Home Depot is bracing for another challenging year, with the world’s largest home‑improvement retailer forecasting lower‑than‑expected sales growth for 2026 as the slowdown in renovation spending shows little sign of easing.
Wood Central understands the company expects sales to rise between 2.5% and 4.5% next year — below the 4.5% growth analysts anticipated, according to FactSet data cited by The Wall Street Journal. Earnings per share are projected to be flat to up 4%, while comparable sales are expected to increase up to 2%.
In a more optimistic recovery scenario, Home Depot said sales could climb 5% to 6%, with comparable sales rising 4% to 5% and earnings growing in the mid‑ to high‑single digits.
Chief Financial Officer Richard McPhail said the company remains confident that a housing‑market rebound will eventually reignite renovation activity. “We expect the housing sector to recover faster than the broader economy, and when it does, home‑improvement demand will follow,” McPhail said.
For the current fiscal year, Home Depot reaffirmed its guidance of 3% sales growth, slightly positive comparable sales, and a 6% decline in earnings. The retailer cut its outlook last month, citing persistent weakness in renovation demand.
Homebuilders, including Toll Brothers and Hovnanian, have also reported softer conditions, pointing to high mortgage rates and tariff‑driven economic uncertainty as key factors discouraging home purchases and delaying major improvement projects.
The slowdown in homebuilding and renovation is also rippling through the building‑materials sector. On Monday, West Fraser Timber, the world’s largest producer of oriented strand board (OSB), confirmed it will close its High Level mill in northern Alberta next spring, removing more than 860 million square feet of annual production capacity from the North American market.
The closure follows the indefinite idling of one OSB line at the company’s Cordele, Georgia, facility, which has been offline since late 2023. In total, West Fraser will withdraw 1.3 billion square feet of OSB capacity — a move that underscores the severity of the downturn in construction and remodelling activity.
West Fraser said the decision reflects “a significant weakening of OSB demand,” a trend that has persisted since mid‑2023 as higher interest rates cooled housing starts and renovation spending. The company expects to record a $200 million asset‑impairment loss in the fourth quarter of 2025 tied to the High Level curtailment.
