Home Depot’s revenue growth
In 2018, Home Depot (HD) posted revenue of $108.2 billion, which represents a rise of 7.2% from $100.9 billion in 2017. The revenue growth was driven by positive SSSG (same-store sales growth) of 5.2%, net addition of new restaurants, the adoption of a new accounting standard, and an extra week of operations.
By the end of the fourth quarter of 2018, Home Depot operated 2,287 stores, compared to 2,284 stores at the end of the fourth quarter of 2017. The addition of three new stores contributed to the company’s revenue growth. The adoption of the new revenue recognition standard contributed $216 million to the company’s total revenue. The company had 53 weeks of operations in 2018, compared to 52 weeks in 2017. The extra week contributed $1.7 billion to the company’s 2018 revenue.
Lowe’s revenue growth
Lowe’s Companies (LOW) posted revenue of $71.31 billion in 2018, which represents a rise of 3.9% from $68.62 billion in 2017. The positive SSSG in all four quarters of 2018 and the adoption of a new revenue recognition standard drove the company’s revenue during the period.
By the end of 2018, Lowe’s operated 2,015 stores, compared to 2,152 stores at the end of the fourth quarter of 2017. The closure of 51 Lowe’s stores and 99 Orchard Supply Hardware stores led to a decline in Lowe’s store count. In the third quarter, Lowe’s management announced that it would exit its retail operations in Mexico and some of its non-core business in the US home improvement category, which also hurt the company’s revenues during the quarter.
Next in this series, we’ll look at SSSG for both companies in 2018.