Lowe’s (LOW) Q2 2025 earnings summary

Executive summary

• Q2 2024 sales were $23.6 billion, down 5.1% year-over-year, mainly due to weak DIY demand and unfavorable weather, partially offset by mid-single-digit Pro comp growth and 2.9% online sales growth.

• Net earnings for Q2 2024 were $2.4 billion, with diluted EPS of $4.17 and adjusted diluted EPS of $4.10, including a $0.07 gain from the Canadian retail business sale.

• Disciplined expense management and productivity initiatives supported margins and improved customer experience.

• The My Lowe's Rewards loyalty program launched nationwide, with new partnerships and expanded engagement initiatives.

• Investments in technology, omnichannel delivery, and innovation, including partnerships with Apple, NVIDIA, OpenAI, Palantir, and Uber Eats, are ongoing.

Financial highlights

• Gross margin was 33.47%, down 19 basis points year-over-year, impacted by supply chain investments but partly offset by lower transportation costs.

• Adjusted operating margin was 14.4%, down 114 basis points year-over-year; operating income for Q2 was $3.45 billion.

• Adjusted SG&A was 17.3% of sales, deleveraging 87 basis points due to sales deleverage and cycling a favorable legal settlement.

• Inventory ended at $16.8 billion, down $581 million from Q2 last year.

• Free cash flow was $2.7 billion; 4.4 million shares repurchased for $1 billion; $629 million paid in dividends.

Outlook and guidance

• Full-year 2024 sales expected at $82.7–$83.2 billion, with comparable sales down 3.5% to 4% and adjusted diluted EPS of $11.70–$11.90.

• Adjusted operating margin forecasted at 12.4%–12.5%; capital expenditures for the year expected at ~$2 billion.

• Q3 and Q4 comp sales expected to be about 200 basis points better than Q2, with operating margin rate for the second half roughly in line with prior year.

• Net interest expense for the year expected at ~$1.4 billion.