Two major home improvement retailers reveal they are under pressure as executives warn buyers

HOME Depot and Lowe’s are the latest retailers to be deemed under pressure by executives, who have issued warnings to shoppers.

Home improvement retailers have cited inflation as a key reason for the tough times they are facing.

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Lowe’s and Home Depot posted losses in the fourth quarter.

Shares of the two companies have also fallen about 10% over the past month, Yahoo Finance reported.

During an earnings call on Wednesday, Lowe’s chief financial officer Brandon Sink warned of what was to come for the company.

“In 2023, residential investment will be under pressure, given high levels of inflation, higher interest rates and a more cautious consumer,” Sink said.

“We expect the home improvement market to decline slightly.”

Home Depot CEO Ted Decker provided similar information during the company’s earnings call.

“We expect home improvement demand to moderate,” he said.

“People are also starting to spend more on services. And as we said, we’re seeing more price sensitivity,” he added.

However, both leaders pointed to the potential for increased home upgrades.

“Two-thirds of everything we sell is non-discretionary,” Lowe CEO Marvin Ellison said on the earnings call.

“And there are other tailwinds, the trend of millennial households forming, baby boomers aging in place and more widespread sustainable remote working, so all of those things give us some confidence that the backdrop remains supportive. .”

Earlier this week, Macy’s also flagged the possibility of another drop in sales.

According to the Wall Street Journal, Chief Executive Jeff Gennette expressed his expectation that consumers are in worse financial shape than last year, which will lead to a further decline in sales.

Gennette pointed to rising inflation and other burdens on buyers when explaining the reasons for the drop in sales.

Overall, the company predicts sales could drop as much as 3% in 2023.

The retailer also said prices will rise again this year, but probably not as much as in 2022.

Macy’s expects sales to start rising again — but not before 2024, according to Gennette.

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