Lowes Companies 2026 Q1 Earnings Misses Targets as Net Income Drops 6.5%

Lowe's Companies (LOW), ranking 108th by market capitalization, reported its fiscal 2026 Q1 earnings on May 29th, 2025. The company posted a net income decline of 6.5% year-over-year. Despite this, Lowe's maintained its full-year guidance for 2025, projecting total sales between $83.5 billion and $84.5 billion, and diluted earnings per share ranging from $12.15 to $12.40. Analysts had anticipated these figures, reflecting the company's steady outlook amidst challenging market conditions. Lowe's continues to navigate the housing market headwinds with strategic investments.

Revenue
Lowe's Companies reported a total revenue of $20.93 billion for 2026 Q1, marking a decrease of 2.0% from $21.36 billion in the previous year's Q1. The home décor segment led the revenue at $7.55 billion, followed closely by building products, which brought in $6.56 billion. Hardlines contributed $6.40 billion, while the 'Other' category added $424 million, culminating in the total revenue figure.

Earnings/Net Income
Lowe's Companies experienced a decline in EPS to $2.93 from $3.06 in 2025 Q1, alongside a drop in net income to $1.64 billion, down from $1.75 billion. This performance indicates challenges in maintaining earnings growth.

Price Action
The stock price of Lowe's Companies edged down 0.27% during the latest trading day, decreased by 1.07% during the most recent full trading week, and increased by 1.71% month-to-date.

Post-Earnings Price Action Review
The strategy of buying Lowe's shares when revenues miss expectations and holding them for 30 days has proven beneficial, yielding a 25.8% gain in contrast to a 15.6% gain for the SPY ETF during the same timeframe. This approach showcases its potential in leveraging negative earnings surprises, offering a valuable addition to risk-averse portfolios. Investors have observed that despite short-term fluctuations in the stock price, the long-term benefits of holding Lowe's shares during periods of revenue miss can result in substantial gains. This strategy underscores the resilience of Lowe's stock in bouncing back, providing an opportunity for investors seeking stable returns amidst market volatility.

CEO Commentary
Marvin R. Ellison, CEO of Lowe's Companies, highlighted the company's resilience in navigating near-term uncertainty and housing market headwinds. He emphasized that investments in technology, customer service, and store environments have been pivotal in maintaining customer satisfaction, which has earned Lowe's the top ranking in customer satisfaction among home improvement retailers. Ellison noted that while the company faced challenges such as unfavorable weather impacting sales, there were positive developments with mid-single-digit growth in sales to home professionals and online sales. He expressed cautious optimism, indicating that while customers are currently delaying larger projects, Lowe's is well-positioned to capitalize on future market opportunities.

Guidance
Lowe's Companies maintains its full-year guidance for 2025, expecting total sales between $83.5 billion and $84.5 billion, with comparable sales projected to be flat to up 1% year-over-year. The company aims for diluted earnings per share in the range of $12.15 to $12.40, and capital expenditures are estimated at approximately $2.5 billion. Additionally, operating income as a percentage of sales is anticipated to be between 12.3% and 12.4%.

Additional News
In April 2025, Lowe's announced the acquisition of Artisan Design Group for $1.3 billion, aiming to enhance its Pro planned spend and gain share in a $50 billion market. This strategic move is part of Lowe's disciplined capital management strategy and positions the company for a housing recovery expected over the next decade. Additionally, Lowe's continued its commitment to shareholder value by paying dividends totaling $645 million during the quarter. Meanwhile, share repurchases decreased significantly to $112 million, reflecting a cautious approach amid current market uncertainties. These corporate actions demonstrate Lowe's focus on strategic growth and prudent financial management.