Advance Auto Parts Inc (0H9G.L) Q4 2024 Earnings Report

Advance Auto Parts Inc (0H9G.L) delivered a difficult Q4 2024, with revenue of $1.996 billion down 19% year over year and a net loss of $414.8 million (-$6.94 per share). The quarter featured a sharp deterioration in gross profit (gross margin 17.39%) and substantial fixed-cost leverage that drove operating income to a negative $820.0 million and EBITDA to a negative $731.7 million (EBITDA margin -36.66%). The negative earnings translated into a substantial earnings gap versus a year ago, underscoring the scale of profitability headwinds in the period.

Cash flow remained constrained despite a strong cash balance. Operating cash flow was negative $73.3 million, while capital expenditures were $51.1 million and free cash flow registered at negative $124.4 million. The company finished the period with cash and cash equivalents of $1.869 billion, total debt of $3.686 billion, and a balance sheet that shows a current ratio of 1.317 and a debt-to-capitalization ratio of 0.629, signaling meaningful leverage despite an improved liquidity position from working capital movements and financing activity.

Together with a persistently weak earnings profile, these results highlight the ongoing need for margin expansion, cost containment, and working-capital optimization to restore profitability and cash generation. The environment in the US auto parts aftermarket remains competitive, pressuring price and margins while consumer demand and vehicle repair activity influence top-line trends. Investors should monitor management actions around cost control, inventory management, and potential portfolio optimization as catalysts for a path back to generating positive cash flow and improved returns.