Autozone Inc.: Q3 FY2026 earnings call

What management said about Q3 FY2026, from the documents filed with the SEC on 26 May 2026: press release. Guidance figures: 1 raised. The quarter’s numbers.

Read the filing

Key takeaways

• Net sales rose 8.4% to $4.8 billion: Net sales for the 12 weeks ended May 9, 2026 were $4.8 billion, up 8.4% from the prior year's third quarter. Both periods contained 12 weeks. Source
• Diluted EPS rose to $38.07: Diluted EPS was $38.07 against $35.36 a year earlier. Net income was $641.5 million, compared with $608.4 million in the prior-year quarter. Source
• Same store sales up 3.9% in constant currency: Total company same store sales rose 5.5% as reported and 3.9% in constant currency. Domestic same store sales rose 4.1%. Source
• International same store sales slowed: International same store sales rose 16.6% as reported, against a 9.2% decline a year earlier. In constant currency the rise was 1.6%. Source
• Domestic commercial sales up 10.4%: Domestic commercial sales were $1.40 billion in the 12 weeks, up 10.4%. For 36 weeks they rose 9.7% to $5.61 billion. Source
• Gross margin down on LIFO charge: Gross margin was 52.2%, down 57 basis points. Management attributed the decline to a 77 basis point non-cash LIFO impact, partly offset by other gross margin gains. Source
• Inventory up 10.8% on growth: Inventory rose 10.8% from a year earlier to $7.56 billion. Management attributed the increase to growth initiatives and inflation. Inventory per store was $962. Source
• Repurchased $586.3 million of stock: AutoZone bought back 164 thousand shares at an average price of $3,582, a total investment of $586.3 million, in the quarter. Source
• 82 new stores in the quarter: The company opened 57 stores in the U.S., 20 in Mexico and five in Brazil. Net openings for 36 weeks were 199, against 163 a year earlier. Source

“As we remain focused on gaining market share in our industry, we will stay committed to a disciplined approach of increasing earnings and cash flows to drive shareholder value,”

Phil Daniele, President and Chief Executive Officer

Guidance

What changed from last quarter

• Guidance raised: Full-year store opening expectation raised to approximately 355-365 from 350-360. Source

Results and growth drivers

• Net sales rose 8.4% to $4.8 billion: Net sales for the 12 weeks ended May 9, 2026 were $4.8 billion, up 8.4% from the prior year's third quarter. Both periods contained 12 weeks. Source
• Diluted EPS rose to $38.07: Diluted EPS was $38.07 against $35.36 a year earlier. Net income was $641.5 million, compared with $608.4 million in the prior-year quarter. Source
• Same store sales up 3.9% in constant currency: Total company same store sales rose 5.5% as reported and 3.9% in constant currency. Domestic same store sales rose 4.1%. Source
• Operating margin back above 19%: Operating profit rose 6.6% to $923.8 million. Management said the operating margin returned to north of 19% for the quarter. Source

Segments and regions

• International same store sales slowed: International same store sales rose 16.6% as reported, against a 9.2% decline a year earlier. In constant currency the rise was 1.6%. Source
• International sales challenged in constant currency: Management said international sales in constant currency continued to be challenged, with Mexico and Brazil performing similarly to last quarter. Source
• Domestic DIY and commercial both grew: Management said domestic DIY and commercial sales both grew this quarter, with domestic same store sales up 4.1%. Source

“While international performance has been below our plan, we believe our market share continues to grow as we outpace our competition in both international marketplaces.”

Phil Daniele, President and Chief Executive Officer

Products and customers

• Domestic commercial sales up 10.4%: Domestic commercial sales were $1.40 billion in the 12 weeks, up 10.4%. For 36 weeks they rose 9.7% to $5.61 billion. Source
• Sales per commercial program up 4.5%: Average domestic commercial sales per program per week were $18.5 in the 12 weeks, up 4.5% from $17.7. Source
• Commercial programs at 6,356 stores: 6,356 domestic stores had commercial sales programs at quarter end, up from 6,011 a year earlier. Source

Margins, costs and tax

• Gross margin down on LIFO charge: Gross margin was 52.2%, down 57 basis points. Management attributed the decline to a 77 basis point non-cash LIFO impact, partly offset by other gross margin gains. Source
• Operating expenses fell to 33.1%: Operating expenses were 33.1% of sales, against 33.3% last year. Management attributed the lower ratio to sales growth and expense management. Source
• Trailing tax rate edged up: The effective tax rate over the trailing four quarters was 20.8%, against 20.6% a year earlier. Source

Inventory and payables

• Inventory up 10.8% on growth: Inventory rose 10.8% from a year earlier to $7.56 billion. Management attributed the increase to growth initiatives and inflation. Inventory per store was $962. Source
• Net inventory per store negative $107 thousand: Net inventory per store, defined as inventory less accounts payable, was negative $107 thousand. The prior year was negative $142 thousand, and last quarter negative $105 thousand. Source
• Inventory turns at 1.3 times: Inventory turns on a trailing five-quarter basis were 1.3 times, against 1.4 times a year earlier. Source
• Payables at 111.1% of inventory: Accounts payable were 111.1% of inventory at quarter end, against 115.6% a year earlier. Source

Capital, cash and shareholder returns

• Repurchased $586.3 million of stock: AutoZone bought back 164 thousand shares at an average price of $3,582, a total investment of $586.3 million, in the quarter. Source
• $0.8 billion authorization remaining: The company had $0.8 billion left under its current repurchase authorization at quarter end, against $1.1 billion a year earlier and $1.4 billion at the prior quarter end. Source
• Operating cash flow and capex higher: Cash flow from operations was $847.4 million in the 12 weeks, against $769.0 million. Capital spending was $391.7 million, against $345.9 million. For 36 weeks, operating cash flow was $2,165.0 million, flat on the prior year. Source
• Investment grade ratings targeted: Management said it targets the capital structure to maintain investment grade credit ratings. Adjusted debt to EBITDAR was 2.5 times in both periods; adjusted after-tax ROIC was 36.3%, against 43.5%. Source

Store growth and investment

• 82 new stores in the quarter: The company opened 57 stores in the U.S., 20 in Mexico and five in Brazil. Net openings for 36 weeks were 199, against 163 a year earlier. Source
• Store count reached 7,856: The store count was 7,856 at quarter end: 6,766 in the U.S., 933 in Mexico and 157 in Brazil. A year earlier it was 7,516. Source
• Square footage per store at 6,790: Total square footage was 53,339 thousand, or 6,790 per store, against 6,754 per store a year earlier. Source

Figures management reported

Risks management discussed

• Demand: International sales in constant currency were challenged, with Mexico and Brazil performing similarly to the prior quarter. Source
• Financial: A non-cash LIFO impact of 77 basis points reduced gross margin this quarter, partly offset by other margin gains. Source

Earlier plans management reported on

• On track: Management described the 82 quarterly openings as in line with its current expectation for the full fiscal year. Source
• Missed: Management said international performance was below its plan, while it believes its market share is growing. Source

Other quarters

• Q2 FY2026 earnings call
• Q1 FY2026 earnings call
• Q4 FY2025 results
• Q3 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.