Lowe’s has released its Q1 2025 earnings — and while headline sales are down, the home improvement chain is leaning on Pro growth, digital momentum, and capital discipline to navigate a choppy macro environment. Despite housing market softness and tough weather early in the quarter, the company reaffirmed its full-year outlook.
Net Sales: $20.9B (⬇️ 2.1% YoY from $21.4B)
Comparable Sales: ⬇️ 1.7%, weighed down by weak DIY traffic
Gross Margin: 33.4% (flat YoY)
Operating Margin: 11.9% (vs. 12.4% last year)
Diluted EPS: $2.92 (vs. $3.06 YoY)
Net Income: $1.6B
The decline in comps was driven by unfavorable weather and softer DIY activity. But Pro customer sales — the higher-margin, contractor-focused segment — delivered mid-single-digit growth, offering a critical offset.
Digital sales also grew at a mid-single-digit pace, with online orders increasingly integrated into Lowe’s omnichannel ecosystem. While overall demand dipped, the company's investments in digital and store experience kept core metrics stable.
CEO Marvin Ellison: “Despite near-term uncertainty and housing market headwinds, our team’s focus on exceptional service earned us the #1 spot in J.D. Power’s 2025 Home Improvement Retailer Satisfaction Study.”Digital: The Silver Lining
Lowe’s continues to execute with discipline:
Operating income of $2.5B
SG&A expenses held at 19.3% of sales, despite ongoing wage and supply chain pressure
Capex: $518M, in line with strategic investment plans
Cash from operations: $3.4B — down YoY, but still healthy
Shareholder returns remained robust, with $645M in dividends and $112M in share repurchases. The company ended the quarter with $3.05B in cash.
Inventory levels rose slightly to $18.3B, up 0.6% YoY — a relatively modest build compared to peers like Target, where inventory was up double digits. However, accounts payable declined by $500M YoY, which put pressure on operating cash flow.
This working capital squeeze was one reason why cash flow from operations dipped 21% from Q1 2024, despite strong net income and steady margins. Still, Lowe’s appears to be managing inventory with a long-term view — prioritizing product availability for Pro customers and project-based shoppers.
While Lowe’s isn’t chasing aggressive short-term growth, it’s building long-term muscle in three areas:
Omnichannel consistency — blending in-store and online shopping without margin dilution.
Pro dominance — growing share in a segment that values reliability and inventory depth.
Capital discipline — balancing investment with shareholder returns.
With over 195M sq ft of retail selling space and 1,750+ stores, Lowe’s is focused on productivity per square foot rather than sheer expansion. And with housing starts expected to rebound later this year, the company could be well-positioned for a second-half lift.
Full-Year Sales: $83.5B to $84.5B
Comparable Sales: Flat to +1%
EPS Guidance: $12.15–$12.40
Operating Margin: 12.3%–12.4%
CapEx: ~$2.5B
In other words, no panic. Lowe’s is banking on second-half stabilization as housing activity and outdoor spending normalize.
Lowe’s didn’t wow on the topline, but it didn’t flinch either. The brand is staying the course:
• Betting on Pro customers
• Leaning into e-commerce
• Keeping margins tight
• Rewarding shareholders
While store comps are under pressure, Lowe’s strategic focus on experience, digital, and cash flow discipline keeps it well-positioned, especially if the housing cycle turns upward later this year.
This quarter wasn’t a breakout, but it was solid footing in a shaky macro. And that’s worth noting.
Check out the full earnings report here - Lowe’s Earnings Report