Lowe’s (LOW) stock fell on Wednesday after the home improvement retailer issued cautious guidance that overshadowed its fourth quarter earnings beat.
The company said it expects same-store sales growth to be flat to up 2% year over year in 2026. Wall Street was looking for 2% growth, according to Bloomberg consensus data.
“We’re just focused on the reality,” CEO Marvin Ellison told Yahoo Finance. “We have a very dynamic tariff environment, and that environment is in existence prior to the Supreme Court ruling, … in addition to the fact that we have housing turnover at its lowest level since the early 1990s.”
He added, “It was just really appropriate for us to be conservative because there’s so much that we don’t know about this macro [environment].”
Lowe’s full-year earnings forecast of approximately $12.25 to $12.75 per share fell short of the $13 per share forecast that Wall Street expected. The company also issued revenue guidance of $92 billion to $94 billion, which was roughly in line with the Street’s forecast of $93.2 billion.
For the fourth quarter, adjusted earnings of $1.98 were $0.04 higher than the Street predicted. Revenue grew 10% to $20.58 billion, slightly above the expectations of $20.35 billion.
Same-store sales rose 1.3% during the quarter, boosted by growth in its Pro business, home services sales, and a “strong holiday performance.”
Read more: Live coverage of corporate earnings
The results for the quarter ended Jan. 30, 2026, follow the Supreme Court’s 6-3 ruling that deemed President Trump’s tariffs enacted under the International Emergency Economic Powers Act (IEEPA) illegal. The IEEPA tariffs brought in $133.5 billion in revenue, if not more, which could be subject to refunds.
Unlike other companies, such as Costco (COST), Goodyear (GT), and Prada (PRDSF), that sued the administration to preserve their right to a refund, Ellison said Lowe’s did not file and that it is “just too early to speculate about a refund.”
“What I will tell you is that when I talk to my legal team, there are quite a few maneuvers that the administration can take to prevent a refund from being a reality in the near-term, and so we’re not sitting back factoring in that we’re going to receive a refund,” he said.
Meanwhile, a stuck housing market has challenged the broader home improvement industry. Mortgage rates have hovered around 6%, sidelining many potential homebuyers.
Only 2.8% of US homes changed hands in 2025, marking the lowest turnover rate since 1995, according to Redfin data.
