Canada markets close in 2 hours 49 minutes
  • S&P/TSX

    19,889.71
    -324.98 (-1.61%)
     
  • S&P 500

    4,356.96
    -45.24 (-1.03%)
     
  • DOW

    34,249.21
    -191.67 (-0.56%)
     
  • CAD/USD

    0.7422
    -0.0008 (-0.11%)
     
  • CRUDE OIL

    89.84
    +0.18 (+0.20%)
     
  • Bitcoin CAD

    35,882.33
    -755.10 (-2.06%)
     
  • CMC Crypto 200

    566.91
    -9.35 (-1.62%)
     
  • GOLD FUTURES

    1,939.70
    -27.40 (-1.39%)
     
  • RUSSELL 2000

    1,788.74
    -21.36 (-1.18%)
     
  • 10-Yr Bond

    4.4720
    +0.1230 (+2.83%)
     
  • NASDAQ

    13,320.76
    -148.37 (-1.10%)
     
  • VOLATILITY

    16.44
    +1.30 (+8.59%)
     
  • FTSE

    7,678.62
    -53.03 (-0.69%)
     
  • NIKKEI 225

    32,571.03
    -452.75 (-1.37%)
     
  • CAD/EUR

    0.6960
    -0.0004 (-0.06%)
     

Lowe's brings down annual sales outlook amid weaker demand for DIY products

Investing.com -- Lowe’s (NYSE:LOW) has reported a decline in first-quarter sales and lowered its full-year financial outlook, as the home improvement chain was hit by a slowdown in discretionary spending by shoppers and softening lumber prices.

Comparable sales for the three months ended on May 5 slipped by 4.3%, while total sales during the period fell to $22.35 billion from $23.66B in the corresponding timeframe last year.

In a statement, Lowe's chairman Marvin Ellison said the decrease in the top-line result was driven by "record lumber deflation and unfavorable spring weather." Demand for the high-priced items like grills and patio furniture sold by the company was also weaker than anticipated, in the latest sign that recent cost-of-living pressures are leading customers to rein in spending on non-essential items.

Ellison said this trend convinced the business to bring down its 2023 guidance. Lowe's now expects comparable sales to slide by 2% to 4% compared to the prior year, down from its initial estimate that the figure would either stay flat or drop by as much as 2%.

Total sales, meanwhile, are now seen at $87B to $89B. Lowe's had previously expected the number to come in at $88B to $90B.

However, Lowe's did get a boost in its most recent quarter from the 2022 sale of its Canadian retail business, which helped lift diluted earnings per share by $0.10. But excluding this benefit, the company still posted a 5% year-on-year increase in adjusted diluted EPS to $3.67.

Shares edged marginally lower in premarket trade on Tuesday.

TD Cowen analysts said the company slashed its annual sales outlook to reflect a softening U.S. consumer.

"We're unsure if guide is de-risked," the analysts said in a note.

Goldman Sachs analysts added: "The lowered guidance was not unexpected, in our view, given the recent guide down from [Home Depot]."

Additional reporting by Senad Karaahmetovic

Related Articles

Lowe's brings down annual sales outlook amid weaker demand for DIY products

Microsoft and Google PTs raised at Jefferies following AI deep-dive

Weakest European firms face highest amount of maturing debt since 2015 - DB