Home Depot Earnings Preview: Declining Customer Transactions Weigh on Q2 Results
Home Depot is set to release its fiscal second-quarter earnings on Tuesday morning, with shares trading near $338. The company is expected to report adjusted earnings per share of $4.73 and revenue of approximately $47.25 billion for the period.
The retailer has seen a five-quarter streak of declining customer transactions, but this trend has been partially offset by rising average ticket values. Comparable customer transactions fell 1.3% in the fiscal first quarter, while total transactions came to 391.1 million, down from 394.8 million a year earlier.
The housing market remains a key constraint for Home Depot's retail segment, with mortgage rates above 6.5% keeping home prices elevated and making financing costly for potential buyers. Existing home sales fell 1.7% in July to an annualized 4.06 million units, as homeowners with low-rate mortgages opted to stay put rather than move.
CEO Ted Decker will be taking a temporary medical leave of several months, adding uncertainty to the earnings picture. Operational oversight has shifted to senior executives Ann-Marie Campbell and chief financial officer Richard McPhail in his absence.