Home Depot reports Q3 earnings

Home Depot, otherwise known as the Muhammad Ali of home improvement, beat Wall Street’s estimates last week:

• $37.7 billion in revenue, down 3% year-over-year.

• $3.8 billion (10%) in net earnings.

The big picture: CFO Richard McPhail noted that while this has been a year of moderation for home improvement, the worst of the inflationary environment is behind us. 

“The consumer — and particularly the homeowning consumer who is our customer — is healthy…They’re employed. They’ve seen income gains and wealth gains in recent years. They have excess savings and they remain engaged in home improvement”, he said.

Lennox CEO, Alok Maskara, made similar comments on their recent earnings call. Although interest rates remain elevated, he stated: “[The] consumer seems to be holding pretty well on the residential side.”

For Pros: Home Depot will continue to prioritize its Pro initiatives to capture a bigger share of contractors’ wallets.

“Having the right products in stock, in the right quantity, and on the shelf available for purchase is critical. And we’ve implemented several initiatives to help us do this more effectively and efficiently”, said Ann-Marie Campbell, who was recently promoted to lead the charge.

Looking ahead: To echo his financial chief, CEO Ted Decker mentioned that the home improvement market — HVAC included — is also healthy. “The asset class for home improvement is worth 15-odd trillion dollars more than it was pre-pandemic.”

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