01—Abstract
Summary
Summary of the 10-K filed March 15, 2023. Cited figures are marked; the original filing is the authoritative source.
The Home Depot, Inc. reported strong net sales of $157.4 billiona for fiscal year 2022, a 4.1% increase from the prior year, driven by an increase in average ticket price partially offset by fewer customer transactions.
The company maintained a robust gross profit margin of 33.5% and focused on managing operating expenses, resulting in a slight decrease in SG&A as a percentage of net sales. Net earnings reached $17.1 billionb, or $16.69 per diluted share, up 7.5% year-over-year. The company continued its commitment to shareholder value by investing $3.1 billion in capital expenditures, increasing its quarterly dividend by 10%, and returning over $14 billion to shareholders through dividends and share repurchases in fiscal 2022.
Strategic priorities include enhancing the interconnected shopping experience, focusing on professional customers ('Pros'), and investing in supply chain capabilities to improve delivery speed and reliability. Despite facing macroeconomic headwinds like inflation and a shift in consumer spending, Home Depot is well-positioned due to its strong brand, operational efficiency, and commitment to customer experience. The company's robust financial position and disciplined capital allocation strategy indicate resilience and a continued focus on long-term shareholder value creation.
02—Key points
Key Highlights
- Achieved net sales of $157.4 billion in fiscal 2022, a 4.1% increase year-over-year.
- Reported net earnings of $17.1 billion, or $16.69 per diluted share, up 7.5% from the prior year.
- Returned over $14 billion to shareholders through cash dividends and share repurchases in fiscal 2022.
- Increased quarterly cash dividend by 10% to $2.09 per share.
- Invested $3.1 billion in capital expenditures to support business growth and enhance customer experience.
- Maintained a strong ROIC of 44.6% in fiscal 2022.
- Online sales grew by 7.4%, representing 14.2% of total net sales, reflecting ongoing digital investments.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2023, Home Depot, Inc. kept $0.11.
- Revenue$157.40B100.0%
- Cost of revenue−$104.63B66.5%
- Gross profit$52.78B33.5%
- Operating costs−$28.74B18.3%
- Operating income$24.04B15.3%
- Interest, other & tax−$6.93B4.4%
- Net income$17.11B10.9%
Where FY2023 revenue went
$157.40B- Cost of revenue: $104.63B, 66% of revenue
- SG&A: $26.28B, 17% of revenue
- Net income: $17.11B, 11% of revenue
- Other operating costs: $2.46B, 1.6% of revenue
- Interest, other & tax: $6.93B, 4.4% of revenue
Kept 11% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2023filed March 15, 2023Financial Statements
FY2023 against FY2022
| Line item | FY2023FY2022 | Change |
|---|---|---|
| Revenue | $157.40B$151.16B | +4.1% |
| Cost of Revenue | $104.63B$100.33B | +4.3% |
| Gross Profit | $52.78B$50.83B | +3.8% |
| SG&A Expenses | $26.28B$25.41B | +3.5% |
| Operating Expenses | $28.74B$27.79B | +3.4% |
| Operating Income | $24.04B$23.04B | +4.3% |
| Interest Expense | $1.62B$1.35B | +20.0% |
| Net Income | $17.11B$16.43B | +4.1% |
| EPS (Basic) | $16.74$15.59 | +7.4% |
| EPS (Diluted) | $16.69$15.53 | +7.5% |
| Shares Outstanding (Basic) | 1.02B1.05B | −3.0% |
| Shares Outstanding (Diluted) | 1.02B1.06B | −3.1% |
05—Questions
Frequently Asked Questions
What were Home Depot's key financial performance indicators for fiscal year 2022?
In fiscal year 2022, Home Depot reported net sales of $157.4 billion, a 4.1% increase from fiscal year 2021. Net earnings were $17.1 billion, or $16.69 per diluted share, representing a 7.5% increase. The company maintained a gross profit margin of 33.5% and a Return on Invested Capital (ROIC) of 44.6%.
How did Home Depot return value to its shareholders in fiscal year 2022?
The company demonstrated a strong commitment to shareholder returns by investing $3.1 billion in capital expenditures to drive growth and enhance customer experience. Additionally, Home Depot returned over $14 billion to shareholders through a combination of cash dividends and share repurchases. They also announced a 10% increase in their quarterly cash dividend.
What are Home Depot's primary strategic focuses for the future?
Home Depot's core strategies revolve around providing the best customer experience in home improvement, extending its position as the low-cost provider, and being the most efficient investor of capital. Key initiatives include enhancing its interconnected shopping experience across digital and physical channels, growing its professional customer segment ('Pros'), and investing in its supply chain to improve delivery speed and reliability.
What challenges did Home Depot face in fiscal year 2022, and how did they impact performance?
The company navigated challenges such as macroeconomic factors including inflation, which led to an increase in the average ticket price but also a decrease in customer transactions. A shift in consumer spending from goods to services also contributed to fewer transactions. Despite these factors, the company managed its expenses effectively, and the impact of inflation was partially offset by higher retail prices and favorable product mix.
06—Continue