Lowe's (NYSE:LOW) just dropped its Q3 earnings, and while the numbers beat Wall Street's expectations, the stock still took a hit, sliding over 4% in early trading. Here's the deal: earnings per share came in at $2.89down from $3.06 last year, but above the $2.82 analysts predicted. Sales slipped 1.4% to $20.2 billion, though they edged past forecasts of $19.9 billion. Storm recovery efforts gave a short-term lift, but same-store sales dipped 1.1%, showing DIY spending is still in the dumps. CEO Marvin Ellison didn't sugarcoat it, citing inflation and high interest rates as key factors squeezing consumers.

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Here's the rub: the bigger, splashy renovation projects? Still on hold. Zhihan Ma at Bernstein is calling it too soon to say demand is bouncing back, predicting home improvement will stay sluggish for the next year. That sentiment lines up with what Home Depot's team flagged last weekbuyers aren't rushing into pricey renovations while mortgages hover near 7%. Still, Lowe's bumped its full-year guidance slightly, now expecting sales of $83-$83.5 billion and earnings per share of $11.80-$11.90. Meanwhile, the company's focusing on growth moves like boosting online sales and Pro services, plus paying out $758 million in share buybacks this quarter.

But there's a twist that could shake things up: potential tariffs under a Trump administration. With 40% of Lowe's goods sourced internationally, CFO Brandon Sink admitted costs could climb if those tariffs land. However, the team's been prepping, diversifying its supply chain since Trump's first term. For now, Lowe's is banking on long-term resilience while navigating a dicey macro environment. Investors will be watching closely for more clarity when the company unveils its growth strategies at next month's Analyst and Investor Conference.

This article first appeared on GuruFocus.