December 6, 2017 Carol Tomé: EVP, Corporate Services & CFO Richard McPhail: SVP, Finance Control & Administration Isabel Janci: VP, Investor Relations & Treasurer Europe June 2019 1
Forward Looking Statements and Non-GAAP Financial Measurements Certain statements contained herein constitute “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements may relate to, among other things, the demand for our products and services; net sales growth; comparable sales; effects of competition; implementation of store, interconnected retail, supply chain and technology initiatives; inventory and in-stock positions; state of the economy; state of the housing and home improvement markets; state of the credit markets, including mortgages, home equity loans and consumer credit; issues related to the payment methods we accept; demand for credit offerings; management of relationships with our associates, suppliers and vendors; continuation of share repurchase programs; net earnings performance; earnings per share; dividend targets; capital allocation and expenditures; liquidity; return on invested capital; expense leverage; stock-based compensation expense; commodity price inflation and deflation; the ability to issue debt on terms and at rates acceptable to us; the impact and expected outcome of investigations, inquiries, claims and litigation; the effect of accounting charges; the effect of adopting certain accounting standards; the impact of the Tax Cuts and Jobs Act of 2017 and other regulatory changes; store openings and closures; guidance for fiscal 2019 and beyond; financial outlook; and the integration of acquired companies into our organization and the ability to recognize the anticipated synergies and benefits of those acquisitions. Forward-looking statements are based on currently available information and our current assumptions, expectations and projections about future events. You should not rely on our forward-looking statements. These statements are not guarantees of future performance and are subject to future events, risks and uncertainties – many of which are beyond our control, dependent on the actions of third parties, or are currently unknown to us – as well as potentially inaccurate assumptions that could cause actual results to differ materially from our expectations and projections. These risks and uncertainties include, but are not limited to, those described in Item 1A, “Risk Factors,” and elsewhere in our Annual Report on Form 10-K for our fiscal year ended February 3, 2019 and in our subsequent Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date they are made, and we do not undertake to update these statements other than as required by law. You are advised, however, to review any further disclosures we make on related subjects in our periodic filings with the Securities and Exchange Commission. This presentation is also supplemented with certain non-GAAP financial measures. We believe these non-GAAP financial measures better enable management and investors to understand and analyze our performance. However, this supplemental information should not be considered in isolation or as a substitute for the related GAAP measures. Reconciliations of the supplemental information to the comparable GAAP measures can be found on our Investor Relations website at ir.homedepot.com . 2 2
Discussion Overview Who We Are Financial Results Company Initiatives and Long-Term Targets 3
• Providing a best-in-class interconnected shopping experience for our customers while continuing to drive shareholder value • Maintaining our position as #1 in product authority for home improvement through a comprehensive product offering, delivering innovation and exceptional value • Investing ~$11B across the business over 3 years (nearly double our business as usual investment spend) to position the company for continued, long-term success Store count is reflective of total stores at the end of the 1 st quarter of Fiscal 2019. 4
The Home Depot: 3-Year View 1) Sales Operating Margin $108.2B $110B 15.0% 14.55% $105B 2 ) $100.9B 14.35% 14.5% 14.19% $100B $94.6B 14.0% $95B 13.5% $90B $85B 13.0% 2016 2017 2018 2016 2017 2018 Earnings Per Share ROIC $9.73 $10.00 50% 44.8% $9.00 40% 34.2% 31.4% $8.00 $7.29 30% $6.45 $7.00 20% $6.00 10% $5.00 $4.00 0% 2016 2017 2018 2016 2017 2018 Driving Consistent Results Across the Business 1) Fiscal year 2018 included 53 weeks. Fiscal year 2017 and 2016 included 52 weeks. 2) Reflects the first year of an ~$11B investment plan, nearly double our investment spend in a business as usual environment. 5
Retail Environment is Changing Rapidly 6
Retail Customers Expect More Improved Seamless Personalized Delivery Checkout Experiences HD Must Continue to Keep Pace with Changing Environment 7
Strategic Investments for the Future 2018 – 2020 Investments 1) ($ in billions) Investment $11.1B Other 1.8 New Stores 0.6 5.0 Stores Supply 0.8 Chain $5.7B BAU Other 2.9 IT / 0.8 Online New Stores 0.6 2.4 Stores 0.2 Supply Chain 1.7 BAU 2) Target IT 1) Investments: Capital and Expense, excludes incremental depreciation. Amounts shown are estimates as of December 2017. 2) BAU represents our spend in a “business as usual” environment. 8
Investing in Stores & Associates Improving the Customer Shopping Experience Both In-Store and Online 9
Investing in Product & Innovation Maintaining Our Position as the #1 Retailer for Product Authority in Home Improvement 10
Investing in Personalized Experiences Delivering Tailored Marketing Messages to Create a More Personalized Shopping Experience 11
Investing in Pro & Services Leveraging Data and Analytics to Better Understand and Serve Our Pro Customers 12
Investing in Our Supply Chain Upstream • 2007 – 2017: • Upstream Supply Chain transformation • Built Rapid Deployment Center (RDC) network, creating a competitive Stores advantage in our upstream network • 2018 – 2022: • Leveraging our competitive advantage in our upstream network Vendors • Investing in increased mechanization to drive further efficiency DC Network (Bulk / Stocking / Flow) Leveraging Our Upstream Competitive Advantage to Drive Greater Efficiencies Downstream 13
Investing in Our Supply Chain Downstream • 2007 – 2017: • Built interconnected network to enable BOSS, BODFS, and home delivery Direct Fulfillment Centers • Enabled 2-day parcel delivery to ~95% (Parcel / Flatbed / Local) of U.S. population • 2018 – 2022: • Enhancing our downstream network by building out ~150+ new facilities • Enabling same day/next day delivery of Market Delivery Operations Customers (DIY / Pro / MRO) a wider assortment of products, including big and bulky goods • 2022 Goal: Enable Same-Day/Next-Day Delivery to ~90% of the U.S. Population Market Delivery Stores Creating the Fastest, Most Efficient Delivery and Flow in Home Improvement 14
Continued Focus on Productivity Cost of Operating Goods Sold Expenses Productivity is Our Virtuous Cycle 15
Enhancing the Customer Experience, Investing for the Future, Creating Value Sales Operating Margin ROIC ~15.0% ~$120.4B ~40%+ 14.5% ~$115.5B 34.2% ~14.4% $101B 2017 2020T 2017 2020T 2017 2020T *As of May 15, 2018 One Home Depot: 2020 Targets * 16
APPENDIX December 6, 2017
Fiscal 2019 Guidance 1) (As of May 21, 2019) Sales growth 2) ~3.3% 2) Comp sales growth ~5.0% New store openings 5 net new stores ~14.4% Operating margin Diluted EPS growth ~$10.03, or an increase of ~3.1% Share repurchases Targeting $5 billion 1) All guidance based on GAAP 2) Fiscal year 2019 includes 52 weeks. Fiscal year 2018 included 53 weeks. Comparable sales growth is calculated on a 52-week basis. 18
Drivers of Home Improvement Spend Household Home Price Age of Housing Housing Turnover Formation Appreciation Stock Impact on HI Supports Incremental Drives Spending Both Demands Ongoing Repairs Increases Demand Spend Investments Pre And Post Sale And Major Repairs Recent Impact Forward Per Unit Spend Acceleration Continued Stays At View Increases Appreciation Current Rate Expected Future Impact 19
Target Market Opportunity U.S. Addressable Market $600 Billion ~$50B Maintenance, Repair and Operations ~$200B Home Services ~$350B Home Improvement $ in Billions Sources: 2017 HIRI Reference Guide; NAICS; and external market analysis 20
December 6, 2017 21
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