Home Depot’s first-quarter net income dips 7 per cent

(Source: The Home Depot/Facebook)

The Home Depot‘s first-quarter net income dipped 7 per cent year on year to $3.6 billion, which an analyst blamed on a continuing soft housing market.

The company also booked lower net sales at $36.42 billion, down 2.3 per cent.

“Across the quarter, existing home sales fell by 4.4 per cent over last year,” said GlobalData MD Neil Saunders.

“Earlier on in this year, the hope was that interest rate cuts may inject some momentum into people buying and selling homes, but with inflation still heavier than the Federal Reserve wants, the prospects of this happening are narrowing.”

Saunders added that customers are now shopping around for the best deals, and this impacts Home Depot.

Meanwhile, the company forecasts full-year sales to grow by about 1 per cent with the 53rd week projected to add about $2.3 billion.

Moreover, the company anticipates opening 12 new stores during the year.

“Overall, Home Depot remains a formidable business. The current challenges are all caused by a period of churn in the consumer economy rather than by any missteps the company has made. Even so, we think the year ahead will be one of continued reset,” said Saunders.

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