Did Home Depot beat earnings in Q4 FY2025?

Home Depot's Q4 FY2025 results were largely in-line with expectations. Revenue was $38.2B with comparable sales up 0.4%, and adjusted EPS was $2.72. Results were impacted by the prior year having a 14th week.

What is Home Depot's FY2026 guidance?

Home Depot guided FY2026 total sales growth of 2.5% to 4.5%, comparable sales growth of flat to 2.0%, and adjusted EPS growth of flat to 4.0% from $14.69.

Did Home Depot raise its dividend?

Yes, Home Depot increased its quarterly dividend by 1.3% to $2.33 per share ($9.32 annually).

What did Home Depot say about tariffs?

CFO Billy Bastek said more than 50% of products are sourced domestically. Tariff exposure is mid-single digits, with ~3% average SKU price impact. The company is 'mostly done' with tariff-related pricing actions.

HOME DEPOT (HD)·Q4 2026 Earnings Summary

Home Depot Q4 FY2025: Comp Sales Turn Positive, Stock Surges 3%

February 24, 2026 · by Fintool AI Agent

Banner

Home Depot reported fourth quarter fiscal 2025 results that were "largely in-line with expectations," with comparable sales turning positive for the first time in nine quarters. The stock surged +3.1% to $388.55 on earnings day, as investors responded favorably to positive comp sales and constructive FY2026 guidance despite ongoing housing market headwinds.

Did Home Depot Beat Earnings?

Home Depot delivered Q4 FY2025 results that met Street expectations, with some headline noise due to the prior year's extra week:

Metric	Q4 FY2025	Q4 FY2024	YoY Change	Notes
Revenue	$38.2B	$39.7B	-3.8%	14th week added ~$2.5B to prior year
Comparable Sales	+0.4%	—	—	U.S. comps +0.3%
Gross Margin	32.6%	32.8%	-20 bps	GMS mix impact
GAAP EPS	$2.58	$3.02	-14.6%	14th week added ~$0.30 to prior year
Adjusted EPS	$2.72	$3.13	-13.1%	Excludes intangible amortization
Operating Margin	10.1%	11.3%	-120 bps
Adj. Operating Margin	10.5%	11.7%	-120 bps

Key Context: The fourth quarter of fiscal 2024 included a 14th week that contributed approximately $2.5 billion in sales and $0.30 to diluted EPS . Adjusting for this calendar difference, underlying demand was "relatively stable throughout the year" according to CEO Ted Decker.

Monthly Comp Performance :

Month	Total Company	U.S.
November	-0.2%	-0.3%
December	+0.1%	-0.2%
January	+1.3%	+1.4%

January strength was driven by Winter Storm Fern activity .

Ask Fintool AI Agent

Full Year Fiscal 2025 Performance

For the full year, Home Depot delivered modest top-line growth driven by the SRS Distribution acquisition:

Metric	FY2025	FY2024	YoY Change
Revenue	$164.7B	$159.5B	+3.2%
Comparable Sales	+0.3%	—	—
U.S. Comps	+0.5%	—	—
Gross Margin	33.3%	33.4%	-10 bps
GAAP EPS	$14.23	$14.91	-4.6%
Adjusted EPS	$14.69	$15.24	-3.6%
Operating Margin	12.7%	13.5%	-80 bps
Adj. Operating Margin	13.1%	13.8%	-70 bps

The year-over-year decline in earnings was driven by higher operating expenses from the SRS acquisition integration, increased interest expense from higher debt levels, and the 53rd week benefit in the prior year .

What Did Management Say?

CEO Ted Decker highlighted market share gains despite a challenging backdrop:

"Our fourth quarter results were largely in line with our expectations, reflecting the lack of storm activity in the third quarter and ongoing consumer uncertainty and pressure in housing. Additionally, storm activity in January provided a sales benefit in the quarter. Adjusting for storms, underlying demand was relatively stable throughout the year."

Key operational highlights:

8 of 16 merchandising departments posted positive comps
Online sales up ~11% leveraging interconnected platforms
Average ticket increased 2.4%; comp transactions down 1.6%
Big ticket (>$1K) transactions positive 1.3%
Pro outperformed DIY with strength in gypsum, wire, concrete, plumbing
Customer satisfaction score increased every quarter; hourly tenure highest since 2017
Store count reached 2,359 at fiscal year-end

What Did Management Guide?

Home Depot provided FY2026 guidance that brackets current consensus expectations:

Guidance Bridge

Metric	FY2026 Guidance	FY2025 Actual	Consensus
Total Sales Growth	+2.5% to +4.5%	+3.2%	~$165B*
Comparable Sales	Flat to +2.0%	+0.3%	—
Gross Margin	~33.1%	33.3%	—
Operating Margin	12.4% to 12.6%	12.7%	—
Adj. Operating Margin	12.8% to 13.0%	13.1%	—
GAAP EPS Growth	Flat to +4.0%	$14.23	—
Adjusted EPS Growth	Flat to +4.0%	$14.69	~$14.50*
New Stores	~15	12	—
New SRS Locations	40-50	—	—
SRS Organic Growth	Mid-single digit %	Low single digit %	—
Capex	~2.5% of sales	—	—
Effective Tax Rate	~24.3%	23.9%	—

*Values retrieved from S&P Global

The guidance implies:

Revenue range: $168.8B to $172.1B (at midpoint ~$170B)
Adjusted EPS range: $14.69 to $15.28
Home improvement market: expected down 1% to up 1%, with HD outperforming in all scenarios
Intangible amortization impact: ~40 basis points on operating margin, ~$0.50 on EPS

Ask Fintool AI Agent

Capital Allocation Update

Dividend Increase: Home Depot raised its quarterly dividend by 1.3% to $2.33 per share, equating to $9.32 annually .

Share Repurchases: The company did not repurchase shares in fiscal 2025 . Management expects to return to share repurchases sometime in the first half of 2027 once the company returns to an excess cash position .

Capital Expenditures: FY2025 capex was $3.7 billion , with FY2026 expected at approximately 2.5% of sales (~$4.2B-$4.3B) .

Balance Sheet:

Metric	Feb 1, 2026	Feb 2, 2025	Notes
Inventory	$25.8B	$23.4B	+10% YoY: GMS addition + higher tariff costs
Inventory Turns	4.4x	4.7x	Down from prior year
ROIC	25.7%	31.3%	Impacted by acquisitions
Dividends Paid (FY)	$9.2B	—	—

How Did the Stock React?

Home Depot shares surged +3.1% to $388.55 on earnings day, reflecting investor enthusiasm for positive comp sales and constructive guidance despite housing headwinds.

Stock Metric	Value
Current Price	$388.55 (+3.1%)
Day Range	$386.22 - $394.14
52-Week High	$426.75
52-Week Low	$326.31
Market Cap	$387B

What Changed From Last Quarter?

Factor	Q3 FY2025	Q4 FY2025	Change
Comp Sales	-1.3%	+0.4%	Turned positive
U.S. Comps	-1.2%	+0.3%	Turned positive
Gross Margin	33.4%	32.6%	-80 bps (GMS mix)
Avg. Ticket Change	—	+2.4%	Price + mix
Comp Transactions	—	-1.6%	—
Online Sales	—	+11%	Interconnected strength

Key shift: Comparable sales turned positive for the first time since early fiscal 2023, a meaningful inflection point that helped drive the after-hours rally.

Risks and Headwinds

Management highlighted several ongoing challenges in the forward-looking statements :

Housing market pressure: Elevated mortgage rates continue to suppress existing home sales and large remodeling projects
Consumer uncertainty: Macroeconomic uncertainty affecting discretionary spending
Tariff exposure: Potential impact from trade policy changes on imported goods
Integration execution: Continued integration of SRS Distribution and recent GMS acquisition
Margin pressure: Intangible amortization from acquisitions creating ~40 bps operating margin headwind

Q&A Highlights

Tariffs and Pricing

CFO Billy Bastek provided clarity on tariff exposure :

"More than 50% of our products are sourced domestically and haven't been subject to tariffs... We're mostly done with tariff-related pricing actions as it relates to the impacts back to April. Our exposure was kind of mid-single digits, and then if you think of SKU price, that's right about 3%."

SRS Performance in Challenging Market

CFO Richard McPhail highlighted SRS's resilience in a brutal Q4 for roofing :

"In the fourth quarter, according to ARMA data, total industry shipments of shingle squares were down 28% year-over-year. That's the lowest industry volume since 2019... With that, SRS performed exceptionally, and by all external measures, took share in the quarter."

SRS was down low single-digit comps but gained market share. Management expects mid-single-digit organic sales growth from SRS in FY2026 .

Tax Stimulus Expectations

CEO Ted Decker was measured on tax relief benefits :

"If you take a midpoint... you would get at the midpoint, maybe half a point of comp support at that high level analysis of tax relief. We're hearing that it's just as likely that that's either going to be used for debt pay down, for lower income deciles, or saved by higher income deciles. We're not planning on a lot."

Quarterly Earnings Shape

CFO McPhail provided unusual quarterly guidance detail :

H2 comps expected stronger than H1 due to storm activity compares
Q1 gross margin down ~50 bps YoY due to GMS annualization
Q1 EPS expected mid-single-digit % negative YoY — "This is solely due to acquisition annualization and a few timing comparisons"

Pro Ecosystem Momentum

EVP Mike Rowe highlighted pro investments paying off :

AI takeoff tools: Pros can type in a project type and get a pre-populated list of materials
Two Sigma delivery reliability achieved — on-time and complete
Real-time delivery tracking now available for big and bulky items
B2B online sales outpaced overall online growth
Trade credit platform continuing to grow
Pro capabilities "high percentage" done, with continued investments through 2026

Big Ticket Inflection Point?

CEO Decker noted big ticket discretionary hasn't turned yet :

"That's really the telltale for us of when we think the demand profile is going to change for the upside, and we still have not seen that... we have not seen the increase in big ticket, and that will be a telltale for a turn in the market."

However, big ticket transactions over $1,000 were positive 1.3% in Q4 , driven by plumbing, electrical, and power categories rather than appliances and discretionary remodeling.

2026 Ticket vs. Transactions

For FY2026, management expects :

~3% ticket increase from tariff-related pricing (higher early, lower late in year)
Negative transactions offsetting ticket gains

Ask Fintool AI Agent

Looking Ahead

Upcoming catalysts:

Q1 FY2026 earnings expected late May 2026
Spring selling season performance (key demand driver)
Housing market recovery trajectory
Interest rate environment and Fed policy

The company remains confident in its ability to grow market share in any environment while continuing to invest in interconnected retail capabilities and professional customer initiatives through SRS and GMS .

Ask Fintool AI Agent

Related Links: