Home Depot (HD) Q3 2025 Earnings Miss & Outlook Cut Analysis Report

November18,2025 (EST)
November18,2025 (UTC)

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##1. Event Summary
Home Depot (HD) announced third-quarter (Q3) 2025 earnings on November18,2025, including a downward revision of its full-year outlook, which led to a 4% pre-market stock drop. Key details from the event and verified sources:

• Earnings Miss:
  Third consecutive quarter of missing Wall Street earnings estimates [1].
• Outlook Cut:
  Full-year adjusted EPS expected to decline by ~5% YoY (up from prior guidance of 2% decline) [1][2].
• Revenue:
  Q3 sales reached $41.4B (+2.8% YoY), including $900M from the recent GMS Inc. acquisition (8 weeks of sales) [2].
• Comps:
  Comparable sales rose 0.2% (US: +0.1%), a sharp slowdown from prior periods [2].
• Causes:
  The company cited slow consumer spending, weaker housing market, and lower-than-usual storm activity as headwinds [1].

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##2. Market Impact Analysis

• HD Stock Performance:
  Pre-market drop of4% reversed partially during regular trading, closing at $336.48 (-1.03% daily change) with volume of10.14M shares [0].
• Competitor Reaction:
  Lowe’s (LOW), HD’s main competitor, closed slightly up (+0.24% on Nov18), suggesting HD’s decline was partially company-specific [0].
• Sector Performance:
  Consumer Cyclical sector (HD’s primary sector) fell by0.94% on Nov18, underperforming the broader market. HD’s daily decline (-1.03%) slightly exceeded the sector average [0].

• The larger-than-expected EPS decline (5% vs prior2%) indicates persistent operational challenges.
• The GMS acquisition (adding $2B incremental revenue to full-year guidance) may not offset macroeconomic headwinds like weak housing demand [1].

• Negative for HD:
  Consecutive earnings misses and outlook cut signal investor concern about long-term growth.
• Sector Context:
  Consumer Defensive (-1.62%) was the worst-performing sector on Nov18, reflecting broader consumer spending weakness [0].

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##3. Key Data Extraction

Metric	Value	Source
Q32025 Sales	$41.4B (+2.8% YoY)	[2]
Q3 Adjusted EPS	$3.74 (-1.4% YoY)	[2]
Q3 Comparable Sales	+0.2%	[2]
HD Nov18 Open Price	$339.98	[0]
HD Nov18 Close Price	$336.48 (-1.03% daily)	[0]
HD Nov18 Volume	10.14M shares	[0]
LOW Nov18 Change	+0.24%	[0]
Consumer Cyclical Sector Change (Nov18)	-0.94%	[0]

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##4. Affected Instruments

• Directly Impacted:
  Home Depot (HD)
• Related Competitors:
  Lowe’s (LOW)
• Sectors:
  Consumer Cyclical, Building Products (via GMS acquisition)
• Macro:
  Housing market (existing home sales, mortgage rates) and consumer spending indices

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##5. Context for Decision-Makers

1. HD’s Average Volume:
   Need to compare Nov18 volume (10.14M) to historical averages to assess investor interest intensity.
2. Lowe’s Q3 Results:
   Missing data on LOW’s Q3 performance to validate sector vs company-specific issues.
3. Housing Market Data:
   Recent existing home sales or mortgage rate trends to confirm HD’s claim of weaker housing demand.
4. GMS Integration:
   Progress on integrating GMS into HD’s operations and its long-term revenue contribution.

• Bull Case:
  The GMS acquisition adds a new revenue stream in building products, diversifying HD’s portfolio.
• Bear Case:
  Consecutive earnings misses and macro headwinds (housing slowdown) may lead to further downward revisions.

• Consecutive Earnings Misses:
  Three quarters of missing estimates indicate persistent operational challenges [1].
• Larger EPS Decline:
  The5% full-year EPS drop (vs prior 2%) suggests worsening market conditions [2].
• Macroeconomic Headwinds:
  Weak housing demand and slow consumer spending are likely to continue pressuring results [1].

Users should be aware that Home Depot’s third consecutive earnings miss and larger-than-expected full-year EPS decline may indicate persistent operational and market challenges that could impact future performance.

1. Q4 Comps:
   Holiday season sales performance (critical for home improvement retailers).
2. GMS Integration:
   Progress on merging GMS into HD’s supply chain and revenue growth from this segment.
3. Housing Market Trends:
   Existing home sales, mortgage rates, and new construction data.
4. Consumer Confidence:
   Indices like the University of Michigan Consumer Sentiment Index to track spending intentions.

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[0] Ginlix Analytical Database (HD/LOW price data, sector performance)
[1] CNBC: Home Depot (HD) Q32025 Earnings [URL: https://www.cnbc.com/2025/11/18/home-depot-hd-q3-2025-earnings-.html]
[2] PRNewswire: Home Depot Announces Third Quarter Fiscal2025 Results [URL: https://ir.homedepot.com/news-releases/2025/11-18-2025-110057142]
[3] The Fool: Home Depot Stock Falls After Outlook Cut [URL: https://www.fool.com/investing/2025/11/18/home-depot-stock-falls-after-the-company-cut-its-e/]

This analysis is for informational purposes only and does not constitute investment advice. All data is sourced from publicly available information and internal databases as of November18,2025.