Lowe's Reports 10.3% Increase in Net Sales to $23.1 Billion in Q1 Fiscal 2026

Lowe's Companies, Inc. reported its financial results for the first quarter of fiscal 2026, revealing a 10.3% increase in net sales to $23.1 billion, compared to $20.9 billion in the same period last year. The company's net earnings for the quarter were $1.6 billion, slightly down from $1.641 billion in the previous year, resulting in diluted earnings per share of $2.90, down from $2.92. The increase in sales was attributed to a 1.5% rise in the average ticket size, although this was partially offset by a 0.9% decline in customer transactions.

In terms of operational performance, Lowe's experienced a decrease in gross margin as a percentage of sales, which fell by 70 basis points to 32.68%. This decline was primarily driven by the operational cost structure associated with recent acquisitions, including Artisan Design Group and Foundation Building Materials. Selling, general, and administrative expenses were 19.16% of sales, a slight improvement from 19.33% in the prior year. The company reported a total operating income of $2.554 billion, reflecting a decrease from $2.494 billion in the same quarter of the previous year.

Lowe's has made significant strategic moves, including the acquisitions of Artisan Design Group for $1.3 billion and Foundation Building Materials for $8.8 billion. These acquisitions are expected to enhance Lowe's offerings to professional customers and expand its market presence. The company also reported a total of 1,759 retail stores at the end of the quarter, up from 1,750 a year earlier, indicating a continued focus on geographic expansion.

The company’s cash flow from operating activities was approximately $3.4 billion, with $521 million allocated for capital expenditures. In terms of shareholder returns, Lowe's paid $674 million in dividends and repurchased $365 million worth of common stock during the quarter. The company maintains a robust share repurchase program with $10.5 billion remaining available for future buybacks.

Looking ahead, Lowe's management expressed optimism about the company's ability to navigate a challenging macroeconomic environment, including the impact of recent winter storms that delayed the spring selling season. The company remains focused on its Total Home strategy, which aims to drive growth in professional, online, and home services. Despite the current economic conditions, Lowe's is committed to disciplined execution and strategic investments to ensure sustainable long-term growth.