AutoZone, Inc. stock research
FY2025 Q3
AutoZone (AZO) Gross Margin — Quarter Ended May 10, 2025
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, but gross margin declined slightly as cost of revenue grew at a faster rate. The relationship shows that while top-line growth continued, cost pressure reduced the proportion of profit retained per dollar of revenue.
Gross margin takeaway
Quarter ended May 10, 2025 · FY2025 Q3
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, but gross margin declined slightly as cost of revenue grew at a faster rate. The relationship shows that while top-line growth continued, cost pressure reduced the proportion of profit retained per dollar of revenue.
- The strongest observable driver is the faster increase in cost of revenue relative to revenue, which directly compressed gross margin. No other metric in the data shows a comparable shift in proportional terms.
- Compared with the immediately preceding quarter, revenue and gross profit were higher but gross margin was lower. Versus the same quarter one year earlier, revenue and gross profit were also higher while gross margin was slightly lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
52.7%
Gross profit
$2.4B
Revenue
$4.5B
Cost of revenue
$2.1B
Quarter-over-quarter change
-1.1 pts
Year-over-year change
-0.8 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| May 4, 2024 | $4.2B | $2.3B | $2.0B | 53.5% |
| Nov 23, 2024 | $4.3B | $2.3B | $2.0B | 53.0% |
| Feb 15, 2025 | $4.0B | $2.1B | $1.8B | 53.9% |
| May 10, 2025 | $4.5B | $2.4B | $2.1B | 52.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Feb 15, 2025
-1.1 pts
Year-over-year change
May 4, 2024
-0.8 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver is the faster increase in cost of revenue relative to revenue, which directly compressed gross margin. No other metric in the data shows a comparable shift in proportional terms.
Compared with the immediately preceding quarter, revenue and gross profit were higher but gross margin was lower. Versus the same quarter one year earlier, revenue and gross profit were also higher while gross margin was slightly lower.
Monitor demand trends and customer buying patterns, as changes in these areas were cited in the filing as a potential risk to operating cash flow.