May 17, 2026
Have You Heard of Project Phoenix?
Featured: Home Depot Reports Tuesday
Dear Reader,
The race for technological superiority with China is reaching a breaking point …
And to ensure they win, the U.S. government is taking desperate measures.
Restarting a decade-old endeavor called Project Phoenix.
The importance of which has gotten the attention of JPMorgan’s Jamie Dimon.
Who directed the largest bank in the country to invest over a trillion dollars in it …
While appointing Jeff Bezos and Condoleezza Rice to advise it.
At the center of this crucial mission for national security are two tiny companies …
That trade for less than $10 a share.
These are the only two operations that can currently deliver on the program’s mission.
The window to potentially profit from this project is closing quickly …
The country’s biggest banks are quietly buying tens of millions worth of shares.
I urgently recommend getting up to speed by clicking here.
Sean Brodrick
Weiss Ratings
Home Depot dropped its fiscal Q1 2025 results Tuesday morning, and the reaction was predictably muted. Shares edged up less than 1% in pre-market trading — which, given the mixed read, is probably the right response.
Revenue came in at $39.86 billion, comfortably ahead of the $39.31 billion Wall Street was looking for. That’s a 9.4% increase year-over-year. On paper, strong. But strip out the $2.6 billion contribution from SRS Distribution — the $18.25 billion roofing and landscaping supplier HD acquired last year — and organic growth looks considerably thinner. Management was transparent about this on the call. The top-line beat is real, but context matters here.
EPS is where it gets complicated. Adjusted diluted earnings came in at $3.56 versus the $3.60 analysts expected — a $0.04 miss. It’s the first time Home Depot has missed Wall Street’s quarterly earnings estimate since May 2020. GAAP net income was $3.43 billion, or $3.45 per diluted share, down from $3.60 billion and $3.63 per share in Q1 2024. Gross margin contracted 35 basis points to 33.8%. Operating margin fell from 13.9% to 12.9% year-over-year.
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Comparable sales declined 0.3% across the company. U.S. comps were slightly positive at +0.2%, but foreign exchange knocked approximately 70 basis points off the total company figure. Customer transactions rose 2.1% year-over-year — so traffic is holding, even if big-ticket project spending isn’t.
The housing backdrop is the part people keep glossing over. Existing home sales have been stuck near historically low turnover for years, driven by mortgage rates that remain punishing for most buyers. Homeowners aren’t moving, which means fewer renovation projects tied to home sales cycles. That’s a structural drag, not a temporary one.
On tariffs — CFO Richard McPhail was direct: Home Depot does not plan to raise prices. More than 50% of its products are sourced domestically. The company has diversified its supply chain enough to absorb current tariff levels, and McPhail framed stable pricing as a potential market share opportunity rather than a margin sacrifice. Whether that holds if tariff structures shift again is an open question.
Full-year guidance was reaffirmed: total sales growth of approximately 2.8%, comparable sales growth of roughly 1%, and adjusted diluted EPS expected to decline about 2% from the $15.24 posted in fiscal 2024. The guidance assumes the current tariff framework — 30% on Chinese imports, 10% on most other countries — remains in place.
For traders watching HD, the key tension is straightforward. Revenue execution is improving through SRS integration and Pro customer engagement. But margin compression is real, the housing market isn’t cooperating, and EPS is moving in the wrong direction year-over-year. Management is playing a long game — absorbing near-term pressure in exchange for positioning around professional demand and supply chain resilience.
Whether that patience pays off depends heavily on where mortgage rates go from here. Nothing in Tuesday’s report changes that calculus.
Key Numbers at a Glance
- Revenue: $39.86B vs. $39.31B expected (+9.4% YoY)
- Adjusted EPS: $3.56 vs. $3.60 expected
- GAAP EPS: $3.45 vs. $3.63 in Q1 2024
- Gross margin: 33.8% (–35 bps YoY)
- Operating margin: 12.9% vs. 13.9% in Q1 2024
- Comparable sales: –0.3% total company; +0.2% U.S.
- Customer transactions: +2.1% YoY
- FY2025 guidance reaffirmed: ~2.8% sales growth, ~1% comp growth, adj. EPS –2%
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