Home Depot Inc. reported fiscal third‑quarter 2025 results on November 18, 2025, posting $41.4 billion in revenue—up 2.8% year‑over‑year—and adjusted earnings per share of $3.74, which fell short of the consensus estimate of $3.81 by $0.07 (a 1.8% miss). Diluted earnings per share were $3.62 and net earnings reached $3.6 billion.
The revenue beat was driven largely by the $900 million in sales contributed by the recently completed acquisition of GMS Inc., a specialty building‑products distributor. After the acquisition, comparable sales grew only 0.2% versus the 1.3% expected by analysts, indicating that organic demand remains muted. The modest comparable‑sales lift, combined with the GMS contribution, allowed Home Depot to exceed revenue estimates by roughly $0.22 billion (about 0.5% of revenue).
The earnings miss reflects a confluence of headwinds. A sharp decline in storm activity in the third quarter reduced demand for roofing and other seasonal items, while consumer uncertainty in the housing market dampened overall home‑improvement spending. Operating margin contracted to 12.9% from 13.5% in the same quarter a year earlier, as operating expenses rose 55 basis points to 20.5% of sales. The margin squeeze, coupled with the lower seasonal demand, explains why adjusted EPS fell short of expectations.
Management revised its full‑year adjusted EPS guidance from $15.24 to $14.48, a 5% decline, while maintaining a sales outlook of $164.3 billion. The guidance cut signals management’s concern that the combination of weak seasonal demand, persistent housing‑market uncertainty, and higher operating costs will limit growth in the near term. The company emphasized that it remains focused on building market share, particularly in the professional contractor segment, as part of its long‑term strategy.
CEO Ted Decker said the quarter’s results were “missed primarily because of the lack of storms, which reduced demand for roofing and other seasonal products.” He added that consumer uncertainty and continued pressure in the housing market were disproportionately impacting home‑improvement demand, but that the company was “continuing to execute at a high level and growing our market share.” CFO Richard McPhail noted that operating expenses as a percentage of sales increased to 20.5%, contributing to the margin compression.
Analysts reacted to the earnings miss and guidance cut with caution. J.P. Morgan’s Christopher Horvers highlighted that the company’s outlook would likely lead to a downward revision of 2026 forecasts, while Wells Fargo’s Zachary Fadem warned that the lack of storm activity could further soften October exit rates. The market’s reaction was tempered by concerns over the company’s ability to sustain growth amid ongoing macroeconomic headwinds.
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