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Home Depot cuts sales outlook as consumer spending weakens

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Home Depot cuts sales outlook as consumer spending weakens

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Home Depot has slashed its outlook for sales, the latest sign that US consumers are pulling back at a time of high interest rates.

The home hardware retailer said comparable sales would fall by 3 to 4 per cent this year, steeper than its previous forecast of a 1 per cent decline.

The cut to Home Depot’s guidance comes after years of strong inflation stretched the finances of US households. Companies from McDonald’s to Disney have already revealed growing caution by consumers.

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A key factor weighing on Home Depot’s sales has been higher interest rates, said Richard McPhail, chief financial officer. The Federal Reserve has lifted benchmark rates from zero to more than 5 per cent in the past two years in an effort to quell inflation.

Many Home Depot customers are homeowners, and they often finance large projects with debt, McPhail said. Since mid-2023 they have been holding back.

“They have this deferral mindset waiting for the cost of borrowing to go down,” McPhail said in an interview.

However, in the first half of 2024, “our customers are now telling us that general economic uncertainty is weighing on their minds just as much as higher interest rates”, McPhail said. “If you think about the crowding-out that inflation is creating in durable goods, unemployment is beginning to tick up again, [and] just general unease is having an influence on our customers.”

Homeowners who took out mortgages when rates were lower are in many cases staying put. As many big repairs occur when homes change hands, the decrease in turnover has “taken out what’s likely over $10bn in demand in our market”, McPhail added.

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The pressure on sales follows double-digit growth early in the pandemic, as households with surplus savings — and many employees working from home — splashed out on major renovations.

Between fiscal 2019 and 2022, Home Depot’s sales grew by $47bn to $157.4bn. The company has more than 2,300 stores in North America.

Home Depot’s sales totalled $43.2bn in the second quarter that ended in late July, the company said on Tuesday, up 0.6 per cent year on year.

Comparable sales, which cover stores open for at least a year, declined 3.3 per cent in the quarter. During the quarter Home Depot closed a deal to acquire SRS Distribution, a building supply company for professional contractors, at an enterprise value of $18.25bn. 

Home Depot’s net profit was $4.6bn, beating estimates but 2.1 per cent lower than the same quarter a year ago, as costs rose.

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Shares of Home Depot reversed early declines to close 1.2 per cent higher on Tuesday in New York.

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America’s bid for energy supremacy is being forged in war

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America’s bid for energy supremacy is being forged in war

Additional work by Jana Tauschinski

Oil and gas tanker location and destination data are from Kpler. The map shows the latest position for vessels with an active AIS signal on April 19–20, filtered by minimum capacity thresholds: crude tankers of at least 50,000 deadweight tonnage (DWT); oil product tankers of at least 55,000 DWT; oil/chemical tankers of at least 40,000 DWT; LNG carriers of at least 150,000 cubic metres; and LPG carriers of at least 50,000 cubic metres. Net fossil fuel import data by country are based on Ember analysis of the IEA World Energy Balances 2023.

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Roommate faces murder charges in deaths of 2 University of South Florida doctoral students

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Roommate faces murder charges in deaths of 2 University of South Florida doctoral students

A 26-year-old man is facing two counts of first-degree murder in the deaths of two University of South Florida doctoral students who went missing last week, local authorities said Saturday. 

The Hillsborough County Sheriff’s Office in Florida said that evidence presented to the state attorney’s office resulted in the charges against Hisham Abugharbieh, the roommate of Zamil Limon, one of the doctoral students. 

Abugharbieh is accused of premediated murder with a weapon. He was arrested on Friday, the same day Limon was found dead. 

The family of Nahida Bristy, the other doctoral student, told CBS News that police said she is also likely dead. That is based on the volume of blood discovered at Abugharbieh’s residence, which he shared with Limon.

“Police told us she is no longer with us,” Bristy’s brother, Zahid Prato, said early Saturday.

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The family was told her body may never be found and police believe she may have been dismembered, according to Prato. 

CBS News has reached out to police for more information.

Authorities said in a statement Saturday they were still searching for Bristy.

Limon’s remains were found on the Howard Franklin Bridge in Tampa Friday morning, Chief Deputy Joseph Maurer with the Hillsborough County Sheriff’s Office said. His cause of death was pending autopsy results.

Deputies with the sheriff’s office took Abugharbieh into custody on Friday after responding to a domestic violence call at a home in the Lake Forest Community, a neighborhood near USF’s Tampa campus, officials said. He also faces charges of domestic violence and evidence tampering, as well as a charge of failing to report a death to law enforcement.

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Limon and Bristy, both 27, had last been seen in the Tampa area on April 16. 

Limon was studying the use of AI in environmental science and was set to present his doctoral thesis this week, his family said. Bristy is studying chemical engineering. 

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Rubio’s Absence From Iran Talks Highlights Stay-at-Home Role

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Rubio’s Absence From Iran Talks Highlights Stay-at-Home Role

When President Barack Obama negotiated a nuclear deal with Iran more than a decade ago, his point man was Secretary of State John Kerry. Over 20 months of talks, Mr. Kerry met with his Iranian counterpart on at least 18 different days, often several times per day.

High-level nuclear diplomacy was a natural role for the top U.S. diplomat. Secretaries of state traditionally take the lead on the country’s biggest diplomatic tasks, from arms control treaties to Israeli-Palestinian agreements.

But as President Trump prepares to send a delegation to the latest round of U.S.-Iran talks in Pakistan this weekend, his secretary of state, Marco Rubio, will remain where he often does: at home.

Mr. Rubio did not attend the last U.S. meeting with Iran earlier this month. Nor did he join several meetings held over the past year in Geneva and Doha. Mr. Rubio has also been absent from U.S. delegations abroad working to settle the war in Ukraine and Israel’s war in Gaza. Despite a long period of crisis and war in the region, he has not visited the Middle East since a brief stop in Israel last October.

In recent months, Mr. Rubio — consumed with his second role, as Mr. Trump’s national security adviser — has not traveled much at all.

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During the Biden administration, Secretary of State Antony J. Blinken made 11 foreign trips from January 2024 to late April 2024, stopping in roughly three dozen cities, according to the State Department. So far this year, Mr. Rubio has visited six foreign cities, including a stop in Milan for the 2026 Winter Olympics.

Mr. Trump has outsourced much of his diplomacy to others, including his friend Steve Witkoff, a wealthy associate from the world of Manhattan real estate, and his son-in-law, Jared Kushner. Mr. Witkoff and Mr. Kushner have spearheaded diplomacy with Israel, Ukraine and Russia, as well as Iran, whose delegation they will meet for the second time this month in Islamabad, Pakistan’s capital.

Mr. Rubio’s distance from the trenches of diplomacy reflects his dual role on Mr. Trump’s national security team. For the past year, he has served as the White House national security adviser even while leading the State Department — the first person to do so since Henry A. Kissinger in the mid-1970s.

The secretary of state runs the State Department, overseeing U.S. diplomats and embassies worldwide, as well as Washington-based policymakers. Working from the White House, the national security adviser coordinates departments and agencies, including the State Department, to develop policy advice for the president.

The twin roles reflect Mr. Rubio’s influence with Mr. Trump, and offer him a way to maintain it. For Mr. Rubio, less time abroad means more time at the side of an impulsive president prone to making critical national security decisions at any moment.

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As Mr. Witkoff, Mr. Kushner and Vice President JD Vance met with Iranian officials in Pakistan earlier this month, Mr. Rubio was at Mr. Trump’s side at an Ultimate Fighting Championship event, noted Emma Ashford, an analyst of U.S. diplomacy at the nonpartisan Stimson Center in Washington. “Rubio clearly prefers to stay close to Trump,” Ms. Ashford said.

Mr. Rubio accepted the national security adviser job on an acting basis last May after Mr. Trump reassigned the job’s previous occupant, Michael Waltz. But officials say that Mr. Rubio is expected to keep it indefinitely.

That arrangement is not inherently bad, Ms. Ashford added. And she noted that previous presidents had entrusted major diplomatic tasks to people other than the secretary of state. President Joseph R. Biden Jr. delegated his C.I.A. director, William J. Burns, to handle diplomacy with Russia and cease-fire negotiations between Israel and Hamas, for instance.

But she echoed the complaints by many current and former diplomats that Mr. Rubio seems less like someone performing both jobs than a national security adviser who sometimes shows up at the State Department. “I do think it’s to the detriment of the whole department of State and to America’s ability to conduct diplomacy in general that we effectively have the secretary of state position sitting vacant,” she said.

Tommy Pigott, a State Department spokesman, contested such claims. “Anyone trying to paint Secretary Rubio’s close coordination with the White House and other agencies as a negative could not be more wrong,” he said. “We now have an N.S.C. and State Department that are totally in sync, a goal that has eluded past administrations for decades.”

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Mr. Rubio divides his time between the State Department and the White House, often spending time at both in the same day. In an interview with Politico last June, Mr. Rubio said he visited the State Department “almost every day.”

While there, he often meets with visiting dignitaries before returning to the White House. Last week, Mr. Rubio presided over a meeting at the State Department between Lebanese and Israeli officials that set the stage for a cease-fire in Lebanon.

His twin jobs “really do overlap in many cases,” he said. “In many cases you end up being in the same meetings or in the same places; there’s just one less person in there, if you think about it,” Mr. Rubio added. “A lot of people would come to Washington, for example, for meetings, and they’d want to meet with the national security adviser and then meet with me as secretary of state. Now they can do both in one meeting.”

Asked about his travel schedule during a news conference last December, Mr. Rubio said he had less reason to travel abroad because “we have a lot of leaders constantly coming here” to visit Mr. Trump at the White House. Mr. Rubio also joins Mr. Trump’s foreign trips in his capacity as national security adviser.

Many national security veterans call the arrangement unwise, saying that both jobs are extremely demanding and incompatible with one another.

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It was not easy even for Mr. Kissinger, who had firmly established himself over more than four years as national security adviser before convincing President Richard M. Nixon to let him take on an additional role as secretary of state in 1973. (In a reversal of Mr. Rubio’s approach, Mr. Kissinger was in constant motion, including a round of Middle East shuttle diplomacy that kept him on the road for 33 straight days.)

“In general, it’s a mistake to combine those roles,” said Matthew Waxman, who held senior roles at the National Security Council, State Department and the Pentagon during the George W. Bush administration.

“That said, it’s not necessarily a bad thing that a dual-hatted Rubio is so offscreen right now,” Mr. Waxman added. “Especially while so much attention is focused on high-wire diplomacy with Iran, someone needs to manage foreign policy around the rest of the world.”

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