Key Takeaways:
- AutoZone’s quarterly revenue and profit surpassed analysts’ expectations.
- The company’s strong performance was driven by increased merchandise profit margins and lower supply chain expenses.
- As a result, shares of AutoZone surged nearly 7% to reach an all-time high on Tuesday.
AutoZone (AZO) reported second-quarter fiscal 2024 diluted earnings per share of $28.89, surpassing the year-ago period’s $24.64, with net income rising 8.1% to $515.0 million.
Revenue increased by 4.6% to $3.86 billion, driven by a 3% growth in same store sales compared to the previous year.
The company’s gross margin expanded by 160 basis points (bps) to 53.9% in the fiscal second quarter, ending on Feb. 10, benefiting from higher merchandise profit margins, non-cash last in, first out (LIFO) favorability, and reduced supply chain costs.
AutoZone added 19 new stores in the U.S., six in Mexico, and four in Brazil during the quarter, bringing its total store count to 7,191 as of Feb. 10.
Despite facing challenges related to holiday comparisons for both Christmas and New Year’s sales, CEO Phil Daniele emphasized the strong performance of the company.
Shares of AutoZone surged 6.7% to close at $2,954.99 on Tuesday, reaching an all-time high, and have gained 15% year-to-date.