Lowe’s in four charts
Lowe’s CEO Marvin Ellison, during the company’s most recent quarterly earnings call, pointed to three factors that are planted firmly in the positive column of the home improvement industry.
He calls them “core demand drivers.” Disposable personal income is up. Home prices are up. And housing stock is getting older, and therefore in need of home improvement retailers like Lowe’s.
Against these positive factors are several negatives and unknowns, including high interest rates and low existing home sales. Plus, “customers are still showing a preference of spending on services with elevated demand for travel, restaurants and other experiences,” Ellison told analysts.
They’ll be back to their old buying habits, he said, but it’s not clear when.
All those factors played into the company’s top and bottom line performance of 2023, during which the company’s net income of $7.7 billion was up from $6.5 billion in the previous year. Net sales for the full year were $86.4 billion, down 11 percent from $97.1 billion in the prior year.
Chart 1 shows the big picture over time.
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The company's 11 percent sales decline in 2023, was generally shared across its 15 product categories
The big decline, as the chart below reveals, came in the lumber aisle. But despite lumber deflation, the company generated positive comparable sales for the pro customer for the year. And the stand-alone building materials category stands out starkly as a bright spot in year-over-year sales.
Here's a breakdown of percentage gains/losses in each product category.
Chart no. 2
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Lowe's internal organization of its product categories have changed over the years, with various additions, subtractions and shifting definitions. But they have remained relatively consistent since 2019. (Lighting was eliminated as a separate category in 2022.)
Here are the annual sales results over the past decade of the product categories, and how they compare with each other.
Chart no. 3
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As of Feb. 24, 2024, Lowe's operated 1,746 stores, an increase of 8 from the prior year. Seven states welcomed additional stores, and Lowe’s home state of North Carolina added two stores.
Chart no. 4
CORRECTION: A previous version of the "Lowe's Sales by Department" chart used figures for years 2021 and 2022 that were reported before the company's adjustments. The above charts use figures that have been reclassified to conform to the current year report.
