LOW - Earnings call transcript Q4 2025

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Operator

Good morning, everyone. Welcome to Lowe's Companies' Fourth Quarter 2024 Earnings Conference Call. My name is Rob, and I'll be your operator for today's call.

As a reminder, this conference is being recorded.

call and Kate Treasurer. the of Vice turn Relations Investor now over Pearlman, to President I'll

Kate Pearlman

Thank and you, good morning.

Merchandising; our Here Ellison, with Brandon Financial Vice Sink, Boltz, and Vice Stores; Officer. Chairman Marvin our President, Executive Chief and Chief our Vice me Executive Officer; and today President, Joe McFarland, are President Executive Executive Bill

our Lowe's can remind regarding forward-looking Relations included in I be notice statements which morning, on our would press you like this that Investor to website. found release is

this call, of the be uncertainties from risks, a will factors, risk annual may XXXX. we forward-looking, as including making other various in Form on report materially are During Actual and our MD&A and comments important our XX-K those differ our fiscal implied and of that expressed factors, or expectations sections filings. other including for result discussed results SEC those

be U.S. Investor of financial discussing of our measures. Relations Additionally, be non-GAAP Quarterly section reconciliation the can on GAAP A certain Earnings we'll to website. items these found

to turn call over Marvin. I'll Now the

Marvin Ellison

Kate, you, good Thank you and today. us morning, for joining thank and everyone,

quarter, of and comparable $XX.X of delivered the positive we X.X%. billion In sales fourth sales

year fiscal Looking at sales and billion, of $XX.X operating we the full margin earnings share XXXX, of delivered per adjusted adjusted XX.X% of $XX.XX.

wake positive Pro hurricanes. DIY home We efforts continued our are deliver by very this results and macro strong sales and environment. improvement in difficult and And recent the pleased online, seasonal in also momentum expectations very performance driven that with to in comparable rebuilding our quarter a were of we're pleased in performance XXXX exceeded with

And cautious to make performance quarter delivering this for continuing on growth. still with long-term strong on the seeing near-term consumer projects. operating challenging particularly spending, these better-than-expected pressure results, in we backdrop, right focused we're bigger-ticket investments Despite remain leading fourth DIY discretionary while continued a to

results momentum depth, in for that Pro best-in-class we right and inventory dedicated offering our products, jobsite gaining high through to single-digit quarter, second improved a created our we where Pro service a effect with transformed delivered customer the greater program and Turning We're brands fourth with the the the delivery, we experience. engagement Pro quarter. levels with steps comps detail consecutive redesigned flywheel week, in nationwide with launch our Pro about Pro next greater the our small digital for call, updated tailoring to share Last will the Pro the drive took Joe more MyLowe's the Later how to loyalty with in Pros. our Rewards. of program, offering medium we a

Through of AI to and online, DIY investments holiday. online. and QX, traffic in We and more new drove Monday delivery in all Black our growth broad-based divisions, enhanced the Friday which in user Rewards, the combined options, us generating loyalty a strong are results These and include give improvement that more user to Cyber experiences. included Shifting Lowes.com. app same-day off. These omnichannel MyLowe's experience program, record-breaking X.X% across during sales more driving intuitive sales reflected free we're investments merchandising with our excitement paying confidence online

refresh want mobile table solutions AI-enabled retail mobile enhancements as stake U.S. highlighting just in outside but that to digital innovative are also Forrester like rated the just Space Your helps the Style customers features, Lowe's digital our reimagine omnichannel they earning functionalities a And button. overall leader and recognition the through of as touch rooms experience apps, that app not

their customers that the app helpful store virtual projects. adviser on give first tackle the associates to will we their for technology home money. Lowes.com, on companion AI-powered in technology recommendations same product into month, they home using This Lowe's collaboration them This improvement both with our OpenAI, seamless with our adviser Next leveraging time links will are direct advice new improvement as customer the is customers checkout. with and to to products provide enhance saving specific leaning and how virtual a emerging we're experience, know-how project another both Lowe's example launch of

the X me home our today's higher challenging to homeowners have U.S. enjoy. Now existing nearly homebuyers home for down, and between allow rates are led market. Even more view transition the to of rates remains lock-in than in lower interest This macro. rates been the currently in short-term XX a improvement lowest and the gap significant sales come many started of in Mortgage rates a decades, pace to than a creating effect though has they've to years. this

to of lower the difficult the see business. outlook and home rates confident improvement timing of increased we it's when Although demand, medium- long-term our predict we'll in to remain

personal As I've oldest will and the that of sustain home stock in we homes business existing begin long-term history. These in stated than before, upgrades. some faster appreciation, and equity of price disposable income supportive: invest anticipate repairs demand to their tap drivers growing key fund larger to will as U.S. projects. the drivers are our inflation homeowners into housing in renovation And homeowners record levels still

the place refined formation, improvement analyst increasing our long-term that and conference. strength we've our expanding drivers our to work, productivity. space in home online millennial Home loyalty trends and improvement structural boomers meantime, the household home creating are services, In accelerating driving persistence sales, the includes are confidence aging and our investments reinforce industry. such the Total medium- the ecosystem of closely aligned penetration, of Strategy the remote Pro factors, updated these our investor making We a our with in demand. It of December unveiled at long-term Beyond baby as and home strategy

ahead inflects. productivity Total on coupled outlined market to of see share productivity, improvement When look our through our that or that In market Home we cost Strategy, Strategy, execute year. we're and capitalize in initiatives, home well confident the X we strategic economic perpetual disciplined Total the positioned our and that our any the take confident Together, on operating potential in we're of we're range we the focus the improvement at a home our this our outcomes environment. investments also ensure making industry to our when captured And take agility ability addition December with to to our are could continuing recovery to we PPI. out in model conference scenarios very XXXX, we're in Home

outperform macro So each market we the in we that in scenario prepared outlined to December. are

a to thank to who teams take Southern impacted I customers our California across devastating to were support stepped the up like Before minute by close, wildfires. our I'd who

significant store we important not this these was recover. Although felt it we where an is communities to presence, have help area

As impacted a the the reflection impacted to areas. prayers. continuing this in in efforts of wildfires by our in please donated join commitment, keep and our me Lowe's million for And $X relief those thoughts

continue we for how dedication remove I every frontline week, their store to we leadership and demonstrate gives great customer across awarded improve our bonus visit appreciation and associates learn our discretionary managers commitment service. managers for experience. year-end assistant country opportunity the friction $XX million, appreciation and a can which to hardworking across To the them customer me associates, This and their to personally stores reflects including our the to thank our frontline for bonuses of company. for our

I'll over that, Bill. with turn And things to

William Boltz

and good Thanks, Marvin, morning, everyone.

As our we sales fourth quarter. Marvin are pleased mentioned, with the performance in

full positive Pro, broad-based encouraged the online in we by the with as in year the We strength our Pro and as delivered merchandising the continued for sales. divisions quarter well are across all comps momentum fourth

mark clear tools, storage Lowe's categories like hit was and offers seasonal our for go-to holiday the In addition, DIY shoppers. holiday gifts, it's appliances, customer the that destination for many in the as

across strong all spending that home We're big-ticket market, with appliance in our around especially items. continue took of caution homeowners categories. decor. we to discretionary We pleased exercise Starting challenging on major delivered a comps share when positive

leading including and combination that investments choose whether selection Our omnichannel online a brands driven our experience, innovation offer the results providing were to customer widest a or value, in-store by of two. the in or the of shop seamless consumers

and a double over furniture the the and model past to allowing big deliveries next-day best-in-class years. few like of have us products number appliances, market grills, delivery patio We to deliver built bulky

through these now And stores, chain instead products home going of customer's our jobsite. from our supply as directly or a reminder, flow to a

almost In of fact, the next sales. a install to we This purchase accounts broken for the are is code. more of type this deliver XX% who appliance immediately that ZIP a now every appliance need can and critical than as customers major in for day replace appliance industry's only the retailer

our strengthen enhanced delivery, the expanded Our appliances. experience, leadership in rapid further with capacity helps position for along customer

consumers to continue brand We enhance more across our and private as to for look innovate value also continue lineup categories.

of nationwide, carpet We're categories to tile. luxury most new now the on-trend performance they STAINMASTER example, brand bring that look have and need. For the want vinyl to STAINMASTER portfolio our selection the to we're and the large-format within like excited flooring giving expanding our brand trusted they in customers luxury flooring vinyl

a below We're the water starting clothes of items have Essentials cans increase counterparts, start because of products $X, Lowe's products cart and and typically store. help brands gardening will margins our including a at brand, and prices low with private at goals. front launch tools $XX promises launched these And their value-conscious our recently special brand the range home We sales and higher support positioned basics in on margin which priced than our private national customers. brand the for area our handful under of hangers,

in we roofing, in-stocks. rebuilding lumber, to recovery the driven by in and delivered the outdoor driven pleased like inventory improved and now Pro categories our Turning Southeast. continued Pro investment across products, We storm by materials in and as where and were comps well with continued decking, in positive our building the strength growth building siding as

performance These In fourth results MST. were supported services Trim or hardlines, improved our in strong great Tree quarter. we an A and the margin merchandising team, from sell-through execution by a saw

offering, tools seasonal trees including holiday consumers pre-lit Our during and resonated nursery, holidays. with the live

We XX-foot excited we get fast about them stock. as through tall as customers also which could we named our Yeti get almost sold saw animatronic in Bumble,

Carhartt Lowe's was assortment of extension workwear X,XXX customers which on more mini our more our In solid mini growth our couldn't amongst moments items to again, engaging than including addition, And the Kobalt social shoppers. stores, like once we in media. drove the our and get popular viral apparel, delivered unique buckets holiday expanded of where enough lineup, toolboxes,

biggest ahead, excited Looking of spring, year. for the we're season our

the Toro, in-stock they brand, that spring power improvement and and like the ready garden offering all in we retail. with in home inspiring in brand the to leading home take And battery-powered truly for gardens, are tree with unmatched our the projects showcase an with displays, brand; center outdoor and the on vignettes products position gas-powered are strong leading in need We customers where lineup both a rings and our centers, this product best new equipment, only vertical EGO, more. mailbox we're

customers ensuring need they get interactive their right to they on outdoor for As select their local can signage space everything them they the complete plants zone, shop, and to projects. rely help growing

patio products, and performance also seeing to year, product turn. position customers the some meet value backyard and garden our an the extra we're grills Sta-Green and in in already and our to of updated areas This brand. started our expanded has even We've we're for in to packaging the stronger and own early The easy find. where momentum customers' assortment weather lawn make needs,

cooperated, already grills and for we across market, family Our localized pleased and new where good lineup off a Weber Stealth Overall, to patio we're including grills. Weber, products that is Blackstone Lowe's weather Pit the the has of a exclusive have Char-Broil, the are assortments of start. Boss, great like spring

the year. Finally, we're since last with excited our build launched that made to progress DIY great we it on program we've loyalty

free we've took best-selling deals sales applied the We from traffic tech-enabled redesigned which discuss a even incentive of MyLowe's see million members and with member clear this them we and to lean season. support loyalty Lowe's. to Joe will launch just in during these few drive who now designed more the by some a products, in It's XX nearly which this nonmembers offers marketing have loyalty XX%. detail gives doorbusters, minutes. will exclusive now important Pro learnings program, in successful as that of into these We choose of and program, our outspending This value and the featuring we'll them spring Rewards, built our customers by are base offering

provide merchants their and like and hard chain our vendor for thank continue and all customers, work our to I'd value partners, teams inventory our to closing, supply results. drive serve innovation to and In effort our and

call I'll that, turn Joe, over now With to the you.

Joseph McFarland

good Thanks, Bill, morning, everyone. and

As we're California process. rebuilding in to wildfires by the begin mentioned, impacted Marvin the continuing support as communities they

Our and store I'd evacuation supplies and centers teams in masks, provided chain like in delivered truckloads to these families, and recovery assist and who supply and for haul. helped to grateful of their over routed purifiers recognize homes communities as areas firefighters, the shifters to need. NXX like We're water our dedication long and local associates attending commitment own and while customers communities. with supplies to air their the

including that or scores, improved pick in enhanced up through pleased to I'm Turning store strong process, satisfaction online, we buy our transformation. with continue to QX customer which BOPIS, we front-end satisfaction deliver our our performance.

It than picking Black you it's while Marvin. heard orders paying orders. these we've store, We've the our their to and meaningful. in online making records, of transformation in Cyber And easier strong are Friday up sales are tells while our customers quickly get off. from the endorsement earned Monday about scores in is strong investments Now picked for out ever and roughly front-end the we half customer customer set been us online which up that since particularly satisfaction they're

York, our investor productivity we're of a improvement, we PPI At conference perpetual number ways or through our analyst productivity New driving initiatives. and in discussed

give aisle the by the load associates, touches and to there make labels truck products are reduces go from This carts what's without to a how include bay friction these that straight organized Let removed to bay and the unnecessary specific The flow way process, me into labels the speed now are easier. as this we freight our insight trucks continue some makes new in the to carts, by area you more efforts And detailed reloading. the arrives. directions improvements associates process a technology as give of our products our to associates for and more efficiently. before Driven that streamlined The efficient, coming any improve and specific to so as dramatically bring the even to location, our for process. we've improved redesigned stores cart more number to in can unloading it shelf. visibility well

enhancements We are continue we performance overall very with stores. the make pleased operational to our in the of

Transitioning now to our Pro performance.

resulting broad-based We investments, with confident our backlogs. our indicated Pros near-term geographies are they growth continue to across their comps see driven by again high stable single-digit In survey, in in quarter. prospects this recent Pro-focused our

the customer, our week. launched revamped me new target can Now earning Rewards, our easier on let lower levels ever most. our rewards last and MyLowe's prioritizing medium achieve can largest we've customer small than to give higher Pro our is of an loyalty program an use, start with This we which you spending competitor. program, by intuitive who Pro and offering features nationwide Pros just experience immediately functions With program use update and our Pros, specifically tailored offered rewards to compared for program, offerings to

As business a deals, exclusive in the and members, and online, suite store Lowe's discounts perks solutions. to Pros have member-only volume in including of and app access

time save and Pros help to designed is this of All money.

more to for tech and simplifies Now platform support repeat trips and currency, with easier explain customer should Money. Pro Pro greater the programs making it's the drive not run our and to both experience, purchases same customers already This program. loyalty Lowe's. MyLowe's on and and associates our DIY engagement the incentivize the same use it This only

programs way DIY to team customers. Pro We're time leverage Pro customers. technology them commitment the experience, distinct and provide year. cross-functional platform, our to coordination both season we customers, to one Lowe's every our on From our look now together and strong we're time we're on biggest we're working loyalty tailor value with helping making merchandising With valuable exciting only selling across generate our retailer is shopping programs powers to our evolve to unique able improved bringing an marketing to that enhance the to loyalty ready better by money. These the we the the programs our store to for to and to unparalleled tech offer organization. and the it. program save and are is spring, as stronger both improvement an an customers This of demand and data ecosystem and for home our programs capture for with And we're operations more as continue DIY to our now day marketing, time life to our right customers customers levels important for ahead serve staffing during offers

most to Before in $XX,XXX like managers to are discretionary to Lowe's. who and and this for and want to critical teams. frontline support for differentiates managers their results We're of $X,XXX our teams grateful our In year. incredible appreciation hold service I'd leadership expertise recognize them to some our the contribution particular, their what we're roles a commitment efforts, for managers bonus, thank In their excellent hardworking awarding I close, Their store they store managers. year-end and assistant frontline for our guidance their assistant for company. our the I provide

Brandon. me over let turn now to And call the

Brandon Sink

associated consideration with and we earnings on per pretax of Thank $X.XX. retail quarter, a gain generated of sale share our million the of we XXXX morning, diluted business. Starting our $XX with In GAAP contingent Canadian the recognized good you, everyone. results, Joe, fourth quarter

$X.XX. adjusted share earnings per Excluding of diluted this we delivered benefit,

certain and their quarter storm-related billion Fourth non-GAAP applicable. recovery up exclude Milton from hurricanes will shift Pro that homeowners demand this were comp the sales as Strong online towards We where X.X%. and by My drove roughly comments began benefit, sales basis XXX hurricane-related sales include in securing estimate this results. as better-than-expected the as from and from with cleanup Helene and comparable points comparisons QX point forward properties impacted rebuilding. demand well $XX.X growth positively

especially projects. in ticket DIY by positive driven X.X%, in spend. recovery project momentum appliances, larger-ticket Comparable X.X%, strong pressure average interior continued Comparable was declined with transactions in comps Pro persisting and storm up discretionary

Our monthly January. in and in shift in The Black in November XXXX Cyber demand X.X% November, December X.X% Monday comp sales weekend calendar from down of some were up December down in X.X% Friday XXXX and shifted between periods. into

Additionally, January was the month, negatively of markets. weeks the in X especially winter unfavorable weather in southern impacted by final

was up productivity margin sales from or of chain costs. fourth the supply quarter, XX.X% points PPI of improvement, basis ongoing partly XX investment our driven Gross benefits by year, in perpetual by the last offset initiatives,

versus delevered sales health of XX of XX% margin and of X of rate of basis sales multiple rate tax offset effective we year, versus was initiatives. care basis expenses, of year. X.X% targeted points PPI driven operating period. prior XX.X%, Adjusted SG&A Inventory builds million Adjusted year, year as by improved compensation largely increased benefits versus prior by adjusted seasonal accelerated below slightly critical points up the prior year. this spring prior And ahead $XXX the finished

million quarter through $X.X capital we key continue the at $X.XX Turning initiatives. billion expenditures repurchases productivity $X.X million in million In debt-to-EBITDAR dividends billion the projects allocation. of share totaled $X.X the and cash at paid billion we Capital fourth a returned on shareholders to and free In now dividends. delivered $XXX and ended share year. tech-driven we and to for per quarter, $XXX X.XXx, return generated invested capital to X.X we in repurchased billion, for in shares to flow XXXX, our in invest XX% shareholders. year and growth Adjusted the as returning $X.X

few to Now have again But near home improvement of home is history. improvement scenarios incomes record prices outcomes we our take market real detailing the the remain still in we X an deal the demand XXXX forecast in around range drivers I based on a inflection outlook. grow minutes of out potential in larger-ticket U.S. oldest near-term of In timing are market. are stock market, discretionary would of the a highs, performance the especially a discuss like XXXX, laid housing to spend. Core December, for home good supportive, and there to uncertainty

rates to occasions. home mortgage elevated, existing expect pressure continuing larger also remain put sales those of the We are on that and projects to to some linked

improvement occasion. this outpacing on are we maintenance repair factors, be the by to driven Pro home the these and DIY Based year, flat roughly with forecasting market

new updated grow enable investments resonating, take results we online are made part Total drive have that we the this the laid and share. than Strategy out And which is strong as However, in confident the market us are our growth of to reflected we faster to quarter. Home Pro and our initiatives will

account, of XXXX, sales Taking are all up range sales expecting for we of comparable to $XX.X into X%. in a this billion ranging with flat billion $XX.X from to

approximately with PPI operating margin of as which strategic elevated to inflation, in chain our health XX.X%, strategic billion prior Home in This expect year will store offset tech-driven priorities depreciation and operations, expense, increases cost over merchandising higher care range $XXX productivity forecasted into to this our we general increase investments supply approximately million expenses, and from investments. productivity $X We merit is Total and year. pressure across XX.X% initiatives in operating driving lean a

to year repay in to less $X.X billion but assumptions result also in approximately expected Additionally, short-term billion we investment this have approximately These maturities interest as $XX.XX full due expect $X.X diluted per interest lower plan we debt share net to $XX.XX. rates. earnings year, of of expense will income

as $X.X to approximately priorities stores. of XX and our store up we in We Total new billion X XXXX, strategic open we new ramp to also to expect begin plan In Home invest capital expenditures builds.

the few your are a cadence of year. items with the in here assist To to modeling, keep for mind

cycling the we with expect quarter, poor the half below the sales we account, second weather. moving expect from quarter in of We comp flat, demand sales full particularly points first this be are first into our comp year to XXX guide. where roughly end spring approximately quarter first Taking into basis some the bottom

We deleverage first actions full wage our operating on lower be the XX sales strategic incremental and the basis margin end the to the prioritization Total wrap season. selling rate year of for frontline of expect driven investments our our including below guide, Home of also bottom approximately associates quarter category initiatives, to points the by spring volume, accelerators capture in

we remain high closing, shareholder executing Total Home managing drive our level a at focused by all In continuing on investing through productivity, long-term driving sustainable in Strategy, the and while near-term pressures diligently market to value. costs

And with for will your up that, we open questions. it

Operator

the Our Instructions] line comes Horvers first question JPMorgan. [Operator with of Christopher from

Christopher Horvers

little a talk to you the fourth quarter context. saw the about that wanted putting strength into and in you're how that I bit

-- comp there see storms. we're you was of you any tariff and in out Obviously, -- you're the the maybe December? though or had Putting context not did much even benefit that context deferral? really expecting helped the there the sort You pull-forward forward? how pull from hurricane year, that COVID maybe improvement another weather year Do had Was in of dynamics. think the of weather election the guided you and November that you benefit

Marvin Ellison

point specifics. give my performed take we Marvin. Look, is this the we're Brandon main really and how pleased first I'll I'll with overall, some Chris, in part, quarter. the is, let

very of our store remains the a and board it with macro the execution home Just pleased stores. the merchants improvement prepared chain backdrop, as comments, supply we we're and and across difficult in said the in

give delivered relative to growth. confidence specifics result the that that, a positive that in spite we don't a As Brandon comp, have of expect I'll relates still market and of XXXX. XXXX feel and QX we to have we we more the any in let how you fact to

Brandon Sink

us first really bottom of share Marvin. the execution and I'd in Beats in bonuses in High our gave Chris, to growth QX. discretionary that and associates, the and positive line, ability success Thanks, time in with EPS in years. top couple $XX here growth online comps pleased single-digit back. a Pro just the echo, million paying with for

poor the is here You year just is particularly about impacted That just drag, the pressing which over thinking That is a mentioned QX into, about first the January, and weeks. company-specific weather of the the weather we're course in in particular from north February, X here, basis a of factoring to for month of the seen how we've standpoint. month full points. was XXX

to an But standpoint, as as prepared remarks talked 'XX, the in all about home at overall into taken the remain macro expect from we to we flat a consideration our conditions been as expect where about how then And that's that, market. and our we improvement looked we basis 'XX. fall about we Total relative thinking we drive that's in challenging we to to XXX initiatives, and Home from points start get guide

Christopher Horvers

think the talk the about a first expecting, clawbacks can the pressures investment are they in talk over with of there? still should obviously margin deleverage. about I to quarter, gross tailwinds. you can vendor you as -- the the on about other follow-up, of year, I it. the half the it, along cycle then decent You into shape terms first talked of And be and here in the of Got you side But the think,

you do So gross expect margin year? then and roughly over the up flattish

Brandon Sink

that Chris, we highlighted QX Yes. the majority of from the deleverage. is on sales operating basis the XX points margin, cited you that

to We million that expect shift have about we from QX QX. to $XXX

investments, wage that some few the we that's out. made half other upfront a in in the of category with also items year of on particular, in rolling investment bit accelerators to the QX. There's cycling put a we're So unique second pressure going in the that little that we're

as the expecting We're PPI through move continue to year. ramp we the to

gross are overall we margin, flat to on year. question for that the expecting be Your

we at as in we offsetting in As our again, pressure initiatives PPI chain. seeing and the supply business Pro look that invest are we're that, the

model. us to to to will very our we say improve as to the a with actions, price associates, we sales seasonal look created like and as We're the focused see leadership. customers. first sales increase course marketing our invest of we And really for that in action thumb value at investments rule start also we're the maintain that year. our half ensure we our traffic-driving make allows still in investing promotions, hit I proposition and especially continuing model We've over the on in of value and customers

Operator

are Morgan next of the line from with Our Gutman questions Simeon Stanley.

Simeon Gutman

it Just either move slower it from roughly X the -- of And did the the saw? the slightly closer to you if still backdrop Because clarify, this the for it same you roughly ago? year, market lean sales volatility because are to the of think I guidance months X%. or is the take framework Or share, even going sounds would that to some same.

just I'm anything if of to at changed couple months. put to all the last that So out in understand trying

Brandon Sink

Simeon. This Roughly I same, from say, macro. overall the is Brandon. an would Sure,

'XX. we as the that's saw we've benefit mention, points mentioned, in QX both hurricane basis for I in create that factoring as lapping in to also As terms going the expectation a and we look a XXX start drag and we're seen our weather outpaced pressure February. what I'll at about of slower here XXXX. in we're to January, that of We in actually us each saw expected QX, slight benefit

particularly the still flat. in around December. still challenging, things consumer, again, cautious back conditions that remain big-ticket discretionary. Those all roughly rates, cited elevated market, But And relative we are the

But items. same account trying overall, near-term overall, framework, take I company-specific we're would to say, the still So framework. into some the

Marvin Ellison

Marvin. this Simeon, is

points. additional X Just

in in cooperated, So South. is February. to surprise the But not the And where pressured of again, parts a to weather, start anyone. a spring off has the February, weather is because overall, February to that's, specific specifically of good

December, out all and outperformance. laid reminder, scenarios, X we scenarios as of a the in to it those included Relative

home market we And XXXX we look the though or flat, home improvement that. market being to even at in so our relevant roughly improvement outperform plan

the if the anticipate, anticipate better is so we And is than to better we performance our than market market. what be going

the the plan what have believe So initiatives, irrespective us, strategic market to the of we and the we gives it. outperform agility

Simeon Gutman

My how follow-up, the business then and with about enough. it's Fair the PPI relationship performs.

So you're if what at lighter, specific that the and for just let's all? it then both a to flex being change that up do in you have invest going offset spend doesn't land toggles So a little of have a in how it approach them? say place? areas PPI of change, the to margin And you just in and those Does year. you ends give you sense on this help have certain you in basically could the market plan a to us

Brandon Sink

portfolio, Yes. flex definitely the across margin of evenly We we've the roughly split million stores efforts, deliver $X that December million $XXX in That's now, of through $XXX right about Simeon, plan. highlighted to that. merchant supply productivity billion But I we here teams. the consisting built expecting on 'XX. we're would side, in in say have some chain the another the in mainly expense

sort move as expect continue to ramp we through of to We the that year.

And the the as for we've multiyear referenced, we're have as as we opportunity flywheel created in that believe here opportunity. PPI we've right confident with and the 'XX well

ramp we can the operating outlook. near-term they factors margin soften, that get well of have as ramp as with plan initiatives, been really as in up, confident the things terms in included and certainly that's of So our down better, but larger the some look, as

Operator

Our Baird. next question the line of Benedict with Peter is from

Peter Benedict

the the versus your Any outlook guess, the of you half were? seeing the for maybe start hurricane the or I what year first cadence of a just what you you've of rebuild. expect the first of the different rebuild just expectations or over kind anything seen? question. to Is there First, That's the lift, you're I in about half similar my versus the dollar unique cycle back reason understand year. on wouldn't rebuild

Brandon Sink

Yes.

Peter, these first But in know, to especially the that's you of benefit hurricane insurance some markets, the re-spent. to get that's here timing we've half. in think when definitely that as of some the So going in have how baked going awarded, I be proceeds,

conservative So take bit little of approach. we've tried more a to a

back markets. of standpoint, benefit Carolinas a to half as just in inventory these think year, the we've terms from to We've In. and than assumption. support we're what and as that's that do in, that lower support of we're cadenced baked financially about baked have the And that's across we Florida. Pro we in ready loaded what ready, in ready in the But the in, mentioned, we slightly how the we saw But I

Peter Benedict

to sense That broadening kind as to rates these -- you resonating Pro seeing business? or you question engagement small there. prudent. seems are And of within remind categories growth my the next you're good see talk continue any leads about That the performance that or Pro. larger Okay. Can the for Pro? Pro your maybe the particular a that with Really versus of then medium us me define how to around good us you the put of in kind the Give demand segment? versus

Marvin Ellison

Yes.

quarterly we in. We their pattern part So do Peter, engaged basically financial the really annual overall and spend, We the Pro the first talk performance. and Pro what about let we're their customers. the spend. understand take understand We shopping category what I'll that understand surveys, based their again, that, position so And they're these is. we define annual the and of Bill with on business I'll

it define we that so And regard. in

Now the to service we we Pro investments more load-in, of and we've do agile delivery. taking best-in-class Home product just things to growth Total thing have that again, online is to the improved hold benefits our responding like And see saw a a levels, really online. double-digit think flexible able we been And really on offering.

merchant be do some think we about to the that And and lot flexibility before. addition it to engagement that Bill have has teams of delivery brought fact we really the as a never commitment where have have and to the to you with needs a the have it had bear, we the think in made the overall that to to inventory brands of Pro,

the Pro smaller- that fact they our that lower because, that we're small rewards achieve are those that the to could again, but levels spend excited based And simplistic, about program, they on of from higher wanted Rewards, that more was also they loyalty medium-sized and MyLowe's relaunch received at we something earn something customers is data business. a the more of

seen great. result We a continue. think some we going efforts. take Overall, the off specific about to I'll is we've as let be these of that And of momentum feel categories Bill that

William Boltz

I And for category both business, remarks, prepared my in really positive we're every the growth the year said the saw and we Marvin. as pleased Pro merchandising year. Peter, quarter Thanks, the with for for for as across Yes. the quarter and

by paint strength And store and what but millwork, businesses across some led so key building those of think categories hardware. some tools, areas, also Pro-centric you across those would appliances, other materials, largely but lumber, is

it's quarter to for the the encouraging see for Pro. categories So in strength really merchandising the us year both in and those across

Operator

Our next question Sachs. with is of Goldman McShane from line the Kate

Katharine McShane

think slightly that's talk inflation what looks wondered going margin to throughout below you if ticket category us would thinking year, you're how you're you could accelerators the QX, drags. the one transaction about can just much be QX mentioned of why year? like? during in to be the 'XX. space the happening And that Is the other in that through than range as for quarters? We you about the do versus when How us And can remind specific the something you more

Brandon Sink

transaction the 'XX. Sure, I'll for Kate. assumption This ticket hit is Brandon.

that's a the 'XX. to that slight pressures DIY We ticket The formula. part really that inflation, offset is look driven we the expecting to at that continued strength not Pro. expect of by mainly in we're are Commodity and as persist traffic see we growth, also expecting of balance

muted as We for of the 'XX, we've and it as copper. majority to expect that's just that relates seen be lumber and to

we're QX year. it I in last mentioned the sales relates due just season cycling that to to being main item the As the pressure, shift the

deleverage, bit you Strategy timing pressure So of in unique just a standpoint the QX, Home the the would the and little investment. sales And of I wage from have Total given say category initiatives, going we and out particular, we're look rollout, at touching that where stores and we're there. the the rural our doing the some the rollout and of initiative accelerators as resetting things in other a

would to as particular, say initiative. that the it I in that's there QX, relates uniqueness So with

Operator

question The Greg from line next with is Melich Evercore of ISI. the

Gregory Melich

contemplated to in in And was are tariffs just wanted it little anything part your quarter? a of the inflation. bit What guide? growth? it follow that ticket on up I there as Was

Brandon Sink

would your then say been say I the pretty Greg, I question at QX. terms explicitly what's muted situation very would of our on when or not inflation, in guide But like-for-like in included And incorporated it's enacted. there, look tariffs, recently we fluid.

that tariffs against already Our enacted. teams activating are been have the

in announcements changes tools and merchant and have and teams we prepared We're confident watch that team continue manner. processes our be right or We're respond. may Bill's in keeping team running the respond coming place. potential We're policy that play. close an a on other the effective my And run across and and to finance to

Gregory Melich

leverage downside. a Analyst And it. the upside potentially on you've here? framework and about good talked of leverage, levels Got at bps Day the the the about that the demand still XX given XX of sort think Is on that on to

Brandon Sink

Yes.

quarterly yes, have sort about much thinking in on But on on, down. expectation. the still think that better very XX level. doesn't upside, you're operating of that Greg. the spot We necessarily against full apply XX framework place, on when a I year. it's It still The the framework works

Operator

UBS. The line of next questions the from with come Michael Lasser

Michael Lasser

versus like and the areas impacted for they specifically by Where large-ticket in the of remodels today is does Lowe's Because remodels? seem where do stand adversely bath remodeling some it XXXX, like Lowe's softness. categories being were kitchen disproportionately

it would a presumably, benefit So those as be improve. categories

Marvin Ellison

Michael, is Well, Marvin. this

big everything one said under DIY is I that is think big consistently thing discretionary DIY ticket. and discretionary you is listed pressure, we ticket

impacts those business discretionary categories it those And the revenue. under so from the our since and obvious And XXXX. our revenue customer, when answer DIY categories are big-ticket pressure, coming pressure our disproportionately of feel XX% is with

you I'll so more any Brandon give And context. let

Brandon Sink

seen. Yes. in years terms just Michael, over-reversion sort relative categories these we've the to X flooring, around of we've ago as consistent look been what we pretty in decor, K&B of at

believe the and when certainly that. ready for and market when pent-up there's we're I inflects demand So turns, it

of QX, when But course here On just it's negatives $XXX. at the coming use and another the the roughly XXXX, looks We're larger QX. is we on sequential it in out bigger I'll improvement single-digit out data like call getting specifically we term of were over high here tickets QX point over less flat would worse. our ticket, tickets I look

kind seeing in but of bumping XXXX, at certainly we a in categories. inflection So good those the along we're a or here. projecting we're the recovery an that hope sign Not bottom trough as we look

Michael Lasser

business the My to follow-up drive and activity between around incremental is some description DIY there initiatives. promotions, was other advertising a

Meaning, taken been it b, can a, DIY And that? all is how changes quantify market So been thinking has past? the the you in business to today the just future -- share have given are expensive that cost the place? in maintain where it it's the drive about to where versus more you becoming

Marvin Ellison

the know seen promotional very tell but specific any excited the we change I is do about of anything not we planning create to what one in are inflection question, launch anticipating are you That any in we which that our nor we The have for change program, to context is will and exactly in is doing DIY. don't cadence will DIY the DIY, cadence. nor that the loyalty Michael, thing be that over we leverage our we're cycling March, will to program. point

a program. competitive space. investing modernized gives than We're had program Pro with Other DIY going a loyalty that the key more the going run play. that to in you database, to than is continue past. of have it mean, we're to a expectation home and mentioned, to what specific I in benefits improvement the loyalty marketplace. distinct one marketing be DIY the more capabilities in to one-to-one no But as only we're we be And that, Joe we've the we're And of very going aggressively continue marketing retailer

Brandon Sink

margin for at flow-through, SG&A gross in take investment, same would resonate, all in actions, deliver guide. in continue we within in and the to to continue what space, financial in categories I pricing XXXX the it's that to to the of us or of time, factored our I leadership in, cost the just all at marketing it's take look that factored Michael, terms on the going flat right that in referenced, as add that promotional expectation of terms just whether

Operator

question Zack the next Fargo. from of Our Wells Fadem line is with

Zachary Fadem

a was whole the February to to consumer more be say fair Do a of little about sounds air pocket it's that attribute As behalf bit it there you XXXX? maybe some in QX January, think like, post-election died as down this in you exuberance weather. on

you back through So QX confidence move give trends factors into that and the year. through through to snap that as just the and can trying think we QX

Marvin Ellison

to we Zack, But election specifically real will season. you what is I this So no Marvin. on appreciate holiday of tell data we tangible point the have to business. is can I during that question. weather the support the any exuberance our impact

our of where wet well. resonating have is frozen at shining any February, look not where business And that performing -- cool, of January look and precipitation, points spring is well. the for is and weather, the at clear as business, the really spread geographic mentioned, is we unseasonably As it Brandon and as we the we seasonal sun crystal we have normal

we So no shock or any support any we other macro to happening. that more be data Again, a election as weather that. than have broader see impact story could today this

Zachary Fadem

lots moving the here. Got it. environment, Appreciate that. And then of parts on policy

how immigration You the and you business? like how that through potential think talked impact your tariffs. about dynamics other could policy for incremental Curious

Marvin Ellison

attention another and companies, tell it's most fair timely I to it. What question. Now paying like close really really, U.S. very large will that we you are is

highly We are segments. our engaged customer with all of

agile the U.S., can. we any public as of the as one going just have are and teams of We relations best government company we be to in

know is thing we there do alone. policies not will that if any are one our impact that we be business, The

is control your keenly and aware anything. timely just and we prepared for we being question of can tell prepared very you what is and to Again, controlling everything marketplace. objective I a But are is for focus so question. very we're And what the on our fair

or agility be the to our And and we environment ability that of believe could that way. our team policy execution changes level any manage has through the coming any political high

Operator

Oppenheimer. line Our next with of from Brian Nagel question is the

Brian Nagel

Congratulations lot today. sense really pickup the the in I saw are apologize. quarter. make trying this Together So bit be But results repetitive, think may your just we sales results that, with us looking competitor I at so your of XXXX. yesterday, of reported to a a nice on late a

Marvin, -- mentioned, with and if these macro has repetitive in weather, a there's out ongoing this of a apologize. can I the you that of is business business there like some looking recognizing positive have us else may moving a you're again, the guess But there give and type as but challenges? -- see inflection that the part, anything indication election is we lot some I So despite hit someone there pieces at

Marvin Ellison

be would mean down discretionary to tell Brian, down. returning a key one that what is for improvement we normal And it thanks big it, to you, the it us, to going question. to I indicators ticket us, of consider for comes homeowner of is DIY. spend. mentioned for Brandon comes home cadence the to be the What that, I

so going paying be to going we're And close, it. and we're that to keen tracking be really, really attention to

us business, the into installations. us Another i.e., another equity. you is home know, key we of have that equity. services And indicator as for our are tapping for amounts consumers home record That's either

on we, think I per roughly average, home. $XXX,XXX

are that into And existing get stay some point, equity, to modernize going the home. tap mortgage we believe in making start to their this home normalized going environment, going to that high so rate and in decision they're they're but customers that at to

up positive that's to to for see a business basis, that tick So the services on us. to start continuous be start positive moment going we another sign more home

points at we the will inflection us around data hopefully corner. So is are give the that those look a that really sign that key X

Brian Nagel

question, my the And helpful. very then on That's somewhat second Pro business. related, but

of say, taking at performing quarter, So where you're lot hold great another to market. the sort clearly of initiatives are, outpacing well Lowe's. A and internal

changed macro this? share continue the So the -- gains we You're environment, put materialize. I the your think start can market here? maybe mean, given standpoint, at sustainability in longer I up Lowe's I much from how How think substantial about nothing Pro? we in else to take should to much these looking hold in is, mean about Pro business question the these guess should initiatives how how I have and

Marvin Ellison

question. another key just fair of kind the we're talk that give I'll broad let of Joe I'll about a some gives executing again, us initiatives perspective. you So that confidence.

the are where focused it's a to medium Pro total for fragmented Pro we $XXX is of is XX% segment. we marketplace. So market Pro And that small way look billion the extremely an addressable that roughly key at market, and the as customer our that is

surveyed we're Joe in they sales, comments, their they they're in in, feel paying really confident the his process still when policies remains in confident in overall, feel And close of cited like our degree changing attention, in customers, as confidence we their et the really backlog high. although have all ability cetera. political and still to prepared macro, dynamics But we to good are, and that

fragmented business. their So we confident feels the ability billion marketplace have to a where drive $XXX in customer

additional gives confidence. gives indication us that some for that And us so us to Joe you the initiatives give let on still some examples of And that lots opportunity an there's grow. I'll of

Joseph McFarland

in our we we as with Lowe's asset-light But business, about some centers, And our look about like Pro Brian, Marvin. that what fulfillment our that relaunch how at outside Thanks, we're of our making, things Supply. flatbed Rewards, Pro. resonating doing Yes. centers, we're thinking we're talked of fulfillment MVP leveraging the sales, Pro Pro investments Pro

And continued so initiatives. lot a have of we

will Just and surface with future. what it into the continue Pro, that have on confidence doing the scratching great we're we

Marvin Ellison

it last customer new come will comes point DIY the that customer for Brian, hypothesis this, perfectly is positioned Home just we Total I'll we're and Strategy. that make out, back the when to a our And have on this back, close with

to the omnichannel that our strategy. DIY to Pro drive of that then execute for well continue concert, see future. these we us to at back. we when we're So And same we customer time, And all on to our to initiative. We're small bodes going coming think do be in able going and our it medium things really

Okay. Rob, one question. for have we time more

Operator

That comes with of from line Zaccone Citi. Steven the

Steven Zaccone

side I wanted appliances to the the ask business. of on

you are What of innovation? seeing seeing So some replacement Do competitor. like some to you some seeing natural we're from stabilization cycles, there? from hear. be maybe and kind larger just duress, we're curious yourself Just think it your seems

William Boltz

This thanks. Bill. Steven, Yes, is

We key really results quarter the our across with appliance categories. the pleased business. saw really strong So all in of

up able that model saw well cited be customers, growth largely it. to as innovation duress obviously we well you and So is driving driven It of customer. take to sets care I our unit as by think

have country remarks, deliver for and able As in that the best-in-class. ZIP I cited the is us. prepared install every in delivery my model code almost is across appliance And being we to set up an remarkable

business appliances equally And is for as strong. our online

bringing about. merchants innovation with excited done And and us, so and the of the we're that across providing us new engage care pieces are nice forefront. for coming And XXXX us new all puzzle, is we're kind of of level in into that take as consumer we our of category, finding go that the I launches, a the the to got job of innovation. We've at service lot just stores have keeps guess, products, the ways to customer of every a the

Steven Zaccone

category bit sense last year? about the you across too spring other the in to to you categories would typical saw see expecting we of of of my question when you in But about expect are in category just year, business? spring as then quarter first And ask what of for first material 'XX, to Yes. think have half your relative change it a performance the seems overall you here I little noise think of growth weather. any the kind

William Boltz

chain early -- seen quarter, merchants, wrap markets. inventory work our weather And ready, our spring are We'll couple actually starting. our Yes. of team, in resets is our with really where up collaboration the some underway. of getting about northern the store We're how we've supply were in those business actually the that we've we've encouraged had a in weeks product teams, the

product, we spring ammunition the innovation new easy-to-install the both merchandising a to addition the just have just we're and lot every for customer the across examples, drywall give we've professional. which really few of we a A excited And new tool customer. that in from a being about. across of WAL-BOARD, you windows #X gun that's But got talked that in about the to drywall from Pro do-it-yourself for new is lot category, Pella, whether ready tools

Lowe's. continues camp regards and New about that products Valspar will new be water application at for exclusive softeners being go-to for from product plumbing. go on in innovation EGO on when heighten floor at power the what and metal on are and We can We've to composite we the and garage you the I collections launched have that We've spring outdoor new We've you found decking to got Deckorators. destination mean rough category. only Then you've going. XX got from that Weber Whirlpool got in Trex, in think and new ], products go categories, [ paint. TimberTech I to in got patio.

So nudge. little Mother gives ready We're and Nature roll. us bit rock a of a to

Kate Pearlman

speaking with you earnings Thank May. first all for joining you We in on quarter us to today. call forward our look

Operator

Earnings Quarter XXXX Lowe's the Call. Fourth This concludes

You may now disconnect.

Lowe's Companies (LOW) 26 Feb 252025 Q4 Earnings call transcript