Home Depot beats EPS but misses sales as comparable growth stays modest

The profit line beat, but the top-line result missed. Published estimates were roughly $4.73 for adjusted EPS and $48.7 billion of revenue; Home Depot delivered adjusted EPS of $4.92 but sales of $47.861 billion, making this a clear earnings beat offset by a roughly 1.7% revenue shortfall.

Underlying demand improved, but customer traffic remained weak. Comparable sales rose 1.7%, helped by a 2.8% increase in average ticket, while comparable transactions declined 1.0%; the pattern says customers spent more per visit but fewer customers came through the business. The company said, “Our second quarter results exceeded our expectations.” 〔0〕 (Selected sales data)

Profit growth was helped by sales leverage but not by expanding margins. Gross profit increased 6.5%, faster than sales, yet operating expenses rose 8.2%, leaving operating income up only 4.3% and reducing operating margin to 14.3% from 14.5%. That makes the EPS beat useful, but less clean than a result combining stronger sales with wider operating profitability. (Income Statement)

Cash generation was a genuine bright spot, though acquisition spending increased. Six-month operating cash flow rose to $11.422 billion from $8.968 billion, driven partly by a much better working-capital contribution, while payments for acquired businesses increased to $1.333 billion from $233 million. The filing states, “The Company reaffirms its fiscal 2026 guidance.” 〔1〕 (Cash Flow statement)

Net read: broadly in line, not a clean beat. The adjusted-EPS outperformance and stronger cash flow are constructive, but the revenue miss, declining transactions, modest U.S. comparable growth of 1.3%, and unchanged full-year outlook keep the filing from materially raising expectations. The direction was partly anticipated; the new information is the quarter’s mixed magnitude rather than a major change in the story.