Home Depot Inc (NYSE:HD, XETRA:HDI) on Tuesday posted quarterly results that topped Wall Street’s revenue expectations but fell short on profit, as softer US home-improvement demand and fewer storm-related projects weighed on its business.
The largest US home-improvement retailer reported third-quarter sales of $41.35 billion, up 2.8% from a year earlier and ahead of analysts’ estimates of $40.91 billion. But adjusted earnings per share fell to $3.74, missing expectations of $3.85, while operating income slipped 1.2% to $5.35 billion.
Comparable sales rose 0.2%, well below the 1.36% increase analysts had expected, while US comparable sales inched up just 0.1%, short of the forecast 1.25% gain.
CEO Ted Decker said the quarter fell short largely because anticipated demand failed to materialize in key categories. “We had anticipated that demand would begin to accelerate gradually in the back half of the year as rates and mortgage eased… But what we saw was that ongoing consumer uncertainty and continued pressure in housing are disproportionately impacting home improvement demand,” he said.
Home Depot said it now expects fiscal 2025 adjusted earnings of $14.48 per share, down from a prior outlook of $14.94 and below analysts’ expectations of $14.99. The company reiterated that comparable sales for the year are expected to be slightly positive on a 52-week basis.
It forecast full-year sales of $164.3 billion, roughly 3% higher than last year but a touch below market estimates. Gross margin is projected at about 33.2%, with operating margin of 12.6%.
Customer traffic softened in the quarter, with transactions down 1.4% year over year, though the average ticket rose 2% to $90.39.
Shares of Home Depot were down 3.4% in morning trading.