Home improvement retailer Home Depot beat earnings and revenue estimates last quarter, and reaffirmed its outlook despite ongoing housing market pressures.
Earnings per share fell 3.7% year-over-year to US$3.43, above LSEG-compiled estimates of $3.41. Revenue was up 4.8% to $41.77 billion, passing estimates of $41.52 billion.
“Our first quarter results were in line with our expectations. The underlying demand in our business was relatively similar to what we saw throughout fiscal 2025, despite greater consumer uncertainty and housing affordability pressure,” said CEO, president, and chair Ted Decker.
The company reported 391.1 million customer transactions, an 0.9% fall. The average ticket grew 2.3% to $92.76.
Comparable sales were up 0.6%, under StreetAccount estimates of 0.8%. Nine of its 16 merchandising departments saw an increase in comparable sales.
Operating income was down 3% to $4.98 billion. Operating expenses rose 5.7% to $8.80 billion, driven by 5.7% growth in selling, general and administrative expenses.
Across fiscal 2026, Home Depot has projected sales growth of 2.5-4.5% and adjusted diluted earnings per share growth 0-4%. LSEG estimates included sales growth of 4%, with earnings per share increasing by 2.4%.
Homeowner customers have remained resilient despite the United States’ low consumer confidence and spiking mortgage rates, CFO Richard McPhail told CNBC, though they are continuing to defer spending on some larger projects.
Average U.S. 30-year mortgage rates climbed to a seven-week high of 6.56% last week, according to the Mortgage Bankers Association. Mortgage applications also fell 2.3% from the previous week.
“We still very much are bullish on the medium, long-term prospects in U.S. housing and homeownership, and the value of the home, and the aging of the home,” Decker said on an earnings call.
Home Depot (NYSE: HD) shares closed 2.7% higher at $310.58, but fell 0.1% after-hours. Its market capitalisation is $309.35 billion.
