Home Depot Reports Q4 and Fiscal Year 2025 Results with Dividend Increase and 2026 Guidance

Home Depot Reports on Fiscal 2025

In a recent announcement, The Home Depot®, recognized as the world's leading home improvement retailer, released its financial results for the fourth quarter and fiscal year 2025. Despite facing challenges, the company demonstrated resilience amidst shifting market dynamics.

Financial Overview

For the fourth quarter of fiscal 2025, Home Depot recorded sales totaling $38.2 billion. This figure reflects a decrease of $1.5 billion, or 3.8%, compared to the same period in 2024, where the fourth quarter consisted of 14 weeks instead of the standard 13 weeks for the latest quarter. The presence of an additional week in the previous year contributed approximately $2.5 billion in sales.

Interestingly, comparable sales saw a modest increase of 0.4% in the fourth quarter, with U.S. comparable sales rising by 0.3%. However, net earnings for the same period listed at $2.6 billion ($2.58 per diluted share) showed a decline from $3.0 billion ($3.02 per share) in fiscal 2024.

Looking at the entire fiscal year, Home Depot reported total sales of $164.7 billion, marking an increase of $5.2 billion or 3.2% from the previous year. Net earnings reached $14.2 billion ($14.23 per diluted share), a slight decline from $14.8 billion ($14.91 per diluted share) in 2024. In terms of adjusted diluted earnings per share, the figures were $14.69 for fiscal 2025 compared to $15.24 in the prior year, reflecting ongoing market challenges.

Leadership Insights

Ted Decker, Chair, President, and CEO expressed gratitude to the teams for their effort in engaging customers and expanding market share. He noted that while the fourth quarter's results aligned with expectations, they were influenced by limited storm activity in the third quarter, alongside ongoing consumer uncertainties concerning housing. However, adjusted for such external factors, overall demand remained stable through the year.

Dividend Declaration

In a notable move, the board of directors approved a quarterly dividend increase of 1.3%, raising it to $2.33 per share, which translates to an annual dividend of $9.32 per share. This dividend will be paid on March 26, 2026, with a record date of March 12, 2026, highlighting the company's consistent track record of dividend payments, marking its 156th consecutive quarter.

Fiscal 2026 Guidance

Home Depot also provided insights into its fiscal 2026 outlook, projecting total sales growth in the range of 2.5% to 4.5%. Comparable sales growth is expected to be flat to 2.0%, with plans to open around 15 new stores.

Among other financial metrics, the company estimates a gross margin of approximately 33.1% and an operating margin forecasted between 12.4% to 12.6%. The adjusted operating margin is anticipated to land between 12.8% and 13.0%. Furthermore, diluted earnings-per-share growth is projected to remain in the flat to 4.0% range compared to fiscal 2025.

In summary, although facing a decrease in certain financial metrics, Home Depot's strategic plans for fiscal 2026 and its sustained commitment to shareholders through dividend increases illustrate a robust approach to navigating market fluctuations. As the year progresses, it will be crucial to observe how the retail giant adapts to consumer trends and economic conditions.