AutoZone, Inc. (NYSE:AZO) shares experienced slight gains during regular trading hours Tuesday despite the company’s earnings miss.
AZO shares edged 0.2% higher even though the company missed the earnings expectations of $8.20 per share by 12 cents, revealing earnings of $8.08 per share. The figure was and 8.8% year-over-year growth compared to the $7.43 reported a year ago.
Net income saw an increase year-over-year as well, helping to drive up the stock at $237.1 million, better than the $228.6 million from a year ago. Meanwhile, quarterly revenue posted a 1.4% surge year-over-year to $2.29 billion.
Wall Street was projecting revenue of $2.35 billion over the course of AutoZone’s second quarter. Domestic same-store sales for stores open for at least one year were not higher or lower, remaining flat.
Gross profit experienced a rise of $1.19 billion to $1.21 billion year-over-year, which amounted to 52.7% of all sales. Higher shrink expense and supply chain costs helped this number go up, as well as lower acquisition costs.
Sales growth at existing locations did not perform as well as the company expected, proving to be flat following the previous quarter’s minor growth. New IRS regulation pinched customer spending.
Inventory levels were 9% higher for AutoZone’s period thanks to due to a larger store base and efforts to improve stock existing locations. Operating profit surged to $384 million from $382.7 million recorded in the second quarter of fiscal 2016 over the three months that comprised it.
