Lowe's Earnings Rise, 2026 Outlook Cautions
Lowe's earnings show stronger Q4 sales and adjusted EPS, but FY2026 guidance signals slower comps and tighter margin targets, shifting the outlook for 2026
KEY TAKEAWAYS
- Q4 net sales rose to $20.6 billion with comparable sales up 1.3%.
- Adjusted diluted EPS was $1.98; adjusted operating margin was 9.0%.
- FY2026 guidance targets $92.0-$94.0 billion in sales and adjusted EPS of $12.25-$12.75, signaling slower comps.
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Lowe's earnings on Feb. 25, 2026 showed higher fourth-quarter sales and adjusted earnings, but the company issued fiscal 2026 guidance signaling slower comparable-sales growth and narrower margins amid home-improvement market uncertainty.
Fourth-Quarter Results and Fiscal 2026 Guidance
Lowe's Companies, Inc. reported net sales of $20.6 billion for the quarter ended Jan. 30, 2026, up from $18.6 billion a year earlier, with comparable sales rising 1.3%. The gains were driven by the Pro segment, online sales, services, and holiday demand.
The company reported net earnings of $1.0 billion and diluted earnings per share (EPS) of $1.78, down from $1.99 a year earlier. Adjusted diluted EPS increased 2.6% to $1.98. Operating margin narrowed to 8.3% from 9.9%, with adjusted operating margin at 9.0% and gross margin at 32.5%. The quarter included $149 million of pre-tax acquisition-related costs tied to the completed purchases of Foundation Building Materials and Artisan Design Group.
For fiscal 2025, Lowe's reported full-year sales of $86.3 billion, diluted EPS of $11.85, and adjusted diluted EPS of $12.28. Operating margin was about 11.8% (12.1% adjusted).
The company’s fiscal 2026 guidance calls for sales between $92.0 billion and $94.0 billion, reflecting 7% to 9% growth, with comparable sales flat to up 2%. It expects an operating margin of 11.2% to 11.4% (adjusted 11.6% to 11.8%, excluding roughly 40 basis points of intangible amortization) and diluted EPS of about $11.75 to $12.25 (adjusted $12.25 to $12.75). The outlook factors in home-improvement market uncertainty, the Pro/Total Home strategy, productivity initiatives, and acquisition integration. Net interest expense is projected at roughly $1.6 billion, with capital spending planned around $2.5 billion.
Capital Allocation and Balance Sheet
Lowe's returned $673 million in dividends during the fourth quarter and $2.6 billion for fiscal 2025. The recent acquisitions are complete, with no outstanding approvals.
At quarter end, the company held $982 million in cash and $37.5 billion in long-term debt. It operated 1,759 stores totaling approximately 196 million square feet of retail space. The guidance and acquisition-related costs highlight 2026 capital-allocation trade-offs among integration spending, dividends, and planned capital expenditures.
