Buyers always abandon the new data from Lowe's, this is why
There were a few factors that contributed to a drop in sales in the last quarter.
If you have reduced spending recently, you are not alone. Grocery price Stay high, leaving many of us inclined to save additional money for experiences, rather than spending them on articles with large tickets or material goods. The domiciliary renovation sector was directly influenced by this change of development after the COVVI-19 pandemic, with big names like Home Depot and Lowe's both Representation of declines These last months. Now new data show that buyers are always abandoning LOWE. Read more to find out why sales have dropped.
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Sales fell by 17%.
In a February 27 Press release Lowe said the results of the fourth quarter, with sales at $ 18.6 billion. It was a decrease of 17% compared to the same quarter of the previous year, where sales reached $ 22.4 billion. Comparable sales - which are adjusted for openings and closings in store - also decreased by 6.2%, according to the press release.
However, even if sales were down, the results were in fact better that Wall Street had planned it. Analysts expected sales to reach $ 18.47 billion, but sales beat him. The profit per share was also higher than expected, coming from $ 1.77, compared to $ 1.68.
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The drop in sales is the result of a few contributory factors.
In the press release, Marvin R. Ellison , The president, president and chief executive officer of Lowe, awarded the drop in sales to "the continuation of the decline in DIY expenses [in DIY]".
Speaking with CNBC, Ellison said consumers continue to invest in experiences and are Concentrate less on DIY projects Due to a decrease in housing turnover. About two -thirds of the owners are locked up at mortgage rates less than 4%, Ellison said when calling the profits, which "can hold a lot on the sidelines" in terms of purchase and sale.
Regarding the drop in comparable sales, the company noted the decrease in DIY, as well as "the unfavorable winter times of January".
Ellison developed at this February 27 profit call , doubling the time of January "hard" and "extreme". He is not too far in his statements either, as the National Weather Service said last month " extremely "On the temperature side, with a little more snow than expected.
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Apparatus sales have been affected by spending habits.
During the call for profits, Ellison also cited the current problems with sales of large tickets, because consumers focus more on "value".
"Macroeconomic factors such as persistent inflation and a stagnant housing market continue to make DIY customers and consumers hesitating to spend large purchases of tickets for their home, and those who have engaged in renovation activities have taken Smaller non -discrimination projects with increased accent on value, "said Ellison." This had an impact on the request of more important interior categories such as the kitchen and the bathroom, the floor covering and household appliances. "
Instead of investing in a new "suite" for their kitchen, consumers will buy an article with large tickets such as a dishwasher or a refrigerator, Ellison explained to CNBC. For the Lowe activities sector, Ellison said that this new expenditure habit is in fact "the largest decisive factor in our falling sales volume".
Lowe leaders are optimistic, but cautious around 2024.
In the meantime, the leaders proceed to caution, but maintain a positive perspective. Given the current economic factors, the company provides for sales between $ 84 and $ 85 billion, which is less than $ 86.3 billion earned during the 2023 fiscal year.
"While we look at 2024, we expect the request for DIY to remain under short -term pressure," Ellison told CNBC. "But we feel good in the long -term perspectives for our business and frankly for the home improvement industry in general."
When mortgage rates drop, Ellison also plans that people will be more interested in domiciliary renovation products.
"When the prices drop, it will stimulate the turnover of the accommodation and you know what is happening when you put the house on the market: you pack the paint. You can embellish the courtyard. You will do different projects around the House to get ready to sell, then when you buy a house, you do the same thing, "he told CNBC.
