Home Depot says shoppers are delaying big remodels, annual outlook steady

Shoppers are still coming through Home Depot’s doors, but many are hesitating on the kind of kitchen, bath and whole-home remodels that drive the biggest jobs for store teams. That uneven mix is the key signal from the company’s first quarter: demand did not fall off a cliff, yet customers were clearly more selective, pushing associates toward smaller repair-and-replace projects, tighter budget conversations and more pressure to convert traffic before carts get abandoned.

The company said first-quarter fiscal 2026 sales reached $41.8 billion, up 4.8% from a year earlier, while comparable sales rose 0.6% overall and 0.4% in the United States. Net earnings were $3.3 billion, or $3.30 a share, and adjusted diluted earnings per share came in at $3.43. Ted Decker said underlying demand was “relatively similar” to fiscal 2025 despite greater consumer uncertainty and housing affordability pressure, and Home Depot kept its full-year outlook unchanged, calling for sales growth of about 2.5% to 4.5%, comparable sales flat to up 2.0%, and adjusted diluted EPS growth flat to up 4.0%.

For store managers and department supervisors, the more telling data point was the split between ticket size and traffic. Comparable average ticket rose 2.2%, while comparable transactions fell 1.3%. Transactions over $1,000 increased 0.8%, which suggests the shoppers who do show up are still willing to spend, but fewer are taking the leap on major remodels. That creates a very specific floor challenge in aisles tied to kitchens, baths, flooring and pro-heavy projects: teams have to steer customers toward workable phases of a job, find lower-friction substitutes and keep service fast enough that a hesitant shopper does not walk out.

Richard McPhail said the homeowner customer is relatively more financially protected than other cohorts, but is deferring larger projects amid geopolitical tension, weak consumer confidence and a “broken housing market.” The company’s broader operating picture matched that cautious tone. Merchandise inventories ended the quarter at $27.3 billion, up $1.5 billion from a year earlier, and online sales grew more than 10% for the fourth straight quarter. Home Depot also said its Pro business outperformed DIY, helped by digital tools and a managed sales force focused on complex, high-value residential work.

That Pro strength matters because it gives store teams another lane when discretionary remodel demand softens. The company completed the acquisition of Mingledorff’s, adding 42 HVAC distribution locations in five Southeastern states, another sign that Home Depot is still investing for growth even as customers stretch out bigger projects and keep the pressure on the store floor to turn uncertain traffic into real sales.