Lowe’s Companies (NYSE: LOW) has disclosed its financial results for the second quarter of 2024, showcasing a blend of success and challenges. The renowned home improvement retailer reported net earnings of $2.4 billion and diluted earnings per share (EPS) of $4.17 for the quarter ending on Aug. 2, 2024.
Although this marks a decrease from the previous year’s second quarter, where diluted EPS was $4.56, it’s important to note that the company recognized a $43 million pre-tax gain related to the 2022 sale of its Canadian retail business. This gain had a positive impact on the second-quarter diluted EPS by $0.07. Excluding this gain, the adjusted diluted EPS for the quarter stood at $4.10.
Total sales for the quarter amounted to $23.6 billion, a decline from $25.0 billion in the prior year quarter. This drop in sales was primarily driven by a 5.1% decrease in comparable sales, attributed to ongoing pressure on DIY bigger ticket discretionary spending and unfavorable weather conditions affecting sales in seasonal and outdoor categories.
LOW Surpasses EPS Expectations in Q2, Falls Short in Revenue
When comparing Lowe’s actual performance against analyst forecasts, the company exceeded expectations in terms of EPS but fell short in revenue. While analysts had predicted an EPS of $3.96, Lowe’s reported a diluted EPS of $4.17 and an adjusted diluted EPS of $4.10.
This indicates that the company’s profitability outperformed expectations, even though it was lower than the previous year. The adjusted EPS, excluding the one-time gain from the Canadian business sale, surpassed analyst forecasts by $0.14.
On the revenue front, Lowe’s missed the anticipated $23.93 billion, reporting $23.6 billion instead. The decline in revenue can be attributed to the 5.1% decrease in comparable sales, driven by external factors such as continued pressure on DIY spending and adverse weather conditions.
Guidance for the Future
Lowe’s has adjusted its full-year 2024 outlook to reflect the current market conditions and its performance in the second quarter. The company has revised its expectations to consider the ongoing challenges in discretionary spending and the impact of unfavorable weather conditions.
Overall, while Lowe’s faced some setbacks in the second quarter of 2024, the company demonstrated resilience in certain segments, such as Pro and online sales. By adapting to market conditions and focusing on key growth areas, Lowe’s aims to navigate the challenges ahead and drive continued success in the future.