Revenue Performance: The Home Depot generated revenues of $40.2 billion, up 6.6% year-over-year. Despite the growth, comparable store sales declined by 1.3%, with a notable 1.2% drop in U.S. stores. Adjusted diluted earnings per share reached $3.78, down from $3.85 in the prior year, indicating a decline of 2%.
Profitability Metrics:
- Gross Profit Margin: 33.4%, a decrease of 40 basis points YoY due primarily to the SRS acquisition's impact on product mix.
- Operating Margin: Stood at 13.5%, down from 14.3% in Q3 2023.
- Net Income: $3.648 billion, reflecting a YoY increase of 30.24%, albeit a QoQ decline of 20.02% due to lower consumer activity and higher operational costs.
Cash Flow and Balance Sheet:
The company's free cash flow for the quarter was $3.415 billion, supported by strong operating cash flows of $4.233 billion. On the balance sheet, The Home Depot holds $1.531 billion in cash with total liabilities of $91.478 billion, resulting in a debt-to-equity ratio of 10.95, indicating a high leverage position.
Market Position: The Home Depot continues to position itself favorably against competitors, gaining market share in core categories such as paint and outdoor garden, thanks to strategic merchandising and supplier partnerships.