Autozone Inc (NYSE:AZO) reported fiscal third quarter earnings that topped Wall Street expectations, but revenue came in slightly below forecasts, sending the company’s shares down more than 10% in early trade on Tuesday.
The auto parts retailer posted adjusted earnings per share of $38.07 for the quarter ended May 9, ahead of the consensus estimate of $36.22.
Revenue rose 8.4% year over year to $4.84 billion but fell short of the $4.86 billion analysts had expected.
AutoZone said total company same-store sales increased 3.9% on a constant-currency basis during the quarter, while domestic same-store sales rose 4.1%. Total company same-store sales, including currency impacts, increased 5.5%.
During the quarter, AutoZone repurchased 164,000 shares for $586.3 million at an average price of $3,582 per share. The company had approximately $800 million remaining under its current share repurchase authorization at quarter-end.
Inventory increased 10.8% from the prior year, driven mainly by growth initiatives and inflation, the company said.
AutoZone CEO Phil Daniele said the company delivered strong domestic sales growth in both its do-it-yourself and commercial businesses while continuing to expand its store footprint.
He noted that international operations in Mexico and Brazil remained under pressure on a constant-currency basis but said the company believes it is continuing to gain market share in those markets.
“As we remain focused on gaining market share in our industry, we will stay committed to a disciplined approach of increasing earnings and cash flows to drive shareholder value,” Daniele said.
