Home Depot beats sales estimates in June qtr on demand from builders

Net sales for the largest US home improvement chain climbed 6.5% to a $43.79 bn, compared with estimates of $43.36 bn

Home Depot Inc on Tuesday reported quarterly comparable sales above Wall Street estimates on steady demand for home-improvement goods from builders and handymen.
 

Analysts have said demand from home-improvement professionals has been strong, even as do-it-yourself customers are reining in their spending, due to a healthy pipeline of remodeling work.

Around 40 per cent to 45 per cent of Home Depot's customers are professionals, compared with just 20 per cent to 25 per cent for smaller rival Lowe's Cos Inc, according to estimates from several brokerages.

Home Depot's comparable sales rose 5.8 per cent for the second quarter, while analysts had expected a 4.9% growth, according to IBES data from Refinitiv.

Net sales for the largest U.S. home improvement chain climbed 6.5 per cent to a $43.79 billion, compared with estimates of $43.36 billion.

Higher product prices drove average spending per transaction up more than 9 per cent, even as customer transactions at its stores dropped 3 per cent, helping the company record its highest ever quarterly sales and earnings.

Net earnings increased to $5.17 billion, or $5.05 per share, for the quarter ended July 31, from $4.81 billion, or $4.53 per share, a year earlier. Analysts were expecting $4.94 per share.

Home Depot's shares fell 1.5 per cent to $310 in premarket trading as it maintained its outlook for fiscal 2022.