Key facts
- Lowe's reported second-quarter earnings per share of $4.27, beating analyst expectations of $4.22.
- Gross margins were $8.58 billion, exceeding estimates.
- The company's sales of $25.96 billion missed estimates of $26.16 billion.
- Same-store sales increased by 0.2%, below the expected 0.8% growth.
- Lowe's lowered its annual sales growth forecast to flat.
- Shares rose 4% in early trading.
Lowe's reported second-quarter earnings per share of $4.27, surpassing the $4.22 expected by analysts, and gross margins of $8.58 billion, also above estimates. The home-improvement retailer's sales, however, came in at $25.96 billion, below the $26.16 billion consensus, with same-store sales increasing by a modest 0.2% against expectations of 0.8% growth.
Despite beating profit expectations, Lowe's lowered its annual sales growth forecast to flat, a reduction from its previous outlook of flat to 2% growth. This guidance cut reflects cautious consumer spending, with homeowners prioritizing necessary repairs over larger, high-cost renovations. The company's professional customer segment showed continued momentum, helping to offset uneven demand from do-it-yourself shoppers.
Shares of Lowe's rose 4% in early trading following the announcement. Analysts noted that while the company's growth may be flat this year, it is not due to internal issues but rather broader market conditions and a housing market that has yet to fully recover. The results follow a day after rival Home Depot also beat expectations, raising overall sentiment for the sector.