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Factors That Drove AutoZone’s Fiscal 4Q17 Revenues Higher

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Sep. 21 2017, Updated 9:11 a.m. ET

AutoZone’s business

Based in Memphis, Tennessee, AutoZone (AZO) generates its revenues by selling auto parts and accessories primarily in the US, Puerto Rico, Mexico, and Brazil. In 2015 and 2016, US automakers (FXD) such as General Motors (GM) and Ford (F) benefited from higher US demand for trucks and utility vehicles.

This positive trend in US auto demand also boosted the growth potential for US auto parts retailers such as AutoZone, O’Reilly Automotive (ORLY), and Advance Auto Parts (AAP). Let’s take a closer look at AutoZone’s fiscal 4Q17 revenues.

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AutoZone’s fiscal 4Q17 revenues

In fiscal 4Q17, AutoZone reported revenues of $3.5 billion, about 3.3% higher than in fiscal 4Q16. During the quarter, AutoZone’s domestic same-store sales recovered and rose 1.0% after falling 0.8% in fiscal 3Q17.

AutoZone’s management highlighted its focus on improving its closure rates, which should lead to higher sales for the company.

Recently, AutoZone began collecting data to recognize its customers’ shopping patterns. The company took this step to allow AutoZone customers to receive a customized shopping experience.

The company’s sales at mega hubs rose significantly in the fourth quarter. AZO opened two new mega hubs in fiscal 4Q17 and planned to open another ten such hubs in fiscal 2018.

During the company’s fiscal 4Q17 earnings conference call, AutoZone’s president and CEO, Bill Rhodes, noted, “The mega hubs act as distribution nodes for hard-to-find parts for their network stores.” He added, “These mega hubs further our ability to say, yes, we’ve got it to all of our customers.”

Continue to the next part where we’ll learn how AutoZone’s key business segments performed in fiscal 4Q17.

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