Press release·08/25/2026 12:11:22

Financial Performance Overview

The Home Depot, a leading home improvement retailer, has reported its financial results for the second quarter and first six months of fiscal year 2026. The company delivered solid performance, with increases in net sales, net earnings, and diluted earnings per share compared to the same periods in the prior year.

In the second quarter of fiscal 2026, the company reported net sales of $47.9 billion, up 5.7% from $45.3 billion in the same quarter last year. Net earnings were $4.8 billion, or $4.79 per diluted share, compared to $4.6 billion, or $4.58 per diluted share, in the prior year period.

For the first six months of fiscal 2026, net sales were $89.6 billion, an increase of 5.3% from $85.1 billion in the first half of fiscal 2025. Net earnings were $8.1 billion, or $8.09 per diluted share, compared to $8.0 billion, or $8.03 per diluted share, in the prior year period.

The company’s financial performance was driven by several factors, including:

Comparable Sales Growth The company’s total comparable sales, which measure the change in net sales at locations open for more than a year, increased 1.7% in the second quarter and 1.2% in the first six months of fiscal 2026. This growth was primarily due to a 2.8% and 2.5% increase in comparable average ticket in the second quarter and first half, respectively, partially offset by decreases in comparable customer transactions.

Acquisitions The company completed two significant acquisitions during the past year that contributed to its sales growth. In September 2025, it acquired GMS, a leading distributor of specialty building products, which added $1.4 billion in net sales in the second quarter and $2.8 billion in the first six months of fiscal 2026. In May 2026, the company acquired Mingledorff’s, a wholesale distributor of HVAC equipment, parts, and supplies, though the impact on sales was immaterial in the periods reported.

Online Sales Online sales, which include sales generated through the company’s websites and mobile applications, represented 16.6% of total net sales in the second quarter and 16.5% in the first six months of fiscal 2026. Online sales increased 11.0% and 10.8% in the second quarter and first half, respectively, compared to the prior year periods.

Gross Profit Margin Gross profit margin, or gross profit as a percentage of net sales, was 33.7% in the second quarter, up from 33.4% in the same quarter last year. For the first six months, gross profit margin was 33.4%, down slightly from 33.6% in the prior year period. The increase in the second quarter was driven by the benefit of tariff refunds, partially offset by higher costs for fuel, energy, and other product inputs. The slight decrease in the first half was due to the inclusion of the GMS business, as well as the cost pressures, largely offset by the tariff refunds.

Operating Expenses Selling, general, and administrative (SG&A) expenses increased as a percentage of net sales, rising to 17.6% in the second quarter from 17.1% in the prior year quarter, and to 18.3% in the first six months from 18.0% in the same period last year. This was primarily due to higher operating costs relative to the pace of sales growth.

Depreciation and amortization expenses were 1.8% of net sales in both the second quarter and first half of fiscal 2026, consistent with the prior year periods.

Interest and Other Expenses Interest and other expenses, net, decreased to 1.1% of net sales in the second quarter from 1.2% in the prior year quarter. For the first six months, interest and other expenses, net, were 1.3% of net sales, unchanged from the prior year period. The decrease in the second quarter was driven by higher interest income from the tariff refunds.

Earnings and Earnings per Share Net earnings increased 4.7% to $4.8 billion in the second quarter and 0.9% to $8.1 billion in the first six months of fiscal 2026 compared to the same periods in the prior year. Diluted earnings per share grew 4.6% to $4.79 in the second quarter and 0.7% to $8.09 in the first half of fiscal 2026.

Cash Flow and Capital Allocation During the first six months of fiscal 2026, the company generated $11.4 billion in cash flow from operations. This cash, along with existing cash on hand, was used to fund $4.6 billion in cash dividends, repay $3.0 billion of long-term debt, invest $1.7 billion in capital expenditures, and fund $1.3 billion in acquisitions.

The company’s Board of Directors approved a $15.0 billion share repurchase authorization in August 2023, replacing a previous $15.0 billion authorization. However, the company has paused share repurchases since March 2024 and had approximately $11.7 billion remaining under the current authorization as of August 2, 2026.

Inventory and ROIC The company’s inventory turnover ratio, which measures how efficiently the company is managing its inventory, was 4.5 times at the end of the second quarter of fiscal 2026, compared to 4.6 times a year earlier.

The company’s return on invested capital (ROIC) for the trailing twelve-month period was 24.8% at the end of the second quarter of fiscal 2026, down from 27.2% a year earlier. The decrease was primarily driven by higher average equity due to the pause in share repurchases.

Tariffs and Trade Policy The company continues to monitor developments related to tariffs and other trade policy matters, including the effects of a U.S. Supreme Court decision invalidating tariffs imposed under the International Emergency Economic Powers Act (IEEPA). During the second quarter of fiscal 2026, the company began receiving IEEPA tariff refunds, totaling approximately $730 million as of August 2, 2026, which were recognized as a reduction of cost of goods sold and inventory.

Outlook and Risks While the company has delivered solid financial performance, it faces ongoing uncertainties related to tariffs, trade policies, consumer uncertainty, and housing affordability pressures that could impact future results. The company cannot predict with certainty the ultimate impact of these factors on its business in future periods.

Conclusion The Home Depot has reported strong financial results for the second quarter and first half of fiscal 2026, driven by sales growth, acquisitions, and operational efficiency. However, the company faces various macroeconomic and trade-related challenges that could affect its performance going forward. The company’s focus on managing costs, investing in its business, and returning capital to shareholders through dividends and share repurchases will be key to its continued success.