Key Highlights

  • Net sales rose 1.2% to $129.3 million in the third quarter, from $127.8 million.
  • Gross Margin was 33.4%, compared with 33.1% a year earlier.
  • Net loss narrowed to $4.1 million, or $0.53 per share, from $10.9 million, or $1.87.
  • Adjusted EBITDA was $1.0 million, against a loss of $2.5 million a year ago.
  • Cash and cash equivalents were $33.8 million at October 3, 2026.

Third-quarter sales edge up while nine-month sales fall 7.1%

CarParts.com (NASDAQ:PRTS), a leading online provider of aftermarket auto parts and accessories, filed its Quarterly Report on October 30, 2026 for the thirteen weeks ended October 3, 2026. It sells mainly to individual consumers through its website, mobile app and online marketplaces, and also serves professional installers through a wholesale platform.

Net sales were $129.3 million, up $1.6 million, or 1.2%, from $127.8 million in the prior year quarter. The company attributed the gain primarily to higher consumer Demand while keeping its focus on optimizing Advertising spend.

For the thirty-nine weeks, net sales fell 7.1% to $396.9 million from $427.1 million. Management tied that decline to profitability initiatives, including less advertising spend on lower-margin customers and customers with lower lifetime values.

Gross margin edges up as freight costs help

Gross profit rose 2.1% to $43.2 million in the quarter, and gross margin increased 30 basis points to 33.4%. The company credited favorable freight costs for the improvement.

For the nine months, Gross Profit was $131.2 million, down 5.9%, while gross margin rose 40 basis points to 33.0%. Tariff refunds recorded in the year to date period also contributed to the improvement.

Operating expense falls 10.2% and narrows the loss

Operating expense dropped 10.2% to $47.0 million, or 36.3% of net sales versus 40.9%. Management pointed to lower distribution center costs, favorable advertising spend and lower Payroll costs after headcount reductions.

The loss from operations narrowed to $3.8 million from $10.0 million. Net loss was $4.1 million, or $0.53 per share, compared with $10.9 million, or $1.87 per share, though the weighted average share count rose to 7.7 million from 5.8 million.

For the nine months, the net loss was $9.3 million, or $1.23 per share, against $38.9 million, or $6.37. The year to date period included a $2.3 million gain on the sale of the Philippines subsidiary, which was deconsolidated on January 27, 2026.

Adjusted EBITDA turns positive

Adjusted EBITDA was $1.0 million in the third quarter, up from a loss of $2.5 million. Depreciation and amortization fell to $3.8 million from $5.2 million, and Stock Compensation expense dropped to $1.0 million from $2.3 million.

Year to date, adjusted EBITDA was $3.4 million, compared with a loss of $11.8 million in the prior year period, a swing of about $15.2 million on a calculated basis.

Cash, Debt and what to watch

Cash and cash equivalents rose by $8.0 million to $33.8 million from $25.8 million at January 3, 2026, after $10.0 million of Operating Cash Flow and $8.0 million of gross proceeds from issuing common stock. The company spent $7.6 million on property and equipment, mainly capitalized website and software development.

Total debt was $32.4 million, mostly $25.5 million of convertible notes due September 10, 2028, convertible at $12.00 per share, plus finance Lease obligations. On June 15, 2026 it entered a new asset-based revolving Credit Facility of up to $25.0 million, with no balance drawn. Inventory fell to $76.9 million from $95.2 million.

Readers will likely follow whether sales growth continues without extra advertising spend, whether adjusted EBITDA stays positive, and how the company manages Liquidity and covenants under the new credit facility.