Lowe's Cuts Its Forecast as Sales Drop Amid Decline in DIY Project Spending

By
Bill McColl
Bill McColl
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Bill McColl has 25+ years of experience as a senior producer and writer for TV, radio, and digital media leading teams of anchors, reporters, and editors in creating news broadcasts, covering some of the most notable news stories of the time.

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Published November 21, 2023
Lowe's store

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Key Takeaways

  • Lowe's missed quarterly sales estimates and cut its forecast as DIY project demand slowed.
  • The home improvement retailer's revenue and comparable store sales declined amid a drop in DIY discretionary spending, especially for big-ticket items.
  • Lowe's benefited from an increase in business from professional contractors.

Shares of Lowe’s (LOW) dropped over 2% in early trading Tuesday after the home improvement retailer missed revenue expectations and slashed its outlook as the booming demand for home upgrades during the pandemic faded.

Lowe’s now expects full-year earnings per share (EPS) of about $13, and revenue at $86 billion. That’s down from its previous estimates of EPS in the range of $13.20 to $13.60, and revenue of $87 billion to $89 billion. In addition, the company projects comparable store sales falling 5% versus its earlier forecast of a drop of between 2% and 4%.

In its fiscal 2023 third quarter, Lowe’s reported EPS of $3.06, better than expected, but sales fell 12.8% from a year ago to $20.47 billion, less than anticipated. Comparable store sales slipped 7.4%.

CEO Marvin Ellison blamed the lackluster results and guidance on a decline in discretionary spending for do-it-yourself (DIY) projects, especially big-ticket items. He noted that because so much of Lowe’s revenue is generated by DIY consumers, the “greater-than-expected” pullback “disproportionately impacted our third quarter comp performance.” However, he explained that Lowe’s benefited from increased demand from professional contractors.

With Tuesday's losses, Lowe’s shares were little changed for 2023.?

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  1. Lowe’s. “LOWE’S REPORTS THIRD QUARTER 2023 SALES AND EARNINGS RESULTS.”

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