AutoZone Falls Short of Quarterly Profit Estimates Due to Rising Costs; Shares Decline, Reports Reuters

Auto parts retailer AutoZone has reported disappointing fourth-quarter profits, falling short of expectations on Tuesday and causing its shares to dip nearly 5% in early trading.

Although there has been an increase in demand for do-it-yourself parts as more individuals look to maintain their older vehicles, AutoZone has faced challenges from inflation and supply chain disruptions within a turbulent economic environment. Competitors in the industry, such as Advance Auto Parts and O’Reilly Automotive, have also indicated facing similar demand issues.

CFRA Research analyst Garrett Nelson noted that while the earnings per share miss was disappointing—marking AutoZone’s first such miss since 2018—the company’s overall financial growth remains strong within the retail sector. He also highlighted that the record-high average age of vehicles in the U.S., now at 12.6 years, is likely to bolster demand in the auto aftermarket.

For the quarter ending August 31, AutoZone reported a net income of $902.2 million, or $51.58 per share, compared to analysts’ predictions of $53.53 per share. In the same quarter last year, the company had net income of $864.8 million, or $46.46 per share. Overall revenue increased by approximately 9% to $6.2 billion, aligning closely with analysts’ forecasts.