Home Depot Earnings August 18: The Guide Needs a Rescue the Mortgage Market Won't Give

TL;DR

• Home Depot reports fiscal Q2 2026 results Tuesday, August 18, before the open (date per multiple outlets; not yet re-confirmed on the company's IR page at writing). The buy-before-or-wait call is in the decision piece.
• Consensus wants $4.71 of EPS, up just 0.6% from last year's adjusted $4.68, on revenue near $47.5 billion, up about 4.9% (the GMS acquisition inflates total sales; comps tell the truth). Beware a stale $45.4 billion consensus figure still circulating: it fails basic arithmetic.
• The full-year guide is modest and still at risk: comps flat to +2%, total sales +2.5-4.5%, EPS flat to up 4%. Q1 comps came in at just +0.6%, so the back half needs acceleration merely to hold the midpoint.
• The macro sets the ceiling on this quarter: the Fed held on July 29 with three dissents wanting higher rates, 30-year mortgages sit at a one-year high near 6.66%, and June existing-home sales fell again. The big-ticket remodel recovery keeps getting pushed out.
• The stock closed Monday in the high-$330s-to-$340 area (quote services disagreed on the exact print), inside a $289-427 yearly range. This preview will be updated in place as the date approaches and consensus firms.
• Updated August 12: chair, president and CEO Ted Decker is on temporary medical leave, expected to run a few months, so he will not present this quarter. Ann-Marie Campbell takes day-to-day operations and CFO Richard McPhail takes financial management plus the Pro subsidiaries. The stock fell about 3% on the news.
• UPDATE (August 18): the comp accelerated, and the trigger fired. Home Depot reported adjusted EPS of $4.92 against a $4.73 consensus, on revenue of $47.86 billion, up 5.7% and above the roughly $47.23 billion Street figure. Comparable sales rose 1.7% (1.3% in the US), beating the 0.9% expected and the highest comp print since fiscal Q3 2022, a clean acceleration from Q1's +0.6%. The company reaffirmed, rather than raised, full-year guidance: comps flat to +2%, total sales +2.5-4.5%, EPS flat to up 4%. Shares rose modestly on the print, up roughly 0.7% to the $340s in Tuesday morning trading; closing-price feeds disagreed with each other by several dollars, so no closing percentage is asserted here. The conditional long from the trade log below is triggered.

When Does Home Depot Report Earnings?

Tuesday August 18, before the market opens, kicking off the retail earnings fortnight that ends with Walmart on August 20 and Target between them. Dates and times for the whole stretch are on the earnings calendar.

Ted Decker Is on Medical Leave Through the Print

Home Depot announced on August 12 that Ted Decker, chair, president and CEO, is taking a temporary medical leave of absence the company expects to last a few months. That puts the leave across the August 18 report, so Decker will not front this quarter.

The interim split is unusually clean for a company this size. Ann-Marie Campbell, senior EVP, oversees day-to-day operations, Richard McPhail, EVP and CFO, oversees financial management and the Pro subsidiaries, and Greg Brenneman chairs the board in his existing role as independent lead director. In the release, Brenneman said Campbell and McPhail "have worked together for more than 20 years" and that the board is "confident in Ann-Marie's and Richard's ability to lead the company during this time".

Shares fell about 3% on the day. My read is that the reaction is about timing rather than succession: a bench this deep does not usually cost a retailer 3%, but handing the guide question to interim leadership six days before the print does raise the odds that management defends the full-year outlook rather than revisiting it. Note also that McPhail now owns the Pro line, which is the one part of the business this preview has flagged as the bridge holding the story together.

I would not change the thesis on this. The question on August 18 is still the comp, and the comp is set by mortgage rates rather than by who reads the script.

The Board

The guide assumes the comp accelerates. The mortgage market keeps voting against it.

The Comp Has to Accelerate From Here

Home Depot's own full-year frame, reaffirmed in May: comparable sales flat to +2%, total sales up 2.5-4.5% (GMS padding the total), margins roughly held, EPS flat to up 4%. Then Q1 delivered comps of +0.6%, with US comps weaker still and adjusted EPS down year on year. The algebra is unforgiving: holding even the middle of the comp range requires the remaining quarters to run visibly hotter than Q1. This is the quarter that has to show it, in peak home-improvement season.

The offsetting strength is structural: Pro outgrew DIY again in Q1, and the GMS/SRS build-out (trade credit now live) keeps deepening the contractor moat. A Pro-led comp acceleration with DIY still soft is the realistic bull print.

The Macro Is Doing the Talking

Every quarter this cycle, Home Depot's results have mattered less than its commentary on when big-ticket remodels return, and the inputs just got worse: the Fed held on July 29 with three dissenters wanting hikes, a decision the market sold off on, 30-year mortgage rates back near 6.66%, a one-year high, and existing-home sales still shrinking. The lock-in effect (nobody trades a 3% mortgage for a 6.7% one) starves both housing turnover and the renovation projects that follow it.

Add tariffs: after holding the line publicly, Home Depot has conceded "modest price increases" on affected goods. Gross margin guided near 33.1% is where that concession shows up, or does not.

The Options Angle

No implied move was sourceable this far ahead of the print, so no volatility plays are logged; this piece gets marked to the numbers as the date approaches. The equity frame: consensus already concedes a flat-earnings year, the guide already assumes little, and the stock sits mid-range. That is a low bar priced for a low outcome; the asymmetric information on the 18th is the comp trajectory and any guide cut, because a cut from an already-modest guide is the one genuinely bearish surprise available.

Trade log

#	Stance	Structure	Strikes and expiry	Cost or credit	Spot at writing	Implied move	Breakeven
1	Pass	Any pre-print options position	Aug expiries	Not sourced this far out	High-$330s area, Aug 3 close (exact print unverified)	Not sourced	n/a; pass scored against the realised move
2	Triggered, open	Long (shares)	Entered Aug 18 morning session	n/a	~$340.26, Aug 18 morning (premarket/open read; closing print not reconcilable across feeds)	n/a	Comps accelerated to +1.7% from +0.6% with FY guidance intact, so the condition fired; scored against ~$340 going forward

The One-Line Read

Home Depot walked into August 18 with a guide that required the second half to rescue the first, and the comp answered: 1.7% against 0.6%, guidance held rather than cut, and the conditional long from this preview is now open.