What Drove Lowe’s Revenue in 2Q17?
Lowe’s Companies (LOW) posted revenues of $19.5 billion in 2Q17, which represents growth of 6.8% from $18.3 billion in 2Q16. Analysts were expecting the company to post revenue of $19.5 billion.
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Lowe’s revenue growth was driven by the acquisition of RONA, Central Wholesalers and Maintenance Supply Headquarters, positive same-store sales growth (or SSSG), and the addition of new stores. RONA, which Lowe’s acquired in May 2016, generated approximately $1 billion of sales, contributing 3.0% to revenue growth. The acquisition of Central Wholesalers and Maintenance Supply Headquarters expanded Lowe’s capability to serve the multi-family housing industry, thus driving its sales growth.
During the last four quarters, the company has increased its unit count by 33 units to 2,141 stores compared to 2,108 in 2Q16. The company opened four new stores in the US during the quarter. Lowe’s posted SSSG of 4.5% in 2Q17, which we’ll discuss in our next article.
However, due to the calendar shift, 2Q17 had one less week of spring and one more week of summer than 2Q16, which lowered the company’s revenue by $285 million or 1.7%.
Next, we’ll look at Lowe’s 2Q17 same-store sales growth.