Lowe's profit spikes as customers load up during coronavirus outbreak

Online sales rose 80% in the first quarter

Lowe’s first-quarter profit spiked 28 percent from a year ago as customers stocked up on essential items during the early days of the COVID-19 pandemic.

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The Mooresville, North Carolina-based home-improvement chain earned $1.34 billion, or an adjusted $1.77 a share, as revenue rose 11 percent year-over-year to $19.68 billion. Wall Street analysts surveyed by Refinitiv were expecting adjusted earnings of $1.32 a share on revenue of $18.32 billion.

Comparable sales in the U.S. jumped 12.3 percent.

TickerSecurityLastChangeChange %
LOWLOWE'S COMPANIES INC.130.35+2.23+1.74%

"Our strong first-quarter performance, which continues into May, also reflects the benefits of our retail fundamentals strategy, the improvement in our execution, and the resiliency of our home improvement business model,” CEO Marvin Ellison said in a statement. “I am also pleased with our ability to pivot to serve increased online demand with Lowes.com sales increasing 80% in the quarter.”

Lowe's made two separate $300 payments to full-time employees and $150 payments to part-time employees to help with unexpected expenses caused by COVID-19, and increased pay for frontline employees by $2 per hour in the month of April. Total expenses related to supporting employees and the community totaled $340 million.

HOME DEPOT HIT WITH $850M CORONAVIRUS CHARGE

At the end of the first quarter, Lowe's had $6 billion cash and $3 billion available on its credit facilities

The company repurchased 9.6 million shares for $947 million during the first quarter, but does not expect to buy back any more stock this year.

Lowe's withdrew its full-year 2020 guidance due to uncertainty caused by COVID-19.

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Shares fell 2.41 percent this year through Tuesday, outperforming the S&P 500's 9.53 percent decline.