Camping World Holdings (NYSE:CWH) was one of the biggest beneficiaries of the revival of recreational vehicles as a popular travel option. Yet given how much work the company has put in trying to make itself the leader of the RV retail industry, Camping World was exposed when tougher conditions hit the RV market.

Coming into Wednesday's second-quarter financial report, Camping World investors were prepared to deal with flat sales and falling earnings. Yet even though the retailer managed to produce modest revenue growth, weaker earnings due to industry headwinds showed just how vulnerable Camping World could be if the RV market doesn't bounce back quickly.

RV sales hit the brakes

Camping World Holdings' second-quarter results were mixed in most investors' eyes. Revenue came in at $1.47 billion, which was higher by 2.3% from year ago levels and better than the tiny 0.4% rise in sales that most of those following the stock had anticipated. However, net income of $18 million was down 27% from year-ago levels, and the resulting earnings of $0.46 per share missed the consensus forecast among investors for $0.66 per share.

Camping World storefront with two RVs parked outside.

Image source: Camping World.

The key RV and outdoor retail segment told most of the story for Camping World. Segment revenue was up 2.2%, but same-store sales were down 6.3% compared to year-ago levels. The company also saw cost pressures affect its results, with a decline of nearly a full percentage point in gross margin to 26.9%. Segment income sagged 24%.

Fundamentally, RV performance looked fairly weak. Sales of new vehicles were down 6.3% to about 22,900 units, and it took a big 18% rise in used vehicle unit sales to offset that and keep total units sold relatively stable at around 33,700. Same-store unit sales saw the same trend, with new vehicles seeing a 15% drop while used vehicles climbed almost 12%. Average selling prices were held largely in check, rising 0.4% overall to just under $30,400. New RVs fetched about 3% more at $34,000 per unit on average, but used vehicles saw an almost 1% drop to just under $22,750 per unit. New vehicle inventories per location were down 10%.

The relatively small Good Sam services and plans segment saw better results. Revenue climbed 6%, and income for the segment inched higher by 2.4%. The revenue that Camping World gets from Good Sam is tiny, but high margins make the unit's income a substantial part of the company's overall bottom line. Meanwhile, sales of products, services, and other revenue were higher on an absolute basis, but same-store results were down almost 11% year over year.

Can Camping World get itself moving forward again?

CEO Marcus Lemonis once again tried to keep investors focused on the big picture. "Despite some of the headwinds across the RV market, which were evidenced by a significant decline in both new RV wholesale shipments and RV registration reports," Lemonis said, "we grew both revenue and unit volume and achieved close to $100 million in adjusted [pre-tax operating earnings] in the quarter."

The CEO also pointed to the need to stay aligned with long-term strategic goals. In Lemonis' words, "While some of the broader macro factors impacting the RV industry are outside of our control right now, we are focused on optimizing our assets and improving the RV consumer experience."

Yet Camping World investors didn't seem to be as willing to be patient as the company would've liked, and the stock dropped 9% in after-hours trading following the announcement. Given the generational shift that fostered the latest RV revolution, it seems likely that industry conditions will improve at some point. But if it doesn't happen quickly, then Camping World could remain mired in a subpar environment well into the future.