Disappointing quarter for Lowe’s

It was another disappointing quarter for Mooresville, North Carolina-based  Lowe’s Cos., which on Wednesday reported lower-than-expected earnings and gave notice of slower growth in profit margin for the second half.

The home-improvement company reported revenue of $19.5 billion, which was short of estimates, but reflected a 6.8% increase from the same period last year. Lowe's reported net income for the second quarter of $1.4 billion compared to $1.2 billion a year ago. A bright spot for Lowe’s second quarter was that same-store sales, which rose 4.5%, exceeded Wall Street forecasts.

“While our results were below our expectations in the first half of this year, the team remains focused on making the necessary investments to improve the customer experience and drive sales,” said Robert Niblock, CEO. These investments include consumer messaging and what Niblock called “incremental customer-facing hours” in stores.

Lowe’s, which operates 2,141 stores in North America, announced that it would add 25 home improvement and hardware stores this year.

Product categories that performed above average in the second quarter were appliances, lawn & garden, lumber & building materials, and rough plumbing & electrical. Paint, flooring, and seasonal & outdoor living were among the underperformers.

Shares of Lowe’s were down more than 6% in mid-day trading as the company missing both its top and bottom line numbers spooked investors.The news comes a week after Home Depot reported its highest quarterly revenue in company history.

To boost profits and play catch up to Depot, Lowe’s has been investing in its Pro business. It has also restructured parts of the company, including layoffs of more than 120 corporate tech workers this summer.