Genuine Parts Co ( GPC ) shares are trading lower after the company reported worse-than-expected second-quarter FY24 earnings and a grim outlook.

The company reported second-quarter sales growth of 0.8% year-on-year to $5.963 billion, missing the analyst consensus estimate of $6.047 billion.

The company attributed the sales growth to a 2.2% benefit from acquisitions, partially offset by a 0.9% decrease in comparable sales.

Automotive Parts Group sales grew 2% Y/Y. This segment’s profit margin contracted 60 basis points to 8.4%.

Sales for the Industrial Parts Group declined 1.1%, and the segment’s profit margin contracted 10 basis points to 12.4%.

Adjusted EPS of $2.44 missed the analyst consensus of $2.59.

Gross profit increased 2.1% Y/Y to $2.2 billion. Selling, administrative and other expenses were $1.65 billion, a 4.2% rise Y/Y.

Cash and equivalents totaled $555.3 million as of June 30. Net cash generated from operating activities for the six months totaled $612 million.

“Our quarterly results reflect softer than expected market conditions, which are tempering demand particularly in our Industrial and U.S. and European Automotive businesses. Despite a challenging macro-environment, our teams are operating well and remain focused on executing our long-term strategic initiatives,” said President and CEO Will Stengel.

Outlook: Genuine Parts ( GPC ) lowered FY24 revenue growth outlook from 3% – 5% to 1% – 3%.

It lowered FY24 adjusted EPS outlook from $9.80 – $9.95 to $9.30 – $9.50 versus the consensus of $9.86.

The company still expects FY24 free cash flow of $800 million – $1.0 billion and an operating cash flow of $1.3 billion – $1.5 billion.

Price Action: GPC shares are trading lower by 1.58% at $136.18 at the last check Tuesday.