AutoZone’s Q3 results reflected solid execution in both its retail and commercial channels, with management highlighting improved store execution, expanded parts availability, and strong growth in commercial sales. CEO Philip Daniele credited sales acceleration to market share gains and favorable weather in the latter half of the quarter, noting, “We are encouraged with our sales acceleration this quarter, and we are excited to start the new year.” Management acknowledged that margins were impacted by a non-cash LIFO charge and ongoing tariff-related cost increases, which weighed on profitability.

Is now the time to buy AZO? Find out in our full research report (it’s free).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From AutoZone’s Q3 Earnings Call

• Bret Jordan (Jefferies): Asked if supply chain advantages are enabling lower costs and price-based share gains. CEO Philip Daniele responded that pricing discipline and cost coverage remain priorities, and that at least 3% ticket inflation is likely to rise further.
• Michael Lasser (UBS): Inquired about the trajectory of LIFO charges and margin recovery. CFO Jamere Jackson explained that LIFO headwinds are expected to persist in the near term but could reverse as product cost deflation returns.
• Gregory Melich (Evercore): Probed on SG&A growth and what comp sales are needed to leverage expenses. Jackson said expense growth is being matched with sales expectations, with new stores contributing to mid-single-digit SG&A increases.
• Christopher Horvers (JPMorgan): Sought detail on Mexico’s growth potential and market share. Daniele and Jackson emphasized opportunities to expand store count, especially in dense urban areas, given strong market position and an aging vehicle base.
• Steven Zaccone (Citi): Asked about price elasticity and gross margin drivers. Daniele stated that core categories show minimal elasticity, and Jackson highlighted merchandise margin improvements from vendor negotiations and mix shift toward private label.

Catalysts in Upcoming Quarters

In coming quarters, our analyst team will be closely monitoring (1) the pace and profitability of new store openings, especially mega hub locations; (2) the company’s ability to manage tariff-related cost inflation and maintain gross margin discipline; and (3) sustained momentum in commercial and international sales channels. Execution on these fronts will be critical to validating management’s growth strategy.

AutoZone currently trades at $4,270, up from $4,109 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).

Our Favorite Stocks Right Now

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.