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The nation’s fourth-largest retailer (by market cap) has spoken.
On Tuesday, Home Depot posted Q4 2024 earnings that topped sales expectations but offered downbeat guidance.
Home Depot posted sales of $39.7 billion, a 14.1% increase year over year and a slight beat. Adjusted earnings per share for the quarter climbed to $3.13, beating analyst estimates of $3.04.
For fiscal 2025, the home improvement chain expects sales growth of 2.8% and comparable sales growth of 1%. Analysts expected sales growth of 3.27%, and comparable sales growth of 1.88%, per Investopedia.
The company also projected that earnings per share will dip 2% compared to the year before.
As CNBC pointed out, the company has placed blame on the difficult housing market since around 2023. Sales growth slowed around then after pandemic-era spending decelerated.
Speaking with the outlet, CFO Richard McPhail said those same challenges continue to plague the company, noting that “housing is still frozen by mortgage rates.” In Q4, consumers held back on bigger home improvement projects, like installing new kitchens or updating flooring, he noted.
“We feel confident in the medium to long-term,” McPhail told the Wall Street Journal, “We continue to face pressure as our customers adjust to the new normal of higher rates.”
Moving forward, McPhail told CNBC he expects consumers to stop delaying major home improvements as they acclimate to higher interest rates.
“Home improvement always persists, and so the question, I think, will be around the mindset of whether long-term rates have gotten to a new normal,” he added.