01—Abstract
Summary
Summary of the 10-Q filed May 28, 2026. Cited figures are marked; the original filing is the authoritative source.
Lowe's Companies, Inc. (LOW) reported a 10.3% increase in net sales for the first quarter of fiscal year 2026, reaching $23.1 billiona, up from $20.9 billion in the prior year period.
This growth was primarily driven by a 0.6% increase in comparable sales, which included a 1.5% rise in average ticket price, slightly offset by a 0.9% decrease in customer transactions. Despite the sales increase, net earnings remained relatively flat at $1.63 billionb, leading to a slight decrease in diluted earnings per share to $2.90 from $2.92 in the prior year. The company incurred pre-tax expenses of $96 million related to intangible asset amortization from recent acquisitions (ADG and FBM), which impacted adjusted diluted earnings per share to $3.03, indicating a stronger operational performance when these one-time costs are excluded.
The company continued its strategic investments in Pro customer offerings, online presence, and home services. Significant debt repayment was observed, with $2.4 billionc of bond maturities repaid, aligning with a deleveraging commitment.
Liquidity remains strong, with $0.8 billiond in cash and cash equivalents and $4.6 billion in undrawn capacity on its revolving credit facilities. Management notes a challenging macroeconomic environment, including the impact of winter storms early in the quarter, but expressed encouragement from customer response to seasonal offerings as weather improved.
02—Key points
Key Highlights
- Net sales increased by 10.3% to $23.1 billion, driven by comparable sales growth of 0.6%.
- Net earnings remained stable at $1.63 billion, though diluted EPS slightly decreased to $2.90 from $2.92.
- Acquisitions of ADG and FBM resulted in $96 million in pre-tax intangible asset amortization, impacting reported EPS.
- Adjusted diluted EPS, excluding acquisition-related amortization, was $3.03, indicating underlying operational strength.
- Significant debt repayment of $2.4 billion occurred, supporting deleveraging efforts.
- Strong liquidity position with $0.8 billion in cash and $4.6 billion in available credit facilities.
- The company is actively returning capital to shareholders through dividends ($674 million) and share repurchases ($363 million).
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2027, Lowes Companies Inc kept $0.07.
- Revenue$23.08B100.0%
- Cost of revenue−$15.54B67.3%
- Gross profit$7.54B32.7%
- Operating costs−$4.99B21.6%
- Operating income$2.55B11.1%
- Interest, other & tax−$926.0M4.0%
- Net income$1.63B7.1%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2027filed May 28, 2026Financial Statements
Q2 FY2027 against Q2 FY2026
| Line item | Q2 FY2027Q2 FY2026 | Change |
|---|---|---|
| Revenue | $23.08B$20.93B | +10.3% |
| Cost of Revenue | $15.54B$13.94B | +11.4% |
| Gross Profit | $7.54B$6.99B | +8.0% |
| SG&A Expenses | $4.42B$4.05B | +9.3% |
| Operating Income | $2.55B$2.49B | +2.4% |
| Net Income | $1.63B$1.64B | −0.8% |
| EPS (Basic) | $2.90$2.93 | −1.0% |
| EPS (Diluted) | $2.90$2.92 | −0.7% |
| Shares Outstanding (Basic) | 559.00M559.00M | 0.0% |
| Shares Outstanding (Diluted) | 560.00M560.00M | 0.0% |
05—Questions
Frequently Asked Questions
What was the primary driver of Lowe's sales growth in the first quarter?
Lowe's sales growth was primarily driven by an increase in comparable sales, which rose by 0.6%. This was composed of a 1.5% increase in the average ticket price per customer, partially offset by a 0.9% decrease in customer transactions. This indicates that customers are spending more per visit, even if the total number of visits slightly declined.
How did the recent acquisitions of ADG and FBM impact the financial results?
The acquisitions of Artisan Design Group (ADG) and Foundation Building Materials (FBM) in 2025 led to $96 million in pre-tax expenses related to the amortization of intangible assets in the first quarter of fiscal year 2026. While this reduced reported diluted earnings per share, the company highlighted an 'adjusted diluted earnings per share' of $3.03, which excludes this amortization, suggesting the underlying business operations are performing well.
What is Lowe's approach to managing its debt and returning capital to shareholders?
Lowe's demonstrated a commitment to deleveraging by repaying $2.4 billion of bond maturities in the quarter. The company also returned significant capital to shareholders through $674 million in cash dividends and $363 million in share repurchases. The company also has a substantial remaining authorization for share repurchases of $10.5 billion.
How is Lowe's managing its liquidity and financial flexibility?
Lowe's maintains a strong liquidity position, reporting $0.8 billion in cash and cash equivalents and $4.6 billion in undrawn capacity under its revolving credit facilities as of May 1, 2026. This robust liquidity, combined with ongoing access to capital markets, is expected to support operations, strategic investments, and debt obligations for the next twelve months.
06—Continue