Home Depot Q4 Performance Soars! Revenue and Profit Both Exceed Expectations!

TradingKey - Home Depot (NYSE: HD) reported stunning Q4 results, with both revenue and profits exceeding expectations. Sales are projected to soar by 2.8% in the fiscal year 2025!

Key Financial Highlights

Revenue: The sales for Q4 FY2024 were up 14.1% YoY to $39.7 billion, beating the estimation of $39.2 billion by 1.41%. The additional week contributed approximately $2.5 billion in sales.

EPS: Adjusted EPS for Q4 FY2024 was $3.13, up 9.4% YoY from $2.86, exceeding expectations of $3.04 by 3%. The additional week contributed approximately $0.30 to adjusted EPS. 

Comparable sales: Comparable sales for Q4 FY2024 rose 0.8% with U.S. comparable sales increasing 1.3%,  beating analyst expectations of a 1.48% decline, marking the end of eight consecutive quarters of same-store sales declines, mainly driven by the improvement of store space utilization. 

Selected Sales Data: In Q4 FY2024, Home Depot saw a 7.6% increase QoQ in customer transactions, a 0.3% rise QoQ in average ticket to $89.11, and a 1.2% growth QoQ in sales per retail square foot, reflecting higher customer engagement and improved sales efficiency. 

Investment Outlook 

Although the uncertain macroeconomic conditions and a higher interest rate environment impacted home improvement demand, especially large remodeling projects, the management still expects that consumers will adjust to the higher rate environment and stop delaying major projects, rather than waiting for interest rates to decrease.

For FY2025, Home Depot projects total sales growth of approximately 2.8%, with comparable sales increasing around 1.0%. While external challenges persist, the company remains focused on strategic investments in its core business and expects to maintain strong operating margins (around 13.4% on an adjusted basis). The projected 2% decline in diluted EPS suggests potential headwinds, primarily due to a 53-week comparison, but solid revenue growth and effective cost management are expected to mitigate these challenges.

Home Depot’s FY2025 guidance highlights its resilient business model and focus on long-term growth through strategic investments, efficiency improvements, and customer engagement. The expected moderate decline in EPS may limit short-term upside but solidify its stable financial position, making it an attractive long-term investment for those seeking stability and moderate growth.