AutoZone(AZO) - 2025 Q2 - Quarterly Results

Financial Performance - AutoZone reported net sales of $4.0 billion for Q2 FY2025, a 2.4% increase from Q2 FY2024[1] - Operating profit decreased by 4.9% to $706.8 million, and net income fell by 5.3% to $487.9 million, with diluted earnings per share at $28.29[3] - Total auto parts sales reached $3,874,366 for the 12 weeks ended February 15, 2025, representing a 2.3% increase compared to $3,786,339 in the same period last year[23] - Same store sales for domestic locations increased by 1.9% for the 12 weeks ended February 15, 2025, compared to a 0.3% increase in the prior year[24] - Cash flow from operations for the 12 weeks ended February 15, 2025, was $583,749, compared to $434,127 in the same period last year[21] Sales and Store Performance - Domestic same store sales increased by 1.9%, while international same store sales decreased by 8.2%, resulting in total company same store sales growth of 0.5%[1] - AutoZone's international same store sales grew by 9.5% on a constant currency basis, indicating strong performance despite currency fluctuations[5] - The company opened 45 new stores during the quarter, including 28 in the U.S., 13 in Mexico, and 4 in Brazil, bringing the total store count to 7,432[6] - Total company stores opened, net, was 45 for the 12 weeks ended February 15, 2025, compared to 26 in the same period last year[22] Inventory and Costs - Inventory increased by 10.4% year-over-year, with net inventory per store slightly improving to negative $161,000[4] - Inventory as of February 15, 2025, was $6,588,586, an increase from $5,970,175 the previous year[25] - Total lease cost per ASC 842 was $614,312 for the trailing four quarters ended February 15, 2025, up from $546,195 the previous year[19] Share Repurchase and Capital Management - AutoZone repurchased 100,000 shares at an average price of $3,291, totaling $329.4 million, with $1.3 billion remaining under its share repurchase authorization[3] - Cumulative share repurchases since fiscal 1998 reached $37,820,600, with remaining share repurchase authorization at $1,329,400[20] - Adjusted debt to EBITDAR ratio improved to 2.5 from 2.4 year-over-year, reflecting a disciplined approach to capital management[17] Tax and Returns - The effective tax rate for the trailing four quarters was 20.3%, slightly down from 20.5% in the previous year[19] - Adjusted after-tax return for the trailing four quarters was $3,351,080, an increase from $3,253,009 in the previous year[18] Operating Expenses - Gross profit margin remained flat at 53.9%, with operating expenses as a percentage of sales increasing to 36.0% from 34.6% last year[2] - Average sales per program per week increased to $14.7, up from $14.1 in the prior year[23] Strategic Focus - The company remains focused on expanding its domestic DIY and commercial sales while investing in growth initiatives[5]