Home Depot Reports 1.7% Comparable-Sales Growth in Q2, Reaffirms Full-Year Guidance
The retailer's first results since CEO Ted Decker began a temporary medical leave beat analyst estimates on sales and earnings, while the CFO described U.S. housing conditions as "frozen."
Home Depot's CFO Called the Housing Market "Frozen." A Trade Group Says It's "Remarkably Stable."
Home Depot posted $47.9 billion in sales for the second quarter of fiscal 2026, up 5.7% from a year earlier[1]. Comparable sales — a measure of stores open at least a year, plus online, that strips out growth from opening new locations — rose 1.7%[1]. Analysts had expected about 0.9%[2]. Adjusted earnings per share came in at $4.92, up from $4.68[1].
By any normal reading, that's a good quarter. But CFO Richard McPhail chose a specific phrase to describe the backdrop it happened against: "frozen housing market conditions"[2]. Days later, the National Association of Realtors, the trade group for real estate agents, described the same market as "remarkably stable"[5]. Both are looking at the same data. They just picked opposite words for it, and the word each side picks changes how the whole quarter reads.
Two Numbers, Two Meanings
Here's the collision at the center of the story: existing-home sales fell 1.7% from June to July, to an annual pace of 4.06 million[5]. In the very same week, Home Depot reported that its own comparable sales rose 1.7%[1]. Same number, opposite direction, and no relationship to each other at all — one measures homes changing hands, the other measures a retailer's growth. But the coincidence captures something real about the argument underneath.
Home sales were also up 0.7% from a year earlier, and year-to-date sales are up 2.4%[5]. NAR's chief economist, Lawrence Yun, points to that and calls the market stable even with mortgage rates sitting at 6.54%, up slightly from June[5]. Home prices have now risen for 37 straight months, to a median of $434,100[5]. There's also 4.6 months of supply on the market — under the six-month mark considered balanced, meaning there are still more buyers around than there are homes for sale[5].
McPhail is looking at a different piece of the same picture: how few people are actually moving. Housing turnover, not home prices, is what drives Home Depot's business[1][6]. When people buy or sell a house, they renovate. When they stay put in a mortgage they locked in years ago at a lower rate, they don't gut a kitchen — they fix what's broken[6]. That's the mechanism behind McPhail's word choice: sales figures can look "stable" from a real estate agent's chair while looking "frozen" from a hardware store's.
A Beat the Company Won't Fully Own
Home Depot didn't just beat expectations — it posted its best comparable-sales growth since the third quarter of fiscal 2022[2]. McPhail's read is that the company is taking market share in a weak environment, not benefiting from a strong one. "We're taking share and that we're serving our customers better every day," he said[2].
Yet the company reaffirmed its full-year guidance instead of raising it[1]. That's a deliberate choice, not an oversight. Guidance is a promise a company makes to investors, and breaking one publicly costs more credibility than never raising it in the first place. Reaffirming after a beat lets Home Depot bank the good headline now while keeping room to absorb costs it can't fully predict yet, including new tariffs that hadn't even taken effect when the earnings were reported[1][7].
That mattered to how Wall Street reacted. Analysts had said going in that it would take an upward revision, not just a beat, to really move the stock, since the same beat-and-reaffirm pattern last quarter produced only a modest move[2]. In that view, refusing to raise guidance after a beat this strong is itself information: it suggests the back half of the year carries more risk than the quarter just reported.
Tariffs Arrive the Day After the Numbers Do
One piece of that risk has a specific date attached: August 19, 2026, one day after Home Depot's earnings came out. That's when new 50% duties on a wide range of Canadian goods took effect under Section 338 of the Tariff Act of 1930, a law that lets the president tax goods from a country the U.S. says is treating American trade unfairly[7]. The list, covering about $17.7 billion worth of Canadian goods, includes plywood, cement, and furniture[7]. Raw lumber is not on it — that's taxed separately, under a different law, Section 232[7]. But building materials sourced from Canada are still a direct cost for anyone building or remodeling.
Home Depot says it expects tariff refunds — money paid back on tariffs from other trade actions — to help offset some of its fuel, energy, and input costs elsewhere[1][7]. In effect, the company is netting one tariff policy against another, and neither side of that ledger is fully settled yet. Right-leaning outlets like Fox Business and Benzinga leaned into this forward-looking tariff story more than the quarter itself, treating the earnings report almost as a formality ahead of the real test[7].
The CEO Is Out, and No One Will Say Why
This was also Home Depot's first earnings report since chair, president and CEO Ted Decker began a temporary medical leave on August 12[3][4]. The company didn't disclose what the condition is[3][4]. What it did disclose was oddly precise: Ann-Marie Campbell, a senior executive vice president, now runs day-to-day operations; CFO Richard McPhail took on financial management and the Pro-customer subsidiaries and became interim principal executive officer, the title used for SEC filing purposes; lead director Greg Brenneman is chairing the board[3][8]. Neither Campbell nor McPhail got a pay change[3][8].
That specificity is itself a signal. Campbell has been at Home Depot since 1985, starting as a cashier. McPhail has been there since 2005 and became CFO in 2019[8]. Trade press covering the announcement, like Retail TouchPoints, emphasized that tenure as proof the company has deep bench strength to lean on[8]. Bloomberg's headline took a different angle, noting the leave is "expected to last for months" — turning the company's own softer language, "a few months," into a duration investors now have to plan around[4][9].
Splitting a CEO's duties between two executives can work fine for one quarter. Whether it becomes something more — a real test of succession — depends entirely on how long Decker is actually out, and right now nobody outside the company knows that.
What Gets Decided Once the Rate Cuts Come
Strip away the adjectives, and both sides in the housing debate agree on the same underlying facts: home prices are near record highs, mortgage rates are elevated, and relatively few people are moving[1][5][6]. Home Depot's own results show what that produces — sales growth built more on smaller repair projects than big remodels, even as professional contractors stay busy[2][6].
The unresolved question is what happens if mortgage rates drop. NAR's data suggests a housing market that's holding steady, not collapsing, which is the kind of market that can move quickly once borrowing gets cheaper[5]. Home Depot is betting it can keep growing before that happens, using share gains rather than a housing rebound[2]. Whether "frozen" turns out to describe a market on the verge of thawing, or a market that's simply found a new normal, is something neither this quarter's numbers nor either side's preferred word can settle on its own.
Summary
Home Depot reported second-quarter results on August 18, 2026. Sales were $47.9 billion, up 5.7% from a year earlier[1]. Comparable sales — sales at stores open at least a year, plus online, which strips out the effect of opening new stores — rose 1.7%[1]. In the U.S. alone they rose 1.3%[1]. Analysts had expected about 0.9%[2]. Adjusted earnings were $4.92 per share, up from $4.68[1]. The company reaffirmed its full-year guidance rather than raising it[1].
This was the first earnings report since CEO Ted Decker began a temporary medical leave. Home Depot announced the leave on August 12 and did not say what the condition is[3][4]. Senior Executive Vice President Ann-Marie Campbell is running day-to-day operations[3]. CFO Richard McPhail handles financial management and the Pro subsidiaries, and is the interim principal executive officer for regulatory purposes[3]. Lead director Greg Brenneman is chairing the board[8]. The company said it expects Decker back within a few months[4].
The main point of genuine dispute is not the numbers. It is what to call the housing market. McPhail told CNBC the company is operating in "frozen housing market conditions"[2]. The National Association of Realtors, a trade group for real estate agents, describes the same market differently. Its chief economist, Lawrence Yun, said sales have been "remarkably stable," with sales year-to-date up 2.4%[5]. Both are describing the same data from different angles. Existing-home sales fell 1.7% from June to July but were up 0.7% from a year earlier[5]. Which word you pick — frozen or stable — changes how you read Home Depot's quarter.
The Event
On August 18, 2026, Home Depot released results for the second quarter of fiscal 2026 and reaffirmed its full-year fiscal 2026 guidance[1]. Sales were $47.9 billion, an increase of $2.6 billion or 5.7% over the same quarter last year; comparable sales rose 1.7% and U.S. comparable sales rose 1.3%[1]. Net earnings were $4.8 billion, or $4.79 per diluted share, compared with $4.6 billion, or $4.58 per diluted share, a year earlier; adjusted diluted earnings per share were $4.92 versus $4.68[1]. It was the company's first earnings report since August 12, when Home Depot announced that chair, president and CEO Ted Decker had begun a temporary medical leave, with duties divided between Ann-Marie Campbell and Richard McPhail[3][4].
Undisputed Facts
- Home Depot reported second-quarter fiscal 2026 sales of $47.9 billion, up 5.7% from a year earlier[1].
- Comparable sales rose 1.7% overall and 1.3% in the U.S.[1].
- Adjusted diluted earnings per share were $4.92, up from $4.68 in the same quarter of fiscal 2025[1].
- Home Depot reaffirmed its fiscal 2026 guidance rather than raising it[1].
- CFO Richard McPhail said the 1.7% figure was the company's highest comparable-sales number since the third fiscal quarter of 2022[2].
- Home Depot announced on August 12, 2026 that CEO Ted Decker had begun a temporary medical leave and did not disclose the nature of the condition[3][4].
- Ann-Marie Campbell was assigned day-to-day operations; Richard McPhail took financial management and the Pro subsidiaries and was named interim principal executive officer; neither received a pay change[3][8].
- U.S. existing-home sales fell 1.7% from June to a seasonally adjusted annual rate of 4.06 million in July 2026, but were up 0.7% from July 2025[5].
- The average 30-year fixed mortgage rate was 6.54% in July 2026, up from 6.49% in June and down from 6.72% a year earlier, per Freddie Mac[5].
The Pressure
Strip away the moralizing and blame. What structural realities persist regardless of which narrative wins?
- Housing turnover, not house prices, is Home Depot's engine
- People renovate around moves. Existing-home sales are running at a 4.06 million annual pace, and 30-year mortgage rates are at 6.54%[5]. Homeowners holding cheap older loans do not sell, so big remodels get deferred and small repairs continue. That is the mechanical reason a 5.7% sales gain still comes with cautious guidance[1][6].
- Guidance is a promise, not a forecast
- Reaffirming rather than raising after a beat is a deliberate choice. It banks the good quarter while keeping room to absorb tariff costs later in the year without cutting a number publicly[1][7].
- Tariff costs are moving, not settled
- Home Depot's own guidance already assumes tariff refunds that "partially offset" fuel, energy and other input costs, while 50% Section 338 duties on Canadian goods took effect August 19[1][7]. The company is netting one policy against another, and both can change.
- An undated CEO absence forces a governance answer
- Splitting a CEO's job between an operator and a CFO is stable for a quarter. The board named McPhail interim principal executive officer for SEC purposes and left both executives' pay unchanged — signals designed to say "temporary"[3][8].
Material realityHome Depot sold $47.9 billion of goods in the quarter and earned $4.8 billion[1]. Comparable sales rose 1.7%, the best since the third fiscal quarter of 2022, but that is still low-single-digit growth[1][2]. Meanwhile, U.S. existing-home sales fell 1.7% month-over-month in July to a 4.06 million annual rate, while the median price rose 2.0% to $434,100 — the 37th straight month of annual gains[5]. Note that two different 1.7% figures appear in this story: one is Home Depot's sales growth, the other is the monthly drop in home sales. They are unrelated. The durable facts are these: houses are expensive, borrowing is expensive, few people are moving, and homeowners are fixing what they have instead of rebuilding it. A CEO is out for an unspecified illness, and two long-tenured executives are covering. None of that changes based on whether the market gets called "frozen" or "stable."
Narrative as a weaponThree parties are shaping how this reads. Home Depot's management is running a deliberate two-sided message: strong enough to beat, cautious enough not to promise more — and "frozen housing market" does real work for them, because it makes 1.7% growth look like outperformance rather than stagnation. The National Association of Realtors, funded by agents who are paid on transactions, is pushing the opposite adjective, calling the same market "remarkably stable" and pointing to sales up 2.4% year-to-date[5]. Financial media sit in between and mostly amplified the company's phrase, because "frozen" is the better headline. Watch for what none of them emphasize: the quarter predates the August 19 Canadian tariffs, and Home Depot's reaffirmed guidance already leans on tariff refunds it does not control[1][7].
How Each Side Sees It
Each major actor’s view — how it frames things, its underlying incentive, and how it’s materially affected. Tap a side to read it.
Frames it asManagement's case is that the company is winning share in a bad market, not riding a good one. Their strongest argument is the gap between the housing backdrop and their own numbers. Home sales are barely moving, yet comparable sales rose 1.7% — the best since the third fiscal quarter of 2022[2]. McPhail's line is that "we're taking share and that we're serving our customers better every day"[2]. Their second argument is discipline. They saw "broad engagement" across both professional contractors and do-it-yourself shoppers, but chose to reaffirm guidance rather than raise it because uncertainty is high[2]. In their telling, that is prudence, not weakness. Third, on leadership: the interim structure is not a scramble. Campbell has worked at Home Depot since 1985, starting as a cashier; McPhail has been there since 2005 and CFO since 2019[8]. Handing the keys to two 20-year colleagues is presented as the payoff of a deep bench[8].
WhyManagement needs to hold the stock and its credibility steady through a leaderless stretch. Beating estimates while refusing to raise guidance does both: it buys a good headline now and avoids a promise they might have to break in the fourth quarter, when tariff costs land[1][7].
Impact on themA beat plus reaffirmed guidance keeps the fiscal 2026 targets that executive pay and analyst models are built on[1]. If Decker's leave runs longer than "a few months," the interim split becomes a de facto succession contest between Campbell and McPhail[3][9].
Frames it asThe bullish case is that Home Depot is a share-gainer with a cyclical spring loaded underneath it. Housing turnover is near multi-year lows, so any drop in mortgage rates releases pent-up remodeling demand — and the company is posting growth before that happens[2][5]. The bearish case is narrower than it looks. A beat is not the issue; guidance is. Analysts going in said it would take an upward revision to move the stock, because the same beat-and-reaffirm pattern in the prior quarter produced only a muted move[2]. So a company that "exceeded expectations" but would not touch its own full-year numbers is, in this reading, telling you the second half is the risk[1]. Both camps agree on the crux: the quarter is backward-looking, and the tariff schedule is forward-looking.
WhyAnalysts and funds are positioning for a housing-rate turn, not judging a single quarter. They want to know whether 1.7% is the start of a recovery or the top of a flat range.
Impact on themHome Depot stock was in the high $330s heading into the print[2]. The company is a Dow component, so its read on the U.S. consumer moves broader retail sentiment[12].
Frames it asThe Realtors' association pushes back on "frozen." Its strongest evidence is that the market has stopped falling. Existing-home sales in July were up 0.7% from a year earlier, and year-to-date sales are up 2.4%[5]. Chief economist Lawrence Yun called sales "remarkably stable, even amid the rising mortgage rate environment of the past few months"[5]. Their argument is that low volume is not the same as collapse: prices rose 2.0% year-over-year to a median of $434,100, the 37th straight month of annual gains, and inventory at 4.6 months of supply still favors sellers[5]. A market where prices keep rising and homes keep selling is, in their view, tight — not frozen. "Months of supply" means how long it would take to sell every listed home at the current sales pace; six months is considered balanced, so 4.6 months means there are still more buyers than houses[5].
WhyNAR is a trade group funded by real estate agents, who earn commissions on transactions. Its members are paid when homes change hands, which gives it a standing reason to describe the market as functioning.
Impact on themHome Depot's own business runs on housing turnover: people renovate when they buy or sell. Fewer moves means more small repairs and fewer kitchen remodels[6].
Frames it asFor households, the story is what got cancelled. The strongest evidence is in the mix, not the total: Home Depot's sales rose because customers focused on smaller projects over the summer[6]. Big-ticket work — additions, kitchens, bathrooms — is what stalls when borrowing is expensive[6]. Record prices and the highest mortgage rates in about a year have kept many would-be buyers out entirely[6]. The pro side of the argument runs the other way: contractors are still busy, which is why Home Depot reported "broad engagement" across both pro and DIY[2]. Tariffs are the next pressure point. Section 338 of the Tariff Act of 1930 lets the president impose duties on a trading partner's goods; under proclamations issued July 20, 2026, new 50% Section 338 duties on roughly $17.7 billion of Canadian goods — including plywood, cement, furniture, and other building materials, though not raw lumber, which is covered separately under Section 232 — took effect August 19, one day after the earnings report[7]. Canadian-sourced building materials are a direct input cost for anyone building or remodeling either way.
WhyHouseholds are protecting cash flow while carrying high borrowing costs. Contractors want project volume and predictable material prices.
Impact on themHome Depot said tariff refunds are "expected to partially offset unplanned fuel, energy, and other product input costs," and McPhail said those refunds let the retailer "maintain value" despite cost pressure elsewhere[1][7]. In practice, that is the company absorbing some cost so shelf prices do not jump — for now.
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The Bias Ledger average rating 3.2
The same story, as framed by outlets across the spectrum, ordered least to most biased. The bias score (1 = straight, 10 = heavily spun) is an AI assessment of that framing — click an outlet to see its track record. The tell is the word choice or omission that reveals the angle.
| Outlet | Vantage | Bias | How they frame it | The tell |
|---|---|---|---|---|
| Associated Press | U.S. center, wire service | 2 | "Home Depot sales lifted by customers focusing on smaller projects, but sticks with previous outlook"[6]. | Straight construction: what happened, plus the caveat. The framing choice is putting the mix shift — smaller projects — in the headline, which quietly makes the beat a story about consumer downgrade rather than company execution. |
| Fox Business | U.S. right | 2 | "Home Depot CEO takes medical leave of absence" — covers the leadership event plainly, without a consumer-distress or economic-blame angle[10]. | The omission is the tell, in both directions: no speculation about instability, and no linking of the housing slump to policy. Straight personnel reporting on a story other outlets used to frame the economy. |
| CNBC | U.S. center, business/markets | 3 | "Home Depot reaffirms guidance amid 'frozen housing market conditions'" — leads with the CFO's bleakest phrase rather than the beat[2]. | The quarter beat estimates and set a multi-year comps high, but the headline picks the gloomiest quote in the interview. That makes a good quarter read as endurance. CNBC also supplied the useful benchmark other outlets omitted — the 0.9% analyst estimate the 1.7% cleared[2]. |
| Retail TouchPoints | U.S. retail trade press, industry-funded | 3 | "Home Depot Names Interim Leaders as CEO Takes Medical Leave" — emphasizes continuity and executive tenure[8]. | Leans on Campbell's start as a 1985 cashier and the pair's 20-year working relationship. That is a real credential, but trade press written for retail executives tends to render succession as reassurance rather than as a test. |
| Bloomberg | U.S. center, financial | 4 | "Home Depot CEO Decker Taking Medical Leave Expected to Last for Months"[9]. | "Expected to Last for Months" is the load-bearing addition. The company said "a few months"; the headline turns a reassurance into a duration investors must price. Accurate, but tilted toward the governance risk. |
| Benzinga | U.S. markets media, retail-investor audience | 5 | "Home Depot Earnings Preview: Tariffs, Mexico And Housing" — reframes the print as a tariff event[7]. | Argues the forward commentary matters more than the quarter, because 50% Section 338 duties on Canadian goods hit August 19. That is a real and specific fact, but the framing pre-decides that the reported numbers are not the news. Benzinga also ran a preview built on foot-traffic data showing store visits down, which primed a miss that did not happen[7]. |
References
- The Home Depot Announces Second Quarter Fiscal 2026 Results; Reaffirms Fiscal 2026 Guidance — The Home Depot (via PR Newswire) · Primary source — the company's own earnings release; self-interested by definition
- Home Depot reaffirms guidance amid 'frozen housing market conditions' — CNBC · U.S. center; business network owned by Comcast/NBCUniversal, investor-facing
- The Home Depot Announces Interim Management Plans While CEO Takes Temporary Medical Leave — The Home Depot (via PR Newswire) · Primary source — company announcement
- Home Depot CEO Ted Decker taking temporary medical leave — CNBC · U.S. center; business network
- NAR Existing-Home Sales Report Shows 1.7% Decrease in July — National Association of Realtors · U.S. real estate industry trade association funded by member agents; its members earn commissions on home sales
- Home Depot sales lifted by customers focusing on smaller projects, but sticks with previous outlook — Associated Press · U.S. center; nonprofit cooperative wire service owned by member news organizations
- Home Depot Earnings Preview: Tariffs, Mexico And Housing — Benzinga · U.S. markets media aimed at active retail traders; ad- and data-subscription funded
- Home Depot Names Interim Leaders as CEO Takes Medical Leave — Retail TouchPoints · U.S. retail industry trade publication, advertiser- and vendor-supported
- Home Depot CEO Decker Taking Medical Leave Expected to Last for Months — Bloomberg · U.S. center; financial news arm of Bloomberg LP, terminal-subscription funded
- Home Depot CEO takes temporary medical leave — Fox Business · U.S. right; business channel owned by Fox Corporation
- Home Depot (HD) details interim leadership while CEO Ted Decker takes medical leave — Form 8-K — U.S. Securities and Exchange Commission filing · Primary source — mandatory regulatory disclosure
- Are consumers cracking under the weight of high prices? We're about to find out — NBC News · U.S. center-left; owned by NBCUniversal/Comcast