Advance Auto Parts (NYSE:AAP) saw its stock jump 21% in premarket trading Thursday after reporting stronger-than-expected earnings and revenue for the first quarter, along with a reaffirmation of its full-year guidance. The results suggest the company is making strategic progress despite ongoing economic headwinds.
For the fiscal quarter ending April 19, 2025, the company posted an adjusted loss per share of $0.22, far better than Wall Street’s projected $0.69 loss. Revenue reached $2.58 billion, exceeding the consensus estimate of $2.51 billion. Still, the top-line figure represented a decline from the $2.8 billion reported in the same period last year.
Comparable store sales declined by 0.6% year-over-year, excluding the impact from liquidation sales related to the closure of over 500 corporate-owned stores – a move the company executed as part of its broader optimization strategy. Gross margin fell slightly to 42.9%, down from 43.4% in the prior year, largely due to markdowns associated with the store closures.
“The Advance team delivered better than expected sales and profitability in the first quarter,” said President and CEO Shane O’Kelly. “During the quarter, we also successfully completed our store footprint optimization within an accelerated timeframe, while continuing to make progress on our other strategic initiatives.”
Despite broader macroeconomic challenges, including recently imposed tariffs, the company reaffirmed its outlook for the full year. Advance Auto Parts expects to generate net sales between $8.4 billion and $8.6 billion, with same-store sales projected to rise by 0.5% to 1.5%. The company maintained its adjusted earnings per share guidance in the range of $1.50 to $2.50, versus analysts’ consensus estimate of $1.54.
The upbeat results and confident tone from management were welcomed by investors, fueling optimism that the company’s restructuring efforts are beginning to deliver operational improvements and positioning it for more stable growth through the remainder of the year.