Home improvement retailers lower outlooks ‘amid ongoing uncertainty’

Some warning signals of slumping demand are flashing right now: Consumer sentiment dropped to a three-year low this month. Restaurant executives warn of weak demand from customers, particularly those with lower incomes.

The latest signal? Home improvement giants Home Depot and Lowe’s both recently decreased their full-year financial outlooks.

“We are seeing a cautious consumer amid ongoing uncertainty in the macro environment and the timing of an inflection in the home improvement in housing markets remains unclear,” Brandon Sink, CFO of Lowe’s, said during a Q3 earnings call on Wednesday. The company, which reported a 0.4% uptick in comparable sales for the quarter, now expects flat comparable sales in fiscal 2025 versus last year, down from a previous estimate of flat to 1% growth, according to its Q3 earnings release.

Lowe’s rival Home Depot also tweaked its outlook this week. According to its earnings release, the retailer expects “slightly positive” comparable sales growth. It previously projected comparable sales to increase 1% YoY, CNBC reported. Home Depot reported a 0.2% increase in comparable sales in Q3.

The revised outlook comes from a soft Q3, relatively quiet storm activity, and “ongoing consumer uncertainty and housing pressure,” CFO Richard McPhail told investors on a Tuesday earnings call.

“Affordability is a word that’s being used a lot,” CEO Ted Decker told investors this week. Decker elaborated that the lack of demand comes from “layoffs, increased job concerns, etc.”