Home Depot sales climb again, but DIY frenzy may be cooling

Home Depot’s sales continue to surge, though same-store sales appeared to come back to earth after a year in which the home improvement chain outperformed expectations repeatedly.

For the three months ended August 1, sales climbed to $41.12 billion from $38.05 billion. Chairman and CEO Craig Menea said in a prepared statement Tuesday that this was the first time the chain surpassed quarterly sales of more than $40 billion.

Revenue also surpassed the $40.71 billion analysts were expecting, according to a survey by Zacks Investment Research.

However, sales at stores open at least a year, a key indicator of a retailer’s health, increased 4.5%, and 3.4% in the U.S. Wall Street had expected same-store sales of 5.4% according to FactSet.

And while the average receipt per ring-up at Home Depot registers was higher, customer traffic slowed compared with the period last year when the pandemic kicked off frenzied do-it-yourself projects at home.

Shares fell more than 4% before the opening bell.

Home improvement stores have filled during the the pandemic as people working from home took on new projects. Many also moved to places with more room for the home office, and that too fueled sales.

Yet sales of new homes fell for a third straight month in June, dropping by 6.6% to the lowest level in more than a year.

Home Depot Inc. earned $4.81 billion, or $4.53 per share, in the quarter. That compares with $4.33 billion, or $4.02 per share, a year ago. This beat the $4.43 per share that Wall Street predicted.

The Atlanta company didn’t provide a full-year forecast.