Home Depot Raises Outlook as Fewer Customers Spend More

Home Depot said Tuesday that it now expects revenue to rise 3% after a strong start to the year. The new view came after a warning in February that sales would only rise slightly. It lifted its profit forecast too, with per-share earnings now expected to rise at a mid-single digit rate.

The retailer was a major beneficiary during much of the pandemic. At one point during the last two years, Home Depot posted four straight quarters of comparable sales growth above 20% as the public-health crisis’s social disruptions left people spending more time in their houses.

It is now confronting a slowdown from that high, as well as rising inflation and continued supply-chain disruptions.

For the three months ended May 1, Home Depot posted earnings of $4.2 billion, or $4.09 a share, compared with $4.1 billion, or $3.86 a share, in the first quarter of last year. Wall Street analysts had expected earnings of $3.71 a share, according to FactSet.

First-quarter sales came in at $38.9 billion, ahead of Wall Street expectations of $36.7 billion.

Shares of Home Depot, down nearly 29% so far this year, rose 4% in premarket trading.

Corrections & Amplifications
Home Depot said the average amount spent per transaction rose 11.4% in the first quarter. An earlier version of the article incorrectly said the metric rose 11.2%. (Corrected on May 17.)

Home Depot said Tuesday that it now expects revenue to rise 3% after a strong start to the year. The new view came after a warning in February that sales would only rise slightly. It lifted its profit forecast too, with per-share earnings now expected to rise at a mid-single digit rate.

The retailer was a major beneficiary during much of the pandemic. At one point during the last two years, Home Depot posted four straight quarters of comparable sales growth above 20% as the public-health crisis’s social disruptions left people spending more time in their houses.

It is now confronting a slowdown from that high, as well as rising inflation and continued supply-chain disruptions.

For the three months ended May 1, Home Depot posted earnings of $4.2 billion, or $4.09 a share, compared with $4.1 billion, or $3.86 a share, in the first quarter of last year. Wall Street analysts had expected earnings of $3.71 a share, according to FactSet.

First-quarter sales came in at $38.9 billion, ahead of Wall Street expectations of $36.7 billion.

Shares of Home Depot, down nearly 29% so far this year, rose 4% in premarket trading.

Corrections & Amplifications
Home Depot said the average amount spent per transaction rose 11.4% in the first quarter. An earlier version of the article incorrectly said the metric rose 11.2%. (Corrected on May 17.)