Home Depot misses earnings and revenue; will open 13 stores in 2025
The Home Depot Inc. reported profit and sales growth that came in below Wall Street expectations but reaffirmed full-year guidance and is opening new stores.
The home improvement giant reported net earnings of $4.6 billion, or $4.58 per diluted share, for the quarter ended Aug. 3, with adjusted earnings of $4.68 per share, basically even with net earnings of $4.6 billion, or $4.60 per share and $4.67 per adjusted share, in the same period of fiscal 2024.
Sales rose 4.9% year-over-year to $45.28 billion from $43.2 billion.
Same-store sales rose 1.4% in the U.S. and 1% across the U.S., Canada and Mexico. Wall Street analysts had expected quarterly earnings per share of revenue of $4.71 and revenue of $45.36 billion. The second quarter of fiscal 2025 marked the first time Home Depot missed quarterly forecasts for both earnings and revenue since 2014.
Jonathan Reid, director, Fitch Ratings, noted that there were signs of optimism in the quarter for Home Depot, highlighted by broader customer engagement, which drove sequential improvement in comps and share gains.
"However, we continue to expect increased prices driven by tariffs and elevated interest rates to negatively impact demand in the home improvement category in the second half of 2025," he added.
According to Home Depot, foreign exchange rates negatively impacted total company same-store sales by approximately 0.4 percentage points. Ted Decker, chair, president and CEO of Home Depot, struck an optimistic tone in his public commentary.
"Our second quarter results were in line with our expectations," said Decker. "The momentum that began in the back half of last year continued throughout the first half as customers engaged more broadly in smaller home improvement projects. Our teams are executing at a high level and we continue to grow market share."
[READ MORE: Home Depot sales top Street, earnings miss; not planning to raise prices]
Fiscal 2025 Guidance
Home Depot is reaffirming its guidance for fiscal 2025, a 52-week year compared to fiscal 2024, a 53-week year. Predictions include:
- Total sales growth of approximately 2.8%.
- Comparable sales growth of approximately 1% for the comparable 52-week period.
- Approximately 13 new stores.
- Diluted earnings-per-share to decline approximately 3% from $14.91 in fiscal 2024.
- Adjusted diluted earnings-per-share to decline approximately 2% from $15.24 in fiscal 2024.
- Capital expenditures of approximately 2.5% of total sales.
At the end of the second quarter, Atlanta-based The Home Depot operated a total of 2,353 retail stores and more than 800 branches across all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. The company employs more than 470,000 associates.
