The Home Depot Provides a Strategic Update; Reaffirms Fiscal 2025 Guidance; Establishes a Preliminary Fiscal 2026 Outlook and a Market Recovery Case

PR Newswire

ATLANTA, Dec. 9, 2025

(1) The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). As used in this release, adjusted operating income, adjusted operating margin, and adjusted diluted earnings per share are non-GAAP financial measures. Refer to the end of this release for an explanation of these non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures.

, the world's largest home improvement retailer, will discuss key strategic priorities, provide a preliminary 2026 outlook and a market recovery case, today at its 2025 Investor and Analyst Conference. ATLANTADec. 9, 2025^®

Today's conference will begin at 8:30 a.m. ET and will be available in its entirety through a live webcast and replay atir.homedepot.com/events-and-presentations

During today's conference, the company will discuss how it is uniquely positioned to grow market share and deliver shareholder value through its strategy to: drive core and culture, deliver a frictionless interconnected experience, and win the pro.

"We are focused on growing sales and delivering exceptional shareholder returns, supported by our culture and values," said Ted Decker, chair, president, and CEO. "The investments we've made over the last several years have further strengthened our distinct competitive advantages and position us well to grow share in an approximately $1.1 trillion total addressable market."

Fiscal Year 2025 Guidance

The company reaffirms its fiscal 2025 guidance, a 52-week year compared to fiscal 2024, a 53-week year:

Preliminary Fiscal Year 2026 Outlook

Today, the company is providing a preliminary outlook for fiscal 2026:

Market Recovery Case

Today, the company is also providing a market recovery case:

"Our Market Recovery Case reflects our performance expectations once we see momentum in housing activity and increased spend on larger projects driven by pent-up demand. We believe that the pressures in housing will correct and provide the home improvement market with support for growth faster than the general economy, and we expect to continue to grow faster than our market," said Richard McPhail, executive vice president and chief financial officer. "In our Accelerated Recovery Case, we could see sales and earnings per share grow faster in the event of a sharper housing recovery."

At the end of the third quarter, the company operated a total of 2,356 retail stores and over 1,200 SRS locations across all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. The Company employs over 470,000 associates. The Home Depot's stock is traded on the New York Stock Exchange (NYSE: HD) and is included in the Dow Jones industrial average and Standard & Poor's 500 index.

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this release constitute "forward-looking statements" under the federal securities laws, including as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on currently available information and our current assumptions, expectations and projections about future events, and use words such as "may," "will," "could," "should," "would," "anticipate," "intend," "estimate," "project," "plan," "believe," "expect," "target," "prospects," "potential," "commit" and "forecast," or words of similar import or meaning or refer to future time periods. Forward-looking statements may relate to, among other things, the demand for our products and services, including as a result of macroeconomic conditions and changing customer preferences and expectations; net sales growth; comparable sales; the effects of competition; our brand and reputation; implementation of interconnected retail, store, supply chain, technology, innovation and other strategic initiatives, including with respect to real estate; inventory and in-stock positions; the state of the economy; the state of the housing and home improvement markets; the state of the credit markets, including mortgages, home equity loans, and consumer and trade credit; the impact of tariffs, trade policy changes or restrictions, or international trade disputes and efforts and ability to continue to diversify our supply chain; issues related to the payment methods we accept; demand for credit offerings including trade credit; management of relationships with our associates, jobseekers, suppliers and service providers; cost and availability of labor; costs of fuel and other energy sources; events that could disrupt our business, supply chain, technology infrastructure, or demand for our products and services, such as tariffs, trade policy changes or restrictions or international trade disputes, natural disasters, climate change, public health issues, cybersecurity events, labor disputes, geopolitical conflicts, military conflicts, or acts of war; our ability to maintain a safe and secure store environment; our ability to address expectations regarding sustainability and human capital management matters and meet related goals; continuation or suspension of share repurchases; net earnings performance; earnings per share; future dividends; capital allocation and expenditures; liquidity; return on invested capital; expense leverage; changes in interest rates; changes in foreign currency exchange rates; commodity or other price inflation and deflation; our ability to issue debt on terms and at rates acceptable to us; the impact and expected outcome of investigations, inquiries, claims, and litigation, including compliance with related settlements; the challenges of operating in international markets; the adequacy of insurance coverage; the effect of accounting charges; the effect of adopting certain accounting standards; the impact of legal and regulatory changes, including executive orders and other administrative or legislative actions, such as changes to tax laws and regulations; store openings and closures; guidance for fiscal 2025 and beyond; financial outlook; and the impact of acquired companies, including SRS Distribution Inc. and GMS Inc., on our organization and the ability to recognize the anticipated benefits of completed or pending acquisitions.

These statements are not guarantees of future performance and are subject to future events, risks and uncertainties – many of which are beyond our control, dependent on the actions of third parties, or currently unknown to us – as well as potentially inaccurate assumptions that could cause actual results to differ materially from our historical experience and our expectations and projections. These risks and uncertainties include, but are not limited to, those described in Part I, Item 1A. "Risk Factors," and elsewhere in our Annual Report on Form 10-K for our fiscal year ended February 2, 2025 and also as described from time to time in reports subsequently filed with the Securities and Exchange Commission. There also may be other factors that we cannot anticipate or that are not described herein, generally because we do not currently perceive them to be material. Such factors could cause results to differ materially from our expectations. Forward-looking statements speak only as of the date they are made, and we do not undertake to update these statements other than as required by law. You are advised, however, to review any further disclosures we make on related subjects in our filings with the Securities and Exchange Commission and in our other public statements.

Non-GAAP Financial Measures

To provide additional transparency, we supplement our disclosure with certain non-GAAP financial measures. When used in conjunction with our GAAP financial measures, we believe these supplemental non-GAAP financial measures will help management and investors to better understand and analyze our performance. However, this supplemental information should not be considered in isolation or as a substitute for the related GAAP measures. Refer to the end of this release for an explanation and definitions of these non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures.

NON-GAAP FINANCIAL MEASURES

Adjusted operating income, adjusted operating margin (calculated as adjusted operating income divided by total net sales), and adjusted diluted earnings per share are presented as supplemental financial measures in the evaluation of our business that are not required by or presented in accordance with GAAP. The Company excludes the impact of amortization expense from acquired intangible assets from adjusted operating income and adjusted operating margin, and the impact of amortization expense from acquired intangible assets, including the related tax effects, from adjusted diluted earnings per share. We do not adjust for the revenue that is generated in part from the use of our acquired intangible assets. Amortization expense, unlike the related revenue, is not affected by operations in any particular period unless an intangible asset becomes impaired, or the useful life of an intangible asset is revised.

When used in conjunction with our GAAP results, we believe these non-GAAP measures provide investors with meaningful supplemental measures of our performance period to period, make it easier for investors to compare our underlying business performance to peers, and align to how management analyzes trends and evaluates performance internally. The Company provides non-GAAP financial information on this basis to facilitate comparability when we report earnings results. These non-GAAP measures should not be considered in isolation or as a substitute for their comparable GAAP financial measures. Investors should rely primarily on our GAAP results and use non-GAAP financial measures only supplementally in making investment decisions. Our calculation of non-GAAP measures may not be comparable to similarly titled measures reported by other companies and other companies may not define these non-GAAP financial measures in the same way, which may limit their usefulness as comparative measures.

The most directly comparable GAAP measure to adjusted operating margin is operating margin, which is calculated as operating income divided by total net sales. Our adjusted operating margin guidance for fiscal 2025 and our preliminary outlook for fiscal 2026 excludes an expected approximately 40 basis point impact in each fiscal year, respectively, from acquired intangible asset amortization.

The most directly comparable GAAP measure to adjusted diluted earnings per share is diluted earnings per share. Our adjusted diluted earnings per share guidance for fiscal 2025 and our preliminary outlook for fiscal 2026 excludes an expected after-tax impact of approximately $0.45 and $0.50, respectively, from acquired intangible asset amortization.

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SOURCE The Home Depot

Total sales growth of approximately 3%
- GMS expected to contribute approximately $2 billion in incremental sales
Comparable sales growth to be slightly positive for the comparable 52-week period
Approximately 12 new stores
Gross margin of approximately 33.2%
Operating margin of approximately 12.6%
Adjusted⁽¹⁾
Tax rate of approximately 24.5%
Net interest expense of approximately $2.3 billion
Diluted earnings-per-share to decline approximately 6% from $14.91 in fiscal 2024
Adjusted⁽¹⁾
Capital expenditures of approximately 2.5% of total sales

Home improvement market in a range between -1% to +1%
Comparable sales growth of approximately flat to 2%
Total sales growth of approximately 2.5% to 4.5%
Operating margin of approximately 12.4% to 12.6%
Adjusted⁽¹⁾
Diluted earnings-per-share to increase approximately flat to 4%
Adjusted⁽¹⁾

Total sales growth of approximately 5% to 6%
Total comparable sales growth of approximately 4% to 5%
Operating profit growth faster than sales
Diluted earnings-per-share growth of approximately mid-to-high-single-digits