.9% to $3.64 billion, from a year earlier.

(Reporting by Apratim Sarkar; Editing by Shreya Biswas and Tasim Zahid)

((Apratim.Sarkar@thomsonreuters.com;))