AutoZone, Inc. (AZO) Earnings

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Aug 2026upcoming

Next quarter

Reports Sep 22, 2026, before the open.

Consensus is $54.97 EPS for Aug 2026 across 11 estimates, ranging $52.91 to $56.97.

AZO May 2026

Reported May 26, 2026

: 5.22%
: -2.34%

: $36.18
: $38.07
: —
: $4.84B

Reported results

: $4.84B; from $4.46B
: 52.15%; from 52.72%
: $923.76M; from $866.17M
: 19.08%; from 19.40%
: $641.49M; from $608.44M
: $38.07; from $35.36

Highlights

Earnings beat: Diluted EPS was $38.07, 5.22% above the $36.18 consensus and up 7.7% from $35.36 a year ago; net income rose 5.4% to $641.5 million.
Sales momentum: Revenue increased 8.4% year over year to $4.84 billion, including 3.9% constant-currency total-company same-store sales and $129 million from new stores.
Commercial strength: Domestic commercial sales grew 10.4% to $1.40 billion, while average sales per commercial program per week increased 4.5% to $18.5 thousand.
Domestic demand: Domestic same-store sales rose 4.1%, versus 5.0% a year ago, and were up 4.2% for the first 36 weeks versus 2.4% last year.
Margin and expenses: Gross margin fell 57 basis points to 52.2%, primarily from a 77-basis-point net non-cash LIFO impact, but SG&A leverage improved the expense ratio to 33.1% from 33.3%.
International recovery, still uneven: Reported international same-store sales rose 16.6%, but constant-currency growth was only 1.6%; management said Mexico and Brazil remained below plan.
Store expansion: AutoZone opened 82 stores during the quarter and 199 year to date, bringing the global count to 7,856; it still expects approximately 355-365 openings for fiscal 2026.
Capital returns: The company repurchased 164 thousand shares for $586.3 million during the quarter at an average price of $3,582, leaving $804.2 million on its authorization.
Investment and inventory: Year-to-date capital spending increased to $997.5 million from $885.6 million, while inventory rose 10.8% year over year and net inventory per store was negative $107 thousand versus negative $142 thousand.

Analysis

AutoZone’s fiscal third quarter was a solid earnings beat driven by broad domestic demand, particularly commercial sales, and operating expense control. EPS of $38.07 exceeded the $36.18 consensus by 5.22% and increased 7.7% from $35.36 a year ago. Revenue rose 8.4% to $4.84 billion, while operating profit increased 6.6% to $923.8 million and net income rose 5.4% to $641.5 million. Sequentially, the seasonal quarter was materially larger than fiscal second quarter revenue of $4.27 billion, operating income of $698.5 million, net income of $468.9 million and EPS of $27.63.

The print was defined by 3.9% constant-currency same-store sales, a 10.4% increase in domestic commercial sales and continued store expansion. Growth came despite a 57-basis-point gross-margin contraction to 52.2%, caused mainly by a 77-basis-point non-cash LIFO impact; SG&A leverage partly offset the pressure. International sales improved sharply on a reported basis but delivered only 1.6% constant-currency same-store growth, leaving Mexico and Brazil below plan. AutoZone also continued to invest heavily, opening 82 stores and spending $391.7 million on capital expenditures in the quarter, while returning $586.3 million through repurchases.

Domestic demand and commercial

Domestic demand remained the central strength of the quarter. Domestic same-store sales rose 4.1%, while domestic commercial sales increased 10.4% to $1.40 billion. Commercial growth reflected both higher activity and broader store participation: 6,356 domestic stores had commercial programs at quarter-end versus 6,011 a year earlier.

Sales productivity: Sales per average store increased to $619 thousand from $586 thousand, and sales per average square foot rose to $91 from $87.
Commercial programs: Average sales per program per week increased 4.5% to $18.5 thousand, compared with 7.9% growth in the prior-year quarter.
Year-to-date trend: For the first 36 weeks, domestic same-store sales rose 4.2% versus 2.4% last year, while domestic commercial sales increased 11.6% to $3.8 billion.

Margins and earnings

AutoZone converted the sales growth into higher operating profit, though gross-margin pressure limited flow-through. Operating profit rose 6.6% to $923.8 million, representing an operating margin of approximately 19.1%, while net income increased to $641.5 million. Lower share count also supported per-share growth: diluted weighted-average shares fell to 16.852 million from 17.207 million.

Gross margin: Gross profit margin declined to 52.2% from 52.7%; management attributed the deterioration primarily to a 77-basis-point net non-cash LIFO impact, with other margin improvements partly offsetting it.
Expense control: Operating, selling, general and administrative expenses rose 7.6% in dollars to $1.60 billion but declined to 33.1% of sales from 33.3%, reflecting sales leverage and expense management.
Tax headwind: The effective tax rate increased to 21.1% from 19.4%, largely because the tax benefit from exercised stock options fell to $4.0 million from $22.7 million.

International and store growth

AutoZone continued to add stores at a rapid pace, but international same-store performance remained the less convincing part of the quarter. Reported international same-store sales increased 16.6%, heavily influenced by currency, while constant-currency growth was only 1.6%. Management said Mexico and Brazil performed similarly to the prior quarter and remained below plan, even as it believes the company is gaining market share.

New stores: The company opened 57 U.S. stores, 20 in Mexico and five in Brazil, bringing the total store count to 7,856 from 7,516 a year ago.
Expansion pace: AutoZone opened 199 net new stores in the first 36 weeks, versus 163 in the comparable period, and expects approximately 355-365 openings for the full fiscal year.
Investment footprint: Year-to-date capital spending rose 12.6% to $997.5 million, primarily for new stores, hub stores and mega hub expansion projects.

Inventory and working capital

Inventory growth was faster than revenue growth as AutoZone funded expansion and absorbed inflation, including tariff-related cost changes. Merchandise inventory increased 10.8% year over year to $7.56 billion, compared with 8.4% revenue growth. The company continued to fund much of that inventory through supplier payment terms.

Inventory per store: Inventory per store increased to $962 thousand from $908 thousand, while trailing five-quarter inventory turns declined to 1.3x from 1.4x.
Net inventory: Inventory less accounts payable was negative $842.2 million, or negative $107 thousand per store, compared with negative $1.06 billion and negative $142 thousand per store a year earlier.
Supplier financing: Supplier obligations confirmed under third-party financing programs totaled $5.6 billion at quarter-end, up from $5.4 billion at August 30, 2025.

Capital returns and liquidity

Share repurchases remained a major use of cash alongside the company’s growth investments. AutoZone generated $847.4 million of operating cash flow in the quarter and $2.12 billion in the first 36 weeks, while repurchasing $1.32 billion of stock year to date. The balance sheet remained reliant on debt and commercial paper, although liquidity was supported by undrawn revolver capacity.

Quarterly repurchases: AutoZone bought 164 thousand shares for $586.3 million at an average price of $3,582, leaving $804.2 million under its authorization.
Debt position: Total debt was $9.02 billion at May 9, 2026, including $1.36 billion of commercial paper; adjusted debt to EBITDAR remained 2.5x, unchanged from a year earlier.
Available liquidity: Cash was $253.7 million and undrawn capacity under the revolving credit facility was approximately $2.2 billion.
Returns on capital: Trailing-four-quarter adjusted after-tax ROIC declined to 36.3% from 43.5%, as invested capital increased to $8.91 billion while adjusted after-tax return was broadly stable.

AutoZone, Inc.

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