Home Depot Inc (NYSE:HD) narrowed full-year guidance, as it reported better-than-expected third quarter earnings despite a drop in sales as demand for big ticket items remained under pressure.
Same-store sales will likely drop 3% to 4% this year, the company said, trimming one percentage off each side of the range, while EPS should fall 9% to 11% compared with a previous forecast of as much as 13%.
Operating margin is forecast between 14.1% and 14.2%.
The world’s largest home improvement retailer said in the quarter ended September, sales fell 3.0% to $37.71 billion from $38.87 billion a year ago.
Comparable sales decreased 3.1%, and comparable sales in the US declined 3.5%.
Net earnings were $3.81 billion, or $3.81 per diluted share, compared with net earnings of $4.34 billion, or $4.24 per diluted share, last year.
While the revenue figure was broadly in line with expectations, the EPS figure was well above the $3.82 consensus, according to Zacks Consensus Estimate.
“Our quarterly performance was in line with our expectations,” said Ted Decker, chair, president and chief executive.
“Similar to the second quarter, we saw continued customer engagement with smaller projects, and experienced pressure in certain big-ticket, discretionary categories.”
Shares rose 1.7% in pre-market trading to $293.00.