Revenue
Earnings
The consensus estimate for earnings in Q2 2023 is $4.45 per share which compares to EPS of $5.05 reported in the year-ago period. In Q1 2023, EPS dropped to $3.82 from $4.09 reported in the same period a year ago.
Points to note
After witnessing strong growth over the past three years, Home Depot anticipated a moderation in the home improvement market during fiscal year 2023. As consumer spending remained pressured, the company saw softness in big-ticket discretionary categories during the first quarter.
Home Depot saw negative results in both its Pro and DIY customer segments and although the backlogs in the Pro segment appear to be healthy, there seems to be a shift from large-scale remodels to smaller projects. These factors could have an impact on Q2 results as well.
In Q1, comparable sales decreased 4.5% while comp sales in the US fell 4.6%. Home Depot saw positive comps in categories like building materials, hardware, plumbing, and millwork. However, categories like patio, grills, and appliances witnessed softness indicating a postponement of these purchases. Lumber deflation had a significant impact on results in Q1, negatively affecting comps by around 220 basis points. These trends may have continued into the second quarter.
Despite these challenges, Home Depot remains optimistic on the medium to long term outlook for home improvement and its ability to grow share in this large and fragmented market.