HomeIndustriesLowe's Cuts Annual Forecasts Amid Downturn in Household Goods Demand

Lowe’s Cuts Annual Forecasts Amid Downturn in Household Goods Demand

Lowe’s Cos Inc cut decreased its sales and profit forecasts for the year on Tuesday following in the footsteps of rival Home Depot. This move indicated the effects of the decline in demand for home improvement goods as persistent inflation continues to limit consumer spending.

In addition to steep inflation, the decline in demand for household items also comes as consumers continue to express a preference to spend on travel and leisure as occurred during the post-pandemic travel boom.

As a result of falling demand, Lowe’s expects its full-year comparable sales to fall between 2% and 4%, compared to its previous forecast which expected sales to remain anywhere between being flat and going down 2%. While same-store sales were previously expected to remain flat, they are now forecast to fall by 2% to 5%.

Lowe’s 2023 adjusted earnings are now projected to be between $13.20 and $13.60 per share. Previously, they were forecasted to be between $13.60 to $14.00 per share.

The home improvement retailer revealed that sales to professional customers, such as builders, contractors, and handymen, were up in the first quarter, in contrast with Home Depot which reported a decline in this market segment.

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