Pros continue to outperform DIY shoppers at Home Depot
Article excerpt
The segment is still the “clearest opportunity to drive growth” at the home improvement retailer even as it beat its own expectations in Q2. While consumers continue to engage in smaller projects, Home Depot executives said demand for larger home improvement projects remains pressured by ongoing consumer uncertainty and a soft housing market. While the sector is showing early signs of improvement, with home sales up 2.2% in Q2, according to GlobalData research, consumers are still skittish to take on larger, more expensive projects. While smaller projects undertaken were up 1.5% year over year - representing “a step change from the declines of previous periods,” according to GlobalData Managing Director Neil Saunders - larger projects were down over 2% in Q2. “Concerns around financing and a previous lack of moving activity both remain major drags on the bigger-ticket segment,” Saunders said. Home Depot has been making investments in its Pro segment, which has historically outperformed the DIY segment. Last month, the retailer expanded its Pro Xtra rewards program, adding partner offers with companies like 7-Eleven, Tecovas and Rosie’s AI Answering Service. Home Depot has also made a string of acquisitions geared toward Pros, including SRS Distribution and GMS Inc. And despite the broader sector’s challenges, Home Depot beat its own expectations in the second quarter, with...
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Home Depot projects gross margin to be 33.1%, and it plans to open 15 new stores during the year.
