Home Depot (HD) reported revenue increased 2.8% year-over-year to $41.4 billion during the company’s second quarter. Comparable sales increased 0.2% for the quarter that ended on November 2, missing the consensus expectation for an increase of 1.4%. During the quarter, total sales included approximately $900 million from the recent acquisition of GMS, which represents approximately eight weeks of sales in the quarter.
Comparable customer transactions fell 1.6% year-over-year, while the comparable average ticket for customers was up 1.8%. Total customer transactions fell 1.4% to 39.5 million. The total average ticket was up 2.0% to $90.39 vs. the $89.71 consensus estimate.
Notably, CEO Ted Decker said the company’s results missed expectations primarily due to the lack of storms in the quarter, which resulted in greater than expected pressure in certain categories. “Additionally, while underlying demand in the business remained relatively stable sequentially, an expected increase in demand in the third quarter did not materialize. We believe that consumer uncertainty and continued pressure in housing are disproportionately impacting home improvement demand,” he added.
Home Depot (HD) reported adjusted operating income for the quarter was $5.35 billion and an adjusted operating margin of 13.0%. Cost of sales increased 2.8% during the quarter to $27.5 billion. Adjusted non-GAAP EPS was reported at $3.74 vs. $3.83 consensus and $4.67 a year ago.
Looking ahead, Home Depot (HD) expects total sales to increase approximately 3% in FY25 vs. a prior expectation for +2.8% growth.
Shares of Home Depot (HD) were down 2.6% in premarket trading on Tuesday. Rival Lowe’s (LOW) shed 2.3%.