AutoZone Shares Fall 3% As Earnings Miss Estimates On LIFO Charge

AutoZone Inc. (NYSE: AZO) shares dropped more than 3% in pre-market trading Tuesday after the company posted fourth-quarter earnings that came in below Wall Street expectations, weighed by a significant LIFO charge despite solid sales growth.

The company reported adjusted earnings per share of $48.71, missing the consensus estimate of $50.93. Revenue was $6.24 billion, matching analyst forecasts. Excluding the impact of the additional week in last year’s quarter, sales increased 6.9% year-over-year. Same-store sales rose 5.1% on a constant currency basis, including a 4.8% increase in domestic stores.

Gross profit margin declined 98 basis points to 51.5%, pressured by an $80 million non-cash LIFO charge compared with none in the prior-year quarter. Operating expenses as a percentage of sales rose to 32.4% from 31.6%, reflecting investments in growth initiatives.

AutoZone added 141 net new stores globally, bringing its total count to 7,657, while inventory climbed 14.1% year-over-year. For fiscal 2025, the company reported net sales of $18.9 billion, up 2.4% from the previous year, with annual EPS falling 3.1% to $144.87 from $149.55.