Despite beating on earnings and raising guidance, Lowe's anticipates a decline in sales this year.

• Lowe's topped third-quarter earnings and revenue estimates on Tuesday.
• Despite raising its outlook, the home improvement retailer anticipates a decline in full-year sales compared to the previous year.
• After the Federal Reserve cut interest rates, Home Depot, Lowe's rival, stated that customers are still postponing major projects.

On Tuesday, the home professional business and stronger online shopping fueled sales, beating Wall Street's quarterly earnings expectations.

Despite the better-than-expected results, the home improvement retailer is projecting a year-over-year sales decline. The company updated its full-year guidance on Tuesday and now expects total sales of between $83 billion to $83.5 billion, higher than its previous forecast of $82.7 billion to $83.2 billion. It said it expects comparable sales to decline 3% to 3.5%, slightly better than the 3.5% to 4% drop that it had previously anticipated.

Lowe's is currently experiencing a decline in sales, with a nearly 13% drop year over year, following a period when the company lowered its outlook and cut its full-year forecast in August due to predicted weak home improvement demand caused by high interest rates.

According to LSEG's survey of analysts, the company's three-month financial report for the period ending Nov. 1 exceeded Wall Street's expectations.

• Earnings per share: $2.89 adjusted vs. $2.82 expected
• Revenue: $20.17 billion vs. $19.95 billion expected

In the most recent quarter, Lowe's earnings decreased to $1.7 billion, or $2.99 per share, compared to $1.77 billion, or $3.06 per share, in the previous year. Additionally, revenue decreased from $20.47 billion in the previous quarter.

Lowe's competitor, Home Depot, reported last week that customers are still deferring bigger projects and pricier purchases, even after two interest rate cuts by the Federal Reserve. Despite beating Wall Street's sales and earning expectations, Home Depot posted its eighth quarter in a row of declining comparable sales. However, the company saw some improving sales trends due to hurricane-related demand, warm-weather home projects, and the acquisition of SRS Distribution, a company that sells supplies to landscaping, pool, and roofing professionals.

Despite the S&P 500's gains of approximately 24% this year, Lowe's shares have only risen about 22%. As of Monday's close, Lowe's stock closed at $271.77, with a market value of $154.17 billion.

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