Home Depot’s first-quarter results landed above Wall Street forecasts even as the company reported a year-over-year drop in profit, with demand supported by homeowners buying spring supplies and by professional customers. The retailer’s CEO, Ted Decker, said Tuesday that underlying demand was “relatively similar” to the pace seen throughout fiscal 2025, despite a backdrop of heightened consumer uncertainty and pressure on housing affordability.
The company’s profit fell to $3.29 billion, or $3.30 per share, for the three months ended May 3. A year earlier, Home Depot earned $3.43 billion, or $3.45 per share, while analysts surveyed by FactSet expected $3.41 per share. After removing certain items, earnings came to $3.43 per share, which the company said was above the FactSet expectation.
Home Depot also reported that revenue climbed to $41.77 billion from $39.86 billion, exceeding Wall Street’s revenue estimate of $41.59 billion. Sales at stores open at least a year, a gauge of ongoing retail health, rose 0.6%, while Home Depot said comparable store sales climbed 0.4% in the U.S.
Within customer activity, the company said transactions declined 1.3% during the quarter, but spending per purchase rose. Home Depot reported that the average receipt increased to $92.76 from $90.71 a year earlier, pointing to a shift toward larger baskets even as the number of transactions slipped.
Decker pointed to conditions in the broader housing market as part of the environment facing home-improvement retailers. The housing market has been “static” as Americans contend with rising costs and other economic concerns, including inflation and gas prices, and Home Depot’s commentary tied that pressure to demand.
The National Association of Realtors reported that sales of previously occupied homes were essentially flat in April, with existing home sales edging up 0.2% from March to a seasonally adjusted annual rate of 4.02 million units. Compared with April of the prior year, existing home sales were unchanged, reflecting a housing-market slump that has stretched since 2022 as mortgage rates rose from historic lows.
Neil Saunders, managing director of GlobalData, said in a statement that Home Depot is navigating a weak housing market and constrained consumer spending. He described the company as “a well-run business” with “impressive dominance in its sector,” and said Home Depot has “right[ly]…pivot[ed] to the professional side of the market.” Saunders added that Home Depot still needs to “stay up to par on the consumer side” by improving “small things and making marginal gains.”
Looking ahead, Home Depot said it still anticipates fiscal 2026 total sales growth of about 2.5% to 4.5% and expected comparable sales to be flat to up 2%. The stock rose slightly before the opening bell Tuesday.