AutoZone (AZO) Q4 2025 earnings summary

Executive summary

• Quarterly net sales were $6.2 billion, up 0.6% year-over-year, and up 6.9% on a comparable 16-week basis; same store sales rose 5.1% company-wide and 4.8% domestically.

• Net income for the quarter was $837 million, with diluted EPS of $48.71, up 1.3% year-over-year on an adjusted basis; annual net income was $2.5 billion and full-year adjusted EPS was $144.87.

• Opened 90 net new domestic stores and 51 international stores in Q4, totaling 304 net new stores for the year, with global store count reaching 7,657.

• $1.5 billion in stock repurchases were completed in FY25, including $447 million in Q4.

• Management expects continued aggressive store openings and disciplined investment to drive earnings and cash flow growth.

Financial highlights

• Q4 adjusted net sales were $6.24 billion (+6.9%); full-year adjusted net sales were $18.94 billion (+4.5%).

• Q4 adjusted EBIT was $1.2 billion (down 1.1%); full-year adjusted EBIT was $3.61 billion (down 2.5%).

• Gross margin for Q4 was 51.5%, down 98–103 bps due to an $80 million LIFO charge; excluding LIFO, gross margin improved by 25 bps.

• Free cash flow for the quarter was $511 million, and $1.8 billion for the year; cash flow from operations for the year was $3.16 billion.

• Inventory per store increased 9.6% year-over-year, with inventory turns declining to 1.4x from 1.5x.

Outlook and guidance

• Expect to open 325–350 stores in the Americas in FY 2026, with CapEx planned at approximately $1.5 billion.

• LIFO charges anticipated at $120 million in Q1 FY 2026, with $80–85 million per quarter for the remainder of the year.

• SG&A growth expected in the mid-single digits, with expense leverage improving as new stores mature.

• Inflation expected to be at least 3% for the coming quarters, with potential for further increases due to tariffs.

• Focus on optimizing assets, expanding hubs, and improving customer experience.