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May 10, 2025
Autozone Q3 2025 Earnings Report
AutoZone reported a solid quarter with strong domestic sales growth and accelerating commercial activity, though margins and net income declined.
Key Takeaways
AutoZone delivered higher revenue driven by 5.0% growth in domestic same store sales. However, profitability metrics declined due to higher inventory shrink, insurance costs, and startup distribution center expenses.
Revenue rose to $4.5 billion, up 5.4% year-over-year.
Domestic same store sales grew 5.0%, signaling strong performance in core markets.
Gross margin declined by 77 basis points due to shrink and cost pressures.
Net income decreased 6.6% year-over-year to $608.4 million.
Revenue by Geographic Location
Forward Guidance
AutoZone expects to sustain momentum into Q4, supported by investments in growth, stronger distribution capabilities, and summer season demand.
Positive Outlook
- Sales momentum accelerated from the previous quarter
- Domestic DIY and Commercial segments both performed well
- International same store sales grew 8.1% in constant currency
- Investments in distribution centers expected to improve margins
- Company remains committed to achieving targeted returns on capital
Challenges Ahead
- Gross margin pressured by inventory shrink and startup costs
- Higher self-insurance expenses drove operating deleverage
- Currency headwinds negatively impacted reported sales and earnings
- Operating profit and net income declined year-over-year
Historical Earnings Impact
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Avg. Return Before/After Earnings
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