Key facts
- Lowe's revised its annual comparable sales growth forecast to flat, down from a previous expectation of 0% to 2% growth.
- The company's projected full-year sales and profit fell below Wall Street estimates.
- Lowe's CEO Marvin Ellison noted that households are pausing large upgrades like kitchen remodels.
- Home Depot maintained its forecast for comparable-sales growth of up to 2%.
Home-improvement retailer Lowe's has cut its forecast for annual comparable sales growth, now expecting it to remain flat compared to a previous projection of 0% to 2% growth. This cautious outlook stems from consumers' hesitation on expensive renovation projects and discretionary spending.
Lowe's projected full-year sales and profit below Wall Street estimates, signaling that the company anticipates muted consumer spending. This contrasts with its larger rival, Home Depot, which maintained its annual forecast for comparable-sales growth of up to 2% and earnings per share increase of as much as 4%. Lowe's is more reliant on do-it-yourself (DIY) spending, which has faced persistent pressure as households defer big-ticket upgrades.
CEO Marvin Ellison stated that the company is focused on directing what is within its control, including productivity initiatives, to protect margins. Lowe's has been cutting jobs and streamlining operations. Economic and tariff uncertainty has also led to cautious updates from other retailers, such as TJX and Steven Madden.
Lowe's forecast adjusted earnings per share in the range of $12.25 to $12.75, below expectations of $12.95. In the fourth quarter, same-store sales at Lowe's rose 1.3%, beating expectations, and its adjusted profit of $1.98 per share surpassed estimates of $1.94.