Market Overview - Pre-market futures are flat following a sixth-straight up-day on the S&P 500, with market sentiment buoyed by positive trade deal expectations [1] - The Dow is up +0.03%, while the S&P 500 is down -0.17%, and the tech-heavy Nasdaq has grown nearly +20% recently but is down -0.28% in early trading [2] Economic Indicators - U.S. Leading Economic Indicators (LEI) dropped -1.0% to 99.4 points in April, marking the first time below 100 since September of last year [3] - This decline represents the fifth consecutive drop in LEI, which had previously shown a hopeful turn around the 2024 election [3] Home Depot Earnings - Home Depot reported mixed Q1 results with earnings of $3.56 per share, missing the Zacks consensus by 3 cents, while revenues were $39.86 billion, up +9.4% year over year [5] - Shares of Home Depot are up +2% in pre-market trading, recovering most of year-to-date losses [5] Viking Holdings Earnings - Viking Holdings reported Q1 results with negative earnings of -$0.24 per share, which was 2 cents better than expected, and revenues of $897.06 million, exceeding estimates by +4.49% [6] - Despite outperforming expectations, shares are down -5% in early trading [6] Upcoming Earnings Reports - Palo Alto Networks is expected to report negative -8% earnings growth with revenues projected to increase by +14.67% [7] - Toll Brothers is anticipated to report fiscal Q2 numbers with expected declines of -15.3% on earnings and -11.9% on revenues, although it may achieve its third earnings beat in the last four quarters [8]

Company Overview - Home Depot held its first quarter 2025 earnings conference call, featuring key executives including Ted Decker (Chair, President & CEO), Ann-Marie Campbell (Senior Executive Vice President), Billy Bastek (Executive Vice President of Merchandising), and Richard McPhail (Executive Vice President and Chief Financial Officer) [3][4]. Conference Call Structure - The call was structured to include prepared remarks followed by a question and answer session, with a reminder for participants to limit their questions to one with one follow-up [4]. - The conference call was recorded for future reference [4]. Forward-Looking Statements - The company included forward-looking statements in its press release and presentations, which are subject to risks and uncertainties as defined in the Private Securities Litigation Reform Act of 1995 [5].

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced and qualified news journalists who produce independent content [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The news team delivers insights across various sectors including biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]

Financial Performance - Home Depot reported revenue of $39.86 billion for the quarter ended April 2025, a year-over-year increase of 9.4% [1] - The EPS for the same period was $3.56, compared to $3.63 a year ago, indicating a slight decline [1] - The reported revenue exceeded the Zacks Consensus Estimate of $39.4 billion by 1.15%, while the EPS fell short of the consensus estimate of $3.59 by 0.84% [1] Key Metrics - Comparable store sales showed a year-over-year change of -0.3%, contrasting with the 10-analyst average estimate of 0.3% [4] - The number of retail stores remained at 2,350, matching the average estimate from five analysts [4] - Comparable store sales in the U.S. had a year-over-year change of 0.2%, compared to the -1% average estimate from three analysts [4] - Sales per store were reported at $16.96 million, exceeding the three-analyst average estimate of $16.71 million [4] - The number of customer transactions in retail was 394.8 million, surpassing the two-analyst average estimate of 390.8 million [4] - The average ticket size in retail was $90.71, slightly below the $91.74 average estimate based on two analysts [4] Stock Performance - Home Depot shares have returned +9.4% over the past month, while the Zacks S&P 500 composite increased by +13.1% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Core Viewpoint - Home Depot is committed to maintaining stable prices despite tariff pressures, contrasting with competitors like Walmart who may need to raise prices due to increased costs from tariffs [1][4]. Group 1: Home Depot's Strategy - Home Depot is actively working with suppliers to shift production away from China and is negotiating for price concessions to protect consumers from the trade war's impact [1]. - The company's CFO, Richard McPhail, stated that no single country outside the U.S. will account for more than 10% of their purchases in the next 12 months [2]. - Home Depot has not altered its financial forecast for 2025, reporting a 0.2% increase in U.S. comparable sales and a 2.1% rise in customer transactions to 394.8 million [3]. Group 2: Competitive Landscape - Unlike Home Depot, Walmart has indicated it may need to raise prices to cope with tariff-related costs, with CEO Doug McMillon acknowledging the pressure on their business [4]. - President Trump criticized Walmart for not absorbing tariff costs, suggesting that the company should maintain its profit margins without passing costs to consumers [5][6]. - The White House supports Trump's stance that foreign countries should bear the burden of tariffs, emphasizing that businesses should not pass these costs onto consumers [5][6]. Group 3: Broader Economic Context - Trump's administration has implemented sweeping tariffs, with rates of 10% on most imports and up to 30% on goods from China, which has led to increased scrutiny on how companies manage their pricing strategies [9][10]. - The President's comments reflect a shift in his approach, as he previously criticized price control proposals, now advocating for businesses to absorb tariff costs [9].

Home Depot Inc (NYSE:HD) stock is in focus this morning, after the home improvement giant made headlines by stating it will not raise prices in response to new tariffs -- a direct contrast to Walmart (WMT), which recently warned of higher consumer prices. CFO Richard McPhail told CNBC the company plans to “generally maintain current pricing levels,” citing its scale, strong supplier relationships, and years-long effort to diversify sourcing away from China.The comments came alongside the company’s first-qua ...

Financial Data and Key Metrics Changes - Total sales for Q1 2025 were $39.9 billion, an increase of 9.4% from the same period last year [6][29] - Adjusted diluted earnings per share were $3.56, a decrease of approximately 3% compared to $3.67 in Q1 2024 [7][32] - Comp sales declined by 0.3% year-over-year, with U.S. comps increasing by 0.2% [6][30] - Gross margin was 33.8%, down 35 basis points from the previous year, while operating margin was 12.9%, compared to 13.9% in Q1 2024 [30][31] - Return on invested capital was 31.3%, down from 37.1% in Q1 2024 [33] Business Line Data and Key Metrics Changes - Six out of 16 merchandising departments posted positive comps, including appliances, plumbing, indoor garden, electrical, outdoor garden, and building materials [21] - Pro comp sales were positive and outpaced DIY customer sales, with strength in pro-heavy categories like gypsum, decking, concrete, and siding [22] - Online comp sales increased approximately 8% compared to the previous year [23] Market Data and Key Metrics Changes - In local currency, Mexico posted positive comps while Canada was below the company average [7][30] - Foreign exchange rates negatively impacted total company comps by approximately 70 basis points for the quarter [30] Company Strategy and Development Direction - The company is focused on diversifying its global supply chain, with over 50% of purchases sourced in the U.S. and no single country expected to represent more than 10% of purchases outside the U.S. within 12 months [8][10] - The company aims to invest in its business to gain market share, particularly in periods of disruption, and is focused on enhancing the pro ecosystem to better serve professional customers [11][12] - The company operates in a fragmented market of approximately $1 trillion, with a healthy consumer base and increasing home equity driving confidence in home improvement investments [10] Management's Comments on Operating Environment and Future Outlook - Management noted that the worst macroeconomic concerns have passed, with improved consumer sentiment and low unemployment [40][41] - Despite high interest rates impacting larger remodeling projects, management remains optimistic about future engagement in home improvement projects as macro confidence increases [42][43] - The company reaffirmed its fiscal 2025 guidance, expecting total sales growth of approximately 2.8% and comp sales growth of about 1% [34][35] Other Important Information - The company opened three new stores, bringing the total store count to 2,350 [32] - Merchandise inventories were $25.8 billion, up approximately $3.3 billion compared to the previous year, with inventory turns at 4.3 times [32] Q&A Session Summary Question: Insights on overall demand environment and sales trends - Management indicated that macro concerns have improved, with consumer sentiment rising and home prices continuing to increase, but high interest rates are still affecting larger remodeling projects [40][41] Question: SG&A growth and one-time impacts - SG&A grew 12% year-over-year, influenced by a legal settlement from the previous year and the addition of SRS expenses [44][45] Question: Comp guidance and market conditions - Management reaffirmed guidance, noting that FX pressure impacted results but overall business performance heading into Q2 is positive [55] Question: Tariffs and pricing strategy - The company has diversified its supply chain, with over 50% of purchases sourced in the U.S., and plans to maintain pricing without broad-based increases [67][70] Question: Deferred demand in home improvement - Management expects to capture share from deferred demand as macro conditions improve, with a focus on servicing both DIY and pro customers [74][75] Question: Regional performance and housing activity - Slight softening was noted in some markets, but overall sales have not been impacted significantly by housing price changes [108] Question: Inventory positioning and summer outlook - Management feels confident about inventory levels, with no pull forward and good positioning for the upcoming season [89][92]

Financial Data and Key Metrics Changes - Total sales for Q1 2025 were $39.9 billion, an increase of 9.4% from the same period last year [5][25]. - Adjusted diluted earnings per share were $3.56, down from $3.67 in Q1 2024, reflecting a decrease of approximately 3% [6][28]. - Gross margin was 33.8%, a decrease of 35 basis points from the previous year [26]. - Operating margin for Q1 was 12.9%, compared to 13.9% in Q1 2024 [27]. - Return on invested capital was 31.3%, down from 37.1% in the same quarter last year [29]. Business Line Data and Key Metrics Changes - Six out of 16 merchandising departments posted positive comps, including appliances, plumbing, indoor garden, electrical, outdoor garden, and building materials [19]. - Comp sales in the U.S. were positive 0.2% for the quarter, with negative 3.3% in February, positive 1.3% in March, and positive 1.8% in April [25][26]. - Pro comp sales outpaced DIY customers, with strength in pro-heavy categories like gypsum, decking, concrete, and siding [20]. Market Data and Key Metrics Changes - In local currency, Canada posted comps below the company average, while Mexico posted positive comps [6]. - Foreign exchange rates negatively impacted total company comps by approximately 70 basis points for the quarter [26]. Company Strategy and Development Direction - The company is focused on diversifying its global supply chain, with over 50% of purchases sourced in the U.S. and plans to ensure no single country outside the U.S. represents more than 10% of purchases [7][9]. - The company aims to invest in its business to gain market share, particularly in periods of disruption, and is focused on enhancing the pro ecosystem to better serve professionals [10][11]. - The addressable market for home improvement is approximately $1 trillion, with a healthy consumer base and rising home equity encouraging investment in home improvements [9]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current macroeconomic environment, with customer engagement continuing from the previous fiscal year [30]. - The company reaffirmed its fiscal 2025 guidance, expecting total sales growth of approximately 2.8% and comp sales growth of about 1% compared to fiscal 2024 [30][31]. - Management noted that while there is macro uncertainty, the fundamentals of home improvement remain strong, with a healthy consumer base and increasing home equity [39][40]. Other Important Information - The company opened three new stores, bringing the total store count to 2,350 [28]. - Merchandise inventories were $25.8 billion, up approximately $3.3 billion compared to the previous year, with inventory turns down from 4.5 times to 4.3 times [28]. Q&A Session Summary Question: Insights on overall demand environment and sales trends - Management noted that macro concerns have eased, with improved consumer sentiment and low unemployment, but larger remodeling projects remain pressured due to high interest rates [36][39]. Question: SG&A growth and one-time impacts - SG&A grew 12% year-over-year, influenced by a legal settlement from the previous year and the addition of SRS expenses [41][42]. Question: Comp guidance and potential for better performance - Management reaffirmed guidance, noting that FX pressure impacted results, but they feel good about business heading into Q2 [50][51]. Question: Tariffs and pricing strategy - The company is diversifying its supply chain to mitigate tariff impacts and does not anticipate broad-based price increases for customers [60][62]. Question: Deferred demand in home improvement - Management expects to capture share opportunities from deferred demand as macro conditions improve [68][70]. Question: Regional performance and housing activity - Some markets showed slight softening, but overall sales remained stable, with weather being a significant factor in performance [99][100].

Home Depot on Tuesday held its forecast for sales in 2025, while one executive reportedly said the retailer won't raise prices because of tariffs, as other companies flag concerns and cut projections, citing uncertainty over U.S. tariffs. Rivian lowered its targets for vehicle deliveries and capital spending for 2025, noting the "current global economic landscape presents significant uncertainty," including "evolving trade regulation, policies" and tariffs. AMD said the company expects to lose $1.5 billion ...

Home Depot’s finance chief says customers shouldn’t expect tariff-driven price increases.“Because of our scale, the great partnerships we have with our suppliers and productivity that we continue to drive in our business, we intend to generally maintain our current pricing levels across our portfolio,” Chief Financial Officer Richard McPhail said in an interview with CNBC on Tuesday (May 20).He said more than half the company’s products come from within the U.S., adding that Home Depot and its suppliers hav ...