AutoZone shares plunged more than 7% in premarket trading after the auto parts retailer's fiscal second-quarter results topped profit expectations but missed on revenue forecasts. Investors reacted negatively to the company's inability to meet revenue targets despite solid earnings performance.

The Memphis-based company reported Q2 earnings per share of $27.63, beating analyst estimates of $27.17. However, revenue fell short at $4.27 billion, below the consensus forecast of $4.31 billion. Net sales grew 8.1% year over year, with same-store sales increasing 3.3% on a constant-currency basis.

CEO Phil Daniele acknowledged solid financial results but noted international sales were slightly below expectations. The company's operating profit declined 1.2% year over year to $698.5 million. Despite the dip, AutoZone maintained it continues to gain market share in Mexico and Brazil.

The market reaction suggests investors prioritize revenue growth over profit margins in the current economic environment, putting pressure on management to address sales execution challenges.