AutoZone, Inc.

Q4 total sales were $6.6 billion, up 5.6% year over year. EPS rose 15.1% to $56.05, net income was $932 million, and gross margin was 53.3%, up 182 basis points versus last year. On an adjusted basis excluding LIFO, EBIT grew 4.4% and EPS grew 8.5%; total company same-store sales were up 1.5% constant currency, domestic same-store sales were up 1.6%, and international same-store sales were up 1.3% constant currency. For FY2026, total sales were $20.3 billion, up 7.4%, and EPS was $152.55, up 5.3%. For FY2027, management expects about 400 store openings, Q1 same-store sales roughly flat with ticket around +5%, gross margin flat to up 25 bps on a GAAP basis excluding LIFO, and FY2027 LIFO charges of $85 million to $90 million; FX at current rates would add about $45 million to revenue, $14 million to EBIT, and $0.60 per share in Q1, while Q1 LIFO would reduce EBIT by about $40 million and EPS by about $1.85.

Phil Daniele framed FY2026 as a year of heavy investment in growth, store openings, hubs/Mega Hubs, supply chain, and service execution, and said those efforts are now beginning to pay off. He emphasized that the company is still gaining share, especially in domestic commercial, and that many of the biggest infrastructure investments are in the later stages or will moderate going forward. His tone was constructive and confident, but he repeatedly stressed that the business remains in a challenging macro and weather-driven environment and that the company is focused on execution rather than assuming the trends will automatically improve.

Jamere Jackson highlighted strong quarterly profitability and cash generation, with EBIT up 10.1% to $1.3 billion and free cash flow of $684 million in Q4. He noted the $96 million tariff refund, the $15 million LIFO charge versus $80 million last year, and the peso tailwind, which added $70 million to sales, $21 million to EBIT, and $0.87 per share to EPS. For FY2026, AutoZone generated about $1.8 billion in free cash flow, repurchased $697 million of stock in Q4 and $2 billion for the year, and finished with leverage at 2.5x EBITDAR; for FY2027, he expects roughly $1.65 billion of CapEx, about $85 million to $90 million of LIFO charges, SG&A per store growth of roughly 3% for the year, and continued strong cash generation to support buybacks.

Analysts focused on the pace of DIY recovery, whether higher inflation and tariffs would continue to pressure transactions, and whether management’s comp framework implied only modest growth. Management said DIY transactions were soft but improving late in the quarter, with lower-income consumers under pressure, while commercial momentum remained strong and should continue. Questions also centered on the return on the company’s multi-year investment phase; management said the supply chain, technology, and store-expansion projects are mostly in later stages, the new stores are performing slightly ahead of plan, and the P&L should become less noisy as LIFO and tariff effects normalize. Another area of interest was Mega Hubs, where management said the lift has been consistent and should remain as good or better as the network expands toward about 300 hubs.