AAP Filings — Advance Auto Parts, Inc. - FilingSpy
AAP
Advance Auto Parts, Inc.
A North American automotive parts retailer, Advance Auto Parts runs a network of stores serving professional mechanics and DIY drivers under the Advance Auto Parts, Carquest, and DieHard names. Founded in 1932 when Arthur Taubman bought three Virginia stores from the founders of Pep Boys, it began as "Advance Stores." Its DieHard battery brand, born at Sears in 1967, earned its name after surviving over 26,000 test starts in extreme temperatures.
Q2 FY2026 gross margin rose 2.7 points to 46.2% and EPS rose to $0.90 as restructuring costs wound down.
turned negative again, down 0.5% in Q2 after a 3.5% gain in Q1. fell 0.5% to $2.0 billion, but rose 2.7 points to 46.2% and rose to $0.90 from $0.25 a year earlier, helped by product , a $26 million , and lower restructuring costs. The restructuring plan is nearly complete, but the sales trajectory remains uneven.
Key takeaways
fell 0.5% in Q2 FY2026, reversing the 3.5% gain in Q1 and the 0.1% gain in Q2 FY2025.
rose 2.7 points to 46.2%, driven by product and a $26 million recognized as a cost of sales benefit.
rose to $0.90 from $0.25 a year earlier, helped by higher and other income, partially offset by higher from the fiscal 2025 debt issuance.
Section summaries
Management's Discussion and Analysis
Q2 FY2026 net sales fell 0.5% to $2.0B, but gross margin rose 267 bps to 46.2% and diluted EPS jumped to $0.90.
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were $2.0 billion in Q2 FY2026, down 0.5% , with down 0.5%; for the 28-week period, net sales rose 0.5% and comparable store sales rose 1.7%.
Restructuring expenses fell to $10 million from $29 million a year earlier as the winds down, with $10–20 million more expected through the rest of fiscal 2026.
improved to $252 million from a $106 million use a year earlier, and cash and equivalents stood at $3.12 billion with $894 million of borrowing availability.
The company repurchased $29 million of 2028 Notes and $0.1 million of 2027 Notes under a .
What changed
Q1 FY2026 flagged as the key watch item after a 3.5% gain; Q2 came in at -0.5%, showing the gain did not hold.
The remaining $20–30 million restructuring charges flagged in Q1 were reduced to $10–20 million expected through the rest of fiscal 2026, with only $10 million incurred in Q2.
continued to expand, rising from 45.1% in Q1 to 46.2% in Q2, with the Q2 figure including a $26 million that was not present in Q1.
swung from a $19 million use in Q1 to a $252 million source in Q2, a reversal from the $156 million use in Q1 FY2025.
What to watch
Q3 FY2026 to see if the -0.5% Q2 decline reverses or extends after the 3.5% Q1 gain.
Whether the $10–20 million remaining restructuring charges stay within the original $875M–$960M total estimate.
trajectory after the $26 million lapses, to see if the 46.2% level holds on product margin alone.
from the $3,387 million against the $3,120 million cash balance, and any further note repurchases.
margin expanded 267 to 46.2% in Q2, driven by product and $26 million of IEEPA tariff refunds recognized as a cost of sales benefit.
SG&A excluding restructuring fell 35 to 40.6% of in Q2; restructuring expenses dropped to $10 million from $29 million as the winds down.
rose to $0.90 from $0.25, helped by higher and other income, partially offset by higher from the fiscal 2025 debt issuance.
Cash and cash equivalents were $3.12 billion with $894 million of borrowing availability; improved to $252 million from a $106 million use a year earlier.
The company repurchased $29 million of 2028 Notes and $0.1 million of 2027 Notes under a , and expects $10-20 million of additional restructuring expenses through the rest of fiscal 2026.
Quantitative and Qualitative Disclosures About Market Risk
There have been no significant changes in the Company’s exposure to market risk since January 3, 2026. See “Item 7A. Quantitative and Qualitative Disclosures about Market Risk” in the Company’s 2025 Form 10-K.
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There have been no significant changes in the Company’s exposure to market risk since January 3, 2026. See “Item 7A. Quantitative and Qualitative Disclosures about Market Risk” in the Company’s 2025 Form 10-K.
Information regarding certain legal proceedings is provided in this Quarterly Report. See Note 9. Commitments and Contingencies, of the Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1.
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Information regarding certain legal proceedings is provided in this Quarterly Report. See Note 9. Commitments and Contingencies, of the Notes to the Condensed Consolidated Financial Statements included in Part I, Item 1.
The Company’s future business, operations and financial results are subject to various risks and uncertainties, including those described in Part I, Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended January 3, 2026, which could adversely affe…
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The Company’s future business, operations and financial results are subject to various risks and uncertainties, including those described in Part I, Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended January 3, 2026, which could adversely affect the Company’s business, financial condition, results of operations, cash flows and future prospects, which could in turn materially affect the price of the Company’s common stock. Other than for matters disclosed in the "Business and Risks Update" in this Quarterly Report, there have been no material changes to the Company’s risk factors since the 2025 Form 10-K.