Home Depot beats earnings, sales estimates even as consumers take on smaller home improvement projects

Earnings

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The logo of Home Depot is seen on a signboard near its store in Seattle. Home Depot is expected to report its quarterly earnings this week. 
Toby Scott | Lightrocket | Getty Images

Home Depot will report its fiscal fourth-quarter earnings on Tuesday, as investors look for signs that demand for kitchen appliances and supplies for home improvement projects may be rebounding as inflation cools.

Here’s what Wall Street analysts are expecting, according to a survey by LSEG, formerly known as Refinitiv:

  • Earnings per share: $2.77
  • Revenue: $34.64 billion

Home Depot has faced a tougher sales backdrop over the past year. The home improvement retailer is following a more than two-year period when Americans had more time and money to spend on painting and fixing up their homes during the pandemic.

The company has also felt a pullback in consumer spending, particularly on big-ticket items, as some families postpone discretionary purchases because of inflation, put off buying a new home because of higher interest rates or choose to spend on experiences rather than goods.

Home Depot said in November that it expected full-year sales to fall by 3% to 4%, and earnings per share to drop by 9% to 11% compared with the prior year.

On calls with investors, Chief Financial Officer Richard McPhail said it would be a “year of moderation” for the retailer as sales patterns normalized. In recent quarters, he has spoken about customers opting for more modest home projects rather than bigger and pricier ones.

As of Friday’s close, shares of Home Depot were up nearly 5% this year. That roughly matches the gains of the S&P 500 during the same period. The company’s shares closed at $362.35 on Friday, bringing Home Depot’s market value to about $360 billion.

This story is developing. Please check back for updates.

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