Advance Auto Parts reported third‑quarter 2025 results for the period ended October 4, 2025, showing its strongest quarterly performance in more than two years.
Net sales totaled $2.0 billion, a 5 % decline year‑over‑year, while comparable store sales increased 3.0 %. Gross profit reached $0.9 billion, or 43.3 % of net sales, and adjusted gross profit was 44.8 %. Adjusted operating income rose to $90 million, or 4.4 % of net sales, compared with $16 million, or 0.7 %, a year earlier. Diluted earnings per share were $0.92, versus a loss in the prior year’s quarter. Net income was $38 million, up from a $1 million loss. Operating cash flow was $118 million used in operating activities, and free cash flow was negative $277 million year‑to‑date. Capital expenditures for 2025 were $250 million.
The company reaffirmed its full‑year 2025 guidance: net sales of $8.55 billion to $8.60 billion, comparable store sales growth of 0.7 % to 1.3 %, adjusted operating income margin of 2.4 % to 2.6 %, and adjusted diluted EPS of $1.75 to $1.85. New store openings were projected at 30, with 14 market hub openings.
Strategic context: Advance Auto Parts completed a footprint optimization that closed under‑performing stores and divested its Worldpac unit, actions that contributed to margin expansion. The company also implemented cost‑saving initiatives and leveraged artificial intelligence for pricing and assortment decisions. Restructuring charges and proceeds from the divestiture are the primary drivers of the negative free cash flow. Management noted softer trends in the DIY channel early in the fourth quarter, but emphasized continued focus on core retail fundamentals.
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