AutoZone has reported net sales of $3.4 billion for its second quarter (12 weeks) ended Feb. 12, 2022, an increase of 15.8% from the second quarter of fiscal 2021 (12 weeks). Domestic same store sales, or sales for stores open at least one year, increased 13.8% for the quarter.
“Our second quarter’s results are a reflection of our AutoZoners’ continued commitment to delivering exceptional service to our customers during these unique times. Our retail and commercial sales performance remained strong this quarter. While our commercial sales growth continued to be elevated at 32.1%, our retail sales growth also remained healthy with over 10% growth against a tough comparison from a year ago. We believe the initiatives we have in place position us well for the remainder of our fiscal year,” said Bill Rhodes, chairman, president and CEO.
For the quarter, gross profit, as a percentage of sales, was 53%, a decrease of 59 basis points versus the prior year. The decrease in gross margin was primarily driven by initiatives to accelerate Commercial growth. Operating expenses, as a percentage of sales, was 34.4% versus 37% last year. The decrease in operating expenses, as a percentage of sales, was driven by strong sales growth and approximately $40 million (137 basis points) in prior year pandemic related expenses, including Emergency Time-Off for our AutoZoners.
Operating profit increased 30.1% to $626.7 million. Net income for the quarter increased 36.4% over the same period last year to $471.8 million, while diluted earnings per share increased 49.4% to $22.30 from $14.93 in the year-ago quarter. The increase in net income was driven by topline growth and operating expense leverage.
Under its share repurchase program, AutoZone repurchased 783 thousand shares of its common stock for $1.6 billion during the second quarter, at an average price of $1,992 per share. At the end of the second quarter, the company had $958 million remaining under its current share repurchase authorization.
“As we continue to focus on the health and well-being of our customers and AutoZoners, we remain committed to providing the best and safest place to shop for everyone’s automotive needs. During these unique and challenging times, we strive to deliver the best customer service possible. As we continue to prudently invest capital in our business, we remain focused on returns on capital. We are committed to our long-term approach of increasing operating earnings and free cash flows while utilizing our balance sheet effectively,” said Rhodes.