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One reason the company cited for the drop in earnings and revenue is the pending $10.3 billion sale of HD Supply. The company released a revised outlook yesterday, reflecting HD Supply as a discontinued operation.
HD Supply would have accounted for 18 cents a share in earnings in the second half of this year, according to the company. The wholesale business also generated about 14 percent of total sales.
Home Depot expects overall sales to drop between 1 percent and 2 percent this year after subtracting the $12 billion in sales HD Supply contributed to the top line. The company also says it expects declines in the mid-single digits for comparable-store sales.
The company also said the weakening U.S. housing market was another factor in the earnings drop. The nation’s home sales in 2007 will fall to their lowest level since the start of the housing boom in 2001, according to a forecast issued yesterday by Freddie Mac.