Lowe’s Cos Inc released its full-year sales forecast on Wednesday, missing market expectations. The company claims that its lower forecasts have arisen due to weakening demand for home improvement products.
The decrease in demand appears to be two-fold. On one hand, inflation has pressured many consumers to put home improvement projects on hold, instead refocusing their finances on daily essentials. Demand also appears to be decreasing due to the return to normal life following the pandemic.
During the pandemic, the shift in consumers’ lifestyles led to a home improvement boom. Now that pandemic concerns are subsiding, consumer spending has shifted from goods to services, with many setting out to partake in activities that were limited during the height of the pandemic such as vacations and travel.
For 2023, Lowe expects full-year revenue of $88 million to $90 million, falling short of Wall Street estimates of $90.48 billion in sales. The company’s forecasted earnings in the range of $13.60 to $14.00 per share encompass the estimated $13.79 per share.
Lowe’s reported a 1.5% fall in comparable sales for the three months that ended February, thereby exceeding an expected 0.01% decline.