MOORESVILLE, N.C. — Lowe’s Companies, the nation’s second-largest home improvement chain, reported net earnings of $988 million and diluted earnings per share of $1.19 for the quarter ended May 4, 2018, compared to net earnings of $602 million and diluted earnings per share of $0.70 in the first quarter of 2017. Diluted earnings per share increased 15.5 percent from adjusted diluted earnings per share1 of $1.03 in the same period a year ago.
Sales for the first quarter increased 3.0 percent to $17.4 billion from $16.9 billion in the first quarter of 2017, and comparable sales increased 0.6 percent. Comparable sales for the U.S. home improvement business increased 0.5 percent.
As of May 4, 2018, Lowe’s operated 2,154 home improvement and hardware stores in the United States, Canada and Mexico representing 215.1 million square feet of retail selling space.
During the quarter, the company adopted the new revenue recognition accounting standard ASU No. 2014-09. As a result, the company reclassified certain items within operating income. This change resulted in an increase to sales of approximately $130 million in the first quarter, driven primarily by the reclassification of the profit sharing income from the company’s proprietary credit program from selling, general and administrative expense. This accounting standard had no impact on comparable sales or diluted earnings per share in the first quarter of 2018. It has been adopted on a modified retrospective basis, therefore the prior year has not been adjusted.
“We drove solid performance in indoor categories and continued to grow our sales to Pro customers. However, prolonged unfavorable weather across geographies led to a delayed spring selling season which impacted results in outdoor categories,” commented Robert A. Niblock, Lowe’s chairman, president and CEO. “Spring has now arrived and we are encouraged by strong sales in the month of May.
“We continue to work diligently to improve conversion, better manage inventory and stabilize gross margin, while investing in the capabilities required to deliver simple and seamless customer experiences,” Niblock added. “I’d like to thank our employees for their commitment and dedication to helping people love where they live.”
Delivering on its commitment to return excess cash to shareholders, the company repurchased $750 million of stock under its share repurchase program and paid $340 million in dividends in the first quarter.