Advance Auto Parts Inc. · NYSE:AAP
Advance Auto Parts — Q3 2025 Earnings Presentation
21 slides from Advance Auto Parts's earnings presentation, Oct 30, 2025
Slide 1: Q3 2025 Results
Q3 2025 RESULTS OCTOBER 30 | 2025
Slide 2: Forward Looking Statements and Non-GAAP
Forward Looking Statements and Non-GAAP Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,”
Slide 3: Agenda
Business Update Shane O’Kelly President and Chief Executive Officer AGENDA Financial Update Ryan Grimsland Executive Vice President and Chief Financial Officer Q&A 3
Slide 4: Business Update
BUSINESS UPDATE Shane O’Kelly 4
Slide 5: Summary
SUMMARY Strong Q3 2025 Technology Roadmap Steady Execution of Operating Positioning Advance Strategic Plan Performance For the Future 5
Slide 6: Strategic Pillars and Key Initiatives
STRATEGIC PILLARS AND KEY INITIATIVES Right Right Right Part. Place. Service. Merchandising Supply Store Excellence Chain Operations Distribution center Store Strategic sourcing productivity operating model Assortment Hub network Service-level management expansion improvements Promotions & margin Tr
Slide 7: Merchandising
MERCHANDISING • Long-term growth partner for vendors • On track to deliver product cost savings through vendor negotiations • Top 50 DMAs operating with new assortment framework • Achieved store depth availability target • Improving speed to market to enhance breadth of assortment • Deploying segmen
Slide 8: Supply Chain
SUPPLY CHAIN US Distribution Center consolidation plan Distribution Center – 16 DCs by end-2025 vs. 38 at end-2023 – Additional focus on DC productivity DC Accelerating market hub expansion Market Hub Store – Opening 14 in 2025 (vs. prior 10) – Includes 4 greenfield hubs – 33 hubs by end-2025 vs. 0
Slide 9: Store Operations
STORE OPERATIONS • Professional/ DIFM – Launching store operating model in Q4 2025. Expect to be complete in 1H 2026 – Collaborating with national, regional and main street accounts to improve service capabilities • Retail/ DIY incl e-commerce – Simplifying operations to enhance productivity and imp
Slide 10: Financial Update
FINANCIAL UPDATE Ryan Grimsland 10
Slide 11: Q3 2025 Results
Q3 2025 RESULTS Advance Auto Parts Continuing Operations Comparable Store Adjusted Diluted Net Net Sales Sales Growth Earnings Per Share Leverage Ratio $2.0B +3.0% YoY $0.92 2.6x (-5.2% YoY) TTM Adj. Net Debt/ Adj. EBITDAR Adjusted Adjusted Adjusted Operating Gross Margin SG&A Margin Income Margin 4
Slide 12: FY 2025 Guidance (53 Weeks)
FY 2025 GUIDANCE (53 WEEKS) ($ in million, except margins and per share data) Current - As of October 30, 2025 Prior Guidance Net sales (1) $8,550 - $8,600 $8,400 - $8,600 Comparable store sales (52 weeks) 0.70% - 1.30% 0.50% - 1.50% Adjusted operating income margin 2.40% - 2.60% 2.00% - 3.00% Adjus
Slide 13: Q&A
Q&A ° *C/ADVA
Slide 14: Appendix – Q3 2025 Reconciliation of Non-GAAP Financial Measures
APPENDIX – Q3 2025 RECONCILIATION OF NON-GAAP FINANCIAL MEASURES 14
Slide 15: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES The Company uses certain non-GAAP financial measures described below to supplement the Company's unaudited condensed consolidated financial statements prepared and presented in accordance with GAAP and to understand and evaluate the Company's core operat
Slide 16: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Transformation Expenses Expenses incurred in connection with the Company's turnaround plan and specific transformative activities related to asset optimization that the Company does not view to be normal cash operating expenses. These expenses primarily
Slide 17: Reconciliation of Diluted Earnings Per Share
RECONCILIATION OF DILUTED EARNINGS PER SHARE (GAAP) AND ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP) Twelve Weeks Ended (in millions, except per share data) Classification October 4, 2025 October 5, 2024 Net income (loss) from continuing operations (GAAP) $ (1) $ (25) Cost of sales adjustments: Tr
Slide 18: Reconciliation of Adjusted Diluted Weighted-Average Common Shares Outstanding
RECONCILIATION OF ADJUSTED DILUTED WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING 18
Slide 19: Reconciliation of Adjusted Gross Profit and SG&A
RECONCILIATION OF ADJUSTED GROSS PROFIT Twelve Weeks Ended Change (in millions) October 4, 2025 October 5, 2024 Basis Points Gross Profit (GAAP) $ 881 $ 908 N/A Gross Profit adjustments 32 — N/A Adjusted Gross Profit (Non-GAAP) $ 913 $ 908 N/A Gross Profit Margin (GAAP) (1) 43.3 % 42.3 % 100 Adjuste
Slide 20: Reconciliation of Adjusted Operating Income and Free Cash Flow
RECONCILIATION OF ADJUSTED OPERATING INCOME Twelve Weeks Ended Change (in millions) October 4, 2025 October 5, 2024 Basis Points Operating income (GAAP) $ 22 $ — N/A Gross Profit adjustments 32 — N/A SG&A adjustments 36 16 N/A Adjusted Operating Income (Non-GAAP) $ 90 $ 16 N/A Operating Income Margi
Slide 21: Reconciliation of Adjusted Net Debt to Adjusted EBITDAR
RECONCILIATION OF ADJUSTED NET DEBT TO ADJUSTED EBITDAR1 Four Quarters Ended (In millions, except adjusted debt to adjusted EBITDAR ratio) October 4, 2025 Total Debt (GAAP) $ 3,411 Add: Operating lease liabilities 2,252 Less: Cash & cash equivalents (3,174) (1) Management believes its Adjusted Net D