Home Depot gives cautious guidance for 2026; offers ‘market recovery’ outlook
The Home Depot issued a guarded outlook for fiscal 2026 as the housing market continues to struggle.
The home improvement giant reaffirmed its fiscal 2025 guidance and outlined its strategic priorities and financial expectations for the coming year at its 2025 Investor and Analyst Conference. The company also detailed how a recovery in the housing market would affect its fortunes.
“Our Market Recovery Case reflects our performance expectations once we see momentum in housing activity and increased spend on larger projects driven by pent-up demand,” said Richard McPhail, executive VP and CFO.
With a housing rebound, Home Depot expects total sales growth of approximately 5% to 6% and total comparable sales growth of approximately 4% to 5%. It expects operating profit growth faster than sales and earnings per share growth of approximately mid-to-high single digits.
“We believe that the pressures in housing will correct and provide the home improvement market with support for growth faster than the general economy, and we expect to continue to grow faster than our market,” McPhail said.
The company reaffirmed its fiscal 2025 guidance for total sales growth of approximately 3%, with adjusted earnings per share to decline approximately 5% from $15.24 in fiscal 2024.
The Home Depot projected modest growth in its preliminary outlook for 2026. It expects total sales growth of approximately 2.5% to 4.5%, with comp sales growth of approximately flat to 2%. Adjusted earnings per share are expected to increase approximately flat to 4%.
The company outlined three key strategic areas: to drive core and culture, to deliver a frictionless interconnected experience, and to win the pro.
"We are focused on growing sales and delivering exceptional shareholder returns, supported by our culture and values," said Ted Decker, chair, president and CEO. "The investments we've made over the last several years have further strengthened our distinct competitive advantages and position us well to grow share in an approximately $1.1 trillion total addressable market."
At the end of the third quarter, the company operated a total of 2,356 retail stores and over 1,200 SRS locations across all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. It employs over 470,000 associates.
