Lowe’s Companies (NYSE:LOW) fell in premarket action on Tuesday after missing revenue expectations with its Q3 earnings report.
For the third quarter, the North Carolina-based specialty retailer reported comparable sales decreased 7.4% to miss the consensus estimate for a decline of 4.9%. The company pointed to a decline in DIY discretionary spending, partially offset by positive Pro customer comp sales. Lowe’s (LOW) also churned up $3.06 in earnings per share vs. $3.02 consensus
“In the third quarter, the company delivered strong operating performance and improved customer service despite a greater-than-expected pullback in DIY discretionary spending, particularly in bigger ticket categories. Given our 75% DIY mix, the DIY pressure disproportionately impacted our third quarter comp performance. At the same time, our investments in Pro continue to resonate, resulting in positive Pro comps again this quarter,” noted CEO Marvin Ellison.
Gross margin came in at 33.7% of sales vs. 33.3% a year ago and 33.3% consensus. Cost of sales was 66.3% of total sales vs. 66.7% a year ago.
Looking ahead, Lowe’s (LOW) said it expects full-year sales of approximately $86B vs. a prior outlook for $87B to $89B. Comparable sales are expected to be down approximately -5% as compared to a year ago. Adjusted operating income as a percentage of sales is expected to be approximately 13.3%.
Shares of Lowe’s (LOW) shed 4.62% in premarket trading to $195.00 vs. the 52-week trading range of $181.85 to $237.21.