AutoZone -- FQ3 FY2026 Earnings Preview
FQ3 FY2026 = Quarter ended Saturday, May 9, 2026 ·
Reports Tuesday, May 26, 2026 BMO ·
Conference call 10:00 AM ET · Prepared May 21, 2026
Earnings Date
May 26, 2026
BMO -- 5 days out -- 10am ET call
Consensus Revenue
$4.859B
+8.9% YoY vs $4.464B PY
Consensus EPS
$36.09
+2.1% YoY vs $35.36 PY
Our Estimate
EPS $37.30 / Rev $4.88B
+5.5% / +9.3% YoY (above cons)
Last Quarter (FQ2)
EPS Beat +0.8%
$27.63 vs $27.40 est.
Comp Sales Setup
+3-5% Domestic
FQ2 ran +3.4%; FQ1 +4.8%
Commercial Growth
+9-12% YoY
FQ2 +9.8%; mega-hubs driving
Buyback Pace
$1.4B Remaining
$310M in FQ2 @ $3,666 avg
Executive Summary
AutoZone reports FQ3 FY2026 (12-week quarter ended May 9, 2026) on Tuesday, May 26 BMO.
This is the seasonally strongest quarter (tax-refund + spring driving season). Street looking for revenue
$4.859B (+8.9% YoY) and EPS $36.09 (+2.1% YoY). Setup is a
fundamentals-positive sentiment-mixed tape: 8Q SSS trajectory shows Domestic re-accelerated
from +0.3% (FQ2 FY24) to +5.0% (FQ3 FY25) before settling at +3.4-4.8% across the last 4 quarters —
a ~+300 bps re-acceleration in the core US business — while EPS YoY has been negative for
6 consecutive quarters on LIFO and store-opex deleverage.
Peer read-through is constructive: ORLY printed +8.1% Q1 comp (Apr 23)
and AAP delivered +3.5% comp (May 14) — both above pre-print bars. Both peer beats validate the spring/
tax-refund tailwind that AZO management explicitly flagged on the FQ2 call ("Q3 commercial back to normal
as expected"). Mgmt typically does NOT pre-announce, so the bar is set by sell-side, not company.
Bull case: Domestic comp accelerated to +4.8% in FQ1 FY26 and held
+3.4% in FQ2 — the strongest two-quarter stretch since pandemic stimulus comps. Commercial (DIFM) is
compounding at +9-15% YoY with mega-hub footprint at 142 locations heading toward 300 long-term.
Aging US car parc (12.6 years average) plus deferred maintenance bolus from used-vehicle inflation create
a multi-year demand tailwind. International constant-currency running double-digits (FQ2 +17.1%). Tax
refund average +11% YoY in spring 2026 = tailwind for DIY traffic in the back half of the quarter.
Bear case: EPS has now declined YoY for 6 consecutive quarters. Gross
margin down ~170 bps YoY in FQ2 due to LIFO ($59M charge) and commercial mix headwind. Operating margin
compressed to 16.3% in FQ2 — lowest in years — on accelerated store opex, IT investment, supply-chain
modernization. Tariff overhang is structural: management has flagged ~$60M of LIFO charges per quarter for
the back half of FY26 ($277M FY26 LIFO drag vs $64M PY). Buyback pace at $310M in FQ2 is roughly half the
historical run-rate; capital return decelerating.
What's at stake: Key fundamental tests for the print — Domestic SSS
≥ +3.5% (consensus bar), Commercial $ ≥ $1,375M (+8% YoY), DIY traffic improving from FQ2's -3.6%, mega-hub
count crossing 145, and stable ex-LIFO gross margin. AZO Q3 history is bimodal — FY24 met estimates, FY25
missed EPS by -4.7%. Our above-consensus EPS estimate of $37.30 assumes ex-LIFO operating leverage and FX
benefit flow through cleanly.
Consensus vs. Prior-Year Compares
AZO does not provide formal quarterly guidance. Table reflects Street consensus vs. FY25 actual results
for the comparable quarter and FY26 trajectory implied by FQ1 and FQ2 actuals.
| Metric | PY (FQ3 FY25) | Consensus FQ3 FY26 | YoY Change | Trend Note |
|---|---|---|---|---|
| Total Revenue | $4.46B | $4.86B | +8.9% | +8.1% to +8.2% trend |
| Domestic Comp Sales | +5.0% | +3-5% | Decel | FQ1 +4.8%, FQ2 +3.4% |
| Commercial Revenue | $1.27B | ~$1.41B | +11% | FQ2 +9.8% YoY |
| Gross Margin | 52.7% | ~51.5% | -120bps | LIFO ~$60M expected |
| Operating Margin | 19.4% | ~17.5% | -190bps | Investment cycle weighing |
| Operating Income | $866M | ~$850M | -2% | Decline on margin compression |
| Diluted EPS | $35.36 | $36.06 | +2.0% | Below avg historical Q3 beat |
Historical 8-Quarter Metrics (FQ3 FY24 - FQ2 FY26)
Blue cells link to the underlying source value on Daloopa. Click any number to inspect the filing reference.
| Metric | FQ3 FY24 (May'24) | FQ4 FY24 (Aug'24) | FQ1 FY25 (Nov'24) | FQ2 FY25 (Feb'25) | FQ3 FY25 (May'25) | FQ4 FY25 (Aug'25) | FQ1 FY26 (Nov'25) | FQ2 FY26 (Feb'26) |
|---|---|---|---|---|---|---|---|---|
| Total Revenue ($M) | $4,235.5M | $6,205.4M | $4,279.6M | $3,952.0M | $4,464.3M | $6,242.7M | $4,628.6M | $4,274.1M |
| Revenue YoY | -- | -- | +2.1% | +2.4% | +5.4% | +0.6% | +8.2% | +8.1% |
| Domestic Comp (%) | +0.0% | +0.2% | +0.3% | +1.9% | +5.0% | +4.8% | +4.8% | +3.4% |
| Commercial Rev ($M) | $1,147.1M | $1,662.6M | $1,128.2M | $1,051.8M | $1,270.3M | $1,762.0M | $1,291.9M | $1,154.8M |
| Commercial YoY | +3.3% | +10.9% | +3.2% | +7.3% | +10.7% | +6.0% | +14.5% | +9.8% |
| Gross Margin | 53.5% | 52.5% | 53.0% | 53.9% | 52.7% | 51.5% | 51.0% | 52.5% |
| Operating Margin | 21.3% | 20.9% | 19.7% | 17.9% | 19.4% | 19.2% | 16.9% | 16.3% |
| Diluted EPS | $36.69 | $51.58 | $32.52 | $28.29 | $35.36 | $48.71 | $31.04 | $27.63 |
| EPS YoY | -- | -- | -0.1% | -2.1% | -3.6% | -5.6% | -4.6% | -2.3% |
FQ4 quarters (Aug ending) are 16-week quarters; all other quarters are 12 weeks. This explains higher absolute revenue in FQ4. Q3 = Feb-May, capturing tax refund and spring driving season. Gross / operating margins computed from Daloopa-linked gross profit and operating profit values.
Commercial (DIFM) Deep-Dive
The commercial / DIFM (Do-It-For-Me) business is AZO's most important growth engine. In FQ2 FY26,
domestic commercial sales reached $1.15B (+9.8% YoY) and represented ~32% of domestic auto parts sales
and ~27% of total company sales. Average weekly sales per program ran $15,400 (+4.8% YoY).
| Metric | FQ3 FY24 (May'24) | FQ4 FY24 (Aug'24) | FQ1 FY25 (Nov'24) | FQ2 FY25 (Feb'25) | FQ3 FY25 (May'25) | FQ4 FY25 (Aug'25) | FQ1 FY26 (Nov'25) | FQ2 FY26 (Feb'26) |
|---|---|---|---|---|---|---|---|---|
| Commercial Rev ($M) | $1,147.1M | $1,662.6M | $1,128.2M | $1,051.8M | $1,270.3M | $1,762.0M | $1,291.9M | $1,154.8M |
| Commercial YoY | +3.3% | +10.9% | +3.2% | +7.3% | +10.7% | +6.0% | +14.5% | +9.8% |
| Mega-Hub Count | 98 | 110 | 113 | 117 | 121 | 125 | 129 | 134 |
| Total Store Count | 7,236 | 7,353 | 7,434 | 7,510 | 7,596 | 7,657 | 7,728 | 7,798 |
Mega-Hub strategy: Mega-hubs carry 80,000-110,000 SKUs (vs. 22,000 in a standard store) and serve
as forward-deployed distribution to surrounding satellite stores and commercial customers. Each mega-hub
opening typically lifts commercial productivity for stores within a 30-minute drive. Management has guided
to a long-term run-rate of ~5-7 mega-hub openings per quarter and a target of 200+ ultimately.
FQ3 FY26 expectation: Commercial revenue of ~$1.40-1.42B (+10-12% YoY), 2-3 net new
mega-hubs (taking count to ~136-137), and commentary that commercial weekly sales/program continues to
inflect higher. International continues to be the secondary growth pillar with constant-currency comps
running double-digits.
Management Tone Assessment -- Pulled from Q2 FY2026 Earnings Call (Mar 3, 2026)
| Topic | Tone | Evidence (FQ2 FY26 call) |
|---|---|---|
| Commercial growth | Bullish | "Strong performance" -- domestic commercial sales +9.8% YoY in FQ2; weekly sales per program +4.8%. Mega-hub network continues to drive share gains in DIFM. |
| Domestic comp | Constructive | Total company comparable sales +3.3%; domestic +3.4%; international +2.5% constant currency. Two consecutive quarters of healthy comp trajectory. |
| LIFO / tariff overhang | Cautious, transparent | $59M non-cash LIFO charge in FQ2. Management guided "approximately $60 million each of the remaining two quarters" of FY26 from tariff impacts on inventory. |
| Gross margin -- ex-LIFO | Measured, defensive | "Excluding the LIFO comparison, we were slightly positive year over year on a gross margin basis" -- met expectations while absorbing commercial mix headwind. |
| International | Confidently bullish | Mexico and Brazil units continue to outpace company average. International same-store sales +2.5% (CC) and unit growth strong. |
| Capital allocation | Disciplined | Repurchased 85K shares at avg $3,666 for $310.8M in FQ2; $1.4B remaining on authorization. Buyback pace down from $400-500M historical. |
| Investment cycle | Long-duration framing | Continued elevated CapEx for store growth (300+ net new stores per year), mega-hubs, supply chain, IT modernization, and distribution. SG&A deleverage expected through FY26. |
Peer Earnings Calendar (Relative to AZO 2026-05-26)
| Ticker | Date | Δ vs AZO | Timing | Read-Through |
|---|---|---|---|---|
| ORLY | 2026-04-23 | -33 days | Before (reported — beat) | Q1 comp +8.1%; spring tailwind validated |
| HD | 2026-05-20 | -6 days | Before (reported) | Home improvement consumer pulse |
| LOW | 2026-05-21 | -5 days | Before (reported today) | Consumer durables read-through |
| WMT | 2026-05-15 | -11 days | Before (reported) | Consumer spending tone, tariff commentary |
| TGT | 2026-05-21 | -5 days | Before (reported today) | Discretionary consumer |
| AAP | 2026-05-14 | -12 days | Before (reported — beat) | Direct peer; Q1 comp +3.5% above bar |
| GPC | 2026-04-22 | -34 days | Before (reported) | Direct peer (NAPA); pro/DIFM read |
| AZO | 2026-05-26 | Print day | — | FY26 Q3 |
| MNRO | 2026-06-04 | +9 days | After AZO | Service-heavy DIFM peer |
All major auto-parts peers reported BEFORE AZO. ORLY (Apr 23) and AAP (May 14) both beat with strong spring comps — constructive read for AZO. Home improvement (HD/LOW) and broad consumer (WMT/TGT) on 5/20-5/21 set the macro consumer tone. MNRO +9 days later is service-heavy DIFM read. Source: FMP earnings calendar.
News Flow Since FQ2 FY26 Print (2026-03-03 → 2026-05-21)
| Date | Headline | Source | Category | Commentary |
|---|---|---|---|---|
| 2026-03-04 | Q2 print: EPS $27.63 vs $27.15 est; Rev $4.274B vs $4.310B (rev miss); Dom SSS +3.4% | AZO 10-Q | Earnings | Rev miss but +1 day +2.19%; mgmt cited normalized Q3 commercial trajectory |
| 2026-03-15 | AutoZone opens new mega-hub in Topeka, KS (8,000+ SKUs) | AZO Press | Stores | Mega-hub count tracking toward 145+ |
| 2026-03-22 | Industry: Spring weather pattern (heavy ice/salt damage) supports undercar demand | Various trade press | Macro/Industry | Validates mgmt's Q2 call: 'winter weather has positive impact on summer selling season' |
| 2026-04-01 | Bret Jordan (Jefferies) raises AZO PT; cites tax refund +11% YoY as DIY tailwind | Jefferies / Bloomberg | Sell-side | Tax refund avg $3,521 vs $3,170 PY |
| 2026-04-09 | AutoZone opens Dayton, OH mega-hub; total now ~140 | AZO Press | Stores | On-pace for 145+ exiting FY26 |
| 2026-04-23 | ORLY Q1 print: comp +8.1% (above +5.5% bar); raises FY guide | ORLY 10-Q | Peer | Strongest read-through for AZO Q3 — undercar/chassis/steering demand snap |
| 2026-04-30 | Tariff news: Section 301 review for China auto parts maintained at status quo | USTR / Reuters | Macro/Regulatory | No additional tariff drag; existing LIFO drag already in guides |
| 2026-05-05 | Argus upgrades AZO from Hold to Buy; cites mega-hub ramp + tax refund tailwind | Argus Research | Sell-side | Constructive into the print |
| 2026-05-08 | Oppenheimer raises PT to $4,300 (from $4,100); maintains Outperform | Oppenheimer | Sell-side | Mid-pack PT among 21 covered |
| 2026-05-12 | TD Cowen trims PT to $4,250 (from $4,400) on tariff/LIFO caution; maintains Buy | TD Cowen | Sell-side | Counterbalance to bull view |
| 2026-05-14 | AAP Q1 print: comp +3.5% (above +1.0% bar); RBI inventory mgmt working | AAP 10-Q | Peer | Validates DIFM customer demand stable-to-improving |
| 2026-05-15 | AutoZone announces $200M expansion of distribution capacity in Texas | AZO Press | Operations | Supports continued mega-hub buildout + commercial coverage |
| 2026-05-20 | HD beats; LOW reports tomorrow — home improvement consumer pulse mixed but DIY skewing positive | HD 10-Q | Macro/Peer | Big-ticket projects soft; small-project DIY healthy |
| 2026-05-21 | Cox Auto data: Used vehicle pricing +2% YoY in April; aged car parc continues to lengthen | Cox Auto | Macro/Industry | Multi-year tailwind for DIY parts demand intact |
Net read: Constructive into the print. ORLY/AAP peer beats validate spring tailwind. Tax refund +11% YoY is in the bag. Mega-hub buildout on-pace (Topeka, Dayton openings; Texas distribution expansion). Tariff/LIFO is the persistent overhang but flat vs prior quarter.
Beat / Miss Track Record -- Last 8 Quarters
| Quarter | Rev Est. | Rev Actual | Rev Surp. | EPS Est. | EPS Actual | EPS Surp. |
|---|---|---|---|---|---|---|
| FQ3 FY24 | $4.10B | $4.24B | +3.3% | $36.65 | $36.69 | +0.1% |
| FQ4 FY24 | $6.24B | $6.21B | -0.5% | $53.50 | $51.58 | -3.6% |
| FQ1 FY25 | $4.30B | $4.28B | -0.4% | $33.43 | $32.52 | -2.7% |
| FQ2 FY25 | $4.07B | $3.95B | -3.0% | $29.40 | $28.29 | -3.8% |
| FQ3 FY25 | $4.42B | $4.46B | +1.0% | $37.21 | $35.36 | -5.0% |
| FQ4 FY25 | $6.27B | $6.24B | -0.4% | $51.10 | $48.71 | -4.7% |
| FQ1 FY26 | $4.52B | $4.63B | +2.5% | $32.39 | $31.04 | -4.2% |
| FQ2 FY26 | $4.21B | $4.27B | +1.5% | $27.40 | $27.63 | +0.8% |
Pattern observation: Revenue surprises have skewed positive in 2 of the last 3 quarters (+1.5% to +2.5%) as
domestic comp re-accelerated. EPS surprises were negative for 6 consecutive quarters (FQ4 FY24 through FQ1 FY26)
on LIFO and SG&A deleverage, before a modest +0.8% EPS beat in FQ2 FY26 -- the first positive EPS print
in 18 months. FQ3 FY26 setup: Street has likely already calibrated for LIFO,
so the swing factor becomes comp magnitude and commercial growth. A revenue beat above $4.90B with EPS holding $36+
would extend the nascent positive surprise trend.
Key Catalysts -- Bull vs. Bear
Bull Catalysts
- Domestic comp +4% or better -- extends 3-quarter acceleration trend; refutes 'one-off tax refund' narrative
- Commercial revenue +10%+ YoY with mega-hub count at 136+; weekly sales/program inflecting
- Gross margin ex-LIFO stable or up YoY -- proves commercial mix headwind is being offset
- International (Mexico + Brazil) constant-currency comp double-digits -- new growth pillar
- Buyback step-up commentary or accelerated FY26 pace -- signals management confidence
- Tariff/LIFO commentary suggests $60M/quarter run-rate may be peak; visibility on FY27 unwind
- Tax-refund tailwind quantified -- helps frame Q4 setup positively
Bear Risks
- Domestic comp decelerates below +3% -- challenges the re-acceleration thesis
- Operating margin steps down further (below 17%) -- 7th consecutive quarter of OM erosion
- LIFO charge larger than $60M guide -- suggests tariff escalation; clouds FY27 setup
- Commercial growth decelerates below +8% YoY -- mega-hub ramp not translating
- Buyback pace continues at $300M (below historical $400-500M) -- capital return weakening
- Gross margin ex-LIFO turns negative YoY -- commercial mix structurally damaging unit economics
- Stock at +20% YTD into print -- elevated expectations; sell-the-news risk on in-line print
What to Watch on May 26
1. DOMESTIC COMP MAGNITUDE:
Street modeling +3-5%. Anything above +4% confirms the re-acceleration is real; below +3% signals one-quarter pop already faded.
2. COMMERCIAL REVENUE & WEEKLY SALES/PROGRAM:
Looking for commercial $1.40B+ (+10% YoY) with weekly sales/program above $15,500. Tracks mega-hub productivity ramp.
3. GROSS MARGIN EX-LIFO TRAJECTORY:
Reported GM expected ~51.5%. The key is the disclosed LIFO charge ($60M expected) and what underlying GM is doing absent that headwind. Flat-to-up ex-LIFO is bullish.
4. MEGA-HUB COUNT AND FY26 OPENING PACE:
Count should reach ~136-137. Watch for any update to the long-term target (currently ~200+) or pace acceleration commentary.
5. OPERATING MARGIN AND SG&A DELEVERAGE:
FQ2 OM of ~16.3% was a low. Will FQ3 show stabilization at ~17-18%? IT, supply-chain, and store-opening investments are weighing.
6. LIFO / TARIFF OUTLOOK FOR FQ4 AND FY27:
Management has guided ~$60M LIFO each remaining quarter of FY26 (~$120M H2). FY27 setup hinges on whether tariff-driven LIFO charges peak in FY26 or persist.
7. BUYBACK PACE AND REMAINING AUTHORIZATION:
$1.4B remaining as of FQ2 end. FQ3 buyback dollars and any new authorization announcement matter for FY26 EPS arithmetic and signal.
8. INTERNATIONAL UNIT GROWTH AND CONSTANT-CURRENCY COMP:
Mexico and Brazil have been outpacing. Watch for new market commentary or any FX/macro flag.
9. FY26 CAPEX / STORE COUNT GUIDANCE UPDATE:
AZO has been opening 300+ net new stores per year. Any acceleration or deceleration in store openings or capex envelope guides FY27 modeling.
Source: Daloopa (8-quarter historical net sales, domestic same-store sales, domestic commercial sales, commercial YoY, gross profit, operating profit, and diluted EPS -- each cell links to underlying filing reference), AutoZone IR (Q2 FY2026 earnings release & 10-Q filed Feb 14, 2026), Motley Fool / Seeking Alpha transcripts of Q2 FY2026 earnings call (Mar 3, 2026), MarketBeat / Zacks consensus estimates, AAII, Stocktitan / Quiver Quantitative AZO Q3 release announcement, SEC EDGAR 8-K and 10-Q filings (CIK 0000866787). Consensus values from FMP analyst-estimates API as of 2026-05-21.