Home Depot (NYSE:HD) reported stronger-than-expected earnings and revenue for the second quarter on Tuesday, but the company lowered its full-year outlook due to waning consumer demand for home improvement projects.
The home improvement giant posted earnings per share of $4.67, surpassing analysts’ expectations of $4.54. Revenue increased by 0.6% year-over-year to $43.18 billion, exceeding the Street estimate of $42.6 billion. However, the company faced a 3.3% drop in comparable sales, with U.S. comparable sales down 3.6%.
In light of these results, Home Depot revised its full-year guidance, now projecting a 3% to 4% decline in comparable sales, compared to the previously expected 1% drop. The company also adjusted its earnings per share outlook, now forecasting a decline of 2% to 4%, down from the earlier projection of 1% growth.
Despite lowering its forecasts, Home Depot raised its total sales growth outlook for fiscal 2024 to 2.5% to 3.5%, up from the previous estimate of about 1%, largely due to the acquisition of SRS Distribution Inc., which is expected to contribute approximately $6.4 billion in additional sales.
The company remains committed to maintaining its gross margin guidance at around 33.5% for the year and plans to open about 12 new stores in fiscal 2024.