O'Reilly Automotive, Inc. (ORLY) Earnings

metirFinance

Sep 2026upcoming

Next quarter

Expected to report Oct 21, 2026 — estimated from last year’s reporting date.

Consensus is $0.92 EPS for Sep 2026 across 11 estimates, ranging $0.90 to $0.95.

ORLY Jun 2026

Reported Jul 29, 2026

: 1.18%
: -3.61%

: $0.85
: $0.86
: —
: $4.89B

Reported results

: $4.89B; from $4.53B
: 51.45%; from 51.41%
: $985.75M; from $914.47M
: 20.15%; from 20.21%
: $715.06M; from $668.60M
: $0.86; from $0.78

Highlights

Sales: Second-quarter revenue rose 8% year over year to $4.89 billion, from $4.53 billion, and increased from $4.56 billion in Q1 FY2026.
Comparable sales: Comparable store sales increased 6.0%, accelerating from 4.1% a year earlier; first-half comparable sales rose 7.0%, on top of 3.9% last year.
Earnings: Diluted EPS was $0.86, ahead of the $0.85 consensus by 1.18%, up 10% from $0.78 a year ago and from $0.72 in the prior quarter.
Profitability: Operating income increased 8% to $986 million, with the operating margin holding at 20.2%; net income rose 7% to $715 million.
Customer mix: Professional sales increased 12% to $2.47 billion, while DIY sales rose 5% to $2.34 billion, making professional sales slightly larger than DIY.
Guidance: Management raised full-year 2026 comparable-store-sales guidance to 4%–6%; it continues to target 225–235 net new stores, with 110 opened in the first half.
Capital returns: O’Reilly repurchased 26.7 million shares for $2.43 billion in the first half, reducing diluted weighted-average shares 3% to 836 million.
Cash generation: First-half operating cash flow increased to $2.04 billion from $1.51 billion, while free cash flow rose to $1.48 billion from $904 million.

Analysis

O’Reilly delivered a solid second quarter, narrowly exceeding the $0.85 EPS consensus with diluted EPS of $0.86. Revenue of $4.89 billion increased 8% from $4.53 billion a year ago and was 7% above Q1’s $4.56 billion, while EPS rose 10% year over year from $0.78 and 19% sequentially from $0.72. Net income reached $715 million, up 7% from $669 million last year and 18% from $604 million in the prior quarter.

The print was defined by continued same-store momentum, a stronger professional business and substantial capital deployment. Comparable sales rose 6.0% despite a 4.1% comparison, driven by higher average tickets in both customer groups and more professional transactions, partly offset by fewer DIY transactions. Professional sales grew 12% to $2.47 billion, outpacing 5% DIY growth, while gross margin held at 51.4%. O’Reilly raised its full-year comparable-sales outlook to 4%–6% and remains on track for 225–235 new stores. First-half cash generation funded $2.43 billion of repurchases, although higher borrowings lifted interest expense and adjusted leverage to 2.17 times EBITDAR from 2.06 times a year earlier.

Comparable sales momentum

The core sales performance remained strong against a tougher comparison. Comparable store sales increased 6.0% in the quarter, following 4.1% growth in Q2 FY2025, and increased 7.0% in the first half, following 3.9% growth a year earlier. Management attributed the gains to higher average ticket values for both professional and DIY customers and higher professional transaction counts. DIY transaction counts declined, but more complex and expensive replacement parts supported ticket growth.

Professional: Sales to professional service providers increased 12% to $2.47 billion from $2.20 billion, representing roughly half of total sales.
DIY: Sales to do-it-yourself customers rose 5% to $2.34 billion from $2.23 billion.
New stores: The company opened 51 net new stores in the quarter and 110 in the first half; the ending store count reached 6,695, versus 6,483 a year earlier.

Margins and earnings

O’Reilly converted the sales growth into higher operating profit without expanding the quarterly operating margin. Gross profit rose 8% to $2.52 billion, with gross margin unchanged at 51.4%; improved acquisition costs and distribution efficiencies offset a greater professional sales mix, which carries a lower margin than DIY. SG&A grew 8% to $1.53 billion, or 31.3% of sales versus 31.2% last year, reflecting added staffing, inflation and higher medical and casualty insurance costs.

Operating income: Operating income rose 8% to $986 million, while the margin remained 20.2%; first-half operating income increased 10% to $1.83 billion and margin expanded to 19.3% from 19.1%.
Net income: Net income increased 7% to $715 million, but net margin declined to 14.6% from 14.8% because interest expense rose 22% to $70 million and the effective tax rate increased to 22.6% from 22.4%.
Per share: Diluted EPS increased to $0.86 from $0.78 as diluted shares fell to 829 million from 858 million.

Raised full-year outlook

Management raised its full-year 2026 comparable-store-sales guidance to 4.0%–6.0%, citing first-half performance and confidence in underlying aftermarket demand. The outlook assumes continued store expansion and a favorable industry backdrop from an aging vehicle fleet, higher vehicle complexity and ongoing repair demand.

Revenue: Full-year revenue guidance is $18.9 billion–$19.2 billion.
Profitability: Gross margin is expected at 51.5%–52.0%, with operating margin of 19.3%–19.8% and diluted EPS of $3.20–$3.30.
Expansion: The company continues to target 225–235 net new stores in 2026, after opening 110 through June 30.
Cash plan: Full-year operating cash flow is guided to $3.1 billion–$3.5 billion, capital expenditures to $1.3 billion–$1.4 billion and free cash flow to $1.8 billion–$2.1 billion.

Repurchases and leverage

Capital returns were a major feature of the first half. O’Reilly repurchased 26.7 million shares for $2.43 billion at an average price of $91.17, versus $1.18 billion spent on 13.3 million shares in the year-ago period. The buybacks helped drive the 10% quarterly EPS growth despite net income increasing 7%.

Ongoing program: The company had approximately $1.33 billion remaining under its current authorization at the release date and subsequently repurchased a further $632 million through the release date.
Debt: Long-term debt increased to $7.01 billion from $6.02 billion at December 31, 2025, including $1.35 billion of commercial paper and a new $850 million senior-notes issue.
Coverage: Adjusted debt to EBITDAR was 2.17 times at June 30, up from 2.06 times a year earlier; the company remained within its 3.50-times leverage covenant.

Cash flow and investment

First-half operating cash flow benefited from higher operating income and the timing of renewable-energy tax-credit payments. Cash generation more than covered store investment and repurchases, although financing activity was supported by additional debt and commercial paper borrowings.

Operating cash flow: Cash from operations rose 35% to $2.04 billion from $1.51 billion.
Free cash flow: Free cash flow increased 63% to $1.48 billion from $904 million after $552 million of capital expenditures, down from $588 million.
Balance sheet: Cash ended the quarter at $262 million, while inventory increased to $5.97 billion from $5.40 billion a year earlier; inventory turnover remained 1.6 times.

O'Reilly Automotive, Inc.

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