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Lowe's casts a vision for 2025

The company shares its ‘Total Home Strategy’ plans for the new year.
Robby Brumberg

Lowe’s hosted its 2024 Analyst and Investor Conference today to offer a snapshot of its forthcoming productivity initiatives and key financial targets. The company shared a rosy outlook for 2025 consumer spending—despite ongoing uncertain macroeconomic conditions.

“As we look ahead to the expected recovery in home improvement, we are making investments to position the company for long-term growth. We are evolving our Total Home strategy to help solve our customers’ total home improvement needs with more value and exceptional service,” said Marvin R. Ellison, Lowe's chairman, president and CEO. 

He adds: “By leveraging leading technology solutions, we’re creating a best-in-class omnichannel shopping experience for all generations of homeowners. At the same time, we’re building on our momentum with Pros now that we’ve reached 30 percent Pro penetration.”

That “Pro penetration” focus was a key talking point for Ellison and other Lowe’s execs during the webcast, though the company has plenty of other tricks up its sleeve for the year ahead.  

Lowe's casts a vision for 2025.
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Lowe’s shared its “2025 Total Home Strategy,” which spans five growth initiatives: 

  • Drive Pro penetration
  • Accelerate online sales
  • Expand home services
  • Create a loyalty ecosystem
  • Increase space productivity

Lowe’s aims to support its Total Home initiatives via the means below: 

New AI framework to enhance customer experience and drive productivity. 

The company has developed a framework to harness generative AI through a “standardized development process, designed to enhance the customer experience and unlock productivity.”

With an AI platform, the company says it has the agility needed to create innovative solutions alongside many buzzy tech platforms like NVIDIA, OpenAI and Palantir. “Leveraging the experience gained from its success with early AI models that power its online search and product recommendations, sourcing engines and demand planning tools, the company is now piloting new solutions to empower frontline associates to better serve customers and improve the in-store shopping experience.”

Launches first product marketplace in U.S. home improvement industry. 

The company has beefed up its online assortment with the launch of what it calls the first product marketplace in the U.S home improvement industry. 

Lowe’s says it’s working with new sellers and existing suppliers to offer its full product catalogs, including products across price points to serve “value-oriented and more affluent” consumers. This enables the company to offer a wider selection of products without carrying the inventory, managing pricing or investing in new online fulfillment centers, Lowe’s says. “The new marketplace will further position Lowe’s as a one-stop shop where customers can get everything they need for their home.” 

Relaunches Pro loyalty program as MyLowe’s Pro Rewards.

In early 2025, the company says it is relaunching its Pro loyalty program as MyLowe’s Pro Rewards, which is tailored specifically to “small-to-medium Pros.” 

The new program, according to the company, will be more intuitive to use and easier and faster for Pros to earn rewards and redeem them. Additionally, Pro customers who shop with their MyLowe’s Pro Rewards Credit Card will save 5 percent on eligible purchases. 

“The company is bringing its DIY and Pro loyalty programs into one ecosystem, under a single currency, to create a simple yet compelling value proposition for these different customers. Whether it’s a Pro customer who shops multiple times per week or a homeowner who shops a handful of times per year, they’ll be confident that Lowe’s is making it easy for them to save time and money.”

Launches Pro extended aisle to expand jobsite delivery. 

“Through a direct interface with supplier systems, the company is creating a seamless solution for large, special Pro orders.” 

Lowe’s sales associates will now have instant access to an expanded digital catalog, which includes inventory availability, pricing and supplier services like jobsite and rooftop delivery. “With this expedited quoting process, the company expects to improve its close rate on larger orders, capturing more planned Pro spend, while relying on large suppliers to execute job site delivery.”

New store growth.

“To fuel long-term growth, expand its footprint and attract new DIY and Pro customers to the brand, Lowe’s plans to open 10-15 stores per year over the next several years in fast-growing markets in the U.S.,” the company shares.

“In planning this next phase of store expansion, the company will build on the success of its recent new store openings, while also leveraging its enhanced space productivity initiatives. With these new stores, the company expects to strengthen its brand position, build its customer base and drive incremental sales and return on invested capital.”

Extends rural offering to 150 more stores, bringing rural store count to nearly 500. 

Lowe’s is planning to extend its rural offerings to 150 more stores, where it’s “bringing everything needed for farm and home under one roof.”

In these rural locations, Lowe’s says customers can expect to find more options in categories like pet, workwear, automotive supplies and utility vehicles. 

Lowe’s also shared its full-year 2024 financial outlook, which includes:

  • Total sales of $83 to $83.5 billion.
  • Comparable sales expected to be down -3.0 percent to -3.5 percent as compared to prior year.
  • Adjusted operating income as a percentage of sales (adjusted operating margin) of 12.3 percent to 12.4 percent.
  • Net interest expense of approximately $1.3 billion.
  • Adjusted effective income tax rate of approximately 24.5 percent.
  • Adjusted diluted earnings per share of approximately $11.80 to $11.90.
  • Capital expenditures of approximately $2 billion.

From the investor Q&A portion of the webcast, CEO Marvin Ellison made it clear that the company plans to lean heavily into Pro initiatives moving forward: “We see more strength in the Pro segment in 2025,” he said, adding that homeowners are clearly still feeling the pinch of uncertain economic conditions. “In DIY, we’re still feeling that discretionary, big-ticket pressure.” However, Ellison notes that if “macro accelerators happen, things can change,” but Lowe’s is clearly targeting that Pro segment for the next three to five years.

During the Q&A, Ellison also stated that “the demand is coming” for DIY spend. In preparation, Lowe’s is investing in its in-store showrooms, in particular, in anticipation of a hoped-for household spending deluge. As an analogy for its investments, even amid challenging conditions, Ellison says: “You don’t fix a roof when it’s raining. You fix it when the sun is shining.”

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