Lowe’s Companies (LOW) — Q2 2026 Earnings Preview
Key Preview Takeaways
| Factor | Details |
|---|---|
| Consensus Q2 2026 Revenue | $26,233M (rounded to millions) |
| Consensus Q2 2026 EPS (GAAP) | $4.15 |
| Guidance for FY2026 (Affirmed as of Q1 2026) | Sales: $92.0–94.0B; Comp sales: flat to +2%; Adj. EPS: $12.25–12.75; Adj. Op. Margin: 11.6–11.8% |
| Q1 2026 Actuals | Revenue: $23,078M; Adj. EPS: $3.03 (+3.8% YoY); Comp sales: +0.6% |
| Q2 2025 Actuals (YoY Comp) | Revenue: $23,950M; Adj. EPS: $4.33; Comp sales: +1.1% |
| Most Important Factors for Q2 2026 |
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Summary and Conclusions
- Lowe’s enters Q2 2026 coming off four consecutive quarters of positive comp sales, but with modest growth (+0.6% in Q1 2026, +1.3% in Q4 2025, +0.4% in Q3 2025, +1.1% in Q2 2025).
- Q2 2026 consensus revenue ($26.2B) implies a significant step up from Q1 2026 ($23.1B) and Q2 2025 ($24.0B), reflecting the full-year guide of $92–94B (up 7–9% YoY, including FBM/ADG).
- Management expects comps to be roughly in line with the midpoint of the full-year guide (flat to +2%) for Q2, with ticket growth moderating and transactions expected to improve in H2.
- Pro segment is expected to continue outperforming DIY, driven by Pro Extended Aisle, loyalty, and cross-selling with FBM/ADG.
- Margins will be pressured by the wrap of FBM/ADG (30 bps dilution in 2026), higher transportation/fuel costs, and ongoing investments in sales-driving initiatives, but offset by $1B in PPI/AI productivity.
- Online sales and home services remain key growth drivers, with online up 15.5% in Q1 2026 and home services gaining share in a fragmented market.
- Macro remains challenging: management continues to see a cautious consumer, especially for big-ticket DIY, and is not forecasting a macro inflection in 2026.
- Key watch items for Q2: comp sales cadence, ticket vs. transaction mix, Pro/DIY split, margin trajectory, and any updates to full-year guidance.
Q2 2026 Preview Table
Q2 2026 Consensus vs. Q2 2025 Actuals
| Metric | Q2 2026 Consensus | Q2 2025 Actual | YoY Change* |
|---|---|---|---|
| Revenue ($M) | 26,233 | 23,950 | +9.5% |
| Adj. Diluted EPS | 4.33 | ||
| GAAP Diluted EPS | 4.15 | 4.27 | -2.8% |
| Comp Sales (%) | +1.1% | ||
| Gross Margin (%) | 33.8% | ||
| Adj. Operating Margin (%) | 14.7% |
*YoY change calculated where both periods available.
FY2026 Guidance (as of Q1 2026, Affirmed)
| Metric | FY2026 Guidance | Notes |
|---|---|---|
| Total Sales ($B) | 92.0–94.0 | +7–9% YoY; includes FBM/ADG |
| Comparable Sales (%) | Flat to +2% | Market expected flat; LOW expects to take share |
| Operating Margin (%) | 11.2–11.4 | GAAP basis |
| Adj. Operating Margin (%) | 11.6–11.8 | Excludes 40 bps amortization from FBM/ADG |
| Net Interest Expense ($B) | 1.6 | Higher due to FBM acquisition debt |
| Effective Tax Rate (%) | 24.5 | |
| Diluted EPS | 11.75–12.25 | GAAP basis |
| Adj. Diluted EPS | 12.25–12.75 | Excludes $0.50 after-tax amortization |
| Capital Expenditures ($B) | Up to 2.5 | Focused on retail business |
Q1 2026 Results (Most Recent Actuals)
| Metric | Q1 2026 Actual | Q1 2025 Actual | YoY Change |
|---|---|---|---|
| Revenue ($M) | 23,078 | 20,930 | +10.3% |
| Adj. Diluted EPS | 3.03 | 2.92 | +3.8% |
| GAAP Diluted EPS | 2.90 | 2.92 | -0.7% |
| Comp Sales (%) | +0.6 | -4.3 | +4.9 pp |
| Gross Margin (%) | 32.7 | 33.4 | -70 bps |
| Adj. Operating Margin (%) | 11.5 | 11.9 | -43 bps |
Q2 2025 Results (Prior-Year Comparable)
| Metric | Q2 2025 Actual | Q2 2024 Actual | YoY Change |
|---|---|---|---|
| Revenue ($M) | 23,950 | 23,586 | +1.5% |
| Adj. Diluted EPS | 4.33 | 4.10 | +5.6% |
| GAAP Diluted EPS | 4.27 | 4.17 | +2.4% |
| Comp Sales (%) | +1.1 | -1.6 | +2.7 pp |
| Gross Margin (%) | 33.8 | 33.5 | +37 bps |
| Adj. Operating Margin (%) | 14.7 | 14.5 | +23 bps |
What to Watch for in Q2 2026
1. Comp Sales and Growth Drivers
- Q1 2026 comps were +0.6%, with management expecting Q2 comps "roughly in line with the midpoint" of the full-year guide (flat to +2%).
- Q2 2025 comps were +1.1%, so the YoY compare is not particularly tough, but the bar is higher due to the inclusion of FBM/ADG.
- Ticket growth is moderating (Q1 2026: +1.5%), with transactions expected to improve in H2 as tariff-driven price increases cycle out.
2. Pro vs. DIY Performance
- Pro segment continues to outperform DIY, supported by Pro Extended Aisle, loyalty, and cross-selling with FBM/ADG.
- Management expects Pro to "continue to outperform DIY not only in the second half but for the balance of the year."
- DIY remains under pressure, especially for big-ticket discretionary projects.
3. Margin Trajectory and Productivity Initiatives
- Margins are pressured by the wrap of FBM/ADG (30 bps dilution in 2026), higher transportation/fuel costs, and ongoing investments in sales-driving initiatives.
- $1B in PPI/AI productivity targeted for 2026 to offset cost pressures.
- Q1 2026 gross margin was 32.7% (-70 bps YoY), with SG&A leveraging 17 bps.
4. Online and Home Services Momentum
- Online sales grew +15.5% in Q1 2026, with continued enhancements to user experience and fulfillment.
- Home services continues to gain share in a fragmented category, with new offerings like HomeCare+ subscription service.
5. Macro and Consumer Sentiment
- Management continues to see a cautious consumer, especially for big-ticket DIY.
- No expectation for a macro inflection in 2026; guidance assumes a flat home improvement market.
- Like-for-like inflation running ~3% in Q1 2026, expected to moderate as tariff impacts cycle out.
6. Guidance and Outlook
- FY2026 guidance affirmed after Q1: Sales $92–94B, comps flat to +2%, adj. EPS $12.25–12.75.
- Q2 2026 comps expected "roughly in line with the midpoint" of the full-year guide.
- Q2 2026 adj. EPS expected to be ~2% below prior year due to acquisition wrap and cost pressures.
Management Commentary — Key Quotes
- "We are forecasting that Pro will continue to outperform DIY not only in the second half but for the balance of the year, and we think the Pro Extended Aisle initiative is tied directly to that outcome."
- "We do expect the growth to be more weighted towards ticket in the first half of 26, and that's primarily as we, as we wrap the tariff price increases that we've been implementing. As we move into the second half, we do expect to see transaction trends to improve."
- "We remain confident in our team's ability to continue executing with discipline while navigating within the current uncertain environment. We remain committed to advancing our Total Home strategy and driving value for both our customers and shareholders."
Conclusion
Lowe’s is entering Q2 2026 with momentum in Pro, online, and home services, but faces ongoing macro headwinds and margin pressure from recent acquisitions and cost inflation. The most important factors for the upcoming earnings are comp sales cadence, ticket vs. transaction mix, Pro/DIY split, margin trajectory, and any updates to full-year guidance. The company is coming off a modest prior-year comp (+1.1% in Q2 2025), so the YoY compare is not especially tough, but the bar is higher due to the inclusion of FBM/ADG. Management remains focused on taking share, driving productivity, and executing its Total Home strategy regardless of the macro environment.
