Home Depot announces Q1 results, with revenue of $37.257 billion, a 20-year low

It is learned that according to foreign media reports, as the online consumption boom subsided, people postponed home renovations and reduced large items such as patio sets and grills, and the US home furnishing e-commerce company Home Depot's revenue in the first quarter hit a nearly 20-year low.

The retailer said cold weather and falling lumber prices also hurt first-quarter sales. Its last big quarterly sales drop was in November 2002.

The financial report shows that in the first quarter of 2023 (ending April 30), Home Depot's net sales were US$37.257 billion, down 4.2% from US$38.908 billion in the same period last year, which was lower than market expectations. Net profit was US$3.873 billion, down 8.5% from US$4.231 billion in the same period last year. Operating profit was US$5.551 billion, down 6.4% from US$5.929 billion in the same period last year. Comparable sales fell 4.5% year-on-year, with same-store sales in the United States falling 4.6%.

The announcement comes after three years of "unprecedented" growth for Home Depot, which saw sales surge by more than $47 billion, but it expects demand in the home improvement industry to "moderate" in 2023, President and CEO Ted Decker said in a statement.

Ted Decker further noted: "Our sales in the quarter were lower than expected, primarily due to lumber deflation and adverse weather, especially in our business in the western United States, which was greatly impacted by extreme weather. Compared with when we reported fourth quarter results a few months ago, we find that the entire industry is now facing more pressure."

Looking ahead, Home Depot lowered its full-year sales growth forecast to mid-single digits, between 2% and 5%, from high single digits previously. Net profit margins also fell, to between 14% and 14.3%, compared with the previous forecast of 14.5%.

As of the end of the first quarter, Home Depot operated 2,324 physical stores in 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. The company employed approximately 475,000 people.

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