Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
HD delivered 4.8% revenue growth to $41.8B in Q1 FY2026, aided by the GMS acquisition, but gross and operating margin compression drove net income and diluted EPS down 4.2% and 4.3%, respectively. Source: 10-Q Item 2 MD&A, pp.15-16
Revenue
$41.77B
+4.79% YoY
EPS (Diluted)
$3.30
-4.35% YoY
Gross Margin
33.0%
-0.8 pts YoY
Operating Income
$4.98B
-2.96% YoY
Source: SEC XBRL
Home Depot (HD) reported Q1 FY2026 revenue of $41.77B, up 4.8% year over year. Operating margin was 11.9%, down 1.0 points from 12.9% a year earlier. Operating cash flow was $6.03B, up 39.5% year over year. HD's fiscal Q1 FY2026 corresponds to calendar Q2 2026.
Last 4 quarters: 1 beat
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 3.43 | 3.51 | Miss -2.2% |
| Mar 2026 | 2.72 | 2.62 | Beat +4.0% |
| Dec 2025 | 3.74 | 3.95 | Miss -5.4% |
| Sep 2025 | 4.68 | 4.85 | Miss -3.6% |
Compiled by AI from 10-Q Item 2 of this filing
Net sales increased 4.8% year over year to $41.8B, primarily because GMS, acquired on September 4, 2025, contributed $1.3B of first-quarter net sales. A weaker U.S. dollar also added $220M to sales.
Source: 10-Q Item 2 MD&A
Comparable sales rose 0.6%, as a 2.2% increase in comparable average ticket was partly offset by a 1.3% decline in comparable customer transactions. Management cited engagement with smaller home-improvement projects, while consumer uncertainty and housing-affordability pressure continued to weigh on demand.
Source: 10-Q Item 2 MD&A
Gross margin declined to 33.0% from 33.8%, primarily reflecting the inclusion of GMS in consolidated results. SG&A increased 5.7% to $8.0B and rose to 19.1% of sales from 18.9%, primarily because operating costs grew faster than comparable sales.
Source: 10-Q Item 2 MD&A
Operating cash flow increased to $6.0B, up approximately $1.7B year over year, primarily due to working-capital changes. HD used cash flow and cash on hand to pay $2.3B in dividends, repay $1.4B of long-term debt, repay $1.0B of net commercial-paper borrowings, and fund $844M of capital expenditures.
Source: 10-Q Item 2 MD&A
Management does not plan to resume share repurchases in fiscal 2026 as it seeks to reduce outstanding debt following acquisition-related financing. The company plans approximately $4.0B of fiscal 2026 capital expenditures and increased its quarterly dividend 1.3% to $2.33 per share.
Source: 10-Q Item 2 MD&A
Compiled by AI from 10-Q Item 2 of this filing · 0 high, 4 medium, 0 low
HD said the ultimate effects of evolving tariffs, trade-policy discussions, litigation, and the U.S. Supreme Court decision involving IEEPA tariffs cannot be predicted with certainty. The timing and total amount of any additional tariff refunds are uncertain; the company had not recorded IEEPA tariff refunds as of May 3, 2026.
Source: 10-Q Item 2 MD&A
Management stated that comparable-sales performance reflected consumer uncertainty and housing-affordability pressure on home-improvement demand. Comparable customer transactions declined 1.3% in Q1 FY2026, partially offset by a 2.2% increase in comparable average ticket.
Source: 10-Q Item 2 MD&A
HD's ROIC declined to 25.4% from 31.3%, which management attributed partly to higher average long-term debt associated largely with financing the SRS acquisition. The company has paused buybacks and does not plan to resume them in fiscal 2026 while it reduces debt; it had $3.5B of commercial-paper borrowings outstanding at May 3, 2026.
Source: 10-Q Item 2 MD&A
Gross margin fell 80 basis points to 33.0%, primarily reflecting GMS in the consolidated business mix, while SG&A as a percentage of sales increased to 19.1% from 18.9%. These factors contributed to a 3.0% decline in operating income despite revenue growth.
Source: 10-Q Item 2 MD&A
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 41.77 $B | 39.86 $B | +4.79% |
Cost of Revenue $B | 27.98 $B | 26.40 $B | +6.01% |
Gross Profit $B | 13.78 $B | 13.46 $B | +2.39% |
Operating Income $B | 4.98 $B | 5.13 $B | -2.96% |
Net Income $B | 3.29 $B | 3.43 $B | -4.19% |
EPS (Basic) $ | 3.31 $ | 3.46 $ | -4.34% |
EPS (Diluted) $ | 3.30 $ | 3.45 $ | -4.35% |
SG&A Expense $B | 7.96 $B | 7.53 $B | +5.70% |
Answers draw on this SEC filing and the data on this page
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