Lowe’s (LOW) Q1 2023 results

A Lowe’s Home Improvement Warehouse employee retrieves carts from a parking lot on August 17, 2022 in Houston, Texas.

Brandon Bell | Getty Images News | Getty Images

Lowe’s cut its full-year outlook on Tuesday as lumber prices fell and DIY customers bought fewer discretionary items.

It lowered its forecast even as it beat Wall Street’s revenue and profit expectations for the fiscal first quarter.

The home improvement retailer said it now expects total full-year sales to be between $87 billion and $89 billion, down from the $88 billion to $90 billion it had previously planned. He said he expects comparable sales to decline 2% to 4% this fiscal year, below the 2% decline he previously reported. It said adjusted earnings per share would be between $13.20 and $13.60, below its previous range of $13.60 to $14.00.

Shares plunged in premarket trading.

Here’s what the home improvement retailer reported for the three months ended May 5 compared to what Wall Street expected, based on a Refinitiv analyst survey:

  • Earnings per share: $3.67 adjusted vs. $3.44 expected
  • Revenue: $22.35 billion vs. $21.6 billion expected

Lowe’s net income for the three-month period was $2.26 billion, or $3.77 per share, compared with $2.33 billion, or $3.51 per share, a year earlier.

Net sales fell to $22.35 billion from $23.66 billion a year ago, but beat Wall Street expectations.

Comparable sales fell 4.3% in the first fiscal quarter. That’s lower than the 3.4% drop expected by Wall Street, according to StreetAccount.

CEO Marvin Ellison said in the company’s press release that lumber deflation, inclement weather and lower spending by DIY customers hurt quarterly sales. He said the lowered forecast reflects weaker-than-expected consumer demand.

Still, he added, Lowe’s digital sales and comparable sales to home professionals increased in the first quarter compared to the year-ago period.

He said the company remained “optimistic about the medium to long-term outlook for home improvement and our ability to continue to grow market share.”

Lowe’s competitor Home Depot posted a rare revenue loss with its quarterly report last week. The company fell short of sales expectations for the second straight quarter and cut its full-year guidance as customers skipped big-ticket items like grills and opted for smaller, home projects. cheaper.

Like Lowe’s, Home Depot also attributed lower sales to colder, wetter weather in the western United States and lower lumber prices.

Shares of Lowe’s closed Monday at $203.15, bringing the company’s market value to $121.15 billion. Its shares are up nearly 2% so far this year, lagging the S&P 500’s 9% gains.

This is breaking news. Please check for updates.

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