Monro, Inc. Q3 FY2026 earnings call

• Driving customer acquisition and activation: Expanded multichannel digital media plan, activated CRM database, added call center support to 830+ stores. • Improving store-based customer experience and selling effectiveness: Worked on Confidrive inspection tool, streamlined field management, created analytical tools, invested in field compliance support specialists. • Merchandising: Built vendor and assortment strategy, managed tariff impact, exited 32 leases and sold 20 owned locations in Q3 with proceeds of $17,300,000. • Fiscal third quarter results: Comparable store sales positive, gross margin improved, inventory levels reduced by over $7,000,000, sales momentum continued into January with preliminary comp store sales up almost 1%.

In the fiscal third quarter, sales decreased 4% to $293,400,000. Comparable store sales increased 1.2%. Gross margin rate expanded 60 basis points year over year to 34.9%. Operating income was $18,600,000 or 6.3% of sales. Net income was $11,100,000. Cash from operations for the first nine months of fiscal 2026 was $48,000,000.

• Expect to deliver year-over-year comparable store sales growth in fiscal 2026. • Store optimization plan expected to reduce total sales by ~$45,000,000 in fiscal 2026. • Full-year gross margin expected consistent with fiscal 2025, expecting to offset baseline cost inflation and tariff-related costs with store closure and operational improvement benefits. • Expect to reinvest SG&A savings from closed stores into marketing. • Capital expenditures expected to be $25,000,000 to $35,000,000.

• Tariff risk impacting product acquisition cost and market pricing. • Economic environment impact on consumer demand. • Wage inflation affecting technician labor costs. • Uncertainty around additional investment needs for new initiatives.

Q: How should we think about comp store sales and expense leverage long term?

A: Impact of marketing and store efforts takes quarters to fully reveal, expect lift in comps and gross margin, leading to operating leverage benefits though wage pressure and potential additional investments exist.

Q: Duration of benefits from weather and tax refunds?

A: Challenging winter creates consumer need, tax refunds and spring selling season contribute to short-term growth; ConfuDrive tool drives incremental revenue in longer term.