Advance Auto Beats Q3 Earnings Estimates, Narrows 2025 Sales Outlook

Advance Auto Parts, Inc. AAP reported adjusted earnings of 92 cents per share for the third quarter of 2025, beating the Zacks Consensus Estimate of 74 cents. The company incurred an adjusted loss of 4 cents per share in the year-ago quarter.

Advance Auto generated net revenues of $2.04 billion, which beat the Zacks Consensus Estimate of $2 billion. Comparable store sales increased 3% year over year. We expected a rise of 2.4% for the same. The top line, however, decreased from $2.15 billion generated in the year-ago quarter.

Advance Auto Parts, Inc. Price, Consensus and EPS Surprise

Advance Auto Parts, Inc. price-consensus-eps-surprise-chart | Advance Auto Parts, Inc. Quote

Gross profit decreased 3% to $881 million (43.3% of net sales). AAP reported operating income of $22 million. SG&A expenses totaled $859 million for third-quarter 2025, down 5.4% year over year.

The company had cash and cash equivalents of $3.2 billion as of Oct. 4, 2025, compared with $1.87 billion as of Dec. 28, 2024. Total long-term debt was $3.41 billion as of Oct. 4, 2025.

Through the third quarter of 2025, net cash used by operating activities and negative free cash flow totaled $118 million and $277 million, respectively.

As of Oct. 4, 2025, the company operated 4,297 stores in the United States, Canada, Puerto Rico and the U.S. Virgin Islands. It also served 814 independently-owned Carquest-branded stores across these locations, in addition to Mexico and various Caribbean islands.

On Oct. 27, AAP declared a dividend of 25 cents per share to be paid on Jan. 23 to its shareholders as of Jan. 9, 2026.

AAP Updates 2025 Guidance

Advance Auto now expects 2025 net sales from continuing operations in the range of $8.55-$8.60 billion compared with the prior guidance range of $8.4-$8.6 billion. It aims to open 30 new stores in 2025. Comparable store sales are now predicted in the range of 0.7-1.3% compared with the previous outlook of 0.5-1.5%. Adjusted operating income margin from continuing operations is envisioned in the range of 2.4-2.6% compared with the previous guidance range of 2-3%. AAP now expects 2025 capex to be approximately $250 million compared with the prior guidance of $300 million.

Advance Auto Zacks Rank & Key Picks

AAP carries a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks in the auto space are General Motors Company GM, OPENLANE, Inc. KAR and Garrett Motion Inc. GTX, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for GM’s 2025 and 2026 EPS has improved 67 cents and $1.07, respectively, in the past 30 days.

The Zacks Consensus Estimate for KAR’s 2025 sales and earnings implies year-over-year growth of 5.6% and 37.7%, respectively. EPS estimates for 2025 have improved 13 cents in the past 90 days. EPS estimates for 2026 have improved 2 cents in the past 30 days.

The Zacks Consensus Estimate for GTX’s 2025 sales and earnings implies year-over-year growth of 2.6% and 16.7%, respectively. EPS estimates for 2025 and 2026 have improved 3 cents and 8 cents, respectively, in the past seven days. 

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This article originally published on Zacks Investment Research (zacks.com).

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