Lowe’s (NYSE:LOW) business is still surging. On Wednesday, the home improvement retailer announced sales and profit results for the fiscal third quarter that ran through late October. And while revenue growth slowed compared to the prior quarter, Lowe’s continued to gain ground in a booming market for home furnishings.
Sales rose 30% in the core U.S. market, according to its quarterly filing, compared to a 35% spike in the second quarter. That result was enough to keep Lowe’s ahead of rival Home Depot (NYSE:HD) for a third straight quarter this year. The industry leader reported 25% sales gains for Q3 on Tuesday.
Lowe’s also closed the profitability gap between the two businesses by notching gains on both gross and operating profit margins. Yet its 10% operating profit still trails Home Depot’s 14.5% level.
Lowe’s predicted a weaker earnings result in the fourth quarter as management spends more cash on COVID-19-related expenses and on bulking up its supply chain. But CEO Marvin Ellison and his team expect another period of elevated sales gains ahead as growth lands between 15% and 20% in the holiday season quarter.
“We are making the right strategic investments to deliver sustainable, long-term growth,” Ellison said in a press release that included Lowe’s first short-term growth outlook since withdrawing its forecast in late May.