Home Depot Beats Expectations with 4-Year High Comps

Home Depot's second quarter earnings have beat expectations, with sales rising 5.7% to $47.9 billion and comparable sales climbing 1.7%. This is a four-year high in comps for the company.

The increase in sales was driven by customers choosing smaller projects over bigger renovations. CFO Richard McPhail noted that this trend shows 'broad-based demand across the business as customers continued to engage in smaller projects.'

However, total customer transactions fell 1% and average ticket rose 2.8%, indicating that traffic has been negative for several quarters running.

The company's profitability held up but did not expand, with gross profit rising 6.5% and operating margin dipping to 14.3%. Cash flow was stronger, reaching $11.4 billion through six months.