Home Depot’s top executives are sounding increasingly uneasy about what they are seeing in the aisles: shoppers pulling back on big projects, trading down on materials, and visiting less often. The pattern is not just a blip in one quarter, it is emerging as a stubborn shift in how Americans spend on their homes at a time when housing turnover has slowed and inflation has squeezed budgets. That is why the company’s chief executive has begun flagging a troubling customer trend that is now weighing on sales, margins, and expectations for the year ahead.
What is unfolding inside the orange big-box chain is a window into the broader consumer mood, from do-it-yourself homeowners to professional contractors. As customers postpone large renovations and focus on smaller, cheaper jobs, Home Depot is being forced to rethink everything from merchandising to financial guidance, even as it leans on its scale, digital tools, and sprawling store network to keep shoppers engaged.
The “alarming” shift the Home Depot CEO is seeing in stores
The most worrisome pattern, in the view of the Home Depot CEO, is the steady erosion of demand for big-ticket projects that once anchored the company’s growth. Instead of loading carts with kitchen overhauls or full bathroom remodels, customers are more likely to walk out with a single faucet, a few gallons of paint, or a box of peel-and-stick tile. In a detailed breakdown of recent performance, the company has acknowledged that the average amount of money customers spent on each purchase shrunk by almost 1 percent, a sign that shoppers are consciously scaling back even when they do come in to buy, a trend the Home Depot CEO has explicitly tied to weaker sales.
That pullback is not limited to weekend DIYers. Professional customers, from small contractors to tradespeople who once relied on Home Depot for steady flows of lumber, fixtures, and appliances, are also slowing their orders. Executives have described how customers have been avoiding or at least postponing larger projects compared with the same time period last year, a pattern that has shown up in categories like full kitchen packages and multi-room flooring jobs, and that has been reinforced by feedback from survey work that the company has conducted with its own customers.
From red flag to entrenched pattern: how the trend evolved
Home Depot first began publicly raising a red flag about this behavior when executives noticed that shoppers were not just spending less, they were also changing what they were willing to fund. On an earnings call dated Aug 20, 2025, leadership described how customers were continuing to avoid funding larger discretionary projects even as they kept up with smaller, necessary repairs, a shift that the company said it was closely monitoring across its stores and that it highlighted as a key concern for Home Depot investors.
By the time executives spoke again on Aug 20, 2025, the tone had hardened from caution to alarm, with one Home Depot Executive Vice President on that call underscoring that, However, customers were still shying away from the kind of big-ticket spending that historically drove outsized returns for both consumers and pros, a dynamic that the company framed as a structural challenge for the No. 1 home improvement retailer in the United States and that it linked directly to the broader environment facing consumers and pros.
Why shoppers are pulling back: inflation, housing, and confidence
To understand why this shift is proving so stubborn, it helps to look beyond the aisles and into the housing market and household budgets that shape every renovation decision. In research shared with investors, Home Depot has pointed to the way higher mortgage rates and elevated home prices have frozen many owners in place, limiting the churn of home sales that typically sparks big remodels, and it has noted that the number one issue that people were citing in its surveys was the combination of higher prices because of inflation and the fact that home prices remain high, a pairing that has left many would-be remodelers feeling squeezed according to Home Depot customers themselves.
That macro backdrop has been reinforced by what the company is seeing in real estate activity and by the way shoppers describe their own confidence levels. On the Nov. 18 earnings call, management said that real estate activity is at a 40-year low as a percentage of inventory, a figure that helps explain why fewer people are gutting kitchens or adding decks and that has weighed on the stock, which was down 14% in 2025 before executives laid out how Home Depot stock can recover in 2026, a path that analysts tied to any improvement in that 40-year housing slump.
Inside the earnings calls: what Decker and his team are telling Wall Street
When Home Depot CEO Ted Decker talks to analysts, he has been unusually blunt about how difficult it has been to coax customers back into larger projects. On a call dated May 21, 2025, he said that the trend may be sticking around longer than the company had hoped, describing how both do-it-yourself shoppers and professionals were less engaged in the larger projects that once filled store aisles with pallets of materials and that he now sees as a key battleground for future growth, a message that framed the situation as a major problem for Home Depot CEO Ted Decker and his team.
Other senior leaders have echoed that caution as they walk investors through the numbers. Billy Bastek, EVP of merchandising, explained on Nov 18, 2025 that the company was seeing a clear disparity between sales of individual big-ticket items such as appliances and the broader categories tied to full-room remodels, and he used that breakdown to show how consumer uncertainty and housing pressure were hurting demand enough that The Home Depot lowered its outlook, a move that underscored how seriously the company is taking the customer behavior shift that Billy Bastek, EVP laid out.
What the trend means for shoppers, pros, and the broader economy
For everyday shoppers, the shift that Home Depot is describing shows up in subtle ways, from choosing a midrange Samsung refrigerator instead of a top-of-the-line smart model to patching a roof rather than replacing it outright. The company has reported that over the past few months, consumers have also been facing higher borrowing costs and lingering inflation without a meaningful change in overall confidence levels, a combination that helps explain why Home Depot has noticed a decline in sales this year and why its own surveys suggest that many households are in a holding pattern on major upgrades, a pattern captured in the way Home Depot now talks about its customer base.
For professional contractors, the implications are even more direct, since fewer full-scale remodels mean thinner backlogs and more competition for smaller jobs like installing a single window or replacing a water heater. When Home Depot executives warn that customers have also been avoiding or postponing larger projects, they are effectively signaling that the pipeline of work for pros is under pressure, a reality that the Customers who responded to its research are already feeling in their own businesses, and that in turn feeds back into the broader economy as fewer large home projects ripple through suppliers, local trades, and neighborhood property values.
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Alexander Clark is a financial writer with a knack for breaking down complex market trends and economic shifts. As a contributor to The Daily Overview, he offers readers clear, insightful analysis on everything from market movements to personal finance strategies. With a keen eye for detail and a passion for keeping up with the fast-paced world of finance, Alexander strives to make financial news accessible and engaging for everyone.
