Home Depot Reports Q1 2025 Sales Increase Amid Dull Outlook
Company expects foreign exchange headwinds to negatively affect performance in 2025
Home Depot's [HD] sees foreign trade headwinds ahead even as it has reported $39.9 billion sales for the first quarter of fiscal 2025. This marks 9.4% increase compared to the same period in fiscal 2024. The company’s quarterly earnings report showed the company faced foreign exchange headwinds, which negatively impacted total comparable sales by approximately 70 basis points.
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Home Depot’s net income for the quarter was $3.4 billion, accounting for $3.45 per diluted share, down from $3.6 billion ($3.63 per share) in Q1 2024. Adjusted diluted earnings per share were $3.56, compared to $3.67 in the same period last year.
Outlook Guidance
Home Depot reaffirmed its fiscal 2025 guidance, projecting approximately 2.8% sales growth. It projected comparable sales growth of around 1% for the comparable 52-week period. The company plans to open about 13 new stores. It’s gross margin will be approximately 33.4% and operating margin of about 13.0%.
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Home Depot’s adjusted operating margin is likely to be 13.4%. The company’s diluted earnings per share declined by about 3% from $14.9 in fiscal 2024. Its adjusted diluted earnings per share declined by 2% from $15.24 in fiscal 2024.
Despite strong revenue growth, Home Depot's earnings per share of $3.4 fell short of expectations, missing the Zacks Consensus Estimate of $3.59 per share. Analysts say the company has been consistently beating earnings estimates but this quarter's -0.84% variance was a setback.
Home Depot's stock declined by 0.37% in Wall Street, trading at $379.38. Analysts have recommended caution, with some giving a "Hold" rating on the stock due to mixed earnings results and broader industry challenges.
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