The first quarter brought lower sales and earnings at Home Depot as an increasingly wary consumer and poor weather put a damper on spring business, the company announced.
Home Depot posted net earnings of $3.87 billion, or $3.82 per diluted share, versus $4.23 billion, or $4.09 per diluted share, in the period a year before.
Home Depot did come out on top of a Yahoo Finance-published analyst consensus estimate of $3.80 on earnings but didn’t reach the revenue estimate of $38.28 billion.
Comparable sales decreased 4.5% as comps in the United States decreased 4.6% in the quarter year over year, according to the company.
The company reported sales of $37.26 billion, down 4.2% from the quarter a year previous. Operating income was $5.55 billion versus $5.93 billion in the year-prior period.
In announcing the financial results, Ted Decker, Home Depot chair, president and CEO, said, “After a three-year period of unprecedented growth for our sector, during which we grew sales by over $47 billion, we expected that fiscal 2023 would be a year of moderation for the home improvement market. Our sales for the quarter were below our expectations primarily driven by lumber deflation and unfavorable weather, particularly in our Western division as extreme weather in California disproportionately impacted our results. We also observed more broad-based pressure across the business compared to when we reported fourth-quarter results a few months ago. While the near-term environment is uncertain, we remain very positive on the medium-to-long term outlook for home improvement and our ability to grow share in a large and fragmented market.”
At the end of the first quarter, Home Depot operated 2,324 retail stores in all 50 of the United States, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico.