Advance Auto Parts, Inc., which has 100 stores in Wisconsin, announced it will close 523 Advance corporate stores, exit 204 independent locations, and close four distribution centers.
The announcement was made as part of its third-quarter earnings report.
According to a press release, although third-quarter gross profits increased by 11 percent, operating expenses also increased while net sales were down. Advance reported previous earnings as flat in Q2 and down in Q1.
“We are charting a clear path forward and introducing a new three-year financial plan, with a focus on executing core retail fundamentals to improve the productivity of all our assets and to create shareholder value,” said Shane O’Kelly, Advance Auto Parts president and chief executive officer.
Third quarter 2024 net sales from continuing operations totaled $2.1 billion, compared with $2.2 billion in the third quarter of the prior year. Comparable store sales decreased 2.3%.
The company’s gross profit increased 11.0% to $907.9 million, or 42.3% of net sales compared with 36.9% in the third quarter of the prior year. The leverage improvement was primarily due to lapping the one-time impact in the change for inventory reserves in the prior year as well as stabilizing product costs offset by strategic pricing investments.
The company incurred high labor-related expenses due to wage investments in frontline team members that were partially offset by a reduction in marketing expenses.
In addition, operating income was negatively impacted by lost revenue from Hurricane Helene and downtime from the CrowdStrike outage.
