Lowe's Companies, Inc. (NYSE:LOW) is set to report a year-over-year decline in both sales and profit for the second quarter as the challenging economic environment, including still-high inflation and currency headwinds, takes a hammer to its earnings.
The home improvement retailer will report its second-quarter earnings before the opening bell on Tuesday, August 22.
Revenue is expected to decline by 9.2% year-over-year from $27.5 billion in 2Q 2022 to $24.9 billion, according to Zacks Consensus Estimate.
Earnings per share are also expected to drop by about 3.9% to $4.49, from $4.67 in the year-ago quarter.
In addition to consumer pullback on home improvement spending due to inflationary pressures, increased costs during the quarter as Lowe’s has poured funds into wage increases and bonuses are expected to have dragged on the company’s 2Q performance, according to Zacks.
The company forecast on its last earnings call a $400 million headwind to sales for 2Q due to the timing shift in its fiscal calendar, in addition to lumber deflation pressure of 150 basis points.
However, Lowe’s also said it expects to benefit from $250 million in sales from the delayed spring.
Lowe’s shares traded modestly higher on Friday afternoon ahead of its results, up 0.4% at US$219.10.
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