The Home Depot 2026 Q2 Earnings Sustained Profitability with Slight EPS Drop

The Home Depot (HD) reported its Q2 2026 earnings on August 18, 2025, delivering results that were in line with expectations. The company posted a modest revenue increase but saw a slight decline in earnings per share (EPS). The company maintained its full-year guidance and reaffirmed confidence in its long-term performance and market position.

Revenue

The Home Depot achieved a total revenue of $45.28 billion in Q2 2026, representing a 4.9% year-over-year increase from the $43.17 billion recorded in the same quarter of 2025. This growth highlights the company's ability to sustain demand amid a competitive retail environment, with continued consumer interest in smaller home improvement projects contributing to the positive trend.

Earnings/Net Income

Earnings per share (EPS) for the quarter declined slightly to $4.59 from $4.61 in the prior year, marking a 0.4% drop. Similarly, net income decreased by 0.2% to $4.55 billion compared to $4.56 billion in Q2 2025. Despite these small declines, the company has maintained profitability for over 20 years during this quarter, a testament to its strong operational resilience.

Price Action

The Home Depot’s stock price experienced mixed short-term movements following the earnings report. The stock edged down 0.47% during the latest trading day but rebounded with an 1.85% gain during the most recent full trading week. Over the past month, the stock surged 9.93%, indicating strong investor confidence in the long-term outlook.

Post-Earnings Price Action Review

A strategy of buying Home Depot shares immediately after the earnings report was released and holding for 30 days yielded moderate returns, with a compound annual growth rate (CAGR) of 1.28%. However, this approach underperformed the broader market by nearly 49.04%. The strategy’s maximum drawdown was 0.00%, and its Sharpe ratio of 0.05 reflected low volatility and conservative returns, making it suitable for risk-averse investors.

CEO Commentary

Ted Decker, CEO of The Home Depot, expressed satisfaction with the company’s second-quarter performance, noting continued momentum from smaller home improvement projects. He praised the team for its strong execution and market share gains, emphasizing appreciation for the hard work of associates. The tone of his comments was optimistic, underscoring the company’s sustained performance and deep engagement with customers in core markets.

Guidance

The company reaffirmed its fiscal 2025 guidance, projecting total sales growth of approximately 2.8%, with a comparable sales growth of 1.0% for the 52-week period. It also expects to open 13 new stores, maintain a gross margin of around 33.4%, and an operating margin of approximately 13.0%. Adjusted operating margin is anticipated to remain near 13.4%, with a tax rate of about 24.5% and a net interest expense of roughly $2.2 billion. The company forecasts a diluted EPS decline of approximately 3% from $14.91, and an adjusted diluted EPS decline of about 2% from $15.24, with capital expenditures estimated at approximately 2.5% of total sales.

Additional News

While The Home Depot’s latest earnings report focused on operational performance and market resilience, several notable non-earnings-related events have captured attention in the broader business landscape. The U.S. Department of Treasury has reportedly lifted restrictions on the export of rare earth materials to India, sparking discussions on potential impacts on global supply chains. Additionally, new rules went into effect on September 1, 2025, expanding personal pension withdrawal scenarios. On the geopolitical front, a leaked conversation between former U.S. President Donald Trump and French President Emmanuel Macron has sparked public interest, with Macron confirming the discussion.