Macro
← Earnings Calls
01
02
03
04 05 06
Tone
AI
Capex
A1 A2
HD
FY2025 Q4
In line
Home Depot, Inc. (The) earnings call
Buzzberg read
No housing catalyst seen; 2026 demand pressures persist
Home Depot reported a mostly in-line quarter marred by weak housing demand and a lack of storm activity, offset by strong performance in SRS and the contribution of the GMS acquisition. The outlook remains cautious with flat to 2% comparable sales growth for 2026, as consumer uncertainty and high interest rates persist. Home Depot reaffirmed FY26 guidance for flat to 2% comp sales growth and adjusted EPS growth of flat to 4%, expecting market conditions to remain challenged.
Buzzberg read No housing catalyst seen; 2026 demand pressures persist Home Depot reported a mostly in-line quarter marred by weak housing demand and a lack of storm activity, offset by strong performance in SRS and the contribution of the GMS acquisition. The outlook remains cautious with flat to 2% comparable sales growth for 2026, as consumer uncertainty and high interest rates persist. Home Depot reaffirmed FY26 guidance for flat to 2% comp sales growth and adjusted EPS growth of flat to 4%, expecting market conditions to remain challenged. Read full analysisCollapse analysis
Home Depot reported a mostly in-line quarter marred by weak housing demand and a lack of storm activity, offset by strong performance in SRS and the contribution of the GMS acquisition. The outlook remains cautious with flat to 2% comparable sales growth for 2026, as consumer uncertainty and high interest rates persist. Home Depot reaffirmed FY26 guidance for flat to 2% comp sales growth and adjusted EPS growth of flat to 4%, expecting market conditions to remain challenged.
- SRS Distribution significantly outperformed a weak market, with the roofing industry volume down 28% in Q4; SRS is still expected to grow organic sales low-single-digit for the year.
- The GMS acquisition is performing as expected, contributing to total sales growth, and SRS is expected to grow organic sales mid-single digits in FY26.
- Tariff-related price increases have been largely implemented (~3% like-for-like), which will likely impact transaction volumes.
Revenue$38.198B-8% QoQ
EPS$2.72-27% QoQ
Gross margin32.64%Reported
Operating margin10.08%Reported
6 grounded callouts
What matters now
The highest-signal changes from the call.
Guidance
Q1 EPS expected mid-single-digit negative, improving through the year
Demand
SRS guided to mid-single-digit organic sales growth in 2026
Show 3 more callouts
Pro
Pro comps positive; big-ticket transactions rose 1.3% in Q4
Pricing
Tariff price actions mostly complete; like-skew prices up about 3%
AI
AI-driven pro tools show strong early adoption
Reported period
Actuals
| Metric | Reported | Change |
|---|---|---|
| Revenue | $38.198B | -8% QoQ |
| EPS | $2.72 | -27% QoQ |
| Gross margin | 32.64% | Reported |
| Operating margin | 10.08% | Reported |
| Free cash flow | $2.289B | -26% QoQ |
| Capex | $1.058B | Reported |
Forward-looking
Forward guidance
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| Capex | FY2026 | $4.1B | $4.1B | Maintained |
| EPS | FY2026 | $14.69–$15.28 | $14.98 | Maintained |
| Gross margin | FY2026 | 33.1% | 33.1% | Maintained |
| Operating margin | FY2026 | 12.4%–12.6% | 12.5% | Maintained |
| Revenue | FY2026 | $168.8B–$172.1B | $170.45B | Maintained |
AI, capex & demand read
Management read
Cautiously Confident
Management acknowledged persistent housing and demand pressures with no near-term catalyst, but emphasized consistent market share gains, completed tariff pricing actions, and continued investment in the pro ecosystem.
Management AI read
Management is rolling out AI tools for pros, including AI list/project builders and blueprint takeoffs, as part of a broader push to win pro wallet share. Adoption is described as showing strong early days, but no specific AI revenue or monetization was quantified.
Investment and capacity
Capex remains a strategic priority, guided at approximately 2.5% of fiscal 2026 sales after roughly $3.7 billion in 2025. Spending will support ~15 new stores, 40–50 new SRS locations, and continued investment in stores, interconnected experience, and delivery capabilities; management expects to return to buybacks once excess cash builds, around mid-2027.
all 3 named companies below
Companiesreturns since call
Partners
Partners
Richard McVail
Despite a severe industry downturn, SRS likely gained significant share, signaling competitive strength. SRS is guided to grow organic sales mid-single digit in FY26.
Evidence
“SRS was down low single digit comps year over year for the fourth quarter. But if you look at the industry, in the fourth quarter, according to ARMA data, total industry shipments of shingle squares were down 28% year over year.”
Partners
Richard McVail
The GMS acquisition is performing as expected and is contributing to overall sales growth.
Evidence
“we've owned them for five months of the year and we're pleased with their performance and very happy to welcome them to the Home Depot family”
Supply chain
Supply chain
Richard McVail
Roofing industry shipments dropped 28% in Q4, making 2025 the lowest volume year since 2019, which likely indicates severe distress for industry players like GAF and Owens Corning. — This indicates a more severe demand downturn in the roofing materials industry than headline housing data suggests, impacting manufacturers' volumes.
Evidence
“according to ARMA data, total industry shipments of shingle squares were down 28% year over year. That's the lowest industry volume since 2019.”
External signals
Supply-chain alpha · 2returns since call
Roofing industry shipments dropped 28% in Q4, making 2025 the lowest volume year since 2019, which likely indicates severe distress for industry players like GAF and Owens Corning.
Home Depot is mostly done with tariff-related pricing actions, with a like-SKU price impact of around 3% already in the system, indicating the magnitude of cost inflation from tariffs.
Evidence
“we're mostly done with tariff-related pricing actions as it relates to the impacts, you know, back to April... our exposure was kind of mid-single digits, you know, and then if you think of like-skew price, that's right about 3%”
Methodology & coverage
Management-only analysis. All 3 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.