Segment Reporting

8 Months Ended

May 04, 2024

Segment Reporting

Segment Reporting

Note L – Segment Reporting

The Company’s primary operating segments (Domestic Auto Parts, Mexico and Brazil) are aggregated as one reportable segment: Auto Parts Stores. The criteria the Company used to identify the reportable segment are primarily the nature of the products the Company sells and the operating results that are regularly reviewed by the Company’s chief operating decision maker to make decisions about the resources to be allocated to the business units and to assess performance. The accounting policies of the Company’s reportable segment are the same as those described in “Note A – Significant Accounting Policies” in its Annual Report on Form 10-K for the year ended August 26, 2023.

The Auto Parts Stores segment is a retailer and distributor of automotive parts and accessories through the Company’s 7,236 stores in the U.S., Mexico and Brazil. Each store carries an extensive product line for cars, sport utility vehicles, vans and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories and non-automotive products.

The Other category reflects business activities of two operating segments that are not separately reportable due to the materiality of these operating segments. The operating segments include ALLDATA, which produces, sells and maintains automotive diagnostic, repair and shop management software used in the automotive repair industry and E-commerce, which includes direct sales to customers through www.autozone.com for sales that are not fulfilled by local stores.

The Company evaluates its reportable segment primarily on the basis of net sales and segment profit, which is defined as gross profit. Segment results for the periods presented were as follows:

	Twelve Weeks Ended				Thirty-Six Weeks Ended
	May 4,		May 6,		May 4,		May 6,
(in thousands)	2024		2023		2024		2023
Net Sales
Auto Parts Stores	$	4,156,411	$	4,016,692	$	12,058,444	$	11,555,708
Other		79,074		73,849		226,444		210,883
Total	$	4,235,485	$	4,090,541	$	12,284,888	$	11,766,591
Segment Profit
Auto Parts Stores	$	2,218,950	$	2,102,768	$	6,424,651	$	5,945,080
Other		46,572		43,358		134,539		125,671
Gross profit		2,265,522		2,146,126		6,559,190		6,070,751
Operating, selling, general and administrative expenses		(1,365,341)		(1,287,645)		(4,067,163)		(3,819,261)
Interest expense, net		(104,422)		(74,313)		(298,426)		(197,645)
Income before income taxes	$	795,759	$	784,168	$	2,193,601	$	2,053,845