Lowe’s beats on quarterly sales, but lowers full-year profit forecast amid economic

Lowe’s on Wednesday posted a year-over-year sales increase for the quarter, but the company lowered its full-year profit outlook slightly to reflect a tougher economic backdrop.

The home improvement retailer now expects full-year total sales to be $86 billion, up from its previous expectations of $84.5 to $85.5 billion, because of a recent acquisition. However, it said it anticipates comparable sales, an industry metric that takes out one-time factors, to be flat compared to a year ago compared with the prior range it had shared of flat to up 1%.

For the full year, it now expects adjusted earnings per share of approximately $12.25, on the lower side of its previous range of $12.20 to $12.45.

Chief Financial Officer Brandon Sink said on the company’s earnings call that Lowe’s revised its outlook to reflect economic uncertainty and the acquisition of Foundation Building Materials, which closed last month.

On a call with CNBC, CEO Marvin Ellison described the U.S. homeowner as healthy and said its customers’ balance sheets are strong. But, he said, even homeowners “are not immune to the media cycle.”

As they follow the news, he said, they are considering what events like the prolonged government shutdown or policy changes like higher tariffs mean for their household budgets.

Ellison said they have shown hesitance to make pricier purchases or take on bigger projects as they ask themselves, “Is this the right time to invest or should I hold constant?”

Here’s what the retailer reported for the fiscal third quarter compared with Wall Street’s estimates, according to a survey of analysts by LSEG:

Earnings per share: $3.06 adjusted vs. $2.97 expectedRevenue: $20.81 billion vs. $20.82 billion expected

Shares of the company closed on Wednesday at $228.41, up about 4%. The company’s stock rose after Lowe’s earnings report and update that its current quarter was off to a good start.

Ellison said in the news release that the retailer posted positive comparable sales in the third quarter and also started the current quarter with positive comparable sales, “despite headwinds related to hurricane activity in the prior year.”

Lowe’s comparable sales rose 0.4% in the fiscal third quarter.

Home improvement trends, however, remain challenged by a slower housing market and higher borrowing costs — dynamics that have challenged the sector for more than two years.

In the three-month period ended Oct. 31, Lowe’s net income fell to $1.62 billion, or $2.88 per share, compared with $1.7 billion, or $2.99 in the year-ago period. Revenue increased from $20.17 billion in the year-ago quarter. Adjusting for one time items, including pretax expenses associated with its acquisitions, Lowe’s reported earnings of $3.06 per share.

Rival Home Depot on Tuesday also lowered its full-year profit forecast after missing Wall Street’s quarterly earnings expectations for the third quarter in a row. Chief Financial Officer Richard McPhail attributed weaker earnings to lower-than-usual storm activity, a tough housing market and consumer uncertainty.

While the home improvement industry faces a tougher backdrop, Lowe’s CFO Sink said there are trends that the company feels “cautiously optimistic about as we look ahead to 2026.” For instance, he said, the retailer has had stronger sales on the pro side of the business and in appliances. And, he said, there are “early signs of life” in its home services business.

Ten of the company’s 14 merchandise divisions, including appliances, flooring, kitchen and bath, posted positive sales growth in the quarter, Bill Boltz, executive vice president of merchandising, said on the company’s earnings call. Some of those categories, such as kitchen and bath, are typically associated with bigger projects and remodels.

Like Home Depot, Lowe’s has tried to attract more business from contractors and other home professionals to offset weaker do-it-yourself sales. In August, Lowe’s announced it had struck a deal to acquire Foundation Building Materials, a distributor of drywall, insulation and other interior building products for large residential and commercial professionals, for about $8.8 billion.

Earlier this year, Lowe’s announced another pro-focused acquisition. It said in April it had agreed to buy Artisan Design Group, which provides design services and installation of flooring, cabinets and countertops for homebuilders and property managers, for nearly $1.33 billion.

On the company’s earnings call in August, Sink said he expected the company’s own strategy, not an improving industry backdrop, to drive sales for the year. He said the retailer expects “a roughly flat home improvement market” for the year.