Slammed by shrinking same-store sales, Lowe’s (NYSE:LOW) disclosed a deeper-than-expected 10% drop-off in second-quarter earnings on Monday, prompting the home-improvement retailer to downgrade its full-year projections.
Lowe’s said it earned $757 million last quarter, compared with $830 million a year earlier. Per-share earnings were unchanged at 64 cents a share due to a decline in outstanding shares.
The recent quarter’s results included a charge of one cent a share tied to layoffs at the company’s headquarters in Mooresville, N.C.
Still, analysts had been calling for more robust EPS of 70 cents.
Revenue declined 2% to $14.25 billion, trailing the Street’s view of $14.46 billion. Same-store sales dipped 0.4%, including 0.2% in the U.S.
“Our results fell short of our overall expectations,” CEO Robert Niblock said in a statement. “While we recognize the significant magnitude of change that we’ve asked the organization to absorb as we transform our business, we fully understand that we must improve our level of execution.”
Lowe’s also downgraded its full-year EPS view to about $1.64, down from $1.73 to $1.83 and well below consensus calls from analysts for $1.80.
Total sales are seen rising 1%, down from 1% to 2% previously, while same-store sales are expected to inch up 0.5%.
Shares of the No. 2 U.S. home-improvement retailer dropped 6% to $26.21 ahead of the opening bell on Monday. The losses are set to eat into Lowe’s 10% gain so far this year. Wall Street also punished the Home Depot (NYSE:HD) rival for the news, sending its shares slumping 6%.