Q2 2025 Financial Performance - Lowe's reported positive comparable sales growth of +1.1%[1] and a gross margin of 33.8%[1], which is an increase of +34 basis points compared to the previous year[1] - Adjusted operating margin reached 14.7%[2], up +23 basis points year-over-year[2], with diluted EPS at $4.27[2], a +2.4% increase[2], and adjusted diluted EPS at $4.33[2], a +5.6% increase[2] - The company returned $645 million to shareholders through dividends[2] Sales Trends - Comparable transactions decreased by -1.0%[3], while the comparable average ticket increased by +0.3% to $104.60[3] - Online sales growth experienced a decline of -6.4%[3] - Monthly comparable sales performance varied, with May at -1.8%[3], June at +2.9%[3], and July at +7.5%[3] - Comparable sales by ticket size showed growth in the >$500 range at +3.6%[3], a decrease in the $100-$500 range at -1.4%[3], and a decrease in the <$100 range at -0.1%[3] - Positive comparable sales were achieved in 9 out of 14 product categories[5], including Building Materials, Lawn & Garden, and Appliances[5] Strategic Initiatives - Lowe's closed on the acquisition of Artisan Design Group (ADG)[6] - Pro penetration has increased from approximately 19% in 2019 to approximately 30% in 2025[23] - Lowe's announced the acquisition of Foundation Building Materials (FBM) on August 20, 2025[12] Foundation Building Materials (FBM) Acquisition - FBM has approximately $6.5 billion in pro forma 2024 revenue and $635 million in adjusted EBITDA[27] - The purchase price of $8.8 billion reflects a multiple of 13.4x adjusted EBITDA[50]

Financial Data and Key Metrics Changes - Net sales decreased by 5% to $4.2 billion, driven by lower organic sales and commodity deflation, partially offset by growth from acquisitions [19][20] - Gross profit was $1.3 billion, a decrease of 11% compared to the prior year, with a gross margin of 30.7%, down 20 basis points [21] - Adjusted EBITDA was $506 million, down 24%, with an adjusted EBITDA margin of 12%, down 300 basis points from the prior year [22] Business Line Data and Key Metrics Changes - Multifamily sales declined by 23%, while single-family sales decreased by 9%, attributed to lower starts activity and value per start [20] - Repair and remodel increased by 3%, driven by strength in the Mid Atlantic and South Central regions [20] - The company invested over $35 million in value-added solutions, including opening a new millwork location in Florida and upgrading plants in seven states [7][8] Market Data and Key Metrics Changes - Single-family starts are expected to decrease through year-end due to builders managing construction pace amid affordability concerns [9] - Multifamily remains muted due to higher input and financing costs, but it is still considered an appealing and profitable business [10] - The company anticipates a headwind to sales of $400 million to $500 million in multifamily and a headwind to EBITDA of less than $200 million [26] Company Strategy and Development Direction - The company focuses on three key areas: customer service, operational excellence, and disciplined capital allocation [5][6] - The transition to a single ERP system is expected to unlock further growth opportunities and efficiencies [6] - The company remains committed to pursuing higher return opportunities through acquisitions, with a focus on expanding value-added product offerings [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenging market environment but emphasizes the importance of operational discipline and customer service [4][7] - The company expects net sales for Q3 to be between $3.65 billion and $3.95 billion, reflecting a weaker than normal building season [28] - The full-year guidance for net sales is projected to be between $14.8 billion and $15.6 billion, with adjusted EBITDA expected to be between $1.5 billion and $1.7 billion [26] Other Important Information - The company completed a $750 million offering of senior unsecured notes to pay down the balance on its ABL [24] - Capital expenditures for the quarter were $86 million, with $61 million allocated to acquisitions and $391 million used for share repurchases [25] - The company has a net debt to adjusted EBITDA ratio of approximately 2.3x, indicating a comfortable leverage position [24] Q&A Session Summary Question: How is the company strengthening its competitive position in a disappointing starts environment? - The company focuses on improving on-time and in-full performance, enhancing integrations with builders, and leveraging technology to optimize the build process [34][36] Question: What drove the sequential improvement in gross margins in Q2? - The improvement was attributed to better-than-expected performance in multifamily and repair and remodel segments, despite ongoing pressures [41][42] Question: What is the outlook for gross margins in Q3 and the second half of the year? - The company expects sequential normalization or declines in margins due to the competitive landscape and softer starts environment [43] Question: How does the company view the impact of Canadian lumber tariffs on its forecast? - The company has factored in the duties and believes the impact will be minimal in 2025, with lumber prices remaining stable [62] Question: What are the main drivers of the sequential change from Q2 to Q3? - The main drivers include a weakening start environment, continued normalization of multifamily, and commodity deflation [70][71] Question: How is the ERP rollout progressing? - The ERP system went live on July 1, with ongoing support and adjustments being made to address initial challenges [106][107]

Q2 2025 Financial Performance - Net sales reached $1,784.5 million, a 1% increase compared to Q2 2024[6] - Operating income was $272.7 million, a $1.2 million increase from Q2 2024[6] - Diluted EPS (GAAP and ex-ASU) was $5.17, a 4% increase compared to Q2 2024[6] - Gross profit was $535.2 million, a $5.0 million increase from Q2 2024[6] - Gross margin remained in line with Q2 2024 at 30.0%[6] Sales Performance by Geography and Segment - Florida (FL) and Arizona (AZ) saw net sales increases of 2% each[8] - California (CA) and Texas (TX) experienced net sales decreases of 3% and 2% respectively[8] - Horizon net sales decreased by 2%[8] - Europe net sales increased by 7%[8] - Commercial end market sales increased by 5%, while retail sales decreased by 3%[12] Product Category Performance - Chemicals and Equipment sales each increased by 1%, while Building Materials sales decreased by 1%[11] Strategic Initiatives and Capital Allocation - The company returned $253 million to shareholders, including a $76 million year-over-year increase in share repurchases[24] - Capital expenditures amounted to $27.4 million[23] - Share repurchases totaled $160.6 million[23] - Dividends paid were $92.2 million[23] 2025 Guidance - The company anticipates net sales to be approximately flat for the full year 2025[25] - Inflation/pricing is expected to contribute approximately 2%, including 1% from tariffs beginning in Q2[25] - GAAP diluted earnings per share are projected to be in the range of $10.80 to $11.30[25]

Core Insights - Home Depot Inc. is experiencing strength in smaller-scale DIY and maintenance projects, but a revival in big-ticket remodel and renovation spending is necessary for sustained top-line growth [1][3] - Big-ticket sales grew only 0.3% in Q1 fiscal 2025, contributing to a 0.3% decline in overall comparable sales, with U.S. comps up just 0.2% [2][9] - The company anticipates continued pressure on big-ticket renovations due to no major improvement expected in interest rates or housing turnover in 2025 [3] Company Strategy - Home Depot is positioning itself to capture future spending surges through financing options for professionals and streamlined lending tools for consumers [4] - The company is maintaining high in-stock rates for building materials to fulfill large orders promptly when market conditions improve [4] Market Context - Competitors like Lowe's and Walmart are also facing challenges in big-ticket categories, with cautious consumer behavior impacting discretionary purchases [6][7][8] - A recovery in big-ticket demand is critical for both Home Depot and its competitors, as it can significantly influence overall revenues and growth strategies [7][8] Financial Performance - Home Depot's shares have declined 10.8% year-to-date, compared to a 13.9% decline in the industry [11] - The forward price-to-earnings ratio for Home Depot is 22.31X, higher than the industry's 19.68X, indicating a premium valuation [12] - The Zacks Consensus Estimate for fiscal 2025 earnings implies a year-over-year decline of 1.3%, while fiscal 2026 estimates indicate a growth of 9.2% [14]

Company Overview - Doman Building Materials Group Ltd. is a fully integrated national distributor in the building materials sector in Canada, founded in 1989 and headquartered in Vancouver, British Columbia [2] - The company trades on the Toronto Stock Exchange under the symbol DBM and operates multiple treating plants, planing and specialty facilities, and distribution centers across Canada and the United States [2][3] Recent Developments - The board of directors has declared a dividend of $0.14 per share, marking the 61st consecutive quarter of dividend payments, scheduled to be paid on July 15, 2025, to shareholders of record on June 30, 2025 [1] Operational Footprint - Doman operates distribution centers coast-to-coast in Canada and has multiple treating plants in the U.S., including 21 treating plants and five specialty sawmills across nine states [3] - The company also manages private timberlands and forest licenses, along with agricultural post-peeling and pressure treating through its Doman Timber operations [3]