Home Depot reported its 2024 second quarter financial results on Aug. 13, showing a sales boost from its $18.5 billion acquisition of building materials supplier SRS Distribution in June, but when excluding that landmark deal, organic sales declined.

The company posted 2Q net sales of $43.2 billion, up 0.6% year-over-year. Net sales include $1.3 billion from the SRS acquisition. Comparable (organic) sales decreased 3.3% while organic sales in the U.S. decreased 3.6%.

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Operating profit of $6.6 billion and operating margin of 15.4% trailed the $6.6 billion and 15.5% margin of a year earlier, while net profit was of $4.6 billion likewise trailed the 4.7 billion of 2Q24.

“The underlying long-term fundamentals supporting home improvement demand are strong,” Home Depot Chair, President and CEO Ted Decker said in the company’s financial release. “During the quarter, higher interest rates and greater macro-economic uncertainty pressured consumer demand more broadly, resulting in weaker spend across home improvement projects. However, the team continued to navigate this unique environment while executing at a high level.”

2024 Outlook

Looking forward, Home Depot expects sales to increase between 2.5% and 3.5%, while organic sales decline between 3% and 4%. That comparable outlook is a steeper decline than the -1.0% forecasted in the company’s 1Q24 report.

Home Depot anticipates a 2024 gross margin of approximately 33.5% (down from 33.9% given post-1Q24), and an operating margin between 13.5% to 13.6% (down from 14.1% given post-1Q24).

Home Depot predicts SRS Distribution — No. 4 on MDM’s 2024 Top Distributors List for Building Materials & Construction Supplies — to contribute approximately $6.4 billion in full-year incremental sales.