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Advance Auto Parts Inc (AAP)
NYSE:AAP
Earnings Data
Report Date
May 27, 2026Before Open (Confirmed)
Period Ending
2026 (Q1)Consensus EPS Forecast
0.42Last Year’s EPS
-0.22Same Quarter Last Year
Based on 15 Analysts Ratings
Earnings Call Summary
Earnings Call Sentiment|Positive
The call emphasized clear operational progress and material margin recovery: return to positive comparable sales, significant gross- and operating-margin expansion, a return to positive adjusted EPS, major SKU and availability improvements, DC consolidation, and a stronger balance sheet. Management provided concrete 2026 guidance (1%–2% underlying sales growth, 3.8%–4.5% operating margin, ~45% gross margin, $2.40–$3.10 adjusted EPS and ~$100M free cash flow) while acknowledging near-term headwinds — notably a large negative free cash flow in 2025, continued DIY softness, LIFO and markdown pressures, and the early-stage nature of supply chain and store productivity investments. Overall, the positive operational and margin momentum and clearer path to profitability outweigh the near-term cash and top-line challenges, but execution on supply chain and store initiatives remains critical.Company Guidance
Return to Positive Comparable Sales
Comparable sales returned to positive after three years of declines: full-year 2025 comps were just under +1%, and Q4 comparable sales grew +1.1%. Pro channel strengthened throughout the year and grew nearly +4% in Q4, with low single-digit positive comps over the last six months.
Margin Expansion and Profitability Recovery
Significant profitability improvement: adjusted operating income margin expanded ~210 bps year-over-year to 2.5% for FY2025 and Q4 adjusted operating income margin was 3.7% ($73M). Management cites ~500 bps of adjusted operating margin expansion since late 2023. Adjusted diluted EPS turned positive: $2.26 for FY2025 (from a loss of $0.29 in FY2024) and $0.86 in Q4 (from a loss of $1.18).
Gross Margin Expansion
Adjusted gross profit expanded materially: Q4 gross margin was 44.2% (nearly +530 bps YOY) and full-year adjusted gross margin was 43.9% (about +165 bps YOY), driven by sourcing initiatives, footprint optimization and lower-than-expected LIFO expense in Q4.
Real Estate and Cost Rationalization Gains
Completed broad footprint optimization: exited over 500 corporate stores and ~200 independents, saving ~ $70M in operating costs; consolidated U.S. distribution centers from ~38 to 16 (target ~15 by year end 2026), driving SG&A leverage (adjusted SG&A down ~50 bps for the year) and operating efficiencies.
Assortment, Availability and Service Improvements
Expanded assortment by ~100,000 SKUs; store availability improved from the low-90% range to the high-90% range; product costs reduced by >70 bps; increased average Pro delivery speed by cutting >10 minutes (from over 50 minutes) — all contributing to better hard-parts performance (brakes, undercar, engine management).
Stronger Balance Sheet and Capital Plan
Entered 2026 with >$3B cash, $1B undrawn revolver and net leverage improved to 2.4x (target 2.0–2.5x). Management reduced supplier financing usage to $2.5B and expects to increase 2026 CapEx to ~$300M while targeting ~ $100M free cash flow in 2026.
New Initiatives, Brands and Customer Programs
Launched proprietary oil/fluids brand ARGOS and modernized the DIY loyalty program to Advance Rewards (16M active members). These initiatives, plus merchandising and AI tools, are designed to drive DIY engagement and repeat transactions.
Store & Distribution Growth Plans
Operational growth: opened 35 new stores and reached 33 market hubs in 2025; plans to open 40–45 stores and 10–15 market hubs in 2026 (10–15 market hubs targeted), plus store infrastructure upgrades at >1,000 stores in 2026.
AAP Earnings History
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat
Missed
AAP Earnings-Related Price Changes
Report Date | Price 1 Day Before | Price 1 Day After | Percentage Change |
|---|---|---|---|
Feb 13, 2026 | $58.22 | $58.85 | +1.08% |
Oct 30, 2025 | $54.80 | $50.40 | -8.04% |
Aug 14, 2025 | $61.14 | $56.23 | -8.03% |
May 22, 2025 | $30.84 | $48.43 | +57.05% |
Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.
FAQ
When does Advance Auto Parts Inc (AAP) report earnings?
Advance Auto Parts Inc (AAP) is schdueled to report earning on May 27, 2026, Before Open (Confirmed).
What is Advance Auto Parts Inc (AAP) earnings time?
Advance Auto Parts Inc (AAP) earnings time is at May 27, 2026, Before Open (Confirmed).
Where can I see when companies are reporting earnings?
You can see which companies are reporting today on our designated earnings calendar.
What companies are reporting earnings today?
You can see a list of the companies which are reporting today on TipRanks earnings calendar.
What is AAP EPS forecast?
AAP EPS forecast for the fiscal quarter 2026 (Q1) is 0.42.
