stockrowWhat it does
AutoZone is a retailer and distributor of automotive replacement parts and accessories in the Americas. Founded in 1979 and headquartered in Memphis, it is led by President and Chief Executive Officer Philip B. Daniele III.
It sells new and remanufactured hard parts, maintenance products, accessories and non-automotive items for cars, sport utility vehicles, vans and light-duty trucks. Hard parts are components that replace or repair vehicle systems, such as batteries, brakes, starters, alternators, engines and radiators. Maintenance products include fluids, filters, wipers and related items.
The company serves both people repairing their own vehicles and professional customers that repair vehicles for others. Its commercial program supplies repair garages, dealers, service stations, fleet owners and other accounts with parts delivery and commercial credit. It also sells through AutoZone.com, while commercial customers can order through AutoZonePro.com and its mobile application.
AutoZone also sells ALLDATA diagnostic, repair, collision and shop-management software. It offers services such as diagnostic readings, battery testing and charging, used-oil collection, and its Loan-A-Tool program. It does not earn revenue from performing automotive repairs or installations.
How it makes money
AutoZone earns revenue when retail and commercial customers buy parts and related products. Its Auto Parts Stores business generated $20.3 billion in FY2026, compared with $18.9 billion in FY2025, and represented 100.0% of revenue. Total sales in the third quarter of fiscal 2026 were $4.8 billion.
The company sells a broad assortment, with failure and maintenance-related categories representing approximately 85% of fiscal 2026 sales. Customers can choose among products with differing price and quality levels. Its in-house brands include Duralast, Econocraft, ProElite, ShopPro, SureBilt, TotalPro, TruGrade and Valucraft. Product warranties, parts availability and advice are part of the selling proposition.
Sales recur as vehicles age, are driven and require maintenance or replacement parts. The company identifies vehicles seven years old and older as vehicles that generally need more maintenance and repair because they are typically outside original manufacturer warranties. Commercial sales also recur as repair shops and fleet operators reorder parts for customer work.
Pricing is influenced by product costs, tariffs, inflation and the competitive environment. The company expects the operating environment to remain inflationary and manages pricing with suppliers and customers accordingly. In fiscal 2026, domestic commercial sales increased $550.1 million, or 10.6%, from fiscal 2025.
| Segment | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Auto Parts Stores | $20.3 billion | 100.0% | 7.39% |
Customers and how it sells
AutoZone serves do-it-yourself customers, who buy parts for their own vehicles, and commercial customers, including local, regional and national repair garages, dealers, service stations, fleet owners and other accounts. Commercial customers receive prompt delivery and commercial credit where the program is available.
The company operated 8,031 stores at August 29, 2026: 6,863 in the United States, 1,001 in Mexico and 167 in Brazil. Stores in the United States including Puerto Rico produced $17.6 billion, or 86.6%, of FY2026 revenue. Non-U.S. operations produced $2.7 billion, or 13.4%, of FY2026 revenue.
Most stores carry approximately 20,000 to 25,000 unique SKUs. Hub stores carry approximately 40,000 to 50,000, while mega hub stores carry approximately 80,000 to 110,000. These larger stores supply a wider assortment to surrounding locations. Stores can access the expanded assortment of 417 domestic and 74 international hub stores on the same day.
Customers can buy in stores, order online for collection or delivery, and use the commercial website or mobile application. The company had commercial programs in 6,443 domestic stores and in the vast majority of stores in Mexico and Brazil at fiscal year-end.
| Region | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Stores in the United States Including Puerto Rico | $17.6 billion | 86.6% | 5.65% |
| Non-US | $2.7 billion | 13.4% | 20.2% |
Suppliers and costs
AutoZone selects and purchases merchandise centrally through store support centers in Memphis, Monterrey, Chihuahua and São Paulo, supported by sourcing offices in Shanghai, Istanbul and Gurugram. Merchandise generally moves through distribution centers to stores using the company fleet and third-party transportation firms.
One class of similar products accounted for approximately 14 percent of fiscal 2026 revenue, and one individual vendor supplied 14 percent of total purchases. No other individual vendor supplied more than 10 percent. The company believes alternative supply sources exist at similar costs for most product types.
The company directly imported approximately 12% of purchases in fiscal 2026; domestic vendors also import products or components. Costs can therefore be affected by tariffs, freight, raw materials, currency movements, supplier conditions and product availability.
Major operating costs include merchandise, labor, distribution, store operations and growth investment. Operating, selling, general and administrative expense was $6.9 billion, or 34.0% of net sales, in fiscal 2026. The company invested $1.4 billion in capital assets, principally including new stores and hub and mega hub expansions.
- Revenue$20.3B
- Cost of revenue−$9.7B
- Selling, general and administrative−$6.9B
- Operating income$3.7B
Competitive position
No individual competitor is named in the available company disclosures. AutoZone competes in automotive parts, accessories and maintenance items against national, regional and local parts chains; independent parts stores; online parts stores and marketplaces; wholesale distributors; jobbers; repair shops; car washes; auto dealers; and general retailers that sell aftermarket products, chemicals, accessories and tools.
Competition centers on service and parts knowledge, commercial delivery speed, product quality and availability, warranties, store convenience, price, brand strength and digital capabilities. The company states that online and multichannel retailers can have lower operating costs and may offer faster guaranteed delivery and low-cost or free shipping. Customers can also compare prices, assortments, availability and feedback online before buying.
The company states that its commercial market-share opportunity is roughly 5.00%. Domestic commercial sales were just under $5.8 billion in FY2026.
Our reading: The hub and mega hub network is a meaningful local-availability moat because it expands the assortment reachable by surrounding stores and supports same-day access; its strength depends on continued execution of replenishment and delivery. [item1]
Our reading: Proprietary systems, in-house brands and trained store staff support differentiation in advice, fitment and service, but price comparison and competing digital delivery models limit their protective effect. [item1; item1a]
Growth opportunities
AutoZone’s growth plan combines new stores, larger hub formats, commercial sales, parts availability, delivery speed and international expansion. It added 374 net new stores in fiscal 2026, ending the year with 8,031 stores. The company expects to direct investment primarily toward new stores and expanded hub and mega hub stores.
Mega hubs are designed to hold a wider hard-parts assortment and supply nearby stores. AutoZone ended fiscal 2026 with 172 domestic mega hubs, 39 more than at the end of fiscal 2025, and 11 in Mexico. The company targets approximately 300 mega hubs at full build-out and expects to open at least 40 in fiscal 2027.
Commercial is the company’s stated top growth priority. It is seeking share with independent repair shops, national and regional accounts, fleet customers and other commercial accounts through inventory availability, local delivery, Duralast products and sales teams. Domestic commercial sales were just under $5.8 billion in fiscal 2026.
Internationally, the company operates in Mexico and Brazil and expects its international store base to grow. It states that sales growth in Mexico has slowed with that country’s economic growth, while it continues to invest in stores and distribution centers. The company also sees demand support from growth in the number of older vehicles and miles driven.
- $16.3BFY2022
- $17.5BFY2023
- $18.5BFY2024
- $18.9BFY2025
- $20.3BFY2026
Structural risks
-
Demand and vehicle trends. Demand can decline if consumers defer maintenance, drive fewer miles, face higher fuel or energy costs, or shift vehicle spending. Improved parts durability, longer warranties, electric-vehicle adoption, and limits on access to diagnostics or repair information can reduce parts demand.
-
Competitive pressure. Competitors may have greater financial resources, sourcing capabilities, inventory, customer relationships, advertising effectiveness or digital tools. Online and multichannel sellers can operate with lower costs and offer delivery or shipping options that pressure sales and margins.
-
Tariffs, sourcing and supplier disruption. Tariffs, trade policy, inflation, currency movements and supply-chain disruption can increase product costs or reduce availability. Product shortages, quality failures or vendor financial difficulty could affect customer loyalty and sales.
-
Supply-chain and technology interruption. Damage, transportation disruption, distribution-center problems, systems failures, cyberattacks or third-party technology issues could impair ordering, inventory replenishment, payment processing and fulfillment.
-
Labor and execution. The business depends on hiring, training and retaining qualified AutoZoners. Wage pressure, turnover, labor-law changes, union activity or the loss of management and key personnel could increase costs or weaken customer service.
-
International and weather exposure. Mexico and Brazil require adaptation to local vehicles, consumer behavior, laws and currencies. Weather can affect store traffic and seasonal part-failure rates, while severe events can disrupt stores, logistics and sourcing.
Bottom line
Our reading
Our reading: AutoZone is a parts retailer whose sales depend on maintaining local inventory availability and serving both do-it-yourself and professional repair demand through a large store network. [item1; item7]
Our reading: Commercial sales, mega hubs and new stores are central to its expansion plan, while the business remains exposed to vehicle-maintenance demand, pricing pressure, tariffs, supply-chain execution and labor costs. [call_prepared; item1a]
Our reading: The company’s U.S.-weighted revenue base and recurring replacement-parts demand are balanced by a competitive market in which service, assortment, delivery and price all matter. [item1; item1a]