Home Depot reported Tuesday earnings that beat analysts’ expectations, but missed on the top line, dragged down by what the company called a “slow start to the spring selling season.”
Spring is the season when many people stock up on gardening supplies and start home renovations, making it a key quarter for home improvement retailers.
“Outside of our seasonal business, we had solid results in all markets and categories and are seeing strong momentum in all lines of business during these first few weeks of May,” said CEO Craig Menear.
Home Depot shares fell more than 2 percent in premarket trading.
Here’s how the company did compared with what Wall Street expected:
— Earnings: $2.08 per share vs. $2.05 per share forecast by Thomson Reuters
— Revenue: $24.95 billion vs. $25.15 billion forecast by Thomson Reuters
Home Depot reported earnings per share of $2.08, above expectations of $2.05. It reported revenue of $24.95 billion, below the $25.15 billion expected.
Analysts at Jefferies last week lowered their first-quarter estimates for Home Depot, citing the poor spring weather. Jefferies expects shoppers will shift their projects to the summer, not abandon them entirely.
More broadly, Home Depot has been benefiting from a strong housing market and favorable economic tailwinds. Home improvement has been one of the strongest performing segments of retail, in part boosted by the recovery needed following severe weather over the past year.
More broadly, Home Depot has been building out its e-commerce strategy, surpassing its rival Lowe’s in that capacity.
Home Depot said on Tuesday it is backing their previous forecasts for 2018.