Autozone Inc (NYSE:AZO) stock rose 2.70% (As on September 25, 11:18:07 AM UTC-4, Source: Google Finance) after the company reported a lower-than-expected fourth-quarter profit, hurt by inflationary challenges. Despite an uptick in demand for DIY parts and other components as more people sought to keep their aging vehicles on the roads, the company has struggled with inflationary headwinds and supply chain snarls amid a bumpy macro environment. For the quarter, gross profit, as a percentage of sales, was 52.5%, a decrease of 21 basis points versus the prior year. The decrease in gross margin was primarily driven by a 53 basis point non-cash LIFO impact (no LIFO benefit in the current year compared to last year benefiting $30 million), partially offset by higher merchandise margins. Operating expenses, as a percentage of sales, were 31.6% versus last year at 31.2%. Deleverage was driven primarily by higher store payroll as a percentage of sales versus the previous year. Operating profit increased 6.1% to $1.3 billion. Net income for the quarter was $902.2 million compared to $864.8 million in the same period last year

AZO in the fourth quarter of FY 24 has reported the adjusted earnings per share of $51.58, missing the analysts’ estimates for the adjusted earnings per share of $53.53, according to LSEG data. The company had reported the adjusted revenue growth of 9 percent to $6.2 billion in the fourth quarter of FY 24, which is roughly inline with the analysts’ estimates for revenue of $6.2 billion. The international businesses continued to perform well, up roughly 10% on a constant currency basis. For 4th Quarter total company Same Store Sales increased 1.3% and Domestic Same Store Sales increased 0.2%.

Under its share repurchase program, AutoZone repurchased 244 thousand shares of its common stock during the fourth quarter, at an average price per share of $2,915, for a total investment of $710.6 million. At year end, the Company had $2.2 billion remaining under its current share repurchase authorization. The Company’s inventory increased 6.8% over the same period last year driven by new store growth. Net inventory was negative $163 thousand versus negative $201 thousand last year and negative $168 thousand last quarter. During the quarter ended August 31, 2024, AutoZone opened 68 new stores in the U.S., 31 in Mexico and 18 in Brazil for a total of 117 new stores.