Lowe’s released its fiscal second quarter earnings on Wednesday, posting results that fell short of providing momentum for the retailer. The company reported net income of $2.4 billion, or $4.27 per share, which remained roughly flat compared to the year-ago period. On an adjusted basis, excluding one-time items and including tariff refund benefits, the company posted earnings of $4.40 per share.
While the company maintained its full-year guidance range, it adjusted its outlook toward the lower end of previously provided targets. Total sales guidance was revised to $92 billion from a prior range of $92 billion to $94 billion. The retailer now expects comparable sales to be flat rather than flat to up 2%, and adjusted earnings per share guidance moved to $12.25 from a prior range of $12.25 to $12.75. For the quarter ended July 31, Lowe’s recorded total sales of $25.96 billion, up from $23.96 billion in the prior year period, with comparable sales rising 0.2%.
CEO Marvin Ellison attributed the cautious outlook to weakness in consumer spending on home improvement projects. He noted that customers were not trading down to lower-priced options but instead were pausing discretionary purchases. Ellison stated the company expects homeowners to remain cautious throughout the remainder of the year, though he expressed confidence that the housing market would experience a gradual recovery.
The quarter showed strength in certain segments, including a 15.7% increase in online sales and continued growth in professional and home services categories. The company also received approximately $80 million in tariff refunds during the quarter, which contributed an 11-cent boost to earnings per share. However, these gains were partially offset by macroeconomic pressures affecting do-it-yourself customers and what Ellison characterized as heightened competitive activity in July involving competitors deploying tariff refund dollars.
Despite the cautious guidance, Lowe’s shares rose roughly 2% on the day of the announcement. Ellison indicated that the company would prioritize shareholder profitability over aggressive pricing strategies, stating that as tariff refunds are received in coming months, the company would consider how to share benefits with customers. He emphasized that improved consumer confidence in discretionary spending would be necessary before the company would consider raising its outlook.
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