Home Depot’s Sales Growth Flattens After Year of Rapid Gains

Home Depot’s Sales Growth Flattens After Year of Rapid Gains

Sales for Home Depot Inc. continued their upward trend in the latest quarter, but the company’s year-over-year growth rate slowed in comparison with last summer, when the coronavirus pandemic began driving home-improvement spending.

The retailer, which benefited from pandemic-related changes in consumer behavior and federal stimulus payments last year, said that demand has remained strong, but its executives cited supply-chain snags and rising materials prices as challenges. In the latest quarter, comparable sales—a measure that adjusts for stores opening and closing—grew 4.5%, after four consecutive quarters of more than 20% growth.

The more modest sales growth has remained steady through the first two weeks of August, even as the Delta variant of the coronavirus has led to rising case counts, Chief Financial Officer Richard McPhail said in an interview. Still, the course of the pandemic remains hard to predict, he added.

“We just don’t know, and we don’t want to speculate,” Mr. McPhail said.

The types of projects bringing in business for the company are evolving, Home Depot executives said. In the three months through July, shopping declined in do-it-yourself categories such as paints and garden supplies. When consumers retreated to their homes last summer during the pandemic, sales for those products surged as people invested more time and money in sprucing up their properties.

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