The Home Depot’s investments in its online and brick-and-mortar businesses are clearly paying off.
The nation’s largest home improvement retailer on Tuesday reported earnings, revenue and same-store sales that beat the Street, helped by a mild winter and a solid housing market. In comments, Neil Saunders, managing director of GlobalData Retail, said would be unfair to credit all of Home Depot’s success to market conditions.
“Our data continue to show that consumers are thinking more carefully about expensive purchases, including on home improvement projects,” he said. "In our view, Home Depot has excelled at making life easy for the customer by removing roadblocks on the purchase journey – something that helps it to gain market share and to stimulate spend.” For more of Saunders’ comments, click here.
Home Depot reported net earnings of $2.5 billion for the quarter ended Feb. 2, compared to net earnings of $2.3 billion in the year-ago period. Earnings per share came in at $2.28, better than the $2.10 analysts had expected.
Sales totaled $25.78 billion compared to sales of $26.49 billion last year. (Fiscal 2018 included an extra week of operations compared to fiscal 2019. The extra week added about $1.7 billion of sales to the fourth quarter of fiscal 2018.) Analysts had expected sales of $25.76 billion. Same-store sales rose 5.2%, also better than expected.
“Fiscal 2019 was a record year for our business and one marked by significant progress as we invest to transform ourselves into The Home Depot of the future,” said Craig Menear, chairman, president and CEO. “Our fourth quarter results reflect strength in our core business, solid execution around our holiday events and the overall health of the consumer.”
For the full year, net income increased 1.1% to $11.2 billion. Sales rose to $110.2 billion compared to $108.2 billion in fiscal 2018. Full-year same-store sales rose 3.8%.
“We are now two years into our multi-year investment program and have more conviction than ever that our strategic initiatives are creating a value proposition that is unique to the marketplace and will extend our leadership position for years to come,” said Menear. “Through the second year of our One Home Depot investment program, we have grown sales by over $9 billion dollars – a level of growth unmatched in our market.”
Home Depot maintained its fiscal 2020 forecast. It expects total sales growth of 3.5% to 4% and same-store sales growth of 3.5% to 4%. The retailer plans to open six new stores in 2020.