Investing.com -- Lowe’s (NYSE:LOW) has reported a smaller-than-anticipated decline in second-quarter gross profit and backed its annual financial guidance, as online sales growth helped offset lower demand for nonessential items.
Lowe's, along with rival Home Depot (NYSE:HD), has been impacted by a post-pandemic slowdown in spending by inflation-hit shoppers on big-ticket home improvement items, although this trend has been mitigated by expenditures on less pricey maintenance projects. Elsewhere, the U.S. housing market is showing signs of normalizing, with new home sales increasing by 12.2% in May.
Gross income slipped by 8% during the three months ended on August 4 to $8.40 billion, but this still topped Bloomberg consensus estimates of $8.34B due in part to reduced costs.
Diluted income per share fell to $4.56, compared to $4.67 in the same period last year. Meanwhile, net sales dropped by 9.2% to $24.96B.
The DIY chain reiterated its previously-reduced 2023 financial outlook in the wake of what the company described as a "spring recovery" marked by an expansion in online sales. Colder weather in the early part of spring meant that some of the typically stronger sales during the season for lawn care items and outdoor supplies were also pushed into the second quarter.
Full-year adjusted earnings per share are expected to be between $13.20 to $13.60, while total sales are seen at approximately $87B to $89B.
Shares in Lowe's rose in premarket U.S. trading on Tuesday.
Lowe's lowered its full-year sales and earnings outlook earlier this year. But chief executive Marvin Ellison described the medium- and long-term strength of the business as strong at the time, thanks in part to more customers choosing to shell out cash to make repairs on an aging U.S. housing stock.