Home Depot outperformed analyst expectations for fourth-quarter sales, supported by steady purchases from professional contractors and an uptick in lower-cost repairs by consumers facing tighter budgets. The company said it reaffirmed the annual sales target it set in December, and its stock climbed 3.5% in premarket trading following the results.
Headquartered in Atlanta, the world’s largest home improvement retailer has offset weakness in the U.S. housing market by prioritizing its professional - or Pro - customer segment, whose sizable, ongoing projects provide a more stable revenue stream compared with the softer market for large do-it-yourself remodels.
High interest rates have kept demand muted for big-ticket remodeling projects that often require financing, according to the company. That dynamic has helped pivot customer spend toward smaller repairs and contractor-led work.
"For the fourth quarter, our 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," said CEO Ted Decker.
For the three months ended February 1, the company recorded a 0.4% increase in same-store sales, compared with analysts' forecasts of roughly flat sales compiled by LSEG. Home Depot reaffirmed its fiscal year 2026 comparable sales outlook of flat to a 2% increase; analysts' average estimate stood at 2% growth, according to LSEG data.
Management emphasized the role of the Pro customer base in cushioning the business through a period of uneven demand for larger financed projects, while consumers constrained by budgets have shifted toward less expensive fixes. The company also cited the absence of storm-related spending in the prior quarter as a factor influencing recent performance.
The results illustrate how Home Depot is navigating a challenging housing backdrop by leaning on contractor demand and activity that does not rely on the high interest-rate environment. The company’s reaffirmation of its December sales forecast signals confidence in its ability to manage the mix of Pro and retail consumer spending through ongoing housing market pressures.