Home Depot Sees Big-Ticket Bounce as Shoppers Hesitate on DIY Splurges

Home Depot didn’t quite hit Wall Street’s marks this quarter — but there’s a silver lining: Americans are opening their wallets again for the pricey stuff.

The Atlanta-based giant reported second-quarter sales of $45.28 billion, a nearly 5% jump from last year, though revenue and profit both fell just short of analysts’ expectations. Comparable sales rose 1% (vs. the 1.5% analysts were hoping for), and net income slipped a hair to $4.55 billion. It’s the first time since 2014 that Home Depot has missed on both earnings and revenue in the same quarter.

Yet investors didn’t seem too worried. Shares popped nearly 4% in morning trading after the update.

While overall customer transactions dipped 0.9%, the average receipt climbed 1.2% to $90.01 — thanks in part to a 2.6% increase in purchases over $1,000. That’s the kind of momentum CEO Ted Decker says points to a slow but steady thaw in the home improvement freeze.

“These may be shallow gains, but they show material strengthening… and provide confidence that the slump in home improvement is finally over,” wrote GlobalData analyst Neil Saunders.

Twelve of Home Depot’s 16 merchandising departments notched year-over-year sales growth, and July — the last month of the quarter — saw comps jump 3.3%, showing momentum building as summer rolled on.

Higher interest rates and tariffs continue to put a lid on big remodeling jobs. Mortgage rates stuck near 7% have stalled home sales and the remodeling boom that usually follows.

“Our customers tell us the rate environment is giving them pause on larger remodeling projects,” CFO Richard McPhail said. “But pros tell us their customers are deferring projects, not canceling them.”

That “deferral mindset” has been in place since mid-2023, McPhail added, with economic uncertainty still ranking as the No. 1 reason homeowners are hesitant to pull the trigger on major renovations.

Home Depot has been doubling down on its contractor business, which now makes up a slim majority of its sales. Its $18.25 billion acquisition of SRS Distribution and pending $4.3 billion GMS buyout are all about cementing that lead. Lumber, decking, and concrete — staples for pros — performed well this quarter, as did DIY-friendly summer goods like grills and gardening supplies.

Online sales also surged 12%, thanks to faster deliveries.

Home Depot stuck to its 2025 forecast, expecting overall sales to grow 2.8% and comparable-store sales to climb about 1%. Adjusted earnings are projected to slip 2% for the year.

Executives flagged some tariff-driven price increases ahead, though they stressed they’ll be modest and not across the board. More than half of Home Depot’s goods are sourced domestically, cushioning the impact.

Still, Decker left the door open for brighter days:

“Some relief on mortgage rates, in particular, could help.”

For now, Home Depot is straddling two Americas — cautious homeowners holding off on big remodels and pros keeping the big-ticket pipeline alive. And Wall Street? It’s betting the momentum is finally turning.

Axios, CNBC, CNN, Investor’s Business Daily, and the Financial Times contributed to this report.