HOME DEPOT, INC.

At May 3, 2026, we had $1.6 billion in cash and cash equivalents, of which $1.0 billion was held by our foreign subsidiaries. We believe that our current cash position, cash flow generated from operations, funds available from our commercial paper program, and access to the long-term debt capital markets should be sufficient not only for our operating requirements, any required debt payments, and satisfaction of other contractual obligations, but also to enable us to invest in the business, fund dividend payments, and fund any share repurchases through the next several fiscal years. In addition, we believe that we have the ability to obtain alternative sources of financing, if necessary or appropriate.

Our material cash requirements include contractual and other obligations arising in the normal course of business. Our contractual obligations include long-term debt and related interest payments, operating and finance lease obligations, and purchase obligations. In addition to our cash requirements, we follow a disciplined approach to capital allocation. This approach first prioritizes investing in the business, followed by paying dividends, with the intent of then returning excess cash to shareholders in the form of share repurchases. In March 2024, we paused share repurchases in connection with the SRS acquisition and do not have plans to resume share repurchases in fiscal 2026 as we seek to reduce our outstanding debt.

During the first three months of fiscal 2026, we invested $844 million back into our business in the form of capital expenditures. We plan to invest approximately $4 billion back into our business in the form of capital expenditures in fiscal 2026, in line with our expectation of approximately 2.5% of projected fiscal 2026 net sales. We expect to make investments across initiatives supporting our strategy of driving our core and culture, including building new stores and maintaining existing stores, delivering a frictionless interconnected experience, and winning with Pros. However, as in the past, we may adjust our capital expenditures to support the operations of the business, to enhance long-term strategic positioning, or in response to the economic environment, as necessary or appropriate. We may also utilize strategic acquisitions to help accelerate our strategic initiatives.

In February 2026, we announced a 1.3% increase in our quarterly cash dividend from $2.30 to $2.33 per share. During the first three months of fiscal 2026, we paid cash dividends of $2.3 billion to shareholders. We intend to pay a dividend in the future; however, any future dividend is subject to declaration by our Board based on our earnings, capital requirements, financial condition, and other factors considered relevant by our Board.

In August 2023, our Board approved a $15.0 billion share repurchase authorization that replaced the previous authorization of $15.0 billion, which was approved in August 2022. The August 2023 authorization does not have a prescribed expiration date. As of May 3, 2026, approximately $11.7 billion of the $15.0 billion share repurchase authorization remained available.

DEBT

We have a commercial paper program that allows for an aggregate of $11.0 billion in borrowings, and is supported by $11.0 billion of back-up credit facilities. These backup credit facilities consist of a five-year $3.5 billion credit facility scheduled to expire in May 2030, a 364-day $3.5 billion credit facility scheduled to expire in July 2026, a three-year $3.0 billion back-up credit facility scheduled to expire in July 2028, and a 364-day $1.0 billion back-up credit facility scheduled to expire in July 2026.

During the first three months of fiscal 2026, all of our short term borrowings were under our commercial paper program. We utilized commercial paper borrowings to support general liquidity, including the repayment of long-term debt, and the maximum amount outstanding during the first three months of fiscal 2026 was $6.2 billion. At May 3, 2026, we had outstanding borrowings under our commercial paper program of $3.5 billion with a weighted average interest rate of 3.8%, we had no outstanding borrowings under our back-up credit facilities, and we were in compliance with all of the covenants contained in our back-up credit facilities, none of which are expected to impact our liquidity or capital resources.

We also issue senior notes from time to time. We did not have any issuances of senior notes during the first three months of fiscal 2026. In April 2026, we repaid our $1.3 billion 3.00% senior notes at maturity.

The indentures governing our senior notes do not generally limit our ability to incur additional indebtedness or require us to maintain financial ratios or specified levels of net worth or liquidity. The indentures governing our notes contain various covenants, none of which are expected to impact our liquidity or capital resources. We were in compliance with all such covenants at May 3, 2026. See Note 5 to our consolidated financial statements for further discussion of our debt arrangements.

CASH FLOWS SUMMARY

Operating Activities

Cash flow generated from operations provides us with a significant source of liquidity. Our operating cash flows result primarily from cash received from our customers, offset by cash payments we make for products and services, associate compensation, operations, occupancy costs, and income taxes. Cash provided by or used in operating activities is also subject to changes in working capital. Working capital at any point in time is subject to many variables, including seasonality, inventory management and category expansion, the timing of cash receipts and payments, vendor payment terms, and fluctuations in foreign exchange rates.

Net cash provided by operating activities increased by $1.7 billion in the first three months of fiscal 2026 compared to the first three months of fiscal 2025, primarily due to changes in working capital. Changes in working capital were primarily driven by inventory management, along with the deferral of our fourth quarter fiscal 2024 estimated federal tax payment to the first quarter of fiscal 2025, which resulted in fewer income tax payments in the first three months of fiscal 2026 compared to the first three months of fiscal 2025.

Investing Activities

Net cash used in investing activities increased by $178 million in the first three months of fiscal 2026 compared to the first three months of fiscal 2025, primarily resulting from a higher volume of immaterial acquisitions during the first quarter of fiscal 2026.

Financing Activities

Net cash used in financing activities in the first three months of fiscal 2026 primarily reflected $2.3 billion of cash dividends paid, $1.4 billion of repayments of long-term debt, and $1.0 billion of net repayments of commercial paper borrowings. Net cash used in financing activities in the first three months of fiscal 2025 primarily reflected $2.3 billion of cash dividends paid, $1.1 billion of repayments of long-term debt, and $278 million of net repayments of commercial paper borrowings.