#Home Depot Reports Q1 Net Sales of $41.8 Billion as Earnings Decline
The Home Depot, Inc. (NYSE: HD) reported net sales of $41.8 billion for the first quarter of fiscal 2026, up 4.8% from $39.9 billion in the first quarter of fiscal 2025. Net earnings declined to $3.3 billion from $3.4 billion in the year-ago period, with diluted earnings per share falling to $3.30 from $3.45.
Home Depot operates more than 2,361 retail stores and over 1,280 SRS locations across the United States, Canada, and Mexico. The company competes directly with Lowe's Companies in the home improvement retail sector, a market that has faced pressure from higher mortgage rates and reduced housing transaction volumes since 2022.
#Comparable Sales Rise 0.6% as Average Ticket Climbs
Total comparable sales for the quarter increased 0.6%, reversing a 0.3% decline in the same period of fiscal 2025. Comparable sales in the U.S. rose 0.4%, with foreign exchange rates contributing approximately 55 basis points to the total company comparable sales figure.
Comparable customer transactions fell 1.3%, while comparable average ticket rose 2.2%. The divergence indicates customers spent more per visit even as the number of transactions declined.
Adjusted diluted earnings per share, which excludes amortization of acquired intangible assets, came in at $3.43 for the quarter, compared with $3.56 in the first quarter of fiscal 2025. Adjusted operating margin was 12.3%, down from 13.2% a year earlier.
#Decker Cites Consumer Uncertainty and Housing Affordability Pressure
"Our first quarter results were in line with our expectations. The underlying demand in our business was relatively similar to what we saw throughout fiscal 2025, despite greater consumer uncertainty and housing affordability pressure," Ted Decker, chair, president and CEO of Home Depot, said in the earnings release.
The company generated $6.0 billion in operating cash flow during the quarter and paid $2.3 billion in cash dividends. Capital expenditures totaled $844 million, in line with the company's guidance of approximately 2.5% of total sales for the full year.
#Full-Year Guidance Held Steady Amid Macro Uncertainty
Home Depot reaffirmed its fiscal 2026 outlook, projecting total sales growth of approximately 2.5% to 4.5% and comparable sales growth of approximately flat to 2.0%. The company expects diluted earnings per share to grow approximately flat to 4.0% from $14.23 in fiscal 2025.
Full-year adjusted diluted earnings per share are projected to grow approximately flat to 4.0% from $14.69 in fiscal 2025, with gross margin guidance of approximately 33.1% and an operating margin range of approximately 12.4% to 12.6%. The company said it plans to open approximately 15 new stores during the fiscal year.
Management's outlook is subject to risks including tariff exposure, trade policy changes, macroeconomic conditions, housing market weakness, and execution of supply chain initiatives. The company noted that forward-looking statements are subject to risks and uncertainties, many of which are beyond its control, as detailed in its Annual Report on Form 10-K for the fiscal year ended February 1, 2026.