AutoZone Inc (0HJL.L) Q4 2024 Earnings Report

AutoZone Inc reported a standout QQ4 2024 with a substantial top-line expansion and sustained profitability, underscored by a robust cash generation profile but offset by a high leverage position. Revenue for the quarter totaled $6.205B, up 60.8% year-over-year (YoY) and 46.5% quarter-over-quarter (QoQ), driven by strong demand for automotive maintenance parts and a favorable comps base. Gross profit reached $3.256B with a gross margin of 52.5%, while operating income was $1.297B (operating margin ~20.9%), leading to net income of $902.2M and basic EPS of $52.98 (diluted $51.88). These results reflect AutoZone’s continued leadership in the U.S. aftermarket auto-parts market and its ability to translate higher traffic and average ticket into meaningful profitability. The company generated robust operating cash flow of $1.070B and free cash flow of $723.5M in the quarter, supporting a sizable capital allocation program that included $703.7M in share repurchases alongside ongoing capital expenditures of $346.8M. Despite this strength, AutoZone carries a highly leveraged balance sheet: total debt of $12.367B against cash and cash equivalents of $0.298B, resulting in net debt of ~$12.069B and negative reported equity of approximately -$4.750B. Interest coverage remains healthy at ~8.5x, but the negative equity base implies a capital structure that requires careful monitoring of debt maturities, liquidity, and capital return policy. From a tactical standpoint, the QQ4 2024 results affirm AutoZone’s ability to sustain high-margin profitability and free-cash-flow generation even as it navigates leverage pressures and a dynamic retail environment. The absence of an earnings-call transcript in the provided dataset limits the ability to quote management on forward guidance or strategic pivots; nonetheless, the reported metrics imply a continued focus on core store productivity, inventory optimization, and digital/e-commerce enablement to sustain growth. Investors should track operating working capital dynamics, inventory levels, and debt service capability as key risk/fit indicators going forward.