Home Depot sales continue to slide but home improvement chain still tops expectations

abcnews.go.com:

Home Depot is continuing to see its sales decline amid inflation concerns, and the home improvement retailer narrowed its fiscal 2023 outlook

Home Depot sales continue to slide as Americans wrestle with persistent inflation and the company narrowed its outlook for the year. But the nation's biggest home improvement retailer still topped expectations for the quarter and shares jumped more than 6% at the opening bell Tuesday.

Home Depot now expects an earnings per share to decline between 9% and 11% in 2023 and same store sales to fall 3% to 4%. The company previously anticipated an earnings per share drop between 7% and 13% and a same-store sales decline of 2% to 5%.

It's the first time that Home Depot has projected a decline in annual sales since 2009, when the U.S. economy was decimated by a massive housing bubble.

Inflation is hitting Home Depot on a number of fronts.

Americans are more closely watching where they spend money as costs rise. The average receipt at Home Depot declined 0.3% from last year during the same period, and customer transactions are down 2.4%. It is also getting more expensive to put big-ticket items on credit cards or to take out a loan to buy them, a result of the fight by the U.S. Federal Reserve against inflation.

Secondly, as the Fed has raised interest rates to cool the economy and inflation, it has fractured the real estate market, the health of which is a big determinant in Home Depot's fortunes.

Few people are moving from their homes after locking in ultralow mortgages at or below 3%. The average rate on the benchmark 30-year home loan is more than twice that now.

Sales of previously occupied U.S. homes in September fell for the fourth month in a row, grinding to their slowest pace