The Home Depot 2026 Q3 Earnings Revenue Grows 2.8% Amid 1.3% Net Income Decline

The Home Depot reported fiscal 2026 Q3 earnings on Nov 25, 2025, with revenue rising 2.8% year-over-year to $41.35 billion. Despite the top-line growth, net income and EPS declined slightly, reflecting margin pressures. The company raised full-year revenue guidance to 3% growth, signaling cautious optimism.

Revenue

Building materials and décor segments led the revenue growth, contributing $13.60 billion and $12.94 billion respectively. While hardlines sales reached $10.93 billion, the "other net sales" category added $3.89 billion, completing the $41.35 billion total. The performance underscored diversified demand across core categories, though transaction volumes softened slightly.

Earnings/Net Income

Earnings per share (EPS) dipped 1.4% to $3.63 in Q3 2026 from $3.68 in the prior year. Net income fell 1.3% to $3.60 billion, down from $3.65 billion in Q3 2025. Despite the decline, the company maintained profitability for over two decades in the quarter, demonstrating operational resilience amid macroeconomic challenges.

Price Action

The stock surged 3.56% in the latest trading day and 4.34% over the past week, but dropped 9.21% month-to-date.

Post-Earnings Price Action Review

The strategy of buying HD after earnings beats and holding for 30 days yielded a 17.88% return, lagging the benchmark’s 80.96% performance. While the Sharpe ratio of 0.14 and zero maximum drawdown suggest low risk, 23.91% volatility highlights market fluctuations. The 3.36% compound annual growth rate (CAGR) further indicates conservative long-term potential.

CEO Commentary

CEO Craig J. Melvin emphasized operational efficiency and customer-centric initiatives during the earnings call. He noted, “Our ability to grow revenue while navigating macroeconomic headwinds reflects our focus on execution and innovation.” Melvin highlighted investments in digital tools to enhance the Pro customer experience and expand online sales, which grew 11.4% year-over-year. He expressed cautious optimism about the full-year outlook, acknowledging near-term margin pressures but reaffirming confidence in the company’s long-term positioning in the home improvement sector.

Guidance

The company updated its full-year 2026 guidance to reflect 3% revenue growth, slightly above its previous 2.8% forecast. While same-store sales are expected to show “slightly positive” growth, the CEO emphasized disciplined cost management and strategic capital allocation to drive sustainable earnings.

Additional News

On Nov 19, 2025, Telsey Advisory Group lowered its price target for HD to $430 from $455 while maintaining an “Outperform” rating, citing Home Depot’s long-term retail dominance despite near-term margin challenges. The SEC 10-Q report revealed capital expenditures of $4 billion for fiscal 2025, prioritizing store expansions and Pro services enhancements. Additionally, the company opened three new U.S. stores in Q3, expanding its total count to 2,356 locations.