MOORESVILLE, N.C. - Mooresville-based Lowe's blew past second quarter profit expectations, buoyed by strong demand for spring goods and sales to contractors.
Even though the home improvement retailer wrestled with lower lumber prices and rough spring weather, CEO Marvin Ellison said Lowe's saw growth in same-store sales across the U.S.
"Our transformation is ongoing, and our future is bright. We are confident that we are on the right path to capitalize on solid demand in a healthy home improvement market and generate long-term profitable growth," he said.
Ellison, a one-time Home Depot executive who took the top job at Lowe's last year, is trying to reshape the culture at the home improvement retailer, which has been a distant second to Home Depot in the sector.
Wall Street likes what he's doing.
Shares surged 12.6% before the opening bell Wednesday.
Ellison has thinned the executive ranks at the company and is outsourcing some duties once done by employees, such as maintenance. That has meant thousands of layoffs.
Weaker-selling goods are also disappearing from stores.
For the three months ended Aug. 2, the Mooresville company earned $1.68 billion, or $2.14 per share. A year earlier it earned $1.52 billion, or $1.86 per share.
Stripping out one-time costs, earnings were $2.15 per share. That handily topped the $2 per share that analysts surveyed by Zacks Investment Research forecast.
Revenue totaled $20.99 billion, slightly higher than Wall Street's expectations.
Sales at stores open at least a year climbed 2.3%, and rose 3.2% in U.S. stores. Industry analysts watch that figure closely because it removes volatility from recently opened or closed stores, meaning it's a good barometer of a retailer's health.
On Tuesday rival Home Depot Inc. also beat second quarter profit expectations, but the company cut its full-year sales forecast on declining lumber prices and the potential impact tariffs may have on its customers.
Lowe's maintained its full-year adjusted earnings outlook of $5.45 to $5.65 per share.
Read more top trending stories on wsoctv.com:
- 'There's no logical answer': Sheriff offers more details in case of teen killed by dad
- 20-year-old gunned down outside uptown is Charlotte's latest homicide victim
- Mom claims pair posing as Child Protection Services workers tried to take son; police investigating
- FORECAST: Heat returns after first day under 90 degrees in weeks
- Family claims CMS didn’t do enough to protect daughter from sex abuse
Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.