AutoZone, Inc. (NYSE:AZO) beat Wall Street’s expectations for profit but just missed on revenue in its fiscal third quarter, sending its shares lower in pre-market trade.
For the three months to May 6, 2023, the Memphis, Tennessee-based auto parts dealer reported net sales of $4.09 billion, a year-over-year increase of 5.8% but falling short of the $4.12 billion expected by Wall Street analysts.
Revenue growth was assisted by the opening of new stores. Excluding stores open for under a year, domestic same-store sales increased by 1.9%.
Diluted earnings per share improved to $34.12, a gain of 18% and above the $31.51 expected by the Street.
The company said its inventory increased 7.4% over the same period last year, driven by inflation and its growth initiatives.
“I would like to congratulate and thank our entire organization for delivering solid earnings in our third fiscal quarter. The hard work of our AutoZoners and their dedication to providing superior customer service again drove our quarterly performance,” President and CEO Bill Rhodes said in an earnings statement.
“While weaker than expected sales for the month of March meaningfully affected our results this quarter, we are excited about our initiatives and believe we are well positioned for future growth.”
During the quarter, AutoZone noted that it opened 22 new stores in the US, six in Mexico and two in Brazil. At the end of the reporting period, it had 6,248 stores in the US, 713 in Mexico and 83 in Brazil for a total store count of 7,044.
Shortly before the market opened, AutoZone’s shares were down 3.8% at $2,619.80.
Contact the author at stephen.gunnion@proactiveinvestors.com