The ubiquitous Advance Auto Parts will be less so in the coming years. The auto parts retailer will close more than 700 locations by 2027. The move is part of an adjusted business plan after another disappointing earnings report.
According to a press release, while gross profits rose 11 percent in the third quarter, operating expenses also rose while net sales fell for the Raleigh, North Carolina-based auto parts giant. Advance previously reported earnings as flat in the second quarter and lower in the first quarter.
“We are charting a clear path forward and introducing a new three-year financial plan, with a focus on executing key retail fundamentals to improve productivity across our assets and create shareholder value,” said Shane O’Kelly, Advance Auto Parts president and general manager.
According to CNNThis is the second quarter in a row that Advance has lowered its full-year earnings outlook. After its latest earnings report, shares of Advance Auto Parts fell 5 percent.
As part of its “strategic plan to improve business performance” that will be implemented in fiscal year 2027, Advance is looking to reduce its U.S. retail footprint. This includes closing 523 corporate stores, pulling out of 204 independent locations and closing four distribution centers. The supply chain will be further optimized by consolidating distribution centers into 13 major facilities by 2026 and opening 60 market hubs by mid-2027.
Founded in 1932, Advance operates 4,781 Advance Auto Part stores in the U.S. and serves 1,125 independently owned Carquest locations. Advance has additional locations in Canada, Puerto Rico and the U.S. Virgin Islands, while Carquest brand stores are in Mexico and several Caribbean islands. These figures were correct as of October 5, 2024.
Advance has not announced which locations will be closed.
Advance Auto Parts, one of the leading automotive aftermarket retailers, provides parts and services to professional installers and do-it-yourselfers, from batteries and brakes to car wash supplies and air fresheners. The company also dabbled in motorsports and sponsored NHRA Funny Car teams in the past. Last year, Advance became the official sponsor of the IndyCar checkered flag. Yes, just the flag. The IndyCar flag sponsorship runs through the 2025 racing season.