HOME DEPOT, INC.

We reported net sales of $45.3 billion in the second quarter of fiscal 2025. Net earnings were $4.6 billion, or $4.58 per diluted share. For the first six months of fiscal 2025, net sales were $85.1 billion and net earnings were $8.0 billion, or $8.03 per diluted share.

During the second quarter of fiscal 2025, we opened three new stores in the U.S., resulting in a total store count of 2,353 at August 3, 2025. A total of 322 stores, or 13.7%, were located in Canada and Mexico. Our inventory turnover ratio was 4.6 times at the end of the second quarter of fiscal 2025, compared to 4.9 times at the end of the second quarter of fiscal 2024. The decrease in our inventory turnover ratio was primarily driven by higher average inventory levels during the first six months of fiscal 2025.

We generated $9.0 billion of cash flow from operations during the first six months of fiscal 2025. This cash flow, together with cash on hand, was used to fund cash payments of $4.6 billion for dividends and fund $1.7 billion in capital expenditures. In addition, we repaid $1.2 billion of long-term debt and repaid $316 million of net commercial paper borrowings. In February 2025, we announced a 2.2% increase in our quarterly cash dividend to $2.30 per share.

Our ROIC for the trailing twelve-month period was 27.2% at the end of the second quarter of fiscal 2025 and 31.9% at the end of the second quarter of fiscal 2024. The decrease in ROIC was primarily driven by higher average long-term debt and higher average equity due to the financing of the SRS acquisition. See the Non-GAAP Financial Measures section below for our definition and calculation of ROIC.

Pending GMS Acquisition

On June 29, 2025, we entered into a definitive agreement to acquire GMS, a leading distributor of specialty building products including drywall, ceilings, steel framing and other complementary products related to construction and remodeling projects in residential and commercial end markets across the U.S. and Canada. Under the terms of the merger agreement, we, through a wholly-owned subsidiary, made a cash tender offer to purchase all outstanding shares of GMS common stock for $110 per share, reflecting an expected total equity value of approximately $4.3 billion, and implying an expected total enterprise value (including net debt) of approximately $5.5 billion. The closing of the acquisition is subject to customary closing conditions, including the receipt of required regulatory approvals and the tender of a number of shares of GMS common stock representing a majority of the then-outstanding shares, and is expected to be completed in the second half of fiscal 2025. The acquisition is expected to be funded through a combination of cash onhand and borrowings under our commercial paper program.

Tariffs and Other Trade Policy Matters

We continue to monitor developments with respect to tariffs and other trade policy matters closely. We have worked, and continue to work, diligently to diversify our global supply chain. We believe our actions, such as these diversification efforts, along with our scale, vendor relationships, and experienced internal teams, position us to effectively manage the impact that tariffs in effect as of the date of this filing are expected to have on our business. We plan to continue to assess our sourcing strategy on an ongoing basis to maintain a strong value proposition for our customers.

As trade policy discussions and developments are ongoing, we cannot predict with certainty their ultimate impact on our business in future periods, including our results of operations and cash flows. For more information on these risks and uncertainties see Part I, Item 1A. “Risk Factors” of our 2024 Form 10-K.