01—Abstract
Summary
Summary of the 10-Q filed August 7, 2026. Cited figures are marked; the original filing is the authoritative source.
O'Reilly Automotive, Inc. (ORLY) reported strong financial results for the quarter ended June 30, 2026.
Sales increased by 8%a year-over-year, driven by a robust 6.0% comparable store sales growth and contributions from new store openings. This growth was supported by an increase in average ticket values for both professional and DIY customers, reflecting higher average selling prices and the increasing complexity and cost of parts for newer vehicles. The company maintained healthy gross profit margins at 51.4% and saw operating income rise by 8%.
Diluted earnings per share also saw a significant increase of 10% to $0.86b. From a financial position perspective, O'Reilly continues to invest in its growth, as evidenced by capital expenditures and ongoing new store development.
The company also remains active in capital allocation, with substantial share repurchases continuing. Despite increased interest expenses due to higher borrowings, the company maintained compliance with its debt covenants, demonstrating a stable liquidity position supported by strong operating cash flows and access to its revolving credit facility and commercial paper program.
02—Key points
Key Highlights
- Sales grew 8% to $4.89 billion for the three months ended June 30, 2026, driven by comparable store sales growth of 6.0%.
- Gross profit increased by 8% to $2.52 billion, with gross margin stable at 51.4% of sales.
- Operating income rose 8% to $986 million, with operating margin holding steady at 20.2% of sales.
- Diluted earnings per share (EPS) increased 10% to $0.86 from $0.78 in the prior year period.
- The company opened 51 net new stores during the quarter, contributing to sales growth.
- Share repurchases were significant, with $1.5 billion invested in the quarter, and the company had $2.0 billion remaining under its repurchase authorization as of June 30, 2026.
- Cash provided by operating activities increased significantly to $2.04 billion for the six months ended June 30, 2026, up from $1.51 billion in the prior year period, supporting robust free cash flow of $1.48 billion.
03—Questions
Frequently Asked Questions
What was the primary driver of O'Reilly's sales growth in the quarter?
O'Reilly's sales growth was primarily driven by a combination of a 6.0% increase in comparable store sales and contributions from newly opened stores. Higher average ticket values, reflecting increased average selling prices and the cost of parts for more complex vehicles, also played a significant role.
How is O'Reilly managing its debt and liquidity?
O'Reilly has a robust liquidity position, supported by strong operating cash flows. The company has access to a $2.25 billion unsecured revolving credit facility and a commercial paper program. Despite an increase in long-term debt primarily due to a new senior note issuance and increased borrowings on the commercial paper program, the company maintained compliance with all debt covenants, including its fixed charge coverage ratio and leverage ratio.
What is the company's outlook on store expansion?
The company is actively expanding its store footprint, opening 51 net new stores during the quarter. For the full year 2026, O'Reilly anticipates opening between 225 to 235 net new stores, indicating a continued focus on growth through physical expansion.
How did the company's share repurchase program perform during the quarter?
O'Reilly continued its active share repurchase program, investing $1.5 billion in repurchasing shares during the three months ended June 30, 2026. As of the end of the quarter, the company had $2.0 billion remaining under its authorization, indicating ongoing commitment to returning capital to shareholders.
04—Continue