Advance Auto Parts (AAP) 10-Q 24 Aug 21 2021 Q2 Quarterly report Financial data

Cover Page

Cover Page - shares	6 Months Ended
	Jul. 17, 2021	Aug. 20, 2021
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jul. 17, 2021
Document Transition Report	false
Entity File Number	001-16797
Entity Registrant Name	ADVANCE AUTO PARTS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	54-2049910
Entity Address, Address Line One	2635 East Millbrook Road
Entity Address, City or Town	Raleigh
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27604
City Area Code	540
Local Phone Number	362-4911
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	AAP
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		63,000,741
Entity Central Index Key	0001158449
Current Fiscal Year End Date	--01-01
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jul. 17, 2021	Jan. 02, 2021
Current assets:
Cash and cash equivalents	$ 809,287	$ 834,992
Receivables, net	803,880	749,999
Inventories	4,428,115	4,538,199
Other current assets	180,589	146,811
Total current assets	6,221,871	6,270,001
Property and equipment, net of accumulated depreciation of $2,301,277 and $2,189,165	1,472,467	1,462,602
Operating lease right-of-use assets	2,441,652	2,379,987
Goodwill	994,140	993,590
Intangible assets, net	665,193	681,127
Other assets	43,402	52,329
Assets, Total	11,838,725	11,839,636
Current liabilities:
Accounts payable	3,807,293	3,640,639
Accrued expenses	608,846	606,804
Other current liabilities	483,206	496,472
Total current liabilities	4,899,345	4,743,915
Long-term debt	1,033,686	1,032,984
Noncurrent operating lease liabilities	2,091,171	2,014,499
Deferred income taxes	365,978	342,445
Other long-term liabilities	146,980	146,281
Commitments and contingencies
Stockholders' equity:
Preferred stock, nonvoting, $0.0001 par value	0	0
Common stock, voting, $0.0001 par value	8	8
Additional paid-in capital	818,126	783,709
Treasury stock, at cost	(1,973,371)	(1,394,080)
Accumulated other comprehensive loss	(23,283)	(26,759)
Retained earnings	4,480,085	4,196,634
Total stockholders’ equity	3,301,565	3,559,512
Liabilities and Stockholders' Equity, Total	$ 11,838,725	$ 11,839,636

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jul. 17, 2021	Jan. 02, 2021
Statement of Financial Position [Abstract]
Accumulated depreciation	$ 2,301,277	$ 2,189,165
Preferred stock par value (in usd per share)	$ 0.0001	$ 0.0001
Common stock par value (in usd per share)	$ 0.0001	$ 0.0001

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Income Statement [Abstract]
Net sales	$ 2,649,415	$ 2,501,380	$ 5,979,785	$ 5,199,262
Cost of sales, including purchasing and warehousing costs	1,460,164	1,404,666	3,305,608	2,929,815
Gross profit	1,189,251	1,096,714	2,674,177	2,269,447
Selling, general and administrative expenses	944,323	833,869	2,177,120	1,928,177
Operating income	244,928	262,845	497,057	341,270
Other, net:
Interest expense	(8,306)	(13,422)	(19,497)	(25,665)
Other income (expense), net	1,143	3,117	5,979	(2,872)
Total other, net	(7,163)	(10,305)	(13,518)	(28,537)
Income before provision for income taxes	237,765	252,540	483,539	312,733
Provision for income taxes	59,069	62,580	118,913	79,185
Net income	$ 178,696	$ 189,960	$ 364,626	$ 233,548
Basic earnings per common share	$ 2.76	$ 2.75	$ 5.59	$ 3.38
Weighted-average common shares outstanding	64,745	69,118	65,284	69,154
Diluted earnings per common share	$ 2.74	$ 2.74	$ 5.55	$ 3.37
Weighted-average common shares outstanding	65,210	69,294	65,720	69,350

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Net income	$ 178,696	$ 189,960	$ 364,626	$ 233,548
Other comprehensive (loss) income:
Changes in net unrecognized other postretirement costs, net of tax of $25, $26, $44 and $3	(70)	(73)	(124)	(7)
Currency translation adjustments	(1,747)	7,669	3,600	(9,363)
Total other comprehensive (loss) income	(1,817)	7,596	3,476	(9,370)
Comprehensive income	$ 176,879	$ 197,556	$ 368,102	$ 224,178

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) [Abstract]
Changes in net unrecognized other postretirement costs, net of tax of $25, $26, $44 and $3	$ 25	$ 26	$ 44	$ 3

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDES' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Treasury Stock, at Cost	Accumulated Other Comprehensive Loss	Retained Earnings
Balance at Dec. 28, 2019	$ 3,549,081	$ 8	$ 735,183	$ (924,389)	$ (34,569)	$ 3,772,848
Balance (in shares) at Dec. 28, 2019		69,232
Net income	233,548					233,548
Total other comprehensive income (loss)	(9,370)				(9,370)
Restricted stock units and deferred stock units vested	0
Restricted stock and deferred stock units vested (in shares)		179
Share-based compensation	23,838		23,838
Stock issued under employee stock purchase plan	1,518		1,518
Stock issued under employee stock purchase plan (in shares)		15
Repurchases of common stock (in shares)		(287)
Repurchases of common stock	(37,203)			(37,203)
Cash dividends declared	(34,889)					(34,889)
Other (in shares)		0
Other	(4)		(4)
Balance at Jul. 11, 2020	3,726,519	$ 8	760,535	(961,592)	(43,939)	3,971,507
Balance (in shares) at Jul. 11, 2020		69,139
Balance at Apr. 18, 2020	3,537,029	$ 8	749,723	(960,150)	(51,535)	3,798,983
Balance (in shares) at Apr. 18, 2020		69,101
Net income	189,960					189,960
Total other comprehensive income (loss)	7,596				7,596
Restricted stock units and deferred stock units vested	0
Restricted stock and deferred stock units vested (in shares)		42
Share-based compensation	10,029		10,029
Stock issued under employee stock purchase plan	783		783
Stock issued under employee stock purchase plan (in shares)		6
Repurchases of common stock (in shares)		(10)
Repurchases of common stock	(1,442)			(1,442)
Cash dividends declared	(17,436)					(17,436)
Other (in shares)		0
Balance at Jul. 11, 2020	3,726,519	$ 8	760,535	(961,592)	(43,939)	3,971,507
Balance (in shares) at Jul. 11, 2020		69,139
Balance at Jan. 02, 2021	3,559,512	$ 8	783,709	(1,394,080)	(26,759)	4,196,634
Balance (in shares) at Jan. 02, 2021		66,361
Net income	364,626					364,626
Total other comprehensive income (loss)	3,476				3,476
Restricted stock units and deferred stock units vested	0
Restricted stock and deferred stock units vested (in shares)		248
Share-based compensation	33,591		33,591
Stock issued under employee stock purchase plan	869		869
Stock issued under employee stock purchase plan (in shares)		19
Repurchases of common stock (in shares)		(3,166)
Repurchases of common stock	(579,291)			(579,291)
Cash dividends declared	(81,175)					(81,175)
Other (in shares)		37
Other	(43)		(43)
Balance at Jul. 17, 2021	3,301,565	$ 8	818,126	(1,973,371)	(23,283)	4,480,085
Balance (in shares) at Jul. 17, 2021		63,499
Balance at Apr. 24, 2021	3,501,567	$ 8	799,934	(1,577,727)	(21,466)	4,300,818
Balance (in shares) at Apr. 24, 2021		65,439
Net income	178,696					178,696
Total other comprehensive income (loss)	(1,817)				(1,817)
Restricted stock units and deferred stock units vested	0
Restricted stock and deferred stock units vested (in shares)		21
Share-based compensation	17,331		17,331
Stock issued under employee stock purchase plan	869		869
Stock issued under employee stock purchase plan (in shares)		6
Repurchases of common stock (in shares)		(2,004)
Repurchases of common stock	(395,644)			(395,644)
Cash dividends declared	571					571
Other (in shares)		37
Other	(8)		(8)
Balance at Jul. 17, 2021	$ 3,301,565	$ 8	$ 818,126	$ (1,973,371)	$ (23,283)	$ 4,480,085
Balance (in shares) at Jul. 17, 2021		63,499

CONSOLIDATED STATEMENTS OF CH_2

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDES' EQUITY (Parenthetical) - $ / shares	3 Months Ended	6 Months Ended
	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Statement of Stockholders' Equity (Parenthetical) [Abstract]
Cash dividends declared (per common share)	$ 0.25	$ 1.25	$ 0.50

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020
Cash flows from operating activities:
Net income	$ 364,626	$ 233,548
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	135,311	135,221
Share-based compensation	33,591	23,838
Loss and impairment of long-lived assets	5,887	1,801
Provision for deferred income taxes	23,425	4,581
Other	970	940
Net change in:
Receivables, net	(53,301)	(55,055)
Inventories	111,952	67,894
Accounts payable	165,666	(108,860)
Accrued expenses	17,041	145,228
Other assets and liabilities, net	(29,009)	(926)
Net cash provided by operating activities	776,159	448,210
Cash flows from investing activities:
Purchases of property and equipment	(129,573)	(140,105)
Purchase of an indefinite-lived intangible asset	0	(230)
Proceeds from sales of property and equipment	1,857	305
Net cash used in investing activities	(127,716)	(140,030)
Cash flows from financing activities:
Proceeds from borrowing on revolving credit facility	0	500,000
Payments on credit facilities	0	(500,000)
Proceeds from issuances of senior unsecured notes, net	0	498,240
Dividends paid	(97,971)	(39,017)
Proceeds from the issuance of common stock	869	1,518
Repurchases of common stock	(579,291)	(37,203)
Other, net	(48)	(5,815)
Net cash (used in) provided by financing activities	(676,441)	417,723
Effect of exchange rate changes on cash	2,293	(3,066)
Net (decrease) increase in cash and cash equivalents	(25,705)	722,837
Cash and cash equivalents, beginning of period	834,992	418,665
Cash and cash equivalents, end of period	809,287	1,141,502
Non-cash transactions:
Accrued purchases of property and equipment	$ 6,391	$ 9,594

Nature of Operations and Basis

Nature of Operations and Basis of Presentation	6 Months Ended
	Jul. 17, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Operations and Basis of Presentation	Nature of Operations and Basis of Presentation Advance Auto Parts, Inc. and subsidiaries is a leading automotive aftermarket parts provider in North America, serving both professional installers (“professional”) and “do-it-yourself” (“DIY”) customers. The accompanying condensed consolidated financial statements have been prepared by us and include the accounts of Advance Auto Parts, Inc., its wholly owned subsidiaries, Advance Stores Company, Incorporated (“Advance Stores”) and Neuse River Insurance Company, Inc., and their subsidiaries (collectively referred to as “Advance,” “we,” “us” or “our”). As of July 17, 2021, we operated a total of 4,748 stores and 215 branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. In addition, as of July 17, 2021, we served 1,306 independently owned Carquest branded stores across the same geographic locations served by our stores and branches in addition to Mexico and various Caribbean islands. Our stores operate primarily under the trade names “Advance Auto Parts,” “Carquest” and “Autopart International,” and our branches operate under the “Worldpac” trade name. The accounting policies followed in the presentation of interim financial results are consistent with those followed on an annual basis. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), have been condensed or omitted based upon the Securities and Exchange Commission (“SEC”) interim reporting principles. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for 2020 as filed with the SEC on February 22, 2021.

Significant Acounting Policies

Significant Acounting Policies	6 Months Ended
	Jul. 17, 2021
Accounting Policies [Abstract]
Significant Accounting Policies	Significant Accounting Policies Revenues The following table summarizes disaggregated revenue from contracts with customers by product group: Twelve Weeks Ended Twenty-Eight Weeks Ended July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Percentage of Net sales, by product group: Parts and batteries 65% 66% 66% 66% Accessories and chemicals 21% 22% 21% 21% Engine maintenance 12% 11% 12% 12% Other 2% 1% 1% 1% Total 100% 100% 100% 100%

Inventories

Inventories	6 Months Ended
	Jul. 17, 2021
Inventory Disclosure [Abstract]
Inventories	InventoriesInventories are stated at the lower of cost or market. We used the last in, first out (“LIFO”) method of accounting for approximately 89% of inventories as of July 17, 2021 and 88% of inventories as of January 2, 2021. Under the LIFO method, our Cost of sales reflects the costs of the most recently purchased inventories, while the inventory carrying balance represents the costs for inventories purchased in the twenty-eight weeks ended July 17, 2021 and prior years. We recorded an increase to Cost of sales of $39.0 million and $3.1 million for the twelve weeks ended July 17, 2021 and July 11, 2020 and an increase to Cost of sales of $42.2 million and $11.9 million for the twenty-eight weeks ended July 17, 2021 and July 11, 2020 to state inventories at LIFO. An actual valuation of inventory under the LIFO method is performed by us at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on our estimates of expected inventory levels and costs at the end of the year. Inventory balances were as follows: (in thousands) July 17, 2021 January 2, 2021 Inventories at first in, first out (“FIFO”) $ 4,314,884 $ 4,382,779 Adjustments to state inventories at LIFO 113,231 155,420 Inventories at LIFO $ 4,428,115 $ 4,538,199

Intangible Assets

Intangible Assets	6 Months Ended
	Jul. 17, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Intangible AssetsOur definite-lived intangible assets include customer relationships and non-compete agreements. Amortization expense was $7.2 million and $7.3 million for the twelve weeks ended July 17, 2021 and July 11, 2020 and $16.9 million and $17.0 million for the twenty-eight weeks ended July 17, 2021 and July 11, 2020.

Receivables, net

Receivables, net	6 Months Ended
	Jul. 17, 2021
Receivables [Abstract]
Receivables, net	Receivables, net Receivables, net consist of the following: (in thousands) July 17, 2021 January 2, 2021 Trade $ 554,107 $ 449,403 Vendor 242,701 278,180 Other 17,342 34,345 Total receivables 814,150 761,928 Less: Allowance for doubtful accounts (10,270) (11,929) Receivables, net $ 803,880 $ 749,999

Long-term Debt and Fair Value o

Long-term Debt and Fair Value of Financial Instruments	6 Months Ended
	Jul. 17, 2021
Debt Disclosure [Abstract]
Long-term Debt and Fair Value of Financial Instruments	Long-term Debt and Fair Value of Financial Instruments Long-term debt consists of the following: (in thousands) July 17, 2021 January 2, 2021 4.50% Senior Unsecured Notes due December 1, 2023 $ 193,113 $ 192,990 1.75% Senior Unsecured Notes due October 1, 2027 346,122 345,854 3.90% Senior Unsecured Notes due April 15, 2030 494,451 494,140 Total long-term debt $ 1,033,686 $ 1,032,984 Fair value of long-term debt $ 1,121,000 $ 1,145,000 Fair Value of Financial Assets and Liabilities The fair value of our senior unsecured notes was determined using Level 2 inputs based on quoted market prices. The carrying amounts of our cash and cash equivalents, receivables, accounts payable and accrued expenses approximate their fair values due to the relatively short-term nature of these instruments. Bank Debt As of July 17, 2021 and January 2, 2021, we had no outstanding borrowings, $1.0 billion of borrowing availability and no letters of credit outstanding under our unsecured revolving credit facility (the “Credit Agreement”). As of July 17, 2021 and January 2, 2021, we had $100.0 million of bilateral letters of credit issued separately from the Credit Agreement, none of which were drawn upon. These bilateral letters of credit generally have a term of one year or less and primarily serve as collateral for our self-insurance policies. We were in compliance with financial covenants required by our debt arrangements as of July 17, 2021. Senior Unsecured Notes Our 4.50% senior unsecured notes due December 1, 2023 (the “2023 Notes”) were issued in December 2013 at 99.69% of the principal amount of $450.0 million. The 2023 Notes bear interest at a rate of 4.50% per year payable semi-annually in arrears on June 1 and December 1 of each year. On April 16, 2020, we issued $500.0 million aggregate principal amount of senior unsecured notes (the “Original Notes”). The Original Notes were issued at 99.65% of the principal amount of $500.0 million, are due April 15, 2030 and bear interest at 3.90% per year payable semi-annually in arrears on April 15 and October 15 of each year. On July 28, 2020, we completed an exchange offer whereby the Original Notes in the aggregate principal amount of $500.0 million, which were not registered under the Securities Act of 1933, as amended (the “Securities Act”), were exchanged for a like principal amount of 3.90% senior unsecured notes due 2030 (the “Exchange Notes” or “2030 Notes”), which have been registered under the Securities Act. The Original Notes were substantially identical to the Exchange Notes, except that the Exchange Notes are registered under the Securities Act and are not subject to the transfer restrictions and certain registration rights agreement provisions applicable to the Original Notes. On September 29, 2020, we issued $350.0 million aggregate principal amount of senior unsecured notes (the “2027 Notes”). The 2027 Notes were issued at 99.67% of the principal amount of $350.0 million, are due October 1, 2027 and bear interest at 1.75% per year payable semi-annually in arrears on April 1 and October 1 of each year. In connection with the 2027 Notes offering, we incurred $2.9 million of debt issuance costs. Our 2023 Notes, 2027 Notes and 2030 Notes are collectively referred to herein as our “senior unsecured notes.” Pursuant to a cash tender offer that was completed on September 29, 2020, we repurchased $256.3 million of our 2023 Notes with the net proceeds from the 2027 Notes. In connection with this tender offer, we incurred charges relating to tender premiums and debt issuance costs of $30.5 million and $1.4 million. Debt Guarantees We are a guarantor of loans made by banks to various independently owned Carquest-branded stores that are our customers totaling $26.7 million and $23.6 million as of July 17, 2021 and January 2, 2021. These loans are collateralized by security agreements on merchandise inventory and other assets of the borrowers. The approximate value of the inventory collateralized by these agreements is $65.5 million and $57.5 million as of July 17, 2021 and January 2, 2021. We believe that the likelihood of performance under these guarantees is remote.

Leases

Leases	6 Months Ended
	Jul. 17, 2021
Leases [Abstract]
Leases	LeasesSubstantially all of our leases are for facilities and vehicles. The initial term for facilities is typically 5 years to 10 years, with renewal options at 5 year intervals, with the exercise of lease renewal options at our sole discretion. Our vehicle and equipment leases are typically 3 years to 5 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Operating lease liabilities consist of the following: (in thousands) July 17, 2021 January 2, 2021 Total operating lease liabilities $ 2,553,804 $ 2,477,087 Less: Current portion of operating lease liabilities (462,633) (462,588) Noncurrent operating lease liabilities $ 2,091,171 $ 2,014,499 The current portion of operating lease liabilities is included in Other current liabilities in the accompanying condensed consolidated balance sheets. Total lease cost is included in Cost of sales and Selling, general and administrative expenses (“SG&A”) in the accompanying condensed consolidated statements of operations and is recorded net of immaterial sublease income. Total lease cost is comprised of the following: Twelve Weeks Ended Twenty-Eight Weeks Ended (in thousands) July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Operating lease cost $ 124,184 $ 119,707 $ 286,169 $ 281,512 Variable lease cost 34,195 30,856 77,720 74,392 Total lease cost $ 158,379 $ 150,563 $ 363,889 $ 355,904 The future maturity of lease liabilities are as follows: (in thousands) July 17, 2021 Remainder of 2021 $ 279,364 2022 490,926 2023 458,656 2024 388,181 2025 341,696 Thereafter 944,059 Total lease payments 2,902,882 Less: Imputed interest (349,078) Total operating lease liabilities $ 2,553,804 As of July 17, 2021, our operating lease payments include $79.7 million related to options to extend lease terms that are reasonably certain of being exercised and exclude $124.3 million of legally binding minimum lease payments for leases signed, but not yet commenced. The weighted-average remaining lease term and weighted-average discount rate for our operating leases are 7.0 years and 3.4% as of July 17, 2021. We calculated the weighted-average discount rates using incremental borrowing rates, which equal the rates of interest that we would pay to borrow funds on a fully collateralized basis over a similar term. Other information relating to our lease liabilities is as follows: Twenty-Eight Weeks Ended (in thousands) July 17, 2021 July 11, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 275,358 $ 305,079 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 284,295 $ 219,954

Warranty Liabilities

Warranty Liabilities	6 Months Ended
	Jul. 17, 2021
Product Warranties Disclosures [Abstract]
Warranty Liabilities	Warranty Liabilities The following table presents changes in our warranty reserves: Twenty-Eight Weeks Ended Fifty-Three Weeks Ended (in thousands) July 17, 2021 January 2, 2021 Warranty reserve, beginning of period $ 14,120 $ 36,820 Additions to warranty reserves 5,341 14,907 Reduction and utilization of reserve (16,835) (37,607) Warranty reserve, end of period $ 2,626 $ 14,120

Share Repurchase Program

Share Repurchase Program	6 Months Ended
	Jul. 17, 2021
Stock Repurchases: [Abstract]
Share Repurchase Program	Share Repurchase Program On April 19, 2021, our Board of Directors authorized an additional $1.0 billion share repurchase program. This new authorization was incremental to the $700.0 million share repurchase program that was authorized by our Board of Directors in November 2019. Our share repurchase program permits the repurchase of our common stock on the open market and in privately negotiated transactions from time to time. During the twelve weeks ended July 17, 2021, we repurchased 2.0 million shares of our common stock at an aggregate cost of $393.0 million, or an average price of $197.52 per share, in connection with our share repurchase program. During the twelve weeks ended July 11, 2020, we purchased no shares of our common stock under the share repurchase program. During the twenty-eight weeks ended July 17, 2021 and July 11, 2020, we repurchased 3.1 million and 0.2 million shares of our common stock under our share repurchase program. The shares repurchased in connection with our share repurchase program during the twenty-eight weeks ended July 17, 2021 and July 11, 2020 were at an aggregate cost of $563.4 million and $29.0 million, or an average price of $183.57 and $128.36 per share. We had $868.8 million remaining under our share repurchase program as of July 17, 2021.

Earnings per Share

Earnings per Share	6 Months Ended
	Jul. 17, 2021
Earnings Per Share [Abstract]
Earnings Per Share	Earnings per Share The computation of basic and diluted earnings per share are as follows: Twelve Weeks Ended Twenty-Eight Weeks Ended (in thousands, except per share data) July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Numerator Net income applicable to common shares $ 178,696 $ 189,960 $ 364,626 $ 233,548 Denominator Basic weighted-average common shares 64,745 69,118 65,284 69,154 Dilutive impact of share-based awards 465 176 436 196 Diluted weighted-average common shares (1) 65,210 69,294 65,720 69,350 Basic earnings per common share $ 2.76 $ 2.75 $ 5.59 $ 3.38 Diluted earnings per common share $ 2.74 $ 2.74 $ 5.55 $ 3.37 (1) For the twelve weeks ended July 17, 2021, there were no restricted stock units (“RSUs”) that were anti-dilutive. For the twenty-eight weeks ended July 17, 2021, 3,670 RSUs were excluded from the diluted calculation as their inclusion would have been anti-dilutive. For the twelve and twenty-eight weeks ended July 11, 2020, 159 thousand and 326 thousand RSUs were excluded from the diluted calculation as their inclusion would have been anti-dilutive.

Share-Based Compensation

Share-Based Compensation	6 Months Ended
	Jul. 17, 2021
Share-based Payment Arrangement [Abstract]
Share-Based Compensation	Share-Based Compensation During the twenty-eight weeks ended July 17, 2021, we granted 201 thousand time-based RSUs, 63 thousand market-based RSUs and 124 thousand Stock Options. The general terms of the time-based, performance-based and market-based RSUs are similar to awards previously granted by us.We grant options to purchase common stock to certain employees under our 2014 Long-Term Incentive Plan. The options are granted at an exercise price equal to the closing market price of Advance's common stock on the date of the grant, expire after 10 years and vest one-third annually over three years. We record compensation expense for the grant date fair value of the option awards evenly over the vesting period. The weighted-average fair values of the time-based and market-based RSUs granted during the twenty-eight weeks ended July 17, 2021 were $177.77 and $204.97 per share. For time-based RSUs, the fair value of each award was determined based on the market price of our stock on the date of grant adjusted for expected dividends during the vesting period, as applicable. The fair value of each market-based RSU was determined using a Monte Carlo simulation model. The weighted-average fair values of stock options granted during the twenty-eight weeks ended July 17, 2021 was $47.19 per share. No stock options were granted in the twelve weeks ended July 17, 2021. The fair value was estimated on the date of grant by applying the Black-Scholes option-pricing valuation model. Total income tax benefit related to share-based compensation expense for the twelve and twenty-eight weeks ended July 17, 2021 was $4.4 million and $8.2 million. Total income tax benefit related to share-based compensation expense for the twelve and twenty-eight weeks ended July 11, 2020 was $2.5 million and $6.0 million. As of July 17, 2021, there was $87.5 million of unrecognized compensation expense related to all share-based awards that is expected to be recognized over a weighted-average period of 1.6 years.

Significant Acounting Policies

Significant Acounting Policies (Policies)	6 Months Ended
	Jul. 17, 2021
Accounting Policies [Abstract]
Revenues	Revenues The following table summarizes disaggregated revenue from contracts with customers by product group: Twelve Weeks Ended Twenty-Eight Weeks Ended July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Percentage of Net sales, by product group: Parts and batteries 65% 66% 66% 66% Accessories and chemicals 21% 22% 21% 21% Engine maintenance 12% 11% 12% 12% Other 2% 1% 1% 1% Total 100% 100% 100% 100%

Inventories (Policies)

Inventories (Policies)	6 Months Ended
	Jul. 17, 2021
Inventory Disclosure [Abstract]
Inventory, Policy	Inventories are stated at the lower of cost or market.

Leases (Policies)

Leases (Policies)	6 Months Ended
	Jul. 17, 2021
Leases [Abstract]
Lessee, Leases	Substantially all of our leases are for facilities and vehicles. The initial term for facilities is typically 5 years to 10 years, with renewal options at 5 year intervals, with the exercise of lease renewal options at our sole discretion. Our vehicle and equipment leases are typically 3 years to 5 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.The current portion of operating lease liabilities is included in Other current liabilities in the accompanying condensed consolidated balance sheets.Total lease cost is included in Cost of sales and Selling, general and administrative expenses (“SG&A”) in the accompanying condensed consolidated statements of operations and is recorded net of immaterial sublease income.

Share-Based Compensation (Polic

Share-Based Compensation (Policies)	6 Months Ended
	Jul. 17, 2021
Share-based Payment Arrangement [Abstract]
Fair Value Measurement, Policy	For time-based RSUs, the fair value of each award was determined based on the market price of our stock on the date of grant adjusted for expected dividends during the vesting period, as applicable. The fair value of each market-based RSU was determined using a Monte Carlo simulation model. The weighted-average fair values of stock options granted during the twenty-eight weeks ended July 17, 2021 was $47.19 per share. No stock options were granted in the twelve weeks ended July 17, 2021. The fair value was estimated on the date of grant by applying the Black-Scholes option-pricing valuation model.

Significant Acounting Policie_2

Significant Acounting Policies (Tables)	6 Months Ended
	Jul. 17, 2021
Accounting Policies [Abstract]
Revenue from External Customers by Products and Services	The following table summarizes disaggregated revenue from contracts with customers by product group: Twelve Weeks Ended Twenty-Eight Weeks Ended July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Percentage of Net sales, by product group: Parts and batteries 65% 66% 66% 66% Accessories and chemicals 21% 22% 21% 21% Engine maintenance 12% 11% 12% 12% Other 2% 1% 1% 1% Total 100% 100% 100% 100%

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Jul. 17, 2021
Inventory Disclosure [Abstract]
Schedule of Inventory	Inventory balances were as follows: (in thousands) July 17, 2021 January 2, 2021 Inventories at first in, first out (“FIFO”) $ 4,314,884 $ 4,382,779 Adjustments to state inventories at LIFO 113,231 155,420 Inventories at LIFO $ 4,428,115 $ 4,538,199

Receivables, net (Tables)

Receivables, net (Tables)	6 Months Ended
	Jul. 17, 2021
Receivables [Abstract]
Schedule of Accounts Receivable	Receivables, net consist of the following: (in thousands) July 17, 2021 January 2, 2021 Trade $ 554,107 $ 449,403 Vendor 242,701 278,180 Other 17,342 34,345 Total receivables 814,150 761,928 Less: Allowance for doubtful accounts (10,270) (11,929) Receivables, net $ 803,880 $ 749,999

Long-term Debt and Fair Value_2

Long-term Debt and Fair Value of Financial Instruments (Tables)	6 Months Ended
	Jul. 17, 2021
Debt Disclosure [Abstract]
Schedule of Debt	Long-term debt consists of the following: (in thousands) July 17, 2021 January 2, 2021 4.50% Senior Unsecured Notes due December 1, 2023 $ 193,113 $ 192,990 1.75% Senior Unsecured Notes due October 1, 2027 346,122 345,854 3.90% Senior Unsecured Notes due April 15, 2030 494,451 494,140 Total long-term debt $ 1,033,686 $ 1,032,984 Fair value of long-term debt $ 1,121,000 $ 1,145,000

Leases (Tables)

Leases (Tables)	6 Months Ended
	Jul. 17, 2021
Leases [Abstract]
Schedule of Operating Lease Liabilities	Operating lease liabilities consist of the following: (in thousands) July 17, 2021 January 2, 2021 Total operating lease liabilities $ 2,553,804 $ 2,477,087 Less: Current portion of operating lease liabilities (462,633) (462,588) Noncurrent operating lease liabilities $ 2,091,171 $ 2,014,499
Lease, Cost	Total lease cost is comprised of the following: Twelve Weeks Ended Twenty-Eight Weeks Ended (in thousands) July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Operating lease cost $ 124,184 $ 119,707 $ 286,169 $ 281,512 Variable lease cost 34,195 30,856 77,720 74,392 Total lease cost $ 158,379 $ 150,563 $ 363,889 $ 355,904
Lessee, Operating Lease, Liability, Maturity	The future maturity of lease liabilities are as follows: (in thousands) July 17, 2021 Remainder of 2021 $ 279,364 2022 490,926 2023 458,656 2024 388,181 2025 341,696 Thereafter 944,059 Total lease payments 2,902,882 Less: Imputed interest (349,078) Total operating lease liabilities $ 2,553,804
Schedule of Other Information Relating to Lease Liabilities	Other information relating to our lease liabilities is as follows: Twenty-Eight Weeks Ended (in thousands) July 17, 2021 July 11, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 275,358 $ 305,079 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 284,295 $ 219,954

Warranty Liabilities (Tables)

Warranty Liabilities (Tables)	6 Months Ended
	Jul. 17, 2021
Product Warranties Disclosures [Abstract]
Schedule of Product Warranty Liability	The following table presents changes in our warranty reserves: Twenty-Eight Weeks Ended Fifty-Three Weeks Ended (in thousands) July 17, 2021 January 2, 2021 Warranty reserve, beginning of period $ 14,120 $ 36,820 Additions to warranty reserves 5,341 14,907 Reduction and utilization of reserve (16,835) (37,607) Warranty reserve, end of period $ 2,626 $ 14,120

Earnings per Share (Tables)

Earnings per Share (Tables)	6 Months Ended
	Jul. 17, 2021
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	The computation of basic and diluted earnings per share are as follows: Twelve Weeks Ended Twenty-Eight Weeks Ended (in thousands, except per share data) July 17, 2021 July 11, 2020 July 17, 2021 July 11, 2020 Numerator Net income applicable to common shares $ 178,696 $ 189,960 $ 364,626 $ 233,548 Denominator Basic weighted-average common shares 64,745 69,118 65,284 69,154 Dilutive impact of share-based awards 465 176 436 196 Diluted weighted-average common shares (1) 65,210 69,294 65,720 69,350 Basic earnings per common share $ 2.76 $ 2.75 $ 5.59 $ 3.38 Diluted earnings per common share $ 2.74 $ 2.74 $ 5.55 $ 3.37

Nature of Operations and Basi_2

Nature of Operations and Basis of Presentation (Details)	Jul. 17, 2021store
Stores [Member]
Basis of Presentation [Line Items]
Number of Stores	4,748
Branches [Member]
Basis of Presentation [Line Items]
Number of Stores	215
Independently owned Carquest store locations [Member]
Basis of Presentation [Line Items]
Number of Stores	1,306

Significant Acounting Policie_3

Significant Acounting Policies (Details)	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Revenue from External Customer [Line Items]
Percentage Of Sales By Product Group	100.00%	100.00%	100.00%	100.00%
Parts and Batteries [Member]
Revenue from External Customer [Line Items]
Percentage Of Sales By Product Group	65.00%	66.00%	66.00%	66.00%
Accessories and Chemicals [Member]
Revenue from External Customer [Line Items]
Percentage Of Sales By Product Group	21.00%	22.00%	21.00%	21.00%
Engine Maintenance [Member]
Revenue from External Customer [Line Items]
Percentage Of Sales By Product Group	12.00%	11.00%	12.00%	12.00%
Other [Member]
Revenue from External Customer [Line Items]
Percentage Of Sales By Product Group	2.00%	1.00%	1.00%	1.00%

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020	Jan. 02, 2021
Inventory [Line Items]
Percentage of LIFO Inventory	89.00%		89.00%		88.00%
Inventory, LIFO Reserve, Effect on Income, Net	$ 39,000	$ 3,100	$ 42,200	$ 11,900
Inventories at first in, first out (“FIFO”)	4,314,884		4,314,884		$ 4,382,779
Adjustments to state inventories at LIFO	113,231		113,231		155,420
Inventories at LIFO	$ 4,428,115		$ 4,428,115		$ 4,538,199

Intangible Asset (Details)

Intangible Asset (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Expense	$ 7.2	$ 7.3	$ 16.9	$ 17

Receivables, net (Details)

Receivables, net (Details) - USD ($) $ in Thousands	Jul. 17, 2021	Jan. 02, 2021
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total receivables	$ 814,150	$ 761,928
Less: Allowance for doubtful accounts	(10,270)	(11,929)
Receivables, net	803,880	749,999
Trade Accounts Receivable [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total receivables	554,107	449,403
Accounts Receivable, Vendor [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total receivables	242,701	278,180
Accounts Receivable, Other [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total receivables	$ 17,342	$ 34,345

Long-term Debt and Fair Value_3

Long-term Debt and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Jul. 17, 2021	Jan. 02, 2021	Sep. 29, 2020	Apr. 16, 2020	Dec. 03, 2013
Debt Instrument [Line Items]
Fair value of long-term debt	$ 1,121,000	$ 1,145,000
Guarantor Obligations, Maximum Exposure	26,700	23,600
Guarantor Obligation, Collateral Amount	65,500	57,500
Long-term debt	1,033,686	1,032,984
ChargesRelatingtoDebtIssuanceCostsfrom2023SeniorUnsecuredNotes			$ 1,400
ChargesRelatingtoTenderPremiumsof2023SeniorUnsecuredNotesAgreement			30,500
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Letters of Credit Outstanding, Amount	0	0
Line of Credit Facility, Remaining Borrowing Capacity	1,000,000
4.50% senior unsecured notes (2023 Notes) [Member] [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage					4.50%
Debt Issuance, Percentage Of Principal					99.69%
Debt Instrument, Repurchased Face Amount			$ 256,300
Debt Instrument, Face Amount					$ 450,000
1.75% senior unsecured notes (2027 Notes)
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage			1.75%
Debt Issuance, Percentage Of Principal			99.67%
Debt Issuance Costs, Gross			$ 2,900
Debt Instrument, Face Amount			$ 350,000
3.90% senior unsecured notes (2030 Notes)
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage				3.90%
Debt Issuance, Percentage Of Principal				99.65%
Debt Instrument, Face Amount				$ 500,000
Bilateral Letter of Credit Facility [Member]
Debt Instrument [Line Items]
Letters of Credit Outstanding, Amount	100,000
Senior Notes [Member] | 4.50% senior unsecured notes (2023 Notes) [Member] [Member]
Debt Instrument [Line Items]
Long-term debt	193,113	192,990
Senior Notes [Member] | 1.75% senior unsecured notes (2027 Notes)
Debt Instrument [Line Items]
Long-term debt	346,122	345,854
Senior Notes [Member] | 3.90% senior unsecured notes (2030 Notes)
Debt Instrument [Line Items]
Long-term debt	$ 494,451	$ 494,140

Leases (Details)

Leases (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020	Jan. 02, 2021
Lessee, Lease, Description [Line Items]
Total operating lease liabilities	$ 2,553,804		$ 2,553,804		$ 2,477,087
Less: Current portion of operating lease liabilities	462,633		462,633		462,588
Noncurrent operating lease liabilities	2,091,171		2,091,171		$ 2,014,499
Operating lease cost	124,184	$ 119,707	286,169	$ 281,512
Variable lease cost	34,195	30,856	77,720	74,392
Total lease cost	158,379	$ 150,563	363,889	355,904
Remainder of 2021	279,364		279,364
2022	490,926		490,926
2022	458,656		458,656
2023	388,181		388,181
2024	341,696		341,696
Thereafter	944,059		944,059
Total lease payments	2,902,882		2,902,882
Less: Imputed interest	(349,078)		(349,078)
Lessee option to extend reasonably certain of being exercised	79,700		79,700
Operating lease legally binding minimum payments for lease that have not yet commenced	$ 124,300		$ 124,300
Operating Lease, Weighted Average Remaining Lease Term	7 years		7 years
Operating Lease, Weighted Average Discount Rate, Percent	3.40%		3.40%
Cash paid for amounts included in the measurement of lease liabilities:			$ 275,358	305,079
Right-of-use assets obtained in exchange for lease obligations:			$ 284,295	$ 219,954
Real Estate [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Renewal Term	5 years		5 years
Real Estate [Member] | Minimum [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Term of Contract	5 years		5 years
Real Estate [Member] | Maximum [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Term of Contract	10 years		10 years
Equipment [Member] | Minimum [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Term of Contract	3 years		3 years
Equipment [Member] | Maximum [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Term of Contract	5 years		5 years

Warranty Liabilities (Details)

Warranty Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jul. 17, 2021	Jan. 02, 2021
Movement in Standard Product Warranty Accrual [Roll Forward]
Warranty reserve, beginning of period	$ 14,120	$ 36,820
Additions to warranty reserves	5,341	14,907
Reduction and utilization of reserve	(16,835)	(37,607)
Warranty reserve, end of period	$ 2,626	$ 14,120

Share Repurchase Program (Detai

Share Repurchase Program (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended	6 Months Ended
	Jul. 17, 2021	Jul. 17, 2021	Jul. 11, 2020	Apr. 19, 2021	Nov. 08, 2019
Class of Stock [Line Items]
Treasury Stock, Shares, Acquired as Part of Authorized Plan	2,000	3,100	200
Payments for Repurchase of Common Stock	$ 393	$ 563.4	$ 29
Acquired, Average Cost Per Share, Acquired as Part of Plan	$ 197.52	$ 183.57	$ 128.36
Share Repurchase Program, Remaining Authorized Repurchase Amount	$ 868.8	$ 868.8
August 2019 Share Repurchase Program [Member]
Class of Stock [Line Items]
Stock Repurchase Program, Authorized Amount				$ 1,000	$ 700

Earnings per Share (Details)

Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net income applicable to common shares	$ 178,696	$ 189,960	$ 364,626	$ 233,548
Basic weighted average shares	64,745	69,118	65,284	69,154
Dilutive impact of share-based awards	465	176	436	196
Diluted weighted average shares	65,210	69,294	65,720	69,350
Basic earnings per common share	$ 2.76	$ 2.75	$ 5.59	$ 3.38
Diluted earnings per common share	$ 2.74	$ 2.74	$ 5.55	$ 3.37

Earnings per Share - Narrative

Earnings per Share - Narrative (Details) - shares	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
RSUs
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	0	159,000	3,670	326,000

Share-Based Compensation (Detai

Share-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 17, 2021	Jul. 11, 2020	Jul. 17, 2021	Jul. 11, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation, Tax Benefit from Compensation Expense	$ 4.4	$ 2.5	$ 8.2	$ 6
Share-based Compensation, Cost Not yet Recognized	$ 87.5		$ 87.5
Share-based Compensation, Cost Not yet Recognized, Period for Recognition			1 year 7 months 6 days
Market-based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in Period			63
Weighted Average Grant Date Fair Value			$ 204.97
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in Period			201
Weighted Average Grant Date Fair Value			$ 177.77