Home Depot shares slid 6 percent Tuesday after the home improvement giant posted third-quarter results that fell short of expectations, weighed down by weak seasonal demand and a still-shaky U.S. housing market.
The retailer reported USD41.4 billion in sales for the third quarter of fiscal 2025, up 2.8 percent or USD1.1 billion from a year earlier. Roughly USD900 million of that bump came from its recent acquisition of GMS Inc., contributing eight weeks of sales. Comparable sales barely budged, rising just 0.2 percent, with U.S. comps up an even slimmer 0.1 percent.
Net earnings held flat at USD3.6 billion, underscoring sluggish organic growth despite the boost from GMS.
Home Depot chair, president, and CEO Ted Decker attributed the miss to a rare factor for the retailer: too few storms. “Our results missed expectations primarily due to the lack of storms in the third quarter, which resulted in greater than expected pressure in certain categories,” Decker said. He added that an anticipated demand pickup “did not materialize” amid consumer uncertainty and ongoing weakness in housing—both of which are dampening home improvement spending.
Still, Decker said the company continues to gain market share and credited employees for “executing at a high level.”
With a softer fourth quarter expected, Home Depot cut its full-year outlook for 2025. The company now projects full-year sales growth of about 3 percent, with GMS contributing roughly USD2 billion. Gross margin is seen at 33.2 percent, while adjusted diluted earnings per share are expected to drop 5 percent from USD15.24 in 2024.
The update signals a challenging close to the year as the retail bellwether navigates an uneven consumer environment and subdued housing activity.
