UPDATE—May 21, 2024: This article has been updated to reflect more recent share price information.
Key Takeaways
- Lowe’s reported first-quarter earnings that beat analysts’ estimates, despite declining from the year-ago period amid a pullback in home-improvement spending.
- The company said growth in digital sales and market share among professional contractors helped partially offset a continued slowdown in sales of big-ticket items.
- Lowe’s affirmed its full year-guidance, projecting revenue and diluted earnings per share (EPS) roughly in line with analyst estimates.
- Shares rose in early trading Tuesday following the release before turning lower later in the session.
Lowe’s (LOW) reported first-quarter earnings and revenue that beat analysts’ estimates, despite declining from the year-ago period amid a pullback in home-improvement spending. Shares rose in early trading Tuesday following the release before turning lower later in the session.
Lowe’s reported first-quarter sales of $21.36 billion, about 4.4% below last year’s $22.35 billion, but more than the $21.12 billion analysts projected, according to estimates compiled by Visible Alpha.
Profits fell more than 20% compared to the first quarter of 2023, with Lowe’s posting $1.76 billion in net income, compared to $2.26 billion in the same period last year, but still better than the $1.68 billion analysts expected. Earnings per share at $3.06 fell from $3.77 last year, but came in above the $2.93 analysts projected.
Sales have fallen in recent quarters for Lowe’s and rival Home Depot (HD) amid a slowdown in spending on do-it-yourself (DIY) projects and big-ticket items as inflation weighs on many consumers.
The company said growth in its digital sales and market share among professional contractors, an area in which Home Depot is also looking to expand, helped partially offset the continued decline in DIY big-ticket spending.
In Tuesday’s earnings report, Lowe’s affirmed its outlook for the full fiscal year, projecting comparable store sales to decline by 2% to 3% for the year. The company said it anticipates revenue to come in from $84 billion to $85 billion, in line with the $84.25 billion analysts projected, and a decrease from the $86.38 billion in revenue that Lowe’s generated in fiscal 2023.
Lowe’s said it expects diluted earnings per share (EPS) within a range of $12 to $12.30, with analysts expecting around $12.18, down from last year’s $13.20.
Lowe’s shares gave up early gains and were 2.7% lower at $223.05 as of 2:20 p.m. ET Tuesday following the company’s earnings report.