Latest quarter
The Home Depot reported revenue of $47.9 billion for Q2 FY2027, versus the consensus of $47.2 billion, while adjusted EPS as the consensus counts it was $4.92, versus $4.71 expected. The company reported that revenue increased 5.71% from a year earlier and that diluted EPS rose 4.59% to $4.79.
The filing said sales growth reflected GMS, a positive comparable-sales environment, Mingledorff’s and new stores and branches. The filing reported total comparable sales growth of 1.7%, including U.S. comparable-sales growth of 1.30%, and said online sales increased 11.0%. Gross margin was 33.7%, compared with 33.4% a year earlier, as tariff refunds were largely offset by fuel, energy and other product-input costs and the inclusion of GMS. Operating margin was 14.3%, compared with 14.5%, while free cash flow was $4.5 billion, compared with $3.7 billion a year earlier.
| Q2 FY2027 | Q2 FY2026 | Change | |
|---|---|---|---|
| Revenue | $47.9 billion | $45.3 billion | 5.71% |
| Diluted EPS | $4.79 | $4.58 | 4.59% |
| Gross margin | 33.7% | 33.4% | 0.3 percentage points |
| Operating margin | 14.3% | 14.5% | −0.2 percentage points |
| Free cash flow | $4.5 billion | $3.7 billion | 21.0% |
| Against the consensus | Reported | Consensus | Result |
|---|---|---|---|
| Adjusted EPS | $4.92 | $4.71 | Beat by 4.46% |
| Revenue | $47.9 billion | $47.2 billion | Beat by 1.33% |
Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.
What management said on the call
Richard McPhail said customers continued to undertake home-improvement projects and that the company saw broad-based demand, with positive comparable sales in its northern and western U.S. divisions as well as Canada and Mexico. He said consumer uncertainty and housing affordability continued to pressure demand for larger projects, while comparable sales increased through each month of the quarter.
McPhail said the company received $730.0 million in tariff refunds during the quarter, of which $685 million reduced cost of goods sold and $45 million remained in inventory. In response to analyst questions on the margin effect and timing of those refunds, he said the benefit was being used to offset unplanned fuel, energy and other product-input costs and that the company expected those costs to fully offset the refunds over the year. He also said fourth-quarter gross margin would likely be approximately flat compared with the prior year.
Billy Bastek said costs had also risen for commodities including resin and metals, and cited tariff changes as an incremental pressure relative to the company’s initial plan. When analysts asked about housing conditions, McPhail said housing turnover remained at historical lows and that the company saw no sign of an inflection point at that time.
Ann-Marie Campbell said on-shelf availability remained at record levels and described it as foundational to customer service and store fulfillment. Jordan, the company’s digital leader, said online sales grew 11% in the quarter, with traffic and conversion both increasing, and said the company had rolled out express delivery nationwide. Campbell also said 90% of stores had completed a sale through SRS during the prior 12 months.
Guidance
Richard McPhail said The Home Depot was reaffirming its fiscal 2026 guidance on the latest call. The company did not announce a change to its previous outlook; McPhail said comparable sales were expected to range from flat to 2% growth and total sales growth from approximately 2.5% to 4.5%.