Home Depot Sales Decline: Does It Mean the U.S. Economy Is in Trouble?

Home Depot reported minimal sales growth.

Cooling housing market weighs on consumer spending.

Could signal an economic slowdown.

Home Depot’s latest financial results have sparked concern among analysts and consumers.

The home improvement retail chain, widely regarded as a barometer of middle-class spending, reported figures that reflect a shift in household behavior amid persistent inflation and high interest rates. The Home Depot sales decline is being closely watched as a potential indicator of broader economic stress.

Home Depot Sales Decline Raises Red Flags

Sales at US Home Depot stores open for at least one year rose by just 0.2% in the most recent quarter. In addition, the company cut its profit forecast for the year.

The company attributed the slowdown to consumers cutting back on major home renovations and improvement projects. Mortgage rates, stuck between 6% and 7%, have limited both home buying and selling activity.

“We believe consumer uncertainty and continued pressure in the housing market are disproportionately affecting demand for home improvement,” CEO Ted Decker said, according to CNN.

US Economy and Consumer Spending on Pause

Home Depot sits at the center of the US economy, connecting construction, housing, and consumer spending. When its sales stagnate, it often signals that households are tightening their budgets.

Home Depot’s slowdown. The company revealed that sales at its U.S. stores open for at least one year increased by just 0.2% in the last quarter.
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— Gabriela Frías (@gfrias) November 19, 2025

The cooling housing market has led homeowners to postpone renovations, landlords to delay upgrades, and builders to reduce orders. All of this impacts the supply chain and employment.

Reports describe the business as “stagnant,” a sign that some analysts consider troubling for the overall economy, reinforcing concerns linked to the Home Depot sales decline.

Does This Affect Latinos in the United States?

Many Latinos work in sectors tied to construction and home remodeling. When demand drops, contractors and independent workers face fewer job opportunities.

Home Depot Sales Decline – AME4951. LOS ANGELES (UNITED STATES), 08/31/2025.– Photograph of the façade of a Home Depot store in the Westlake neighborhood on Saturday, in downtown Los Angeles (USA). The parking lot of a Home Depot store in Los Angeles has become, in less than three months, a symbol of the harshness of the Trump administration’s immigration raids, with four operations that have resulted in dozens of detainees and criticism from activists over the use of excessive force and unusual tactics by agents. EFE/Ana Milena Varón.

In addition, inflation—which rose 3% year over year according to the September Consumer Price Index—has forced families to adjust priorities and cut back on major expenses.

What Comes Next

Although an eventual interest rate cut could reactivate the housing market, the outlook for 2026 remains uncertain. If Home Depot is bracing for sluggish sales, it could be an early warning sign of a more fragile economy, making the Home Depot sales decline a key signal to watch in the months ahead.