Home Depot beats Q4 earnings expectations despite 3.8% sales decline

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2.25.2026

Quick Facts

Home Depot reported Q4 diluted EPS of $2.58, beating consensus estimate of $2.51 per share
Q4 sales fell 3.8% year-over-year to $38.2 billion due to calendar shift that removed one week
Company expects flat to 2% comparable sales growth in fiscal 2026, below analyst expectations of 2.34%

Home Depot delivered stronger-than-expected earnings in the fourth quarter despite ongoing challenges in the housing market. The retailer reported diluted earnings per share of $2.58, surpassing the consensus estimate of $2.51.

Sales declined 3.8% year-over-year to $38.2 billion in the quarter. The company attributed much of the decline to a calendar shift, as Q4 2024 included 13 weeks compared to 14 weeks in the prior year. The extra week in 2024 added about $2.5 billion in sales.

Comparable store sales edged up 0.4% overall, with U.S. comparable store sales climbing 0.3%. Professional contractor sales outperformed do-it-yourself sales, with Pro posting positive comps across categories including gypsum, wire, concrete, and plumbing.

“Our fourth quarter results exceeded our expectations as we saw greater engagement in home improvement spend, despite ongoing pressure on large remodeling projects,” said CEO Ted Decker.

Digital channels continued growing, with online comparable sales increasing about 11% year-over-year. Big-ticket transactions above $1,000 rose 1.3% versus the prior year.

Despite the earnings beat, shares fell 1.6% in premarket trading as investors focused on the company’s cautious outlook. Home Depot expects fiscal 2026 sales to increase 2.5% to 4.5% year-over-year, with comparable sales growing flat to 2%. This falls short of analyst expectations of 2.34% same-store sales growth.

The retailer also forecasts adjusted earnings to be flat to up 4% from fiscal 2025’s $14.69 per share, below the analyst consensus of 5.6% growth.

Decker described persistent challenges in the housing market, noting that consumers and the company have “been in a frozen housing environment for three years.” Higher interest rates and economic uncertainty have led homeowners to delay major renovation projects typically associated with buying or selling homes.

Home sales of previously occupied U.S. homes fell 8.4% in January from December, reflecting the broader housing market weakness. The company is positioning for long-term growth through strategic acquisitions, including the $18.25 billion purchase of SRS Distribution in 2024.