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Lowe’s (LOW) earnings Q1 2022

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A customer pushes a shopping cart towards the doorway of a Lowe’s store in Concord, California, on Tuesday, Feb. 23, 2021.

David Paul Morris | Bloomberg | Getty Images

Lowe’s on Wednesday missed Wall Street’s sales expectations for its fiscal first quarter, as cooler spring weather hurt demand for supplies for outdoor do-it-yourself projects.

Shares were down about 2% in early trading.

Here’s what the house improvement retailer reported for the quarter ended April 29 compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Earnings per share: $3.51 vs. $3.22 expected
  • Revenue: $23.66 billion vs. $23.76 billion expected

Lowe’s reiterated its full-year outlook, saying it expects total sales to range between $97 billion and $99 billion and same-store sales to range from a decline of 1% to a rise of 1%.

In an interview with CNBC, CEO Marvin Ellison said the underlying aspects driving the house improvement industry haven’t modified: an aging housing stock, a shortage of accessible homes and appreciating real estate values. That is giving consumers confidence to spring for a kitchen appliance or to redo a toilet, despite inflation, he said.

Yet the chilly and cold April weather in parts of the country inspired Americans to postpone purchases of grills, patio furniture and gardening supplies. He said Lowe’s is already seeing sales pick up in May and expects to make up for that weaker early spring within the second quarter as warmer and dryer weather arrives.

Ellison said the corporate has not seen signs of a more skittish consumers. As an alternative of trading right down to cheaper products, he said Lowe’s shoppers are literally trading as much as a latest refrigerator or getting pricier lawn equipment.

Lowe’s results diverged from those of its competitor, Home Depot. On Tuesday, Home Depot surged beyond Wall Street’s expectations for quarterly earnings and revenue, chalking up its growth to home appreciation and a boom in projects for housing professionals.

Lowe’s cited similar sales drivers, but has a unique mix to its business. About 75% of its total sales come from DIY customers compared with Home Depot, which gets about half of its sales from them and half of its sales from home professionals like contractors, plumbers and electricians. That makes Lowe’s more vulnerable to shifts in demand, if homeowners resolve to skip a painting or landscaping project.

Lowe’s net income for the quarter increased barely to $2.33 billion, or $3.51 per share, from $2.32 billion or $3.21 per share, a yr earlier. The outcomes were above the $3.22 expected by analysts surveyed by Refinitiv.

Net sales fell to $23.66 billion from $24.42 billion last yr and missed analysts’ expectations of $23.76 billion.

Same-store sales declined 4% yr over yr, a bigger decrease than the two.5% drop that analysts expected, in response to StreetAccount.

As of Tuesday’s close, shares of Lowe’s are down about 25% up to now this yr. The stock closed Tuesday at $194.03, bringing the corporate’s market value to $128.27 billion.

Read the corporate’s earnings release here.

Correction: Lowe’s net sales missed analysts’ expectations. An earlier version misstated that fact.

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