Lowe’s Cos is signaling a renewed lift in home-improvement demand, backed by stronger July sales, a strategic push into the professional contractor market through a substantial acquisition, and an improving quarterly report that reinforces its position in a competitive retail landscape. The company’s latest disclosures, alongside independent analyst commentary, paint a picture of a retailer navigating a complex mix of DIY and professional demand with improving momentum and a path to accelerated scale in the professional segment. The move to acquire Foundation Building Materials for €8.8 billion stands out as a watershed catalyst designed to broaden Lowe’s reach across the professional construction ecosystem, potentially reshaping its ability to compete with other large players in the trades and contractor space. Against this backdrop, Mizuho’s assessment that Lowe’s is gaining traction in core product categories—supported by a stronger July comp and a disciplined approach to cost and product mix—frames the period as a meaningful inflection point for the company’s multi-year growth trajectory. The narrative that emerges from these developments is one of a retailer transitioning from steady growth to a heightened growth runway anchored in professional channel expansion, disciplined operations, and a more diversified revenue base.
Quarterly momentum and July performance
Lowe’s reported a notable uptick in comparable-store sales (comps) in July, reinforcing management’s view that demand in the two primary engine rooms of its business—home improvement projects for DIY customers and services and products for professional contractors—was broadening. In July, Lowe’s comp sales rose 4.7%, a solid improvement that exceeded the pace of Home Depot, which posted a 3.3% gain in the same period. This differential is meaningful because it suggests Lowe’s is gaining traction in the critical categories that determine longer-term growth, including outdoor living, seasonal items, and essential maintenance categories that tend to see durable demand even in softer macro environments. The July momentum did not exist in a vacuum; it was the culmination of a trend in which the company’s efforts to optimize assortments, improve in-store experiences, and enhance cross-channel capabilities began translating into stronger traffic and higher conversion rates, particularly as consumers pushed through late-summer projects before the fall season.
Within the broader second-quarter framework, Lowe’s posted a 1.1% increase in total comparable-store sales, underscored by the tail-end seasonal strength that often arrives in the final weeks of the quarter. The company benefited from online sales growth that complemented steady improvements in brick-and-mortar performance. This combination—mid-single-digit comp growth with online acceleration—helped stabilize the top line and provided a platform for broader margin management initiatives that the company has been prioritizing. The dual-channel strength also signals that Lowe’s is successfully leveraging its omnichannel capabilities to capture demand across multiple touchpoints, including home improvement projects that require a mix of in-store assistance, online research, and efficient delivery or pickup options.
Beyond the topline indicators, Lowe’s achieved a quarterly revenue increase of 1.6%, bringing the figure to approximately €24 billion. This performance aligned with analysts’ expectations, indicating that the company’s forecasted trajectory for the quarter was realized, even as the business navigated a competitive retail environment and macro headwinds that can affect consumer discretionary spending. The earnings picture was similarly constructive. Adjusted earnings per share (EPS) reached €4.33, topping Wall Street expectations of €4.24 per share, a result that reflects not only top-line resilience but also the company’s continued focus on managing operating costs and improving product mix to drive profitability.
Gross margin performance played a key supporting role in the improved profitability profile. The company reported an expansion in gross margins—approximately 40 basis points—driven by disciplined cost control and a more favorable product mix. This margin expansion occurred even as Lowe’s continued to invest in growth initiatives, including marketing, digital enhancements, and supply chain improvements designed to increase efficiency and reduce waste. The margin dynamics underscore the balance Lowe’s has sought to strike between investing for future growth and preserving the unit economics that underpin its earnings power. The net effect of these strategies is a strengthened profitability framework that offers room for further upside if demand remains resilient and the company can continue to optimize its portfolio.
In parallel with the quarterly results, Lowe’s announced a transformative acquisition—the purchase of Foundation Building Materials (FBM) for €8.8 billion. This deal adds more than 370 locations to Lowe’s footprint and about €6.5 billion in annualized revenue, signaling a meaningful expansion of Lowe’s professional services capability and geographic reach. The FBM acquisition is described as a strategic move to deepen Lowe’s scale and capabilities in the professional contractor market, a segment that has become increasingly important for growth as DIY demand evolves and contractors seek integrated supply solutions that combine product breadth with reliable service and delivery. The scale of the FBM deal positions Lowe’s closer to peers that have built robust professional distribution networks, and it is projected to yield symmetrical advantages that could narrow gaps with competitors like SRS Distribution in certain market segments.
Market observers, including Mizuho, viewed the FBM transaction as a strategic amplifier that could elevate Lowe’s competitive positioning in the professional channel. By expanding the number of locations and the annualized revenue base, Lowe’s aims to unlock cross-selling opportunities, optimize procurement and logistics for professional customers, and deliver improved service levels across a wider geographic footprint. The acquisition is also expected to enhance Lowe’s capacity to offer bundled solutions, faster delivery with enhanced inventory availability, and more comprehensive project support for professional contractors. Taken together with the July momentum and the Q2 performance, the FBM deal reinforces Lowe’s strategy of building a more balanced mix between DIY and professional segments, with an emphasis on professional growth that can sustain higher average ticket sizes and longer-term customer relationships.
The evolving balance between DIY and professional demand
The July comp performance and the subsequent expansion through FBM underscore a broader dynamic in Lowe’s business model. On one hand, the DIY segment remains a meaningful driver of traffic and basket size, with steady improvements in consumer confidence and home improvement spending supporting growth. On the other hand, the professional segment is increasingly central to Lowe’s growth narrative. Contractors, commercial customers, and other trade professionals continue to demand a broader set of services and products, including structural materials, fasteners, tools, and specialized equipment, all supported by reliable supply chains and logistics networks. The FBM acquisition directly targets this professional segment, promising enhanced scale and a more integrated service offering that can improve order-to-delivery efficiency and reduce lead times for professional customers who operate on tight project schedules and require dependable supply.
Analysts have noted that the combination of healthy DIY demand with a rising professional tailwind presents Lowe’s with a unique opportunity to capture incremental growth from both sides of the market. The company’s ability to serve DIY homeowners with curated assortments, digital convenience, and efficient in-store experiences remains important for sustaining traffic and optimizing margins. At the same time, enabling professionals to access a broader product portfolio, a more extensive distribution network, and superior service is critical to driving higher ticket sizes and improved customer retention in a sector characterized by project-driven demand. The FBM acquisition is positioned as a catalyst to accelerate this shift, aligning Lowe’s with the expectations of professional customers who prioritize reliability, inventory availability, and timely fulfillment.
Acquisition and strategic positioning: Foundation Building Materials
The Foundation Building Materials acquisition stands out as a cornerstone of Lowe’s strategic repositioning, aimed at expanding its professional contractor ecosystem and accelerating its growth trajectory in a sector that has historically demanded scale, service, and geographic reach. The deal adds more than 370 locations to Lowe’s network, broadening the company’s presence in regions where professional construction activity remains robust and where competition among distributors is intense. The €8.8 billion price tag reflects the perceived long-term value of FBM’s asset base, including its market footprint, customer relationships, supplier arrangements, and the operational expertise embedded in its leadership team.
From a strategic vantage point, the FBM acquisition complements Lowe’s existing strengths in consumer-focused home improvement and expands the company’s capability to serve a broader set of customers in more markets. It is expected to yield several synergies, including cross-selling opportunities between FBM’s professional customer base and Lowe’s extensive DIY audience, improved procurement efficiency through centralized purchasing, and enhanced logistics and delivery capabilities. The expanded platform is also likely to support more robust marketing and loyalty initiatives designed to cultivate deeper customer engagement and repeat business, particularly among professional customers who require ongoing project support.
A critical dimension of the acquisition is its potential to simulate scale parity with professional-distributor peers, including but not limited to SRS Distribution. By achieving a comparable scale, Lowe’s can better compete on service levels, product breadth, and response times—factors that matter to professional customers who operate on tight schedules and require reliable supply chains. The strategic rationale extends beyond immediate market share gains; it encompasses the creation of a more resilient and diversified revenue mix that can help Lowe’s weather fluctuations in consumer spending and construction activity. Analysts have highlighted the upside from FBM in terms of geographic diversification, improved access to professional markets, and the potential to accelerate the integration of professional products into Lowe’s omnichannel ecosystem.
Integration planning for FBM is expected to emphasize the retention of FBM’s existing distribution relationships and operational practices that have contributed to its efficiency. Lowe’s will likely leverage its own investment in technology and digital platforms to streamline ordering and fulfillment across the combined footprint, while preserving the specialized capabilities that FBM brings to professional customers. The net effect could be a more seamless end-to-end solution for professional contractors, with improved inventory availability, faster turnaround times, and a broader range of project-ready materials.
Financial performance: Revenue, margins, and earnings
Lowe’s reported a cohesive earnings story for the period, with a combination of mid-single-digit revenue growth, margin expansion, and a favorable mix shift that supported stronger earnings per share. Revenue growth, while not explosive, reflected the company’s disciplined approach to managing price, promotions, and costs, anchored by a robust online channel and enhanced in-store execution. The 1.6% quarterly revenue increase to about €24 billion demonstrates that Lowe’s is able to sustain top-line momentum in a competitive retail environment, even as macroeconomic conditions present headwinds in some markets. The alignment between revenue growth and earnings strength underscores the company’s effectiveness in balancing growth investments with operational discipline.
Adjusted earnings per share rose to €4.33, surpassing consensus estimates of €4.24. This outperformance indicates that management’s cost-control measures and product mix optimization have translated into meaningful profit improvements, even as Lowe’s continues to fund growth initiatives and bear the upfront costs associated with the FBM acquisition. The gross margin expansion, recorded at roughly 40 basis points, reflects a combination of price realization, improved product mix, and leaner execution. By maintaining a focus on improving gross margins, Lowe’s has positioned itself to sustain profitability even as it pursues growth through acquisitions and channel expansion.
The acquisition’s impact on revenue and margins will become more visible over time as FBM’s operations are integrated into Lowe’s. Investors and analysts will be paying close attention to how synergies materialize in the balance sheet, including cost savings from centralized procurement, inventory optimization across a larger distribution network, and potential changes in working capital requirements. The scale-up of professional business activity, supported by FBM’s locations and relationships, is anticipated to contribute to higher gross profit opportunities, given the professional sector’s relatively higher-margin product mix and service levels.
The earnings guidance took shape alongside these results. Lowe’s raised its full-year expectations, signaling confidence in its ability to maintain momentum and to execute on the strategic expansion plan. The company guided for 3Q comparable sales growth in a range of 0% to 2.5%, reflecting a cautious but constructive outlook for period-over-period demand. The revised financial trajectory includes a projected full-year EPS in the €12.20 to €12.45 range and annual revenue of €84.5 to €85.5 billion. This outlook indicates that management believes the ongoing initiatives—namely improved DIY and professional sales momentum, the FBM acquisition’s integration potential, and continued cost discipline—can deliver a sustainable revenue base and earnings trajectory across the remainder of the year.
Analysts, including Mizuho, have reinforced a positive stance on Lowe’s stock, citing the continued improvement in consumer and professional demand and the long-term growth potential unlocked by the FBM acquisition. The rating and confidence reflect expectations that Lowe’s can translate near-term gains into longer-term advantages as the professional segment scales and the integrated platform delivers efficiency and cross-selling opportunities. The combination of a stronger July performance, better-than-expected quarterly results, and supportive guidance signals that Lowe’s is navigating the slower macro backdrop with a clear strategic plan anchored in investing for growth while protecting earnings power through cost management and margin discipline.
Strategic significance of the FBM acquisition
The FBM deal represents a significant strategic bet by Lowe’s to accelerate its expansion into the professional contractor market. The addition of FBM’s 370-plus locations positions Lowe’s to deliver more comprehensive service across regions where professional contractors rely on timely deliveries, reliable product availability, and robust technical support. FBM’s footprint complements Lowe’s existing store network and distribution capabilities, enabling the combined entity to offer a broader range of materials and services to professional customers. The objective is not merely to borrow a larger revenue base but to infuse the professional segment with enhanced scale, procurement leverage, and service capabilities that can translate into greater loyalty and higher lifetime value for professional customers.
In practical terms, the FBM acquisition could enable Lowe’s to increase its competitive advantage by offering a more integrated supply solution to contractors who require a mix of materials for framing, finishing, and specialty projects. The scale would also support more efficient logistics and inventory management, reducing lead times and improving the reliability of material supply for ongoing projects. This is particularly important for professional customers who operate on tight schedules and demand consistent, predictable fulfillment. By aligning FBM’s operational strengths with Lowe’s existing capabilities, the combined company can potentially deliver improved service levels and more attractive pricing structures, which are central to sustaining professional customer loyalty and attracting new customers in a crowded market.
The strategic logic of this acquisition extends to the potential for cross-selling opportunities across Lowe’s DIY customer base. FBM’s professional customers can benefit from cross-channel access to Lowe’s product assortment and e-commerce functionalities, while DIY customers may encounter professional-grade materials and solutions through the same platform. This cross-pollination can drive higher average order values and broaden the addressable market for Lowe’s. The synergy potential is particularly pronounced in product categories where DIY and professional segments intersect, such as fastereners, tools, building materials, and outdoor living components, enabling a cohesive ecosystem that serves a wider range of customers with a consistent brand experience.
As Lowe’s advances the integration, it will have to carefully manage cultural alignment, maintain FBM’s existing vendor and contractor relationships, and preserve the operational efficiencies that have contributed to FBM’s profitability. The company’s ability to execute a seamless integration without disrupting service levels will be a critical factor in determining how quickly the expected synergies translate into tangible financial gains. Mizuho’s commentary about the acquisition highlighting the potential for scale parity with peers like SRS Distribution underscores the market’s expectation that the combined entity could achieve meaningful competitive leverage in professional channels.
Guidance, outlook, and analyst perspectives
Lowe’s updated guidance reflects a cautiously optimistic view of the remainder of the year, supported by the observed momentum in July and the ongoing integration work surrounding FBM. The projected 3Q comps in the 0% to 2.5% range indicate management expects the trend to persist, albeit with the potential for short-term fluctuations driven by seasonal dynamics, promotional activities, and macroeconomic factors. The earnings outlook, with EPS guidance of €12.20 to €12.45 for the full year and revenue guidance of €84.5 to €85.5 billion, signals confidence that the gains observed in the first half of the year can be sustained through the back half of the year. The guidance also implies that the integration of FBM will contribute to the topline and margin expansion, supporting a durable earnings profile.
Analysts have responded positively to Lowe’s results and strategic moves. Mizuho, in particular, has maintained an Outperform rating, highlighting several key drivers: the ongoing improvement in DIY and professional sales momentum, the long-term earnings accretion potential of the FBM acquisition, and the expected efficiency gains from integrating FBM into Lowe’s operating framework. The rating suggests that the market should continue to reward Lowe’s for both its near-term execution and its longer-term strategic repositioning. The emphasis on professional channel growth, combined with the company’s disciplined cost management and strong online performance, forms the basis for a favorable view of Lowe’s as a diversified home improvement retailer with a broader earnings runway.
For investors, the implications of the FBM deal extend beyond a single quarter’s numbers. The acquisition is a structural enhancement to Lowe’s ability to compete in the professional contractor space, enabling more robust service levels, improved inventory availability, and expanded geographic coverage. The combination of a practical, well-executed integration plan and the potential for cross-selling across a larger, more capable platform makes the investment compelling for those who view Lowe’s as a strategic beneficiary of ongoing professional market diversification.
Market positioning and sector dynamics
In the broader home improvement landscape, Lowe’s is navigating a market characterized by a blend of resilient DIY demand and an increasingly important professional segment. The competition among large retailers in this space centers on the ability to deliver breadth of products, reliability of supply, and the capacity to serve both casual homeowners and professional contractors with equal efficiency. Lowe’s July performance in comparison with Home Depot’s pace suggests a differential in execution that could influence market share dynamics going forward, especially in categories that drive higher-ticket transactions and repeat visits. The FBM acquisition further intensifies the competitive dynamic by expanding Lowe’s professional capabilities, potentially squeezing margins for peers who have historically commanded a larger professional footprint.
Professional distributors, such as SRS Distribution, have traditionally competed on a combination of scale, supplier relationships, and regional coverage. The FBM acquisition positions Lowe’s to deliver a similar level of scale in professional channels, enabling it to better compete on service levels, on-time delivery, and access to a broader product catalog. As Lowe’s integrates FBM, the market will be closely watching for evidence of improved service metrics, reduced order lead times, and higher acceptance rates for professional orders. The potential to deliver a single, integrated procurement and fulfillment experience across DIY and professional customers could be a differentiator that sets Lowe’s apart from competitors that rely more heavily on specialized distributors or standalone retail formats.
From a strategic perspective, Lowe’s emphasis on professional growth complements its consumer-focused initiatives, including enhancing in-store experiences, sharpening its omnichannel capabilities, and optimizing pricing and promotions to sustain traffic and basket sizes. This dual approach is intended to create a more resilient business model capable of withstanding varied economic scenarios. The FBM acquisition’s potential to diversify revenue streams and reduce reliance on any single customer segment further contributes to a more balanced and durable growth profile, which is an attractive proposition for investors seeking a longer runway for returns.
Operational strategy: cost discipline, online growth, and cross-channel execution
An essential thread running through Lowe’s results is its continued focus on cost discipline and margin optimization. The 40-basis-point gross margin expansion is a tangible indicator of this discipline, reflecting effective cost controls and an improved product mix. The company’s ability to manage expenses while investing in growth initiatives—particularly in the digital space and in professional-service capabilities—will be a key determinant of sustainable profitability as the FBM integration progresses. The omnichannel strategy remains central to Lowe’s operating model, with online growth playing a meaningful role in complementing in-store strengths and enabling more flexible consumer engagement. The company’s digital investments are designed to improve convenience for customers, drive higher conversion rates, and support a more personalized shopping experience across channels.
Inventory management and supply chain execution will be crucial as Lowe’s looks to integrate FBM and optimize its broader product portfolio. Effective inventory alignment across the expanded store network can help reduce stockouts and improve the consistency of product availability for both DIY and professional customers. The logistics and procurement synergies anticipated from the FBM deal are likely to contribute to lower operating costs and improved margins over time, provided the integration is executed efficiently and without excessive disruption to service levels. The company’s emphasis on operational efficiency carries the potential to create a more scalable model that sustains margin gains even as growth accelerates.
From a customer-experience standpoint, Lowe’s continues to emphasize store modernization, service enhancements, and a robust online-offline integration. The goal is to provide a seamless shopping journey that leverages the strengths of both formats: the personalized, hands-on support commonly associated with in-store visits and the convenience, breadth, and fast fulfillment available through digital channels. The FBM acquisition is expected to feed into this strategic objective by providing a stronger base of professional customers who value reliability and efficiency, thereby reinforcing the overall value proposition for Lowe’s.
Outlook, risks, and long-term growth drivers
Looking ahead, Lowe’s remains aligned with a plan to grow through a combination of organic expansion, strategic acquisitions, and continued emphasis on operational excellence. The company’s guidance for the rest of the year reflects a pragmatic approach to expectations, acknowledging that the macro environment may present varying headwinds, while remaining confident that the strategic initiatives—the DIY/professional sales momentum and the FBM integration—will deliver earnings and revenue growth. The professional segment’s growth potential, supported by FBM’s broad footprint and Lowe’s distribution capabilities, constitutes a meaningful long-term growth driver that could yield sustained earnings improvements and a more robust revenue mix.
Key risks to monitor include macroeconomic volatility, shifts in consumer confidence, and potential supply chain disruptions that could affect product availability and delivery times. The integration of FBM carries execution risk, as with any large acquisition, including potential cultural integration challenges, integration costs, and the need to preserve FBM’s existing relationships and operational strengths. The market will also be watching how Lowe’s sustains its margin trajectory as the professional segment scales and as competition intensifies in both price and service levels. The company’s ability to maintain its cost discipline while continuing to invest in digital capabilities, customer experience, and expansion into new markets will be important determinants of whether the current momentum translates into durable, long-term value for shareholders.
On the upside, if demand for both DIY and professional products remains resilient and the FBM integration yields realized synergies sooner than anticipated, Lowe’s could see a stronger-than-expected acceleration in earnings growth and revenue expansion moving into 2025. The cross-channel strategy, the broadened professional footprint, and the improved service metrics could collectively support higher customer retention and longer engagement lifecycles, reinforcing Lowe’s competitive advantage in a dynamic home improvement market. The market’s reaction will hinge on the consistency of the next several quarterly results and the company’s ability to execute on its integration milestones, including the realization of cost savings and revenue synergies that justify the premium paid for FBM.
Conclusion
Lowe’s is signaling a renewed trajectory in home improvement demand, underpinned by a stronger July performance, disciplined cost management, and a strategic expansion into the professional contractor market through the FBM acquisition. The combination of robust DIY momentum, a growing professional customer base, and the integration of FBM’s 370-plus locations and €6.5 billion in annualized revenue is positioned to reshape Lowe’s competitive stance and broaden its earnings power. With guidance pointing to continued growth and an Outperform outlook from key analysts, Lowe’s is showing the capacity to translate near-term momentum into a longer-term, diversified growth narrative. As the company moves through integration milestones and继续 to optimize its omnichannel strategy, investors will be watching to see whether the anticipated synergies unfold as projected, delivering sustained enhancements to profitability, share gains, and a more resilient position in the evolving home improvement landscape.