10-Q 1 low-20240802.htm FORM 10-Q low-20240802
0000060667false2024Q201-31xbrli:sharesiso4217:USDxbrli:pureiso4217:USDxbrli:shares00000606672024-02-032024-08-0200000606672024-08-2700000606672024-05-042024-08-0200000606672023-05-062023-08-0400000606672023-02-042023-08-0400000606672024-08-0200000606672023-08-0400000606672024-02-020000060667us-gaap:CommonStockMember2024-05-030000060667us-gaap:AdditionalPaidInCapitalMember2024-05-030000060667us-gaap:RetainedEarningsMember2024-05-030000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-05-0300000606672024-05-030000060667us-gaap:RetainedEarningsMember2024-05-042024-08-020000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-05-042024-08-020000060667us-gaap:AdditionalPaidInCapitalMember2024-05-042024-08-020000060667us-gaap:CommonStockMember2024-05-042024-08-020000060667us-gaap:CommonStockMember2024-08-020000060667us-gaap:AdditionalPaidInCapitalMember2024-08-020000060667us-gaap:RetainedEarningsMember2024-08-020000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-08-020000060667us-gaap:CommonStockMember2024-02-020000060667us-gaap:AdditionalPaidInCapitalMember2024-02-020000060667us-gaap:RetainedEarningsMember2024-02-020000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-02-020000060667us-gaap:RetainedEarningsMember2024-02-032024-08-020000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-02-032024-08-020000060667us-gaap:AdditionalPaidInCapitalMember2024-02-032024-08-020000060667us-gaap:CommonStockMember2024-02-032024-08-020000060667us-gaap:CommonStockMember2023-05-050000060667us-gaap:AdditionalPaidInCapitalMember2023-05-050000060667us-gaap:RetainedEarningsMember2023-05-050000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-05-0500000606672023-05-050000060667us-gaap:RetainedEarningsMember2023-05-062023-08-040000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-05-062023-08-040000060667us-gaap:AdditionalPaidInCapitalMember2023-05-062023-08-040000060667us-gaap:CommonStockMember2023-05-062023-08-040000060667us-gaap:CommonStockMember2023-08-040000060667us-gaap:AdditionalPaidInCapitalMember2023-08-040000060667us-gaap:RetainedEarningsMember2023-08-040000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-08-040000060667us-gaap:CommonStockMember2023-02-030000060667us-gaap:AdditionalPaidInCapitalMember2023-02-030000060667us-gaap:RetainedEarningsMember2023-02-030000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-02-0300000606672023-02-030000060667us-gaap:RetainedEarningsMember2023-02-042023-08-040000060667us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-02-042023-08-040000060667us-gaap:AdditionalPaidInCapitalMember2023-02-042023-08-040000060667us-gaap:CommonStockMember2023-02-042023-08-040000060667us-gaap:ProductMember2024-05-042024-08-020000060667us-gaap:ProductMember2023-05-062023-08-040000060667us-gaap:ProductMember2024-02-032024-08-020000060667us-gaap:ProductMember2023-02-042023-08-040000060667us-gaap:ServiceMember2024-05-042024-08-020000060667us-gaap:ServiceMember2023-05-062023-08-040000060667us-gaap:ServiceMember2024-02-032024-08-020000060667us-gaap:ServiceMember2023-02-042023-08-040000060667us-gaap:ProductAndServiceOtherMember2024-05-042024-08-020000060667us-gaap:ProductAndServiceOtherMember2023-05-062023-08-040000060667us-gaap:ProductAndServiceOtherMember2024-02-032024-08-020000060667us-gaap:ProductAndServiceOtherMember2023-02-042023-08-040000060667low:HomeDecorMember2024-05-042024-08-020000060667low:HomeDecorMember2023-05-062023-08-040000060667low:HomeDecorMember2024-02-032024-08-020000060667low:HomeDecorMember2023-02-042023-08-040000060667low:HardlinesMember2024-05-042024-08-020000060667low:HardlinesMember2023-05-062023-08-040000060667low:HardlinesMember2024-02-032024-08-020000060667low:HardlinesMember2023-02-042023-08-040000060667low:BuildingProductsMember2024-05-042024-08-020000060667low:BuildingProductsMember2023-05-062023-08-040000060667low:BuildingProductsMember2024-02-032024-08-020000060667low:BuildingProductsMember2023-02-042023-08-040000060667low:OtherSalesMember2024-05-042024-08-020000060667low:OtherSalesMember2023-05-062023-08-040000060667low:OtherSalesMember2024-02-032024-08-020000060667low:OtherSalesMember2023-02-042023-08-040000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasuryNotesSecuritiesMember2024-08-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasuryNotesSecuritiesMember2023-08-040000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasuryNotesSecuritiesMember2024-02-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MoneyMarketFundsMember2024-08-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MoneyMarketFundsMember2023-08-040000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MoneyMarketFundsMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CommercialPaperMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CorporateDebtSecuritiesMember2024-02-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CertificatesOfDepositMember2024-08-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CertificatesOfDepositMember2023-08-040000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CertificatesOfDepositMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:MunicipalBondsMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForeignGovernmentDebtMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForeignGovernmentDebtMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForeignGovernmentDebtMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberlow:FixedToFloatingInterestRateSwapsMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberlow:FixedToFloatingInterestRateSwapsMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberlow:FixedToFloatingInterestRateSwapsMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2024-02-020000060667us-gaap:FairValueInputsLevel3Member2024-08-020000060667us-gaap:FairValueInputsLevel3Member2023-08-040000060667us-gaap:FairValueInputsLevel3Member2024-02-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:UnsecuredDebtMember2024-08-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:UnsecuredDebtMember2024-08-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:UnsecuredDebtMember2023-08-040000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:UnsecuredDebtMember2023-08-040000060667us-gaap:FairValueInputsLevel1Memberus-gaap:UnsecuredDebtMember2024-02-020000060667us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:UnsecuredDebtMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:SecuredDebtMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SecuredDebtMember2024-08-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:SecuredDebtMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SecuredDebtMember2023-08-040000060667us-gaap:FairValueInputsLevel2Memberus-gaap:SecuredDebtMember2024-02-020000060667us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SecuredDebtMember2024-02-020000060667us-gaap:EstimateOfFairValueFairValueDisclosureMember2024-08-020000060667us-gaap:EstimateOfFairValueFairValueDisclosureMember2023-08-040000060667us-gaap:EstimateOfFairValueFairValueDisclosureMember2024-02-020000060667low:A2023CreditAgreementMemberus-gaap:RevolvingCreditFacilityMember2023-09-300000060667low:A2023CreditAgreementMemberus-gaap:RevolvingCreditFacilityMember2023-09-012023-09-300000060667low:A2020CreditAgreementMemberus-gaap:RevolvingCreditFacilityMember2020-03-310000060667low:A2020CreditAgreementMemberus-gaap:RevolvingCreditFacilityMember2020-03-012020-03-310000060667low:ThirdAmendedAndRestatedCreditAgreementMemberus-gaap:RevolvingCreditFacilityMember2021-12-310000060667low:ThirdAmendedAndRestatedCreditAgreementMemberus-gaap:RevolvingCreditFacilityMember2021-12-012021-12-310000060667low:A2023CreditAgreementMember2024-08-020000060667low:A2023CreditAgreementMember2023-08-040000060667low:A2020CreditAgreementMember2023-08-040000060667low:ThirdAmendedAndRestatedCreditAgreementMember2024-02-020000060667low:A2023CreditAgreementMember2024-02-020000060667us-gaap:CommercialPaperMember2024-02-020000060667low:ThirdAmendedAndRestatedCreditAgreementMember2023-08-040000060667us-gaap:CommercialPaperMember2024-08-020000060667low:ThirdAmendedAndRestatedCreditAgreementMember2024-08-020000060667us-gaap:RevolvingCreditFacilityMember2024-08-020000060667low:FixedToFloatingInterestRateSwapsMemberus-gaap:FairValueHedgingMemberus-gaap:DesignatedAsHedgingInstrumentMember2024-08-020000060667low:FixedToFloatingInterestRateSwapsMemberus-gaap:FairValueHedgingMemberus-gaap:DesignatedAsHedgingInstrumentMember2023-08-040000060667low:FixedToFloatingInterestRateSwapsMemberus-gaap:FairValueHedgingMemberus-gaap:DesignatedAsHedgingInstrumentMember2024-02-020000060667low:ShareRepurchaseProgramMember2024-08-020000060667low:AcceleratedShareRepurchaseMember2024-02-032024-08-020000060667low:AcceleratedShareRepurchaseMember2024-05-030000060667low:AcceleratedShareRepurchaseMember2024-02-032024-05-030000060667low:AcceleratedShareRepurchaseMember2024-08-020000060667low:AcceleratedShareRepurchaseMember2024-05-042024-08-020000060667low:OpenMarketPurchasesMember2024-05-042024-08-020000060667low:OpenMarketPurchasesMember2024-02-032024-08-020000060667low:ShareRepurchaseProgramMember2024-05-042024-08-020000060667low:ShareRepurchaseProgramMember2023-05-062023-08-040000060667low:SharesRepurchasedFromEmployeesMember2024-05-042024-08-020000060667low:SharesRepurchasedFromEmployeesMember2023-05-062023-08-040000060667low:SharesRepurchaseProgramAndSharesRepurchasedFromEmployeesMember2024-05-042024-08-020000060667low:SharesRepurchaseProgramAndSharesRepurchasedFromEmployeesMember2023-05-062023-08-040000060667low:ShareRepurchaseProgramMember2024-02-032024-08-020000060667low:ShareRepurchaseProgramMember2023-02-042023-08-040000060667low:SharesRepurchasedFromEmployeesMember2024-02-032024-08-020000060667low:SharesRepurchasedFromEmployeesMember2023-02-042023-08-040000060667low:SharesRepurchaseProgramAndSharesRepurchasedFromEmployeesMember2024-02-032024-08-020000060667low:SharesRepurchaseProgramAndSharesRepurchasedFromEmployeesMember2023-02-042023-08-04

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 2, 2024
or 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to  ______
Commission File Number 1-7898
lowesgraphicimage01.jpg
LOWE’S COMPANIES, INC.
(Exact name of registrant as specified in its charter)
North Carolina56-0578072
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
1000 Lowes Blvd., Mooresville, North Carolina
28117
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code:
(704) 758-1000
Former name, former address and former fiscal year, if changed since last report: Not Applicable
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.50 per shareLOWNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes   No
Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes   No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
CLASSOUTSTANDING AT 8/27/2024
Common Stock, $0.50 par value567,294,169



LOWE’S COMPANIES, INC.
- TABLE OF CONTENTS -
Page No.
Item 1.
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 5.
Item 6.
i
lowes logo.jpg

FORWARD-LOOKING STATEMENTS

This Form 10-Q includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements including words such as “believe”, “expect”, “anticipate”, “plan”, “desire”, “project”, “estimate”, “intend”, “will”, “should”, “could”, “would”, “may”, “strategy”, “potential”, “opportunity”, “outlook”, “scenario”, “guidance”, and similar expressions are forward-looking statements. Forward-looking statements involve, among other things, expectations, projections, and assumptions about future financial and operating results, objectives (including objectives related to environmental and social matters), business outlook, priorities, sales growth, shareholder value, capital expenditures, cash flows, the housing market, the home improvement industry, demand for products and services including customer acceptance of new offerings and initiatives, macroeconomic conditions and consumer spending, share repurchases, and Lowe’s strategic initiatives, including those relating to acquisitions and dispositions and the impact of such transactions on our strategic and operational plans and financial results. Such statements involve risks and uncertainties and we can give no assurance that they will prove to be correct. Actual results may differ materially from those expressed or implied in such statements.

A wide variety of potential risks, uncertainties, and other factors could materially affect our ability to achieve the results either expressed or implied by these forward-looking statements including, but not limited to, changes in general economic conditions, such as volatility and/or lack of liquidity from time to time in U.S. and world financial markets and the consequent reduced availability and/or higher cost of borrowing to Lowe’s and its customers, slower rates of growth in real disposable personal income that could affect the rate of growth in consumer spending, inflation and its impacts on discretionary spending and on our costs, shortages, and other disruptions in the labor supply, interest rate and currency fluctuations, home price appreciation or decreasing housing turnover, age of housing stock, the availability of consumer credit and of mortgage financing, trade policy changes or additional tariffs, outbreaks of pandemics, fluctuations in fuel and energy costs, inflation or deflation of commodity prices, natural disasters, geopolitical or armed conflicts, acts of both domestic and international terrorism, and other factors that can negatively affect our customers.

Investors and others should carefully consider the foregoing factors and other uncertainties, risks and potential events including, but not limited to, those described in “Item 1A - Risk Factors” and “Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates” in our most recent Annual Report on Form 10-K and as may be updated from time to time in our quarterly reports on Form 10-Q or other subsequent filings with the SEC. All such forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update these statements other than as required by law.

lowes logo.jpg
ii

Part I - FINANCIAL INFORMATION
Item 1. Financial Statements
Lowe’s Companies, Inc.
Consolidated Statements of Earnings (Unaudited)
In Millions, Except Per Share and Percentage Data
 Three Months EndedSix Months Ended
 August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Current EarningsAmount% SalesAmount% SalesAmount% SalesAmount% Sales
Net sales$23,586 100.00 %$24,956 100.00 %$44,950 100.00 %$47,304 100.00 %
Cost of sales15,691 66.53 16,557 66.34 29,965 66.66 31,378 66.33 
Gross margin7,895 33.47 8,399 33.66 14,985 33.34 15,926 33.67 
Expenses:
Selling, general and administrative4,025 17.07 4,086 16.38 8,034 17.88 7,912 16.73 
Depreciation and amortization423 1.79 427 1.71 851 1.89 841 1.78 
Operating income3,447 14.61 3,886 15.57 6,100 13.57 7,173 15.16 
Interest – net317 1.34 341 1.36 669 1.49 689 1.45 
Pre-tax earnings3,130 13.27 3,545 14.21 5,431 12.08 6,484 13.71 
Income tax provision 747 3.17 872 3.50 1,294 2.88 1,551 3.28 
Net earnings$2,383 10.10 %$2,673 10.71 %$4,137 9.20 %$4,933 10.43 %
Weighted average common shares outstanding – basic568 584 570 590 
Basic earnings per common share$4.18 $4.56 $7.24 $8.34 
Weighted average common shares outstanding – diluted570 585 571 591 
Diluted earnings per common share$4.17 $4.56 $7.23 $8.32 
See accompanying notes to the consolidated financial statements (unaudited).



Lowe’s Companies, Inc.
Consolidated Statements of Comprehensive Income (Unaudited)
In Millions, Except Percentage Data
 Three Months EndedSix Months Ended
 August 2, 2024August 4, 2023August 2, 2024August 4, 2023
 Amount% SalesAmount% SalesAmount% SalesAmount% Sales
Net earnings$2,383 10.10 %$2,673 10.71 %$4,137 9.20 %$4,933 10.43 %
Foreign currency translation adjustments – net of tax  5 0.01   5 0.01 
Cash flow hedges – net of tax(3)(0.01)(3)(0.01)(6)(0.01)(6)(0.02)
Other2 0.01   1    
Other comprehensive (loss)/income(1) 2  (5)(0.01)(1)(0.01)
Comprehensive income$2,382 10.10 %$2,675 10.71 %$4,132 9.19 %$4,932 10.42 %
See accompanying notes to the consolidated financial statements (unaudited).
1
lowes logo.jpg

Lowe’s Companies, Inc.
Consolidated Balance Sheets (Unaudited)
In Millions, Except Par Value Data
August 2,
2024
August 4,
2023
February 2,
2024
Assets
Current assets:
Cash and cash equivalents$4,360 $3,494 $921 
Short-term investments 330 374 307 
Merchandise inventory – net16,841 17,422 16,894 
Other current assets806 946 949 
Total current assets22,337 22,236 19,071 
Property, less accumulated depreciation17,515 17,373 17,653 
Operating lease right-of-use assets3,819 3,650 3,733 
Long-term investments 292 182 252 
Deferred income taxes – net184 230 248 
Other assets787 850 838 
Total assets$44,934 $44,521 $41,795 
Liabilities and shareholders' deficit
Current liabilities:
Current maturities of long-term debt$1,290 $592 $537 
Current operating lease liabilities552 534 487 
Accounts payable10,336 10,333 8,704 
Accrued compensation and employee benefits 1,055 1,026 954 
Deferred revenue1,417 1,566 1,408 
Other current liabilities3,596 3,561 3,478 
Total current liabilities18,246 17,612 15,568 
Long-term debt, excluding current maturities 34,659 35,839 35,384 
Noncurrent operating lease liabilities3,738 3,611 3,737 
Deferred revenue – Lowe's protection plans1,256 1,231 1,225 
Other liabilities 798 960 931 
Total liabilities58,697 59,253 56,845 
Shareholders' deficit:
Preferred stock, $5 par value: Authorized – 5.0 million shares; Issued and outstanding – none
   
Common stock, $0.50 par value: Authorized – 5.6 billion shares; Issued and outstanding – 568 million, 582 million, and 574 million shares, respectively
284 291 287 
Capital in excess of par value 12  
Accumulated deficit(14,342)(15,341)(15,637)
Accumulated other comprehensive income295 306 300 
Total shareholders' deficit(13,763)(14,732)(15,050)
Total liabilities and shareholders' deficit$44,934 $44,521 $41,795 
See accompanying notes to the consolidated financial statements (unaudited).
lowes logo.jpg
2

Lowe’s Companies, Inc.
Consolidated Statements of Shareholders’ Deficit (Unaudited)
In Millions
Three Months Ended August 2, 2024
Common StockCapital in Excess
of Par Value
Accumulated DeficitAccumulated Other
Comprehensive Income
Total
SharesAmount
Balance May 3, 2024572 $286 $ $(15,188)$296 $(14,606)
Net earnings— — — 2,383 — 2,383 
Other comprehensive loss— — — — (1)(1)
Cash dividends declared, $1.15 per share
— — — (654)— (654)
Share-based payment expense — — 60 — — 60 
Repurchases of common stock (4)(2)(129)(883)— (1,014)
Issuance of common stock under share-based payment plans— — 69 — — 69 
Balance August 2, 2024568 $284 $ $(14,342)$295 $(13,763)
Six Months Ended August 2, 2024
Common StockCapital in Excess
of Par Value
Accumulated DeficitAccumulated Other
Comprehensive Income
Total
SharesAmount
Balance February 2, 2024574 $287 $ $(15,637)$300 $(15,050)
Net earnings— — — 4,137 — 4,137 
Other comprehensive loss— — — — (5)(5)
Cash dividends declared, $2.25 per share
— — — (1,283)— (1,283)
Share-based payment expense— — 110 — — 110 
Repurchases of common stock(7)(4)(193)(1,559)— (1,756)
Issuance of common stock under share-based payment plans1 1 83 — — 84 
Balance August 2, 2024568 $284 $ $(14,342)$295 $(13,763)
3
lowes logo.jpg

Three Months Ended August 4, 2023
Common StockCapital in Excess
of Par Value
Accumulated DeficitAccumulated Other
Comprehensive Income
Total
SharesAmount
Balance May 5, 2023592 $296 $ $(15,310)$304 $(14,710)
Net earnings— — — 2,673 — 2,673 
Other comprehensive income— — — — 2 2 
Cash dividends declared, $1.10 per share
— — — (641)— (641)
Share-based payment expense— — 58 — — 58 
Repurchases of common stock(10)(5)(117)(2,063)— (2,185)
Issuance of common stock under share-based payment plans— — 71 — — 71 
Balance August 4, 2023582 $291 $12 $(15,341)$306 $(14,732)
Six Months Ended August 4, 2023
Common StockCapital in Excess
of Par Value
Accumulated DeficitAccumulated Other
Comprehensive Income
Total
SharesAmount
Balance February 3, 2023601 $301 $ $(14,862)$307 $(14,254)
Net earnings— — — 4,933 — 4,933 
Other comprehensive loss— — — — (1)(1)
Cash dividends declared, $2.15 per share
— — — (1,266)— (1,266)
Share-based payment expense — — 113 — — 113 
Repurchases of common stock (21)(11)(176)(4,146)— (4,333)
Issuance of common stock under share-based payment plans2 1 75 — — 76 
Balance August 4, 2023582 $291 $12 $(15,341)$306 $(14,732)
See accompanying notes to the consolidated financial statements (unaudited).

lowes logo.jpg
4

Lowe’s Companies, Inc.
Consolidated Statements of Cash Flows (Unaudited)
In Millions
Six Months Ended
August 2, 2024August 4, 2023
Cash flows from operating activities:
Net earnings $4,137 $4,933 
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization967 941 
Noncash lease expense260 241 
Deferred income taxes66 23 
(Gain)/loss on property and other assets – net(4)23 
Gain on sale of business(43)(67)
Share-based payment expense110 113 
Changes in operating assets and liabilities:
Merchandise inventory – net53 1,109 
Other operating assets129 224 
Accounts payable 1,679 (191)
Other operating liabilities61 (1,381)
Net cash provided by operating activities7,415 5,968 
Cash flows from investing activities:
Purchases of investments(628)(878)
Proceeds from sale/maturity of investments571 811 
Capital expenditures(808)(765)
Proceeds from sale of property and other long-term assets22 17 
Proceeds from sale of business43 123 
Other – net (23)
Net cash used in investing activities(800)(715)
Cash flows from financing activities:
Net change in commercial paper (499)
Net proceeds from issuance of debt 2,983 
Repayment of debt(47)(45)
Proceeds from issuance of common stock under share-based payment plans84 76 
Cash dividend payments(1,262)(1,257)
Repurchases of common stock(1,930)(4,356)
Other – net(21)(9)
Net cash used in financing activities(3,176)(3,107)
Net increase in cash and cash equivalents3,439 2,146 
Cash and cash equivalents, beginning of period921 1,348 
Cash and cash equivalents, end of period$4,360 $3,494 
See accompanying notes to the consolidated financial statements (unaudited).
5
lowes logo.jpg

Lowe’s Companies, Inc.
Notes to Consolidated Financial Statements (Unaudited)

Note 1: Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements (unaudited) and notes to the condensed consolidated financial statements (unaudited) are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The condensed consolidated financial statements (unaudited), in the opinion of management, contain all normal recurring adjustments necessary to present fairly the consolidated balance sheets as of August 2, 2024, and August 4, 2023, and the statements of earnings, comprehensive income, and shareholders’ deficit for the three and six months ended August 2, 2024, and August 4, 2023, and cash flows for the six months ended August 2, 2024, and August 4, 2023. The February 2, 2024, consolidated balance sheet was derived from the audited financial statements.

These interim condensed consolidated financial statements (unaudited) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Lowe’s Companies, Inc. (the Company) Annual Report on Form 10-K for the fiscal year ended February 2, 2024 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year.

Accounting Pronouncements Not Yet Adopted

There have been no significant changes in the accounting pronouncements not yet adopted from those disclosed in the Annual Report. Accounting pronouncements not disclosed in this Form 10-Q or in the Annual Report are either not applicable to the Company or are not expected to have a material impact to the Company.

Note 2: Revenue

Net sales consists primarily of revenue, net of sales tax, associated with contracts with customers for the sale of goods and services in amounts that reflect consideration the Company is entitled to in exchange for those goods and services.

The following table presents the Company’s sources of revenue:
(In millions)Three Months EndedSix Months Ended
August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Products $22,709 $24,035 $43,396 $45,605 
Services548 578 1,080 1,107 
Other329 343 474 592 
Net sales$23,586 $24,956 $44,950 $47,304 

A provision for anticipated merchandise returns is provided through a reduction of sales and cost of sales in the period that the related sales are recorded.  The merchandise return reserve is presented on a gross basis, with a separate asset and liability included in the consolidated balance sheets. The balances and classification within the consolidated balance sheets for anticipated sales returns and the associated right of return assets are as follows:
(In millions)ClassificationAugust 2,
2024
August 4,
2023
February 2,
2024
Anticipated sales returnsOther current liabilities$207 $256 $191 
Right of return assetsOther current assets119 149 111 

Deferred revenue - retail and stored-value cards
Retail deferred revenue consists of amounts received for which customers have not yet taken possession of the merchandise or for which installation has not yet been completed. The majority of revenue for goods and services is recognized in the quarter following revenue deferral. Stored-value cards deferred revenue includes outstanding stored-value cards such as gift cards and
lowes logo.jpg
6

returned merchandise credits that have not yet been redeemed. Deferred revenue for retail and stored-value cards are as follows:
(In millions)August 2,
2024
August 4,
2023
February 2,
2024
Retail deferred revenue$922 $1,006 $796 
Stored-value cards deferred revenue495 560 612 
Deferred revenue$1,417 $1,566 $1,408 

Deferred revenue - Lowe’s protection plans
The Company defers revenues for its separately-priced long-term extended protection plan contracts (Lowe’s protection plans) and recognizes revenue on a straight-line basis over the respective contract term. Expenses for claims are recognized in cost of sales when incurred.
(In millions)August 2,
2024
August 4,
2023
February 2,
2024
Deferred revenue - Lowe’s protection plans$1,256 $1,231 $1,225 

Three Months EndedSix Months Ended
(In millions)August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Lowe’s protection plans deferred revenue recognized into sales$140 $136 $279 $272 
Lowe’s protection plans claim expenses50 54 104 107 

Disaggregation of Revenues

The following table presents the Company’s net sales disaggregated by merchandise division:
Three Months EndedSix Months Ended
August 2, 2024August 4, 2023August 2, 2024August 4, 2023
(In millions)Net Sales%Net Sales%Net Sales%Net Sales%
Home Décor1
$8,182 34.7 %$8,688 34.8 %$15,848 35.3 %$16,903 35.7 %
Hardlines2
7,709 32.7 8,297 33.2 14,344 31.9 15,022 31.8 
Building Products3
7,085 30.0 7,336 29.4 13,740 30.6 14,239 30.1 
Other610 2.6 635 2.6 1,018 2.2 1,140 2.4 
Total$23,586 100.0 %$24,956 100.0 %$44,950 100.0 %$47,304 100.0 %
Note: Merchandise division net sales for the prior period have been reclassified to conform to the current period presentation.
1    Home Décor includes the following product categories: Appliances, Décor, Flooring, Kitchens & Bath, and Paint.
2    Hardlines includes the following product categories: Hardware, Lawn & Garden, Seasonal & Outdoor Living, and Tools.
3    Building Products includes the following product categories: Building Materials, Electrical, Lumber, Millwork, and Rough Plumbing.

Note 3: Restricted Investments

Short-term and long-term investments include restricted balances pledged as collateral primarily for the Lowe’s protection plans program and are as follows:
(In millions)August 2, 2024August 4, 2023February 2, 2024
Short-term restricted investments$330 $374 $307 
Long-term restricted investments292 182 252 
Total restricted investments$622 $556 $559 

7
lowes logo.jpg

Note 4: Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows:

Level 1 - inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities
Level 2 - inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly
Level 3 - inputs to the valuation techniques that are unobservable for the assets or liabilities

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of August 2, 2024, August 4, 2023, and February 2, 2024:
Fair Value Measurements at
(In millions)ClassificationMeasurement LevelAugust 2,
2024
August 4,
2023
February 2,
2024
Available-for-sale debt securities:
U.S. Treasury securitiesShort-term investmentsLevel 1$184 $138 $152 
Money market fundsShort-term investmentsLevel 181 85 56 
Commercial paperShort-term investmentsLevel 229 17 5 
Corporate debt securitiesShort-term investmentsLevel 221 62 50 
Certificates of depositShort-term investmentsLevel 1 13 72 42 
Municipal obligationsShort-term investmentsLevel 22  2 
U.S. Treasury securitiesLong-term investmentsLevel 1188 166 213 
Corporate debt securitiesLong-term investmentsLevel 279 14 35 
Foreign government debt securitiesLong-term investmentsLevel 222  4 
Municipal obligationsLong-term investmentsLevel 23 2  
Derivative instruments:
Fixed-to-floating interest rate swapsOther liabilitiesLevel 2$57 $92 $76 

There were no transfers between Levels 1, 2, or 3 during any of the periods presented.

When available, quoted prices were used to determine fair value.  When quoted prices in active markets were available, financial assets were classified within Level 1 of the fair value hierarchy.  When quoted prices in active markets were not available, fair values for financial assets and liabilities classified within Level 2 were determined using pricing models, and the inputs to those pricing models were based on observable market inputs.  The inputs to the pricing models were typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others.

The Company has performance-based contingent consideration related to the fiscal 2022 sale of the Canadian retail business which is classified as a Level 3 long-term investment and such contingent consideration had an estimated fair value of zero as of August 2, 2024, August 4, 2023, and February 2, 2024. The Company’s measurements of fair value of the contingent consideration are based on an income approach, which requires certain assumptions considering operating performance of the business and a risk-adjusted discount rate. Changes in the estimated fair value of the contingent consideration are recognized within selling, general and administrative expenses (SG&A) in the consolidated statements of earnings.

lowes logo.jpg
8

The rollforward of the fair value of contingent consideration for the three and six months ended August 2, 2024 and August 4, 2023, is as follows:
Three Months EndedSix Months Ended
(In millions)August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Beginning balance$ $ $ $21 
Change in fair value43  43 102 
Proceeds received(43) (43)(123)
Ending balance$ $ $ $ 

Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis

During the three and six months ended August 2, 2024, and August 4, 2023, the Company had no material measurements of assets and liabilities at fair value on a nonrecurring basis subsequent to their initial recognition.

Other Fair Value Disclosures

The Company’s financial assets and liabilities not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, short-term borrowings, accounts payable, and long-term debt and are reflected in the financial statements at cost. With the exception of long-term debt, cost approximates fair value for these items due to their short-term nature. As further described in Note 7, certain long-term debt is associated with a fair value hedge and the changes in fair value of the hedged debt is included in the carrying value of long-term debt in the consolidated balance sheets. The fair values of the Company’s unsecured notes were estimated using quoted market prices. The fair values of the Company’s mortgage notes were estimated using discounted cash flow analyses, based on the future cash outflows associated with these arrangements and discounted using the applicable incremental borrowing rate.

Carrying amounts and the related estimated fair value of the Company’s long-term debt, excluding finance lease obligations, are as follows:
August 2, 2024August 4, 2023February 2, 2024
(In millions)Carrying AmountFair ValueCarrying AmountFair ValueCarrying AmountFair Value
Unsecured notes (Level 1)$35,440 $32,748 $35,881 $31,898 $35,409 $32,757 
Mortgage notes (Level 2)1 1 2 2 2 2 
Long-term debt (excluding finance lease obligations)
$35,441 $32,749 $35,883 $31,900 $35,411 $32,759 

Note 5: Accounts Payable
The Company has an agreement with a third party to provide a supplier finance program which facilitates participating suppliers’ ability to finance payment obligations from the Company with designated third-party financial institutions. Participating suppliers may, at their sole discretion, make offers to finance one or more payment obligations of the Company prior to their scheduled due dates at a discounted price to participating financial institutions. The Company’s outstanding payment obligations that suppliers financed to participating financial institutions, which are included in accounts payable on the consolidated balance sheets, are as follows:
(In millions)August 2, 2024August 4, 2023February 2, 2024
Financed payment obligations$1,447 $1,475 $1,356 

Note 6: Debt
The Company’s commercial paper program is supported by the $2.0 billion five-year unsecured revolving credit agreement entered into in September 2023 (2023 Credit Agreement), which amended and restated the Company’s $2.0 billion five-year unsecured revolving credit agreement entered into in March 2020, and as amended (2020 Credit Agreement), and the $2.0 billion five-year unsecured third amended and restated credit agreement entered into in December 2021, and as amended (Third Amended and Restated Credit Agreement).  The amounts available to be drawn under the 2023 Credit Agreement and the Third Amended and Restated Credit Agreement are reduced by the amount of borrowings under the commercial paper program. As
9
lowes logo.jpg

of August 2, 2024, August 4, 2023, and February 2, 2024, there were no outstanding borrowings under the Company’s commercial paper program, the 2023 Credit Agreement, or the Third Amended and Restated Credit Agreement. Total combined availability under the 2023 Credit Agreement and the Third Amended and Restated Credit Agreement was $4.0 billion as of August 2, 2024.

Note 7: Derivative Instruments

The Company utilizes fixed-to-floating interest rate swap agreements as fair value hedges on certain debt. The notional amounts for the Company’s material derivative instruments are as follows:
(In millions)August 2,
2024
August 4,
2023
February 2,
2024
Fair value hedges:
Fixed-to-floating interest rate swap agreements$850$850$850

See Note 4 for the gross fair values of the Company’s outstanding derivative financial instruments and corresponding fair value classifications. The cash flows related to settlement of the Company’s hedging derivative financial instruments are classified in the consolidated statements of cash flows based on the nature of the underlying hedged items.

The Company accounts for the fixed-to-floating interest rate swap agreements as fair value hedges using the shortcut method of accounting under which the hedges are assumed to be perfectly effective. Thus, the change in fair value of the derivative instruments offsets the change in fair value on the hedged debt, and there is no net impact in the consolidated statements of earnings from the fair value of the derivatives.

Note 8: Shareholders’ Deficit

The Company has a share repurchase program that is executed through purchases made from time to time either in the open market, which may be made under pre-set trading plans meeting the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934, or through private off-market transactions. Shares purchased under the repurchase program are returned to authorized and unissued status. Any excess of cost over par value is charged to additional paid-in capital to the extent that a balance is present. Once additional paid-in capital is fully depleted, remaining excess of cost over par value is charged to accumulated deficit. As of August 2, 2024, the Company had $12.9 billion remaining in its share repurchase program.

During the six months ended August 2, 2024, the Company entered into Accelerated Share Repurchase (ASR) agreements with third-party financial institutions to repurchase a total of 3.0 million shares of the Company’s common stock for $700 million. The terms of the ASR agreements entered into during the six months ended August 2, 2024, are as follows (in millions):
Agreement Execution
Date
Agreement Settlement
Date
ASR
Agreement Amount
Initial Shares Delivered at InceptionAdditional Shares Delivered at SettlementTotal Shares Delivered
Q1 2024Q1 2024$325 1.1 0.2 1.3
Q2 2024Q2 2024375 1.4 0.3 1.7

In addition, the Company repurchased shares of its common stock through the open market as follows:
Three Months EndedSix Months Ended
August 2, 2024August 2, 2024
(In millions)SharesCostSharesCost
Open market share repurchases2.7$637 4.1 $964 

The Company also withholds shares from employees to satisfy either the exercise price of stock options exercised or the statutory withholding tax liability resulting from the vesting of share-based awards.

lowes logo.jpg
10

Total shares repurchased for the three and six months ended August 2, 2024, and August 4, 2023, were as follows:
Three Months Ended
August 2, 2024August 4, 2023
(In millions)SharesCostSharesCost
Share repurchase program1
4.4 $1,012 10.1 $2,182 
Shares withheld from employees 2  3 
Total share repurchases4.4 $1,014 10.1 $2,185 
Six Months Ended
August 2, 2024August 4, 2023
(In millions)SharesCostSharesCost
Share repurchase program1
7.1 $1,664 20.0 $4,200 
Shares withheld from employees0.4 92 0.7 133 
Total share repurchases7.5 $1,756 20.7 $4,333 
1 Includes excise tax on share repurchases in excess of issuances as part of the cost basis of the shares acquired.

Note 9: Earnings Per Share

The Company calculates basic and diluted earnings per common share using the two-class method. The following table reconciles earnings per common share for the three and six months ended August 2, 2024, and August 4, 2023:
Three Months EndedSix Months Ended
(In millions, except per share data)August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Basic earnings per common share:
Net earnings
$2,383 $2,673 $4,137 $4,933 
Less: Net earnings allocable to participating securities
(6)(7)(10)(13)
Net earnings allocable to common shares, basic
$2,377 $2,666 $4,127 $4,920 
Weighted-average common shares outstanding
568 584 570 590 
Basic earnings per common share
$4.18 $4.56 $7.24 $8.34 
Diluted earnings per common share:
  
Net earnings
$2,383 $2,673 $4,137 $4,933 
Less: Net earnings allocable to participating securities
(6)(7)(10)(13)
Net earnings allocable to common shares, diluted
$2,377 $2,666 $4,127 $4,920 
Weighted-average common shares outstanding
568 584 570 590 
Dilutive effect of non-participating share-based awards
2 1 1 1 
Weighted-average common shares, as adjusted
570 585 571 591 
Diluted earnings per common share$4.17 $4.56 $7.23 $8.32 
Anti-dilutive securities excluded from diluted weighted-average common shares0.5 0.5 0.4 0.5 

11
lowes logo.jpg

Note 10: Supplemental Disclosure

Net interest expense is comprised of the following:
Three Months EndedSix Months Ended
(In millions)August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Long-term debt$364 $368 $729 $711 
Short-term borrowings 1  15 
Lease obligations6 6 12 12 
Interest income(52)(35)(74)(51)
Interest capitalized(1)(1)(2)(2)
Interest on tax uncertainties  3  
Other 2 1 4 
Interest – net$317 $341 $669 $689 

Supplemental disclosures of cash flow information:
Six Months Ended
(In millions)August 2, 2024August 4, 2023
Cash paid for interest, net of amount capitalized$735 $716 
Cash paid for income taxes – net1,2
1,004 2,565 
Non-cash investing and financing activities:
Leased assets obtained in exchange for new finance lease liabilities$33 $22 
Leased assets obtained in exchange for new operating lease liabilities3
353 379 
Cash dividends declared but not paid654 641 
1 Cash paid for income taxes - net for the six months ended August 2, 2024 includes $541 million of cash paid for the purchase of federal transferable tax credits.
2 Cash paid for income taxes - net for the six months ended August 4, 2023 includes $1.2 billion of estimated income tax payments for the third and fourth quarter of fiscal 2022 that were deferred under the Internal Revenue Service’s income tax relief for businesses located in states affected by Hurricane Ian.
3 Excludes $20 million of leases signed but not yet commenced as of August 2, 2024.
lowes logo.jpg
12

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Lowe’s Companies, Inc.

Results of Review of Interim Financial Information

We have reviewed the accompanying consolidated balance sheets of Lowe’s Companies, Inc. and subsidiaries (the “Company”) as of August 2, 2024 and August 4, 2023, the related consolidated statements of earnings, comprehensive income, and shareholders’ deficit for the fiscal three-month and six-month periods ended August 2, 2024 and August 4, 2023, and cash flows for the fiscal six-month periods ended August 2, 2024 and August 4, 2023, and the related notes (collectively referred to as the “interim financial information”). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of February 2, 2024, and the related consolidated statements of earnings, comprehensive income, shareholders’ deficit, and cash flows for the fiscal year then ended (not presented herein); and in our report dated March 25, 2024, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of February 2, 2024, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

This interim financial information is the responsibility of the Company’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our review in accordance with standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.



/s/ DELOITTE & TOUCHE LLP

Charlotte, North Carolina
August 29, 2024
13
lowes logo.jpg

Item 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
This discussion and analysis summarizes the significant factors affecting our consolidated operating results, liquidity and capital resources during the three and six months ended August 2, 2024, and August 4, 2023. This discussion and analysis should be read in conjunction with the consolidated financial statements and notes to the consolidated financial statements that are included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2024 (the Annual Report), as well as the consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) contained in this report. Unless otherwise specified, all comparisons made are to the corresponding period of fiscal 2023. This discussion and analysis is presented in four sections:


EXECUTIVE OVERVIEW

The following table highlights our financial results:
Three Months EndedSix Months Ended
(in millions, except per share data)
August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Net sales
$23,586 $24,956 $44,950 $47,304 
Net earnings
2,383 2,673 4,137 4,933 
Diluted earnings per share
4.17 4.56 7.23 8.32 
Net cash provided by operating activities
$7,415 $5,968 
Capital expenditures
808 765 
Repurchases of common stock1
1,756 4,333 
Cash dividend payments
1,262 1,257 
1    Repurchases of common stock on a trade-date basis.

Net sales in the second quarter of fiscal 2024 declined 5.5% to $23.6 billion compared to net sales of $25.0 billion in the second quarter of fiscal 2023. Comparable sales for the second quarter of fiscal 2024 decreased 5.1%, consisting of a 5.9% decrease in comparable customer transactions, partially offset by an increase of 0.8% in comparable average ticket. Net earnings in the second quarter of fiscal 2024 were $2.4 billion, compared to net earnings of $2.7 billion in the second quarter of fiscal 2023. Diluted earnings per common share were $4.17 in the second quarter of fiscal 2024 compared to $4.56 in the second quarter of fiscal 2023. Included in the second quarter of 2024 results was pre-tax income of $43 million consisting of a realized gain on the contingent consideration associated with the fiscal 2022 sale of the Canadian retail business, which increased diluted earnings per common share by $0.07. Excluding the impact of this item, adjusted diluted earnings per common share was $4.10 in the second quarter of 2024 (see the non-GAAP financial measures discussion).

For the first six months of fiscal 2024, cash flows from operating activities were approximately $7.4 billion, with $808 million used for capital expenditures. Continuing to deliver on our commitment to return excess cash to shareholders, during the three months ended August 2, 2024, we repurchased $1.0 billion of common stock and paid $629 million in dividends.

Second quarter fiscal 2024 comparable sales declined 5.1% driven by continued softness in Do-It-Yourself (DIY) demand and unfavorable weather adversely impacting sales in seasonal and other outdoor categories. These pressures were partially offset by positive comparable sales with our Pro customers and online, demonstrating the importance of our ongoing investments in our Total Home strategy and the success of our expanded omnichannel fulfillment offerings.

Despite prolonged sales pressure this quarter, we delivered strong operating performance and disciplined expense management across the Company due to our continued progress of our Perpetual Productivity Improvement (PPI) initiatives. These PPI initiatives give us the agility to adapt and manage expenses in line with sales trends.

While the near-term macroeconomic environment remains uncertain, the core medium-to-long-term drivers of our business are strong: home price appreciation, disposable personal income, and aging housing stock. We also expect that current generational
lowes logo.jpg
14

trends will be supportive of home improvement demand over the long-term. Wee believe we are well-positioned for market share growth when the home improvement market recovers. In the meantime, we plan to invest in technology and innovation as part of our Total Home strategy, while maintaining operational discipline.

OPERATIONS

The following table sets forth the percentage relationship to net sales of each line item of the consolidated statements of earnings (unaudited), as well as the percentage change in dollar amounts from the prior period. This table should be read in conjunction with the following discussion and analysis and the consolidated financial statements (unaudited), including the related notes to the consolidated financial statements (unaudited).
Three Months EndedBasis Point Increase/(Decrease) in Percentage of Net SalesSix Months EndedBasis Point Increase/(Decrease) in Percentage of Net Sales
August 2, 2024August 4, 2023August 2, 2024August 4, 2023
Net sales100.00 %100.00 %N/A100.00 %100.00 %N/A
Gross margin33.47 33.66 (19)33.34 33.67 (33)
Expenses:
Selling, general and administrative17.07 16.38 6917.88 16.73 115
Depreciation and amortization1.79 1.71 81.89 1.78 11
Operating income14.61 15.57 (96)13.57 15.16 (159)
Interest – net1.34 1.36 (2)1.49 1.45 4
Pre-tax earnings13.27 14.21 (94)12.08 13.71 (163)
Income tax provision3.17 3.50 (33)2.88 3.28 (40)
Net earnings10.10 %10.71 %(61)9.20 %10.43 %(123)

The following table sets forth key metrics utilized by management in assessing business performance. This table should be read in conjunction with the following discussion and analysis and the consolidated financial statements (unaudited), including the related notes to the consolidated financial statements (unaudited).
Three Months EndedSix Months Ended
Other MetricsAugust 2, 2024August 4, 2023August 2, 2024August 4, 2023
Comparable sales decrease 1
(5.1)%(1.6)%(4.6)%(2.9)%
Total customer transactions (in millions)
230 244 437 458 
Average ticket 2
$102.71 $102.35 $102.82 $103.33 
At end of period:
Number of stores1,746 1,742 
Sales floor square feet (in millions)195 195 
Average store size selling square feet (in thousands) 3
112 112 
Net earnings to average debt and shareholders’ deficit26.5 %23.7 %
Return on invested capital 4
30.9 %27.8 %
1    A comparable location is defined as a retail location that has been open longer than 13 months. A location that is identified for relocation is no longer considered comparable in the month of its relocation. The relocated location must then remain open longer than 13 months to be considered comparable. A location we decide to close is no longer considered comparable as of the beginning of the month in which we announce its closing. Operating locations which are sold are included in comparable sales until the date of sale. Comparable sales are presented on a transacted basis when tender is accepted from a customer. Comparable sales include online sales, which positively impacted second quarter fiscal 2024 and fiscal 2023 comparable sales by approximately 30 basis points and 70 basis points, respectively, and year-to-date fiscal 2024 and fiscal 2023 sales by approximately 20 basis points and 65 basis points, respectively. The comparable store sales calculation included in the preceding table was calculated using comparable 13-week and 26-week periods.
2    Average ticket is defined as net sales divided by the total number of customer transactions.
3    Average store size selling square feet is defined as sales floor square feet divided by the number of stores open at the end of the period.
4    Return on invested capital is calculated using a non-GAAP financial measure. See below for additional information and reconciliations of non-GAAP measures.
15
lowes logo.jpg

Non-GAAP Financial Measures

Adjusted Diluted Earnings Per Share

Adjusted diluted earnings per share is considered a non-GAAP financial measure. The Company believes this non-GAAP financial measure provides useful insight for analysts and investors in understanding the comparison of operational performance for fiscal 2024. Adjusted diluted earnings per share excludes the impact of a certain item, further described below, not contemplated in the Company’s business outlook for fiscal 2024. There were no non-GAAP adjustments to diluted earnings per share for the three months ended August 4, 2023.

Fiscal 2024 Impacts
In the second quarter of fiscal 2024, the Company recognized pre-tax income of $43 million consisting of a realized gain on the contingent consideration associated with the fiscal 2022 sale of the Canadian retail business (Canadian retail business transaction).

Adjusted diluted earnings per share should not be considered an alternative to, or more meaningful indicator of, the Company’s diluted earnings per common share as prepared in accordance with GAAP. The Company’s methods of determining non-GAAP financial measures may differ from the method used by other companies and may not be comparable.

Three Months Ended
August 2, 2024
Pre-Tax Earnings
Tax1
Net Earnings
Diluted earnings per share, as reported$4.17 
Non-GAAP adjustments – per share impacts
Canadian retail business transaction(0.07)— (0.07)
Adjusted diluted earnings per share$4.10