(MENAFN- Yolo Wire) Small-cap stock Advance Auto Parts (NYSE: $AAP) is up 10% on Oct. 30 after the car parts dealer reported strong financial results that show its turnaround strategy is working.

The chain of retail automotive stores reported earnings per share (EPS) of $0.92 U.S. for this year's third quarter, which beat Wall Street's call for a profit of $0.76 U.S.

Revenue of $2 billion U.S. was in line with analysts' consensus estimates. However, same-store sales rose 3% from a year earlier, beating forecasts of 2.3%.

At one point the stock of Advance Auto Parts, which has a market capitalization of $3.3 billion U.S., was up 21% immediately after its latest print.

"We delivered our strongest quarterly performance in over two years," said Chief Executive Officer (CEO) Shane O'Kelly in the earnings statement.

Investors are bidding up AAP stock as the strong quarterly results show that the company's multi-year turnaround strategy is taking hold.

Earlier in 2025, Advance Auto Parts announced plans to close more than 700 of its retail stores as it restructures amid weakening demand for the after-market vehicle parts it sells.

The company also announced the sale of Worldpac, a wholesale distributor of automotive parts, for $1.5 billion U.S. and plans to shutter four distribution centres.

The U.S. auto industry is in flux due to a confluence of factors that include weak demand for electric vehicles, a pullback in consumer spending, tariffs, and rising competition from China.

Management has set a goal to improve Advance Auto Parts operating income margin by over 500 basis points through 2027.

The restructuring appears to be working and has had a big impact on the company's latest financial results, sending the stock sharply higher as a result.

Over the past five years, AAP stock has declined 63% to trade at $55.13 U.S. per share.

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