01—Abstract
Summary
Summary of the 10-Q filed June 7, 2024. Cited figures are marked; the original filing is the authoritative source.
AutoZone, Inc. (AZO) reported its fiscal third-quarter and year-to-date results for the period ending May 4, 2024.
The company demonstrated solid performance with a 3.5% increase in net sales for the twelve-week period, reaching $4.2 billiona, and a 4.4% increase year-to-date to $12.3 billion. This growth was supported by the opening of new domestic and international stores and a slight increase in same-store sales. Profitability remained strong, with operating profit increasing by 4.9% to $900.2 million for the quarter.
Diluted earnings per share also saw a healthy increase of 7.5% to $36.69b for the quarter and a 14.0% increase to $98.11 year-to-date. The company highlighted the continued resilience of its business model, with failure and maintenance-related categories constituting a significant portion of sales. AutoZone continues to execute on its growth initiatives, including investments in supply chain and store expansion, supported by robust cash flows from operations and available credit facilities.
02—Key points
Key Highlights
- Net sales increased by 3.5% to $4.2 billion for the twelve weeks ended May 4, 2024.
- Diluted earnings per share (EPS) rose by 7.5% to $36.69 for the twelve-week period.
- Gross profit margin improved to 53.5% for the quarter, driven by higher merchandise margins and LIFO favorability.
- Operating profit increased by 4.9% to $900.2 million for the twelve weeks ended May 4, 2024.
- The company repurchased $2.5 billion of common stock during the first thirty-six weeks of fiscal 2024, with $1.4 billion remaining under its authorization.
- Capital expenditures increased to $725.9 million for the thirty-six weeks ended May 4, 2024, primarily for growth initiatives like distribution centers and new stores.
- Inventory levels increased by 6.8% year-over-year, totaling $6.16 billion, while accounts payable also rose to $7.37 billion.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, AutoZone Inc kept $0.15.
- Revenue$4.24B100.0%
- Cost of revenue−$1.97B46.5%
- Gross profit$2.27B53.5%
- Operating costs−$1.37B32.2%
- Operating income$900.2M21.3%
- Interest, other & tax−$248.5M5.9%
- Net income$651.7M15.4%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed June 7, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $4.24B$4.09B | +3.5% |
| Cost of Revenue | $1.97B$1.94B | +1.3% |
| Gross Profit | $2.27B$2.15B | +5.6% |
| SG&A Expenses | $1.37B$1.29B | +6.0% |
| Operating Income | $900.18M$858.48M | +4.9% |
| Net Income | $651.73M$647.72M | +0.6% |
| EPS (Basic) | $37.73$35.22 | +7.1% |
| EPS (Diluted) | $36.69$34.12 | +7.5% |
| Shares Outstanding (Basic) | 17.27M18.39M | −6.1% |
| Shares Outstanding (Diluted) | 17.76M18.98M | −6.4% |
05—Questions
Frequently Asked Questions
What was AutoZone's revenue growth in the most recent quarter?
For the twelve weeks ended May 4, 2024, AutoZone reported a 3.5% increase in net sales, reaching $4.2 billion, compared to the prior year period.
How did profitability fare in the quarter?
The company saw improved profitability, with operating profit increasing by 4.9% to $900.2 million and diluted earnings per share rising by 7.5% to $36.69 for the twelve weeks ended May 4, 2024.
What is the company's strategy regarding share repurchases and capital expenditures?
AutoZone continues its aggressive share repurchase program, having spent $2.5 billion in the first 36 weeks of fiscal 2024, with significant authorization remaining. Capital expenditures also increased substantially to $725.9 million year-to-date, reflecting investments in growth initiatives such as supply chain enhancements and new store openings.
Are there any concerns regarding inventory or debt levels?
Inventory levels have increased year-over-year, and while accounts payable also rose, the accounts payable to inventory ratio slightly decreased. The company's debt levels are managed with a target adjusted debt to EBITDAR ratio, and it maintained compliance with all covenants on its borrowing arrangements.
06—Continue