Home Depot Posts $41.77 Billion Q1 Revenue, Beats EPS as Mingledorff's Acquisition Opens $100 Billion HVAC Distribution Market

Level 2 — Elementary

On Tuesday, May 19, 2026, The Home Depot reported its sales and profit for the first three months of its fiscal year. The American home-improvement giant said sales reached $41.77 billion, an increase of 4.8 percent compared with the same quarter a year earlier.

Profit was strong too. Each share of stock earned $3.43 in adjusted form, just above what Wall Street analysts had predicted. Nine of the company's sixteen product departments — including lumber, paint and plumbing — saw same-store sales rise. However, very large home-improvement projects continued to slow, partly because of high mortgage rates.

The company also confirmed that it has just finished buying Mingledorff's, a heating-and-cooling parts distributor based in Atlanta, Georgia. With that deal, Home Depot enters the giant business of selling HVAC parts to professional contractors, a market worth around $100 billion per year in the United States.

CEO Ted Decker told investors that Home Depot now believes its total addressable market — the full set of building and repair purchases the company could one day reach — is about $1.2 trillion. The stock rose in pre-market trading after the report.

fiscal year: a one-year period that a company uses for its accounts; it does not always match the calendar year

quarter: in business, a three-month period of a fiscal year

year-over-year: compared with the same period one year earlier

analyst: an expert who studies companies and predicts how well they will do

same-store sales: the comparison of sales in stores that have been open at least one full year, to measure real growth not driven by new locations

mortgage rate: the interest rate that a bank charges for a home loan

distributor: a company that buys products from a maker and sells them on to shops or businesses

contractor: a worker or company hired to build, repair or install something

Level 3 — Intermediate

The Home Depot reported fiscal first-quarter 2026 results before the market opened on Tuesday, May 19, posting $41.77 billion in net sales, an increase of 4.8 percent year-over-year, and non-GAAP diluted earnings per share of $3.43, which topped consensus estimates by 0.7 percent. Adjusted EBITDA came in at $6.07 billion for a 14.5 percent margin, modestly ahead of analyst forecasts.

Comparable transactions held steady while average ticket strengthened in nine of sixteen merchandising departments, including lumber, paint, plumbing and millwork. Management attributed muted performance in the large discretionary 'big-ticket' project categories — outdoor structures, kitchen remodels, full bathroom renovations — to a still-elevated 30-year fixed mortgage average and persistent housing-affordability pressures that continue to defer major home-improvement spending. Pro sales again outpaced consumer sales for the eleventh consecutive quarter.

The headline strategic announcement was the just-closed acquisition of Atlanta-based heating, ventilation and air-conditioning (HVAC) distributor Mingledorff's, originally signed in November 2025 and closed two weeks ago. Management characterised the deal as a strategic entry into the roughly $100-billion U.S. HVAC distribution market, complementing 2024's $18-billion SRS Distribution acquisition and pushing Home Depot's total addressable market to an estimated $1.2 trillion when residential and commercial maintenance, repair and operations are included.

Chief Executive Ted Decker and Chief Financial Officer Richard McPhail reaffirmed full-year fiscal-2026 guidance for low-single-digit comparable sales growth and approximately flat operating margin, citing the Mingledorff's integration and a back-half housing recovery as the principal levers. Shares of HD traded roughly 1.6 percent higher in pre-market hours and held most of that move through the U.S. cash open.

non-GAAP: an alternative measure of corporate performance that excludes some accounting items required under Generally Accepted Accounting Principles

diluted earnings per share: profit divided across every share that could exist if all stock options and convertible securities were exercised

EBITDA: earnings before interest, taxes, depreciation and amortisation; a common proxy for a company's operating cash generation

consensus estimate: the average of analyst forecasts for a given financial metric ahead of an earnings release

millwork: wooden building products like doors, windows, mouldings and trim, generally produced in a mill

Pro sales: in home-improvement retail, sales made to professional contractors, builders and tradespeople rather than do-it-yourself consumers

addressable market: the full revenue opportunity available to a business if it could capture every potential customer in its categories

back-half: the second half of a fiscal year, often used in guidance to describe expected stronger or weaker periods

Level 4 — Advanced

The Home Depot's fiscal first-quarter 2026 print, released before the U.S. cash open on Tuesday, May 19, was a workmanlike beat in a still-bifurcated home-improvement cycle. Net sales of $41.77 billion grew 4.8 percent year-over-year, non-GAAP diluted EPS of $3.43 cleared FactSet consensus by 0.7 percent, and adjusted EBITDA of $6.07 billion at a 14.5 percent margin was modestly ahead of the Street, leaving operating margin essentially in line with the prior-year comparable. Same-store transactions were broadly flat while average ticket re-accelerated in nine of sixteen merchandising departments, with strength concentrated in lumber, paint, plumbing and millwork — categories that benefit disproportionately from repair-and-maintenance demand against a stagnant housing turnover backdrop.

The persistent drag remained in discretionary big-ticket projects — outdoor structures, kitchen and full bath remodels — where management again pointed to an elevated 30-year fixed mortgage rate, sticky housing-affordability pressures and deferred discretionary outlays among the trade-down consumer. Pro sales, however, outgrew DIY for an eleventh consecutive quarter, validating a multi-year capital cycle that has shifted strategy, store assortment and dedicated Pro-desk staffing toward the contractor base.

The strategic centrepiece was confirmation that the November 2025 acquisition of Atlanta-headquartered HVAC distributor Mingledorff's has formally closed. Combined with the 2024 SRS Distribution transaction, the deal completes Home Depot's pivot into specialty-trades distribution, opens roughly a $100-billion incremental wholesale HVAC opportunity, and lifts the company's stated total addressable market to about $1.2 trillion once residential and commercial maintenance, repair and operations are layered in. Chief Executive Ted Decker framed Mingledorff's as anti-cyclical, with HVAC replacement demand structurally driven by equipment life cycles and federal efficiency mandates rather than housing transaction volume.

On guidance, the company reaffirmed low-single-digit comparable sales growth and approximately flat operating margin for fiscal 2026, with Chief Financial Officer Richard McPhail flagging back-half re-acceleration if Federal Reserve rate cuts proceed as the futures curve currently implies. HD opened roughly 1.6 percent higher and held most of that lift through midday, with the upside skew concentrated in the trades-distribution narrative and a relatively undemanding 22.4-times-forward multiple ahead of the Investor Day scheduled for September 2026 in Atlanta.

bifurcated: split into two distinct, often diverging, parts; here describing a home-improvement market with strong maintenance demand but weak big-project demand

FactSet consensus: the analyst-estimate aggregation produced by financial data provider FactSet, a common reference point for whether earnings beat or miss expectations

average ticket: the average dollar amount spent per transaction; rising average ticket indicates customers are buying more or higher-priced items per visit

housing turnover: the rate at which existing homes change hands; a key driver of home-improvement spending because new owners tend to renovate

trade-down consumer: a shopper who, under financial pressure, shifts to lower-priced products, brands or stores while maintaining purchase frequency

specialty-trades distribution: the wholesale business of supplying parts and equipment to specific construction trades such as HVAC, roofing or plumbing professionals

anti-cyclical: a business pattern whose demand is largely insulated from, or even moves opposite to, the broader economic cycle

forward multiple: a valuation ratio, such as price-to-earnings, computed using estimated future-year financial metrics rather than historical results

Level 1 — Absolute Beginner

Level 2 — Elementary

Level 3 — Intermediate

Level 4 — Advanced

Home Depot Posts $41.77 Billion Q1 Revenue, Beats EPS as Mingledorff's Acquisition Opens $100 Billion HVAC Distribution Market

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