Advance Auto Parts' 1Q Results Fail To Cheer Investors, Shares Tank

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Advance Auto Parts Inc
AAP
delivered below than the expected results for the first quarter. Its revenue and comparable store sales fell 1.9 percent each. Following this, the stock dropped more than 9 percent in the pre-market trading on Thursday. The company reported GAAP net income of $158.81 million, up 7.22 percent from $148.11 million while earnings advanced 7.0 percent to $2.14 a share from $2.00 a share in the year-ago quarter. On an adjusted basis, it would have earned a net income of $186.1 million, 27.05 percent higher than $146.48 million recorded in the preceding year period. Similarly, its earnings grew 5 percent to $2.51 a share from $2.39 a share in the prior year quarter. This is $0.09 a share lower than the Street expectations of $2.60 a share. Advance Auto Parts' sales revenue slackened 1.9 percent to $2.98 billion from $3.04 billion in the previous year quarter. Street expected $3.0 billion revenue. The company blamed the sales drop to comparable store sales drop of 1.9% due to availability and service shortfalls. The comparable sales cadence experienced a more pronounced drop in the latter part of the quarter. The Company's comparable store sales were also partially impacted by weak demand due to unfavorable weather during the quarter and gained from the favorable consolidation impact from Carquest stores. The company's CEO, Tom Greco, commented, "Our first quarter results did not meet our expectations. We are moving forward with urgency to drive improved performance. Our customers are our top priority and we are elevating our intensity to get the right parts to the right place at the right time as we empower our team members to serve the customer better than anyone else." Greco continued to add that "I have been energized by the strength and the quality of our team and the opportunity that lies ahead. I am confident our focus and commitment around delivering improved service for our customers will translate into increased profitability and shareholder value." The stock fell 9.6 percent in the pre-market trading on Thursday.
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