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Home Depot on Tuesday raised its full-year outlook after reporting strong quarterly earnings, fueled by the company’s strongest first-quarter sales on record. Shares of the company rose 4% in premarket trading.
Here’s what Home Depot reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $4.09 vs. $3.68 expected
- Revenue: $38.91 billion vs. $36.72 billion expected
The home improvement retailer reported first-quarter net income of $4.23 billion, or $4.09 per share, up from $4.15 billion, or $3.86 per share, a year earlier. Analysts surveyed by Refinitiv were expecting the company to earn $3.68 per share.
Net sales rose 3.8% to $38.91 billion, topping expectations of $36.72 billion. Same-store sales increased 2.2% in the quarter.
“The solid performance in the quarter is even more impressive as we were comparing against last year’s historic growth and faced a slower start to spring this year,” CEO Ted Decker said in a statement.
This marks Decker’s first quarter at the helm of the company. Decker, a longtime Home Depot veteran, previously served as chief operating officer and inherited the top job at a tough time for home improvement.
Inflation keeps climbing, which may lead consumers to put off renovation projects. Rising interest rates could result in a slowdown in the hot housing market and delays to expensive home improvement plans. And many consumers spent the early days of the pandemic painting their walls, buying new patio furniture and taking care of other do-it-yourself projects that won’t need to be repeated for at least a few years.
But Tuesday’s results show that consumers are still willing to spend money on their homes, and the company isn’t expecting the trend to reverse.
For 2022, Home Depot is now expecting sales growth of about 3% and earnings per share growth in the mid-single digits. The company previously forecast “slightly positive” sales growth and earnings per share growth in the low-single digits.