AZO 2026 Q3

Total company sales grew 8.4%, the largest increase in over three years and an acceleration from the first half of fiscal 2026.

“Total sales were $4.8 billion and were up 8.4% versus Q3 of last year. This is the largest increase we have had in over three years”— Jamere Jackson, Chief Financial Officer

AutoZone's fiscal 2026 total sales surpassed $20 billion for the first time, rising 7.4% year over year. AutoZone Inc (AZO) (Q4 2026) Earnings Call Highlights: Record Store Growth and $20 Billion Sales Milestone — gurufocus.com · 23 September 2026

Domestic same-store sales accelerated to 4.1% from 1.5% in Q2, which management attributed to continued market share gains.

“Our domestic comp was solid, up plus 2.2% versus last year, and an acceleration versus the plus 1.5% in Q2”— Philip Daniele, President and Chief Executive Officer

DIY comp momentum decelerated sharply within the quarter, from 5% and 4.5% in the first two four-week periods to 2.9% in the final period and just 1.3% in the last two weeks, due to unseasonably cool, wet weather.

“Those two weeks were softer than the rest of the quarter with comps of 1.3%”— Philip Daniele, President and Chief Executive Officer

Management expects same-SKU inflation and average ticket growth to decelerate to the mid-4% range in Q4 from north of 7% and 5.6%-6% respectively this quarter, as the company begins lapping last year's tariff-driven inflation ramp.

“We expect the average ticket for the fourth quarter to be in the mid-4% range as we begin to lap the inflation ramp”— Philip Daniele, President and Chief Executive Officer

Weather-driven softness caused heat-related category volumes (AC, starting, charging) to weaken in both DIY and commercial in the final weeks of the quarter, a reversal from stronger trends earlier in the period.

“This slowdown in sales was caused by unseasonably cool weather impacting our heat-related categories”— Philip Daniele, President and Chief Executive Officer

Management expressed confidence that double-digit domestic commercial growth will continue even as the company begins cycling much tougher year-over-year comparisons into Q4.

“We believe the strong performance will continue as we move forward even as we cycle tougher comparisons to Q4 of last year”— Philip Daniele, President and Chief Executive Officer

CFO indicated DIY transaction counts, which fell more than historical norms (mid-3% declines vs. typical low-single-digit declines), could see improvement as the industry laps the initial post-inflation deferral period.

“As we move forward, there is an opportunity to see improvement in transactions and traffic”— Jamere Jackson, Chief Financial Officer

International results are outperforming the company's internal forecasts even though Mexico and Brazil economic growth has slowed, with management crediting share gains for the relative outperformance.

“We are pleased with our results versus our forecast in these markets”— Jamere Jackson, Chief Financial Officer

The mega hub pipeline has grown to over 100 locations, and management now says the roughly 300-unit build-out target could be exceeded given stronger-than-expected commercial growth.

“Quite frankly, as our commercial business continues to grow, there is a possibility we could even exceed that number”— Jamere Jackson, Chief Financial Officer

AutoZone guided FY2027 domestic comps flat to up low single digits while planning about 400 new stores and roughly 300 Mega Hubs. AutoZone expects FY 2027 domestic comps flat to up low single digits while planning ~400 new stores and targeting ~300 Mega Hubs (NYSE:AZO) — seekingalpha.com · 22 September 2026

Newer mega hubs are performing much stronger out of the gate than historical cohorts, driven by a stronger existing commercial base and a shift toward direct customer fulfillment rather than primarily supplying other stores.

Per Jamere Jackson, Chief Financial Officer

LIFO swung from a $16 million credit in last year's Q3 to a $20 million charge this quarter, with full-year FY2026 LIFO charges now expected to reach $207 million versus $64 million last year, pressuring gross margin.

“This quarter, we had a $20 million LIFO charge, or a 77-basis-point unfavorable LIFO comparison to last year”— Jamere Jackson, Chief Financial Officer

Excluding LIFO, core gross margin improved 20 basis points as roughly 42 basis points of merchandise margin, shrink, and supply chain productivity gains offset a 22 basis point drag from faster commercial mix growth.

“We saw positive merchandise margins, shrink is improving, and our supply chain productivity is improving”— Jamere Jackson, Chief Financial Officer

EBIT growth would have accelerated to 11% excluding the LIFO charge, versus the reported 6.6%, indicating underlying operating margin trends are stronger than headline results suggest.

“Excluding the unfavorable LIFO comparison, EBIT would have been up 11% versus the prior year”— Jamere Jackson, Chief Financial Officer

SG&A growth per store decelerated to 3% from 4% growth in the prior quarter, as the company laps a heavier new-store load-in period from last year.

“On a per-store basis, our SG&A was up 3% compared to last quarter's 4% increase”— Jamere Jackson, Chief Financial Officer

Management acknowledged competitors are now mirroring AutoZone's mega hub strategy but stated this has not muted or impacted their own execution or growth trajectory.

“Our strategy is being executed appropriately and has not been muted or impacted by what others are doing in the marketplace”— Jamere Jackson, Chief Financial Officer

The company accelerated its global store opening pace to approximately 365 planned for FY2026, up from 305 opened last year, as part of increased strategic capital investment.

“We are on track to open approximately 365 stores for the full year versus the 305 stores we opened globally last year”— Philip Daniele, President and Chief Executive Officer

Mexico and Brazil economic growth has slowed further, softening international comps, though management expects sales to reaccelerate once these economies improve.

“While these economies have slowed, we are continuing to grow share”— Philip Daniele, President and Chief Executive Officer

Management described the energy/oil and lubricant cost environment as increasingly fluid and uncertain, expecting continued inflationary pressure of an uncertain magnitude going forward.

“I would characterize it as a pretty fluid situation as it relates to energy and oil in particular”— Jamere Jackson, Chief Financial Officer