UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

~~WASHINGTON,~~Washington, D.C. 20549

FORM 10-Q

(Mark One)


x	~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~April 29, 2018~~May 5, 2019

-or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR -15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


¨	~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

For the transition period from to

Commission ~~file number~~File Number: 1-8207

THE HOME DEPOT, INC.

(Exact name of ~~Registrant~~registrant as specified in its charter)



Delaware				95-3261426
(State or other jurisdiction of incorporation or organization)				(I.R.S. Employer Identification ~~Number)~~No.)

2455 Paces Ferry Road, Atlanta, Georgia				30339
(Address of principal executive offices)				(Zip Code)

~~(770) 433-8211~~

~~(Registrant’s telephone number, including area code)~~

(770) 433-8211(Registrant’s telephone number, including area code)(Former name, former address and former fiscal year, if changed since last report): N/ASecurities registered pursuant to Section 12(b) of the Act:Title of each classTrading SymbolName of each exchange on which registeredCommon Stock, $0.05 Par Value Per ShareHDNew York Stock Exchange

Indicate by check mark whether the ~~Registrant~~registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the ~~Registrant~~registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the ~~Registrant~~registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the ~~Registrant~~registrant was required to submit ~~and post~~ such files). Yes x No ¨

Indicate by check mark whether the ~~Registrant~~registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.



Large accelerated filer x	Accelerated filer ¨	Non-accelerated filer ¨ ~~(Do not check if a smaller reporting company)~~	Smaller reporting company ¨
Emerging growth company ¨	If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the ~~Registrant~~registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

~~1,153,543,611~~1,100,286,099 shares of common stock, $0.05 par value, as of May ~~15, 2018~~21, 2019

TABLE OF CONTENTS



Commonly Used or Defined Terms		ii
Forward-Looking Statements		iii

~~Part~~PART I – ~~Financial Information.~~FINANCIAL INFORMATION		1
Item 1.	Financial Statements.	1
	Consolidated Balance ~~Sheets.~~Sheets	1
	Consolidated Statements of ~~Earnings.~~Earnings	2
	Consolidated Statements of Comprehensive ~~Income.~~Income	3
	Consolidated Statements of ~~Cash Flows.~~Stockholders' Equity	4
	Consolidated Statements of Cash Flows	5
	Notes to Consolidated Financial ~~Statements.~~Statements	56
	Note 1. Summary of Significant Accounting ~~Policies.~~Policies	56
	Note 2. Net ~~Sales.~~Sales	7
	Note 3. ~~Income Taxes.~~Property and Leases	8
	Note 4. Stockholders' ~~Equity.~~Equity	811
	Note 5. Fair Value ~~Measurements.~~Measurements	911
	Note 6. Weighted Average Common ~~Shares.~~Shares	912
	Note 7. Commitments and ~~Contingencies.~~Contingencies	912
	Report of Independent Registered Public Accounting ~~Firm.~~Firm	1013
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	1114
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	1518
Item 4.	Controls and Procedures.	1518

~~Part~~PART II – ~~Other Information.~~OTHER INFORMATION		1518
Item 1.	Legal Proceedings.	18
Item 1A.	Risk Factors.	1519
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	1619
Item 6.	Exhibits.	1720

~~Signatures~~SIGNATURES		1821

Table of Contents

COMMONLY USED OR DEFINED TERMS



Term		Definition
~~ASR~~		~~Accelerated share repurchase~~
ASU		Accounting Standards Update
Comparable sales		As defined in the Results of Operations -– Sales section of MD&A
EPA		Environmental Protection Agency
Exchange Act		Securities Exchange Act of 1934, as amended
FASB		Financial Accounting Standards Board
fiscal ~~2017~~		~~Fiscal year ended January 28, 2018 (includes 52 weeks)~~
~~fiscal~~ 2018		Fiscal year ending February 3, 2019 (includes 53 weeks)
fiscal 2019		Fiscal year ending February 2, 2020 (includes 52 weeks)
GAAP		U.S. generally accepted accounting principles
Interline		The legacy Interline Brands ~~Inc.~~business, now operating as a part of The Home Depot Pro
MD&A		Management's Discussion and Analysis of Financial Condition and Results of Operations
NOPAT		Net operating profit after tax
~~PLCC~~		~~Private label credit card~~
Restoration Plan		Home Depot FutureBuilder Restoration Plan
ROIC		Return on invested capital
SEC		Securities and Exchange Commission
Securities Act		Securities Act of 1933, as amended
SG&A		Selling, general, and administrative
Tax Act		2017 tax reform, commonly referred to as the Tax Cuts and Jobs Act of 2017
~~2017~~2018 Form 10-K		Annual Report on Form 10-K for fiscal 2018 as filed with the SEC on March ~~22, 2018 for fiscal 2017~~28, 2019

Table of Contents

FORWARD-LOOKING STATEMENTS

Certain statements contained herein, as well as in other filings we make with the SEC and other written and oral information we release, regarding our future performance 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; ~~issues related to the payment methods we accept;~~inventory and in-stock positions; state of the economy; state of the ~~residential construction,~~ 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; ~~inventory and in-stock positions;~~ 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 ~~Act;~~Act and other regulatory changes; store openings and closures; 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 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 Part II, Item 1A, "Risk Factors" and elsewhere in this report and as also may be described from time to time in our future reports we file with the SEC. You should read such information in conjunction with our consolidated financial statements and related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this report. There also may be other factors that we cannot anticipate or that are not described in this report, generally because we do not currently perceive them to be material. Such factors could cause results to differ materially from our expectations.

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 SEC.

iii

Table of Contents

PART I – FINANCIAL INFORMATION

~~Item 1.~~ ~~Financial Statements.~~


Item 1.	Financial Statements.

THE HOME DEPOT, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)


in millions, except per share data	April 29, 2018			January 28, 2018			May 5, 2019			February 3, 2019
Assets
Current assets:
Cash and cash equivalents	$	3,599		$	3,595		$	1,882		$	1,778
Receivables, net	2,296			1,952			2,317			1,936
Merchandise inventories	14,432			12,748			15,495			13,925
Other current assets	887			638			859			890
Total current assets	21,214			18,933			20,553			18,529
Property and equipment, net of accumulated depreciation of $19,668 at April 29, 2018 and $19,339 at January 28, 2018	21,928			22,075
Net property and equipment							22,270			22,375
Operating lease right-of-use assets							5,629			—
Goodwill	2,281			2,275			2,250			2,252
Other assets	1,227			1,246			813			847
Total assets	$	46,650		$	44,529		$	51,515		$	44,003

Liabilities and Stockholders' Equity
Current liabilities:
Short-term debt	$	350		$	1,559		$	372		$	1,339
Accounts payable	9,726			7,244			10,311			7,755
Accrued salaries and related expenses	1,413			1,640			1,418			1,506
Sales taxes payable	730			520			789			656
Deferred revenue	1,911			1,805			2,015			1,782
Current installments of long-term debt	1,199			1,202			1,084			1,056
Current operating lease liabilities							793			—
Other accrued expenses	2,804			2,224			2,891			2,622
Total current liabilities	18,133			16,194			19,673			16,716
Long-term debt, excluding current installments	24,244			24,267			26,804			26,807
Long-term operating lease liabilities							5,145			—
Other long-term liabilities	2,586			2,614			2,036			2,358
Total liabilities	44,963			43,075			53,658			45,881

Common stock, par value $0.05; authorized: 10,000 shares; issued: 1,781 shares at April 29, 2018 and 1,780 shares at January 28, 2018; outstanding: 1,154 shares at April 29, 2018 and 1,158 shares at January 28, 2018	89			89
Common stock, par value $0.05; authorized: 10,000 shares; issued: 1,784 at May 5, 2019 and 1,782 shares at February 3, 2019; outstanding: 1,101 shares at May 5, 2019 and 1,105 shares at February 3, 2019							89			89
Paid-in capital	10,017			10,192			10,590			10,578
Retained earnings	41,221			39,935			47,459			46,423
Accumulated other comprehensive loss	(596		)	(566		)	(835		)	(772		)
Treasury stock, at cost, 627 shares at April 29, 2018 and 622 shares at January 28, 2018	(49,044		)	(48,196		)
Total stockholders’ equity	1,687			1,454
Treasury stock, at cost, 683 shares at May 5, 2019 and 677 shares at February 3, 2019							(59,446		)	(58,196		)
Total stockholders’ (deficit) equity							(2,143		)	(1,878		)
Total liabilities and stockholders’ equity	$	46,650		$	44,529		$	51,515		$	44,003

See accompanying notes to consolidated financial statements.

THE HOME DEPOT, INC.

CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)


	Three Months Ended						Three Months Ended
in millions, except per share data	April 29, 2018			April 30, 2017			May 5, 2019			April 29, 2018
Net sales	$	24,947		$	23,887		$	26,381		$	24,947
Cost of sales	16,330			15,733			17,364			16,330
Gross profit	8,617			8,154			9,017			8,617
Operating expenses:
Selling, general and administrative	4,779			4,361			4,940			4,779
Depreciation and amortization	457			444			480			457
Total operating expenses	5,236			4,805			5,420			5,236
Operating income	3,381			3,349			3,597			3,381
Interest and other (income) expense:
Interest and investment income	(22		)	(13		)	(15		)	(22		)
Interest expense	261			254			288			261
Interest and other, net	239			241			273			239
Earnings before provision for income taxes	3,142			3,108			3,324			3,142
Provision for income taxes	738			1,094			811			738
Net earnings	$	2,404		$	2,014		$	2,513		$	2,404

Basic weighted average common shares	1,152			1,198			1,101			1,152
Basic earnings per share	$	2.09		$	1.68		$	2.28		$	2.09

Diluted weighted average common shares	1,158			1,204			1,106			1,158
Diluted earnings per share	$	2.08		$	1.67		$	2.27		$	2.08

Dividends declared per share	$	1.03		$	0.89

See accompanying notes to consolidated financial statements.

THE HOME DEPOT, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	Three Months Ended						Three Months Ended
in millions	April 29, 2018			April 30, 2017			May 5, 2019			April 29, 2018
Net earnings	$	2,404		$	2,014		$	2,513		$	2,404
Other comprehensive income (loss):
Foreign currency translation adjustments	(76		)	(30		)	(43		)	(76		)
Cash flow hedges, net of tax	28			(25		)	2			28
Other	18			(1		)	9			18
Total other comprehensive income (loss)	(30		)	(56		)	(32		)	(30		)
Comprehensive income	$	2,374		$	1,958		$	2,481		$	2,374

See accompanying notes to consolidated financial statements.

THE HOME DEPOT, INC.

CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~STOCKHOLDERS' EQUITY

(Unaudited)

Three Months Ended
in millions April 29,
2018 April 30,
2017
Cash Flows from Operating Activities:
Net earnings $ 2,404
$ 2,014
Reconciliation of net earnings to net cash provided by operating activities:
Depreciation and amortization 532
505
Stock-based compensation expense 84
81
Changes in assets and liabilities, net of acquisition effects:
Receivables, net (319 ) (145 )
Merchandise inventories (1,687 ) (1,051 )
Other current assets (250 ) 51
Accounts payable and other accrued expenses 2,532
2,062
Income taxes payable 547
877
Deferred revenue 208
166
Deferred income taxes (9 ) (65 )
Other (61 ) 69
Net cash provided by operating activities 3,981
4,564

Cash Flows from Investing Activities:
Capital expenditures (556 ) (458 )
Proceeds from sales of property and equipment 8
13
Net cash used in investing activities (548 ) (445 )

Cash Flows from Financing Activities:
Repayments of short-term debt, net (1,209 ) (710 )
Repayments of long-term debt (10 ) (11 )
Repurchases of common stock (1,121 ) (1,289 )
Proceeds from sales of common stock 14
31
Cash dividends (1,189 ) (1,069 )
Other financing activities 115
(33 )
Net cash used in financing activities (3,400 ) (3,081 )
Change in cash and cash equivalents 33
1,038
Effect of exchange rate changes on cash and cash equivalents (29 ) (11 )
Cash and cash equivalents at beginning of period 3,595
2,538
Cash and cash equivalents at end of period $ 3,599
$ 3,565

Supplemental Disclosures:
Cash paid for interest, net of interest capitalized $ 339
$ 321
Cash paid for income taxes 119
135



	Three Months Ended
in millions	May 5, 2019			April 29, 2018
Common Stock:
Balance at beginning of period	$	89		$	89
Shares issued under employee stock plans	—			—
Balance at end of period	89			89

Paid-in Capital:
Balance at beginning of period	10,578			10,192
Shares issued under employee stock plans	(64		)	(99		)
Stock-based compensation expense	76			75
Repurchases of common stock	—			(151		)
Balance at end of period	10,590			10,017

Retained Earnings:
Balance at beginning of period	46,423			39,935
Cumulative effect of accounting changes	26			75
Net earnings	2,513			2,404
Cash dividends	(1,499		)	(1,189		)
Other	(4		)	(4		)
Balance at end of period	47,459			41,221

Accumulated Other Comprehensive Income (Loss):
Balance at beginning of period	(772		)	(566		)
Cumulative effect of accounting change	(31		)	—
Foreign currency translation adjustments	(43		)	(76		)
Cash flow hedges, net of tax	2			28
Other	9			18
Balance at end of period	(835		)	(596		)

Treasury Stock:
Balance at beginning of period	(58,196		)	(48,196		)
Repurchases of common stock	(1,250		)	(848		)
Balance at end of period	(59,446		)	(49,044		)
Total stockholders' (deficit) equity	$	(2,143	)	$	1,687

See accompanying notes to consolidated financial statements.

THE HOME DEPOT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



	Three Months Ended
in millions	May 5, 2019			April 29, 2018
Cash Flows from Operating Activities:
Net earnings	$	2,513		$	2,404
Reconciliation of net earnings to net cash provided by operating activities:
Depreciation and amortization	547			532
Stock-based compensation expense	86			84
Changes in receivables, net	(391		)	(319		)
Changes in merchandise inventories	(1,586		)	(1,687		)
Changes in other current assets	32			(250		)
Changes in accounts payable and accrued expenses	2,488			2,532
Changes in deferred revenue	236			208
Changes in income taxes payable	554			547
Changes in deferred income taxes	5			(9		)
Other operating activities	91			(61		)
Net cash provided by operating activities	4,575			3,981

Cash Flows from Investing Activities:
Capital expenditures, net of non-cash capital expenditures	(681		)	(556		)
Proceeds from sales of property and equipment	6			8
Other investing activities	(13		)	—
Net cash used in investing activities	(688		)	(548		)

Cash Flows from Financing Activities:
Repayments of short-term debt, net	(967		)	(1,209		)
Repayments of long-term debt	(15		)	(10		)
Repurchases of common stock	(1,368		)	(1,121		)
Proceeds from sales of common stock	34			14
Cash dividends	(1,499		)	(1,189		)
Other financing activities	40			115
Net cash used in financing activities	(3,775		)	(3,400		)
Change in cash and cash equivalents	112			33
Effect of exchange rate changes on cash and cash equivalents	(8		)	(29		)
Cash and cash equivalents at beginning of period	1,778			3,595
Cash and cash equivalents at end of period	$	1,882		$	3,599

Supplemental Disclosures:
Cash paid for interest, net of interest capitalized	$	345		$	339
Cash paid for income taxes	87			119

See accompanying notes to consolidated financial statements.

THE HOME DEPOT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


1.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements of The Home Depot, Inc. and its subsidiaries (the "Company," "Home Depot," "we," "our" or "us") have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Results of operations for interim periods are not necessarily indicative of results for the entire year. As a result, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our ~~2017~~2018 Form 10-K.

There were no significant changes to our significant accounting policies as disclosed in the ~~2017~~2018 Form 10-K, except as set forth below.

~~Net Sales~~Leases

On February 4, 2019, we adopted the new leases standard using the modified retrospective transition method, which requires that we recognize leases differently pre- and post-adoption. See "—Recently Adopted Accounting Pronouncements—ASU No. 2016-02" below for more information.

We ~~recognize revenue, net~~categorize leases at their inception as either operating or finance leases. Lease agreements cover certain retail locations, office space, warehouse and distribution space, equipment, and vehicles. Most of ~~expected returns~~these leases are operating leases; however, certain retail locations and sales tax, at the time the customer takes possession of merchandise, or when a service is performed. The liability for sales returns, including the impact to gross profit, is estimated based on historical return levels, and recognized at the transaction price. We also recognize a return asset, and corresponding adjustment to cost of sales, for our right to recover the goods returned by the customer, measured at the former carrying amount of the goods, less any expected recovery cost. At each financial reporting date, we assess our estimates of expected returns, refund liabilities, and return assets.

Net sales include services revenue generated through a variety of installation, home maintenance, and professional service programs. In these programs, the customer selects and purchases material for a project, and we provide or arrange for professional installation. These programsequipment are offered through our stores and in-home sales programs. Under certain programs, when we provide or arrange for the installation of a project and the subcontractor provides material as part of the installation, both the material and laborleased under finance leases. Operating leases are included in services revenue. We recognize this revenue when the service for the customer is complete, which is not materially different from recognizing the revenue over the service period as the substantial majority ofoperating lease right-of-use assets, current operating lease liabilities, and long-term operating lease liabilities in our ~~services are completed within one week.~~

For merchandise sold in one of our stores or online, tender is accepted at the point of sale. For services, we generally accept tender upon completion of the job. When we receive payment from customers before the customer has taken possession of the merchandise or the service has been performed, the amount received is recorded as deferred revenue until the sale or service is complete. Such performance obligations are part of contracts with expected original durations of three months or less. We further record deferred revenue for the sale of gift cards and recognize the associated revenue upon the redemption of those gift cards in net sales. Gift card breakage income (estimated non-redeemed gift card balance) is recognized in proportion to the redemption pattern of rights exercised by the customer. For merchandise sold to customers to whom we directly extend credit, collection of tender is typically expected within three months or less from the time of purchase. We also have agreements with third-party service providers who directly extend credit to customers and manage our PLCC program. The deferred interest charges we incur for our deferred financing programs offered to our customers, interchange fees charged to us for our customers’ use of the cards, and any profit sharing with the third-party service providersconsolidated balance sheets. Finance leases are included in net ~~sales.~~property and equipment, current installments of long-term debt, and long-term debt in our consolidated balance sheets.

~~Cost~~Leased assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of ~~Sales~~

~~Cost~~lease payments over the lease term. We use a secured incremental borrowing rate as the discount rate for present value of ~~sales includes~~lease payments when the ~~actual cost~~rate implicit in the contract is not readily determinable. We determine a secured rate on a quarterly basis and update the weighted average discount rate accordingly. For operating leases with variable payments dependent upon an index or rate that commenced subsequent to adoption of ~~merchandise sold and services performed;~~ASU No. 2016-02, we apply the ~~cost~~active index or rate as of ~~transportation of merchandise from vendors to our distribution network, stores,~~the lease commencement date. Variable lease payments not based on an index or ~~customers; shipping and handling costs from our stores or distribution network to customers; and~~rate are not included in the operating ~~cost~~lease liability as they cannot be reasonably estimated and ~~depreciation~~are recognized in the period in which the obligation for those payments is incurred. Leases that have a term of ~~our sourcing~~twelve months or less upon commencement date are considered short-term in nature. Accordingly, short-term leases are not included on the consolidated balance sheets and ~~distribution network and online fulfillment centers.~~are expensed on a straight-line basis over the lease term, which commences on the date we have the right to control the property.

Recently Adopted Accounting Pronouncements

ASU No. ~~2014-09.~~2018-02. In May 2014, the FASB issued a new standard related to revenue recognition. Under ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. On January 29,February 2018, ~~we adopted ASU No. 2014-09 using the modified retrospective transition method.~~

In preparation for implementation of the standard, we concluded on key accounting assessments and then implemented internal controls and updated processes to appropriately recognize and present the associated financial information. Based on these efforts, we determined that the adoption of ASU No. 2014-09 changes the presentation of (i) certain expenses and cost reimbursements associated with our PLCC program (now recognized in net sales), (ii) certain expenses related to the sale of gift cards to customers (now recognized in operating expense), and (iii) gift card breakage income (now recognized in net sales). We also have changed our recognition of gift card breakage income to be recognized proportionately as redemption occurs, rather than based on historical redemption patterns.

In addition, the adoption of ASU No. 2014-09 requires that we recognize our sales return allowance on a gross basis rather than as a net liability. As such, we now recognize (i) a return asset for the right to recover the goods returned by the customer, measured at the former carrying amount of the goods, less any expected recovery costs (recorded as an increase to other current assets) and (ii) a return liability for the amount of expected returns (recorded as an increase to other accrued expenses and a decrease to receivables, net).

We applied ASU No. 2014-09 only to contracts that were not completed prior to fiscal 2018. The cumulative effect of initially applying ASU No. 2014-09 was a $75 million increase to the opening balance of retained earnings as of January 29, 2018. The comparative prior period information continues to be reported under the accounting standards in effect during those periods. We expect the impact of the adoption to be immaterial to our financial position, results of operations, and cash flows on an ongoing basis.

~~The effect of the adoption of ASU No. 2014-09 on our consolidated balance sheet as of April 29, 2018, follows.~~

in millions As Reported
ASU No. 2014-09
Effect ⁽¹⁾
Excluding
ASU No. 2014-09 Effect
Receivables, net $ 2,296
$ (46 ) $ 2,342
Other current assets 887
269
618
Other accrued expenses 2,804
223
2,581

~~—————~~

~~(1) Does not include the cumulative effect of initially applying ASU No. 2014-09 to our consolidated balance sheet as adjusted as of January 29, 2018.~~

~~The effect of the adoption of ASU No. 2014-09 on our consolidated statement of earnings for the three months ended April 29, 2018 follows.~~

in millions As Reported
ASU No. 2014-09
Effect

Excluding
ASU No. 2014-09 Effect
Net sales $ 24,947
$ 33
$ 24,914
Cost of sales 16,330
(98 ) 16,428
Gross profit 8,617
131
8,486
Selling, general and administrative 4,779
131
4,648

~~ASU No. 2016-16.In October 2016,~~ the FASB issued ASU No. ~~2016-16,~~2018-02, "Income Statement—Reporting Comprehensive Income ~~Taxes~~ (Topic ~~740)~~220): ~~Intra-Entity Transfers~~Reclassification of ~~Assets~~Certain Tax Effects from Accumulated Other ~~Than Inventory,~~Comprehensive Income," which ~~requires~~allows for an ~~entity~~optional reclassification from accumulated other comprehensive income to ~~recognize~~retained earnings for stranded tax effects as a result of the income tax consequences of an intercompany transfer of assets other than inventory when the transfer occurs. An entity will continue to recognize the income tax consequences of an intercompany transfer of inventory when the inventory is sold to a third party.

Tax Act. On ~~January 29, 2018,~~February 4, 2019, we adopted ASU No. ~~2016-16 using~~2018-02 resulting in an increase of $31 million to retained earnings and a decrease of $31 million to accumulated other comprehensive income.

ASU No. 2017-12. In August 2017, the ~~modified retrospective transition~~FASB issued ASU No. 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities," which amends the hedge accounting recognition and presentation requirements. ASU No. 2017-12 eliminates the concept of recognizing periodic hedge ineffectiveness for cash flow and net investment hedges and allows an entity to apply the shortcut method to partial-term fair value hedges of interest rate risk. On February 4, 2019, we adopted ASU No. 2017-12 with no impact onto our consolidated financial statements. We expect the impact of the adoption to be immaterial to our financial position, results of operations, and cash flows on an ongoing basis.

~~Recent~~

ASU No. 2016-02. In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)," which establishes a right-of-use model and requires an entity that is a lessee to recognize the right-of-use assets and liabilities arising from leases on the balance sheets. ASU No. 2016-02 also requires disclosures about the amount, timing, and uncertainty of cash flows arising from leases. Leases will be classified as finance or operating, with classification affecting both the pattern and classification of expense recognition in the statements of earnings. This guidance was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842; and ASU No. 2018-11, Targeted Improvements. ASU No. 2016-02 and subsequent updates require a modified retrospective transition, with the cumulative effect of transition, including initial recognition of lease assets and liabilities for existing operating leases, as of (i) the effective date or (ii) the beginning of the earliest comparative period presented. These updates also provide a number of practical expedients for implementation which we are applying, as discussed below.

On February 4, 2019 (the “effective date”), we adopted ASU No. 2016-02 and subsequent updates, collectively referred to as Topic 842, using the modified retrospective transition method. In addition, we adopted the package of practical expedients in transition, which permits us to not reassess our prior conclusions pertaining to lease identification, lease classification and initial direct costs on leases that commenced prior to our adoption of the new standard. We also elected the ongoing practical expedient to not recognize operating lease right-of-use assets and operating lease liabilities related to short-term leases. We did not elect the use-of-hindsight or land easements practical expedients. For leases beginning subsequent to the effective date, we elected to not separate lease and non-lease components for certain classes of assets including real estate and certain equipment. To determine the measurement of the lease liability for operating leases with variable payments based on an index or rate that commenced prior to the adoption of Topic 842, we elected to apply the active index or rate at the effective date.

As a result of adopting Topic 842, we recognized net operating lease right-of-use assets of $5.7 billion and operating lease liabilities of $6.0 billion on the effective date. Existing prepaid rent, accrued rent, and closed store reserves were recorded as an offset to our gross operating lease right-of-use assets. The cumulative effect of the adoption resulted in an immaterial adjustment to the opening balance of retained earnings as of February 4, 2019. The standard did not have a material impact on our results of operations or cash flows.

Recently Issued Accounting Pronouncements

Recent accounting pronouncements pending adoption not discussed above or in the ~~2017~~2018 Form 10-K are either not applicable or will not have or are not expected to have a material impact on us.


2.	NET SALES

No sales to an individual customer or country other than the U.S. accounted for more than 10% of net sales during the ~~first quarter of fiscal~~three months ended May 5, 2019 and April 29, 2018. Net sales, classified by geography, ~~for the three months ended April 29, 2018~~ follow.


			Three Months Ended
in millions			May 5, 2019		April 29, 2018
Net sales – in the U.S.	$	23,043	$	24,453	$	23,043
Net sales – outside the U.S.	1,904		1,928		1,904
Net sales	$	24,947	$	26,381	$	24,947

Net sales by products and services ~~for the three months ended April 29, 2018~~ follow.


			Three Months Ended
in millions			May 5, 2019		April 29, 2018
Net sales – products	$	23,735	$	25,232	$	23,735
Net sales – services	1,212		1,149		1,212
Net sales	$	24,947	$	26,381	$	24,947

Major product lines, as well as the associated merchandising departments (and related services) ~~for the three months ended April 29, 2018~~ follow.



Major Product Line		Merchandising Departments
Building Materials		Building Materials, ~~Electrical,~~ Electrical/Lighting, Lumber, Millwork, and Plumbing
Décor		Appliances, Dé~~cor,~~cor/Storage, Flooring, Kitchen and Bath, and Paint
Hardlines		Hardware, Indoor Garden, Outdoor Garden, and Tools

During the first quarter of fiscal 2019, we combined the Electrical and Lighting merchandising departments into one department, Electrical/Lighting, and we renamed the Décor merchandising department to Décor/Storage. These changes had no impact on our net sales presentations.

Net sales by major product lines ~~for the three months ended April 29, 2018~~(and related services) follow.


			Three Months Ended
in millions			May 5, 2019		April 29, 2018
Building Materials	$	9,326	$	9,404	$	9,321
Décor			8,745		8,413
Hardlines	8,415		8,232		7,213
Décor	7,206
Net sales	$	24,947	$	26,381	$	24,947

—————

Note: Net sales for certain merchandising departments were reclassified in the first quarter of fiscal 2019. As a result, prior-period amounts have been reclassified to conform with the current-period presentation.


3.	~~INCOME TAXES~~PROPERTY AND LEASES

~~On December 22, 2017,~~Net Property and Equipment

Net property and equipment includes accumulated depreciation and amortization of $20.9 billion as ofMay 5, 2019 and $20.6 billion as of February 3, 2019.

Leases

We lease certain retail locations, office space, warehouse and distribution space, equipment, and vehicles. While most of these leases are operating leases, certain retail locations and equipment are leased under finance leases. We consider various factors such as market conditions and the ~~SEC issued Staff Accounting Bulletin No. 118 ("SAB 118")~~terms of any renewal options that may exist to ~~address~~determine whether we will renew or replace the ~~application~~lease. A substantial majority of ~~GAAP in situations when a registrant does not~~our leases have ~~the necessary information available, prepared, or analyzed (including computations) in reasonable detail~~remaining lease terms of one to complete the accounting for certain income tax effects of the Tax Act. For the three months ended April 29, 2018, our accounting for the Tax Act is incomplete. As disclosed in our 2017 Form 10-K, however, we were able to reasonably estimate certain effects and, therefore, recorded provisional adjustments associated20 years, typically with the ~~deemed repatriation transition tax~~option to extend the leases for up to five years. Some of our leases may include the option to terminate in less than five years. In the event we are reasonably certain to exercise the option to extend a lease, we will include the extended terms in the operating lease right-of-use asset and ~~remeasurement~~operating lease liability. Real estate taxes, insurance, maintenance, and operating expenses applicable to the leased property are our obligations under the lease agreements.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Further, certain lease agreements include rental payments based on an index or rate and others include rental payments based on a percentage of ~~deferred tax~~sales.

The gross amounts of assets and ~~liabilities.~~liabilities related to both operating and finance leases follow.



in millions	Balance Sheet Caption	May 5, 2019
Assets:
Operating lease assets	Operating lease right-of-use assets	$	5,629
Finance lease assets	Net property and equipment	830
Total lease assets		$	6,459

Liabilities:
Current:
Operating lease liabilities	Current operating lease liabilities	$	793
Finance lease liabilities	Current installments of long-term debt	84
Long-term:
Operating lease liabilities	Long-term operating lease liabilities	5,145
Finance lease liabilities	Long-term debt, excluding current installments	972
Total lease liabilities		$	6,994

The components of lease cost follow.



in millions	Statement of Earnings Caption	Three Months Ended May 5, 2019
Operating lease cost	Selling, general and administrative	$	210
Finance lease cost:
Amortization of leased assets	Depreciation and amortization	21
Interest on lease liabilities	Interest expense	23
Short-term lease costs	Selling, general and administrative	25
Variable lease cost	Selling, general and administrative	58
Sublease income	Selling, general and administrative	(3		)
Net lease cost		$	334

ASU 2016-02 requires that public companies use a secured incremental borrowing rate as the discount rate for present value of lease payments. We determine a secured rate on a quarterly basis and update the weighted average discount rate accordingly. Lease terms and discount rates follow.



	May 5, 2019
Weighted Average Remaining Lease Term (Years):
Operating leases	11
Finance leases	14

Weighted Average Discount Rate:
Operating leases	3.1	%
Finance leases	11.7	%

The approximate future minimum lease payments under operating and finance leases at May 5, 2019 follow.



in millions	Operating Leases		Finance Leases
Fiscal 2019	$	706	$	123
Fiscal 2020	907		176
Fiscal 2021	796		149
Fiscal 2022	696		146
Fiscal 2023	601		139
Thereafter	3,249		970
Total lease payments	6,955		1,703
Less imputed interest	1,017		647
Present value of lease liabilities	$	5,938	$	1,056

—————

Note: Amounts presented do not include payments relating to immaterial leases excluded from the balance sheets as part of transition elections adopted upon implementation of Topic 842. Additionally, we have excluded approximately $1 billion of leases (undiscounted basis) that have not ~~made any measurement-period adjustments related~~yet commenced. These leases will commence between 2019 and 2020 with lease terms of one to these items during the first quarter of fiscal 2018 because we have not finalized the following items: the earnings and profits of the relevant subsidiaries, deemed repatriation of deferred foreign income, and prior year deferred tax activity. We are continuing to gather additional information to complete our accounting for these items and expect to complete our accounting within the one-year time period provided by SAB 118. Any adjustment to these amounts during the measurement period will be recorded in income tax expense in the period in which the analysis is complete.20 years.

The Tax Act also creates a new requirement that certain income (i.e., global intangible low-taxed income or "GILTI") earned by controlled foreign corporations ("CFCs") must be included currently in the gross income of the CFCs’ U.S. shareholder. Due to the complexity of the new GILTI tax rules, we are not yet able to reasonably estimate the long-term effects of this provision. Therefore, we have not recorded any potential deferred tax effects related to GILTI in our consolidated financial statementsapproximate future minimum lease payments under capital and have not made a policy decision regarding whether to record deferred taxes on GILTI or use the period cost method. We have, however, included an estimate of the current GILTI impact in our annual effective tax rate for fiscal 2018.operating leases at February 3, 2019 follow.



in millions	Operating Leases		Capital Leases
Fiscal 2019	$	976	$	150
Fiscal 2020	912		167
Fiscal 2021	792		143
Fiscal 2022	682		142
Fiscal 2023	584		137
Thereafter	3,090		970
	$	7,036	1,709
Less imputed interest			660
Net present value of capital lease obligations			1,049
Less current installments			57
Long-term capital lease obligations, excluding current installments			$	992

Other lease information follows.



in millions	Three Months Ended May 5, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows – operating leases	$	249
Operating cash flows – finance leases	23
Financing cash flows – finance leases	14
Leased assets obtained in exchange for new operating lease liabilities	166
Leased assets obtained in exchange for new finance lease liabilities	1


4.	STOCKHOLDERS' EQUITY

~~Accelerated Share Repurchase Agreements~~Stock Rollforward

~~We enter into ASR agreements from time to time with third-party financial institutions to repurchase~~A reconciliation of the number of shares of our common ~~stock. These agreements are structured as outlined in the 2017 Form 10-K. The terms of the ASR agreement entered into during the first three months of fiscal 2018 follow (in millions).~~stock and dividends per share follows.

Agreement
Date

Settlement
Date

Agreement
Amount

Initial
Shares Delivered

Additional
Shares Delivered

Total
Shares Delivered
Q1 2018 ⁽¹⁾

Q2 2018 ⁽²⁾
$750 3.4 0.8 4.2

~~—————~~


~~(1)~~	The fair market value of the initial 3.4 million shares on the date of delivery was $598 million and is included in treasury stock as of April 29, 2018, with the remaining $152 million included in paid-in capital.


~~(2)~~	~~The ASR agreement terminated on May 17, 2018, at which time we became contractually entitled to receive an additional 0.8 million shares upon settlement.~~

~~See Note 6 to the consolidated financial statements in the 2017 Form 10-K for further discussion.~~



shares in millions	Three Months Ended
	May 5, 2019			April 29, 2018
Common stock:
Balance at beginning of period	1,782			1,780
Shares issued under employee stock plans	2			1
Balance at end of period	1,784			1,781
Treasury stock:
Balance at beginning of period	(677		)	(622		)
Repurchases of common stock	(6		)	(5		)
Balance at end of period	(683		)	(627		)
Shares outstanding at end of period	1,101			1,154

Cash dividends per share	$	1.36		$	1.03


5.	FAIR VALUE MEASUREMENTS

The fair value of an asset is considered to be the price at which the asset could be sold in an orderly transaction between unrelated knowledgeable and willing parties. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a new obligor, rather than the amount that would be paid to settle the liability with the creditor. Assets and liabilities recorded at fair value are measured using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities that are measured at fair value on a recurring basis follow.

Fair Value at April 29, 2018 Using Fair Value at January 28, 2018 Using
amounts in millions
Quoted Prices in Active Markets for Identical Assets
(Level 1)

Significant Observable Inputs
(Level 2)

Significant Unobservable Inputs
(Level 3)

Quoted Prices in Active Markets for Identical Assets
(Level 1)

Significant Observable Inputs
(Level 2)

Significant Unobservable Inputs
(Level 3)
Derivative agreements - assets $

$ 200
$

$

$ 235
$

Derivative agreements - liabilities —
(29 ) —
—
(12 ) —
Total $

$ 171
$

$

$ 223
$



	Fair Value at May 5, 2019 Using							Fair Value at February 3, 2019 Using
in millions	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)
Derivative agreements – assets	$	—	$	144		$	—	$	—	$	138		$	—
Derivative agreements – liabilities	—		(13		)	—		—		(11		)	—
Total	$	—	$	131		$	—	$	—	$	127		$	—

We use derivative financial instruments from time to time in the management of our interest rate exposure on long-term debt and our exposure on foreign currency fluctuations. The fair value of our derivative financial instruments was measured using observable market information (level 2).

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

The carrying amounts of cash and cash equivalents, receivables, short-term debt, and accounts payable approximate fair value due to the short-term maturities of these financial instruments.

Long-lived assets and other intangible assets were analyzed for impairment on a nonrecurring basis using fair value measurements with unobservable inputs (level 3).

The aggregate fair values and carrying values of our senior notes follow.


	April 29, 2018				January 28, 2018				May 5, 2019				February 3, 2019
in millions	Fair Value (Level 1)		Carrying Value		Fair Value (Level 1)		Carrying Value		Fair Value (Level 1)		Carrying Value		Fair Value (Level 1)		Carrying Value
Senior notes	$	25,545	$	24,469	$	26,617	$	24,485	$	28,813	$	26,832	$	28,348	$	26,814


6.	WEIGHTED AVERAGE COMMON SHARES

The reconciliation of our basic to diluted weighted average common shares follows.

Three Months Ended
in millions April 29,
2018 April 30,
2017
Basic weighted average common shares 1,152
1,198
Effect of potentially dilutive securities 6
6
Diluted weighted average common shares 1,158
1,204



~~Anti-dilutive securities excluded from diluted weighted average common shares~~ ⁽¹⁾	—	1

~~—————~~

~~(1) Represent options that were granted under our employee stock plans to purchase shares of our common stock.~~



	Three Months Ended
in millions	May 5, 2019	April 29, 2018
Basic weighted average common shares	1,101	1,152
Effect of potentially dilutive securities	5	6
Diluted weighted average common shares	1,106	1,158

Anti-dilutive securities excluded from diluted weighted average common shares	—	—


7.	COMMITMENTS AND CONTINGENCIES

We are involved in litigation arising in the normal course of business. In management’s opinion, any such litigation is not expected to have a material adverse effect on our consolidated financial condition, results of operations, or cash flows.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors

The Home Depot, Inc.:

Results of Review of Interim Financial Information

We have reviewed the Consolidated Balance Sheet of The Home Depot, Inc. and ~~Subsidiaries~~its subsidiaries (the "Company") as of ~~April 29, 2018~~,May 5, 2019, the related Consolidated Statements of Earnings, Comprehensive Income, Stockholders' Equity, and Cash Flows for the three-month periods ended May 5, 2019 and April 29, 2018, ~~and April 30, 2017,~~ and the related notes (collectively, the ~~"Consolidated~~“Consolidated Interim Financial ~~Information"~~Information”). Based on our reviews, we are not aware of any material modifications that should be made to the Consolidated Interim Financial Information for it to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ~~("PCAOB"~~(“PCAOB”), the Consolidated Balance Sheet of the Company as of ~~January 28, 2018~~,February 3, 2019, and the related Consolidated Statements of Earnings, Comprehensive Income, Stockholders’ Equity, and Cash Flows for the year then ended (not presented herein); and in our report dated March ~~22, 2018,~~28, 2019, we expressed an unqualified opinion on those ~~Consolidated Financial Statements.~~consolidated financial statements. In our opinion, the information set forth in the accompanying Consolidated Balance Sheet as of ~~January 28, 2018~~,February 3, 2019, is fairly stated, in all material respects, in relation to the Consolidated Balance Sheet from which it has been derived.

Basis for Review Results

This Consolidated Interim Financial Information is the responsibility of the Company’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our reviews in accordance with the standards of the PCAOB. A review of consolidated interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

/s/ KPMG LLP

Atlanta, Georgia

May ~~21, 2018~~28, 2019


Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.

Our MD&A includes the following sections:


•	Executive Summary


•	Results of Operations and Non-GAAP Financial Measures


•	Liquidity and Capital Resources


•	Critical Accounting Policies

Executive Summary

Highlights of our financial performance for the first quarter of fiscal ~~2018~~2019 follow.


dollars in millions, except per share data	Three Months Ended						Three Months Ended
dollars in millions, except per share data	April 29, 2018			April 30, 2017			May 5, 2019			April 29, 2018
Net sales	$	24,947		$	23,887		$	26,381		$	24,947
Net earnings	2,404			2,014			2,513			2,404
Effective tax rate	23.5		%	35.2		%	24.4		%	23.5		%

Diluted earnings per share	$	2.08		$	1.67		$	2.27		$	2.08

Net cash provided by operating activities	$	3,981		$	4,564		$	4,575		$	3,981
Repurchases of common stock	1,121			1,289			1,368			1,121

We reported net sales of ~~$24.9~~$26.4 billion in the first quarter of fiscal ~~2018.~~2019. Net earnings were ~~$2.4~~$2.5 billion, or ~~$2.08~~$2.27 per diluted share.

We opened three new stores in the U.S. and closed one ~~new~~ store in ~~the U.S.~~Mexico during the first quarter of fiscal ~~2018,~~2019, for a total store count of ~~2,285~~2,289 at the end of the quarter. As of ~~April 29, 2018,~~May 5, 2019, a total of ~~304~~305 of our stores, or 13.3%, were located in Canada and Mexico. ~~Total~~For the first quarter of fiscal 2019, total sales per square foot were ~~$412.03 in the first quarter of fiscal 2018,~~$435.18 and our inventory turnover ratio was ~~4.9 times~~4.7 times.

We generated $4.6 billion of cash flow from operations during the first three months of fiscal 2019. This cash flow, together with cash on hand, was used to pay $1.5 billion of dividends, repay $967 million of short-term debt, fund cash payments of $1.4 billion for share repurchases, and fund $681 million in capital expenditures.

During the first three months of fiscal 2019, we repurchased a total of 6.5 million shares of our common stock through open market transactions. In February 2019, we announced a 32.0% increase in our quarterly cash dividend to $1.36 per share.

Our ROIC for the trailing twelve-month period was 45.4% at the end of the first quarter of fiscal ~~2018.~~

During the first quarter of fiscal 2018, we repurchased a total of 4.7 million shares of our common stock for $1.0 billion through an ASR agreement and open market transactions. In February 2018, we announced a 15.7% increase in our quarterly cash dividend to $1.03 per share.

We generated $4.0 billion of cash flow from operations in the first quarter of fiscal 2018. This cash flow was used to pay $1.2 billion of dividends, repay $1.2 billion of short-term borrowings, fund cash payments of $1.1 billion for share repurchases, and fund $556 million in capital expenditures.

~~Our ROIC was 36.0% for the first quarter of fiscal 2018.~~2019. See the "Non-GAAP Financial Measures" section below for our definition and calculation of ROIC, as well as a reconciliation of NOPAT, a non-GAAP financial measure, to net earnings ~~the~~(the most comparable GAAP financial ~~measure.~~measure).

Results of Operations and Non-GAAP Financial Measures

The tables and discussion below should be read in conjunction with our consolidated financial statements and related notes included in this report and in the 2018 Form 10-K and with our MD&A included in ~~our 2017~~the 2018 Form 10-K. We believe the percentage relationship between net sales and major categories in our consolidated statements of earnings, as well as the percentage change in the associated dollar amounts, are relevant to an evaluation of our business.

Fiscal 2019 and Fiscal 2018 Three Month Comparisons


	Three Months Ended										Three Months Ended
	April 29, 2018					April 30, 2017					May 5, 2019					April 29, 2018
dollars in millions	$			% of Net Sales		$			% of Net Sales		$			% of Net Sales		$			% of Net Sales
Net sales	$	24,947				$	23,887				$	26,381				$	24,947
Gross profit	8,617			34.5	%	8,154			34.1	%	9,017			34.2	%	8,617			34.5	%
Operating expenses:
Selling, general and administrative	4,779			19.2		4,361			18.3		4,940			18.7		4,779			19.2
Depreciation and amortization	457			1.8		444			1.9		480			1.8		457			1.8
Total operating expenses	5,236			21.0		4,805			20.1		5,420			20.5		5,236			21.0
Operating Income	3,381			13.6		3,349			14.0
Operating income											3,597			13.6		3,381			13.6
Interest and other (income) expense:
Interest and investment income	(22		)	(0.1	)	(13		)	(0.1	)	(15		)	(0.1	)	(22		)	(0.1	)
Interest expense	261			1.0		254			1.1		288			1.1		261			1.0
Interest and other, net	239			1.0		241			1.0		273			1.0		239			1.0
Earnings before provision for income taxes	3,142			12.6		3,108			13.0		3,324			12.6		3,142			12.6
Provision for income taxes	738			3.0		1,094			4.6		811			3.1		738			3.0
Net earnings	$	2,404		9.6	%	$	2,014		8.4	%	$	2,513		9.5	%	$	2,404		9.6	%

—————

Note: Certain percentages may not sum to totals due to rounding.


	Three Months Ended					Three Months Ended
Selected financial and sales data:	April 29, 2018		April 30, 2017		% Change	May 5, 2019		April 29, 2018		% Change
Comparable sales (% change) ⁽¹⁾	4.2%		5.5%		N/A	2.5%		4.2%		N/A
Comparable customer transactions (% change) ⁽²⁾⁽¹⁾	(1.5)%		1.5%		N/A	0.5%		(1.5)%		N/A
Comparable average ticket (% change) ⁽²⁾⁽¹⁾	5.8%		3.9%		N/A	2.0%		5.8%		N/A
Customer transactions (in millions) ⁽²⁾⁽¹⁾	375.9		380.8		(1.3)%	390.0		375.9		3.8%
Average ticket ⁽²⁾⁽¹⁾	$	66.02	$	62.39	5.8%	$	67.31	$	66.02	2.0%
Sales per square foot ⁽²⁾⁽¹⁾	$	412.03	$	394.17	4.5%	$	435.18	$	412.03	5.6%
Diluted earnings per share	$	2.08	$	1.67	24.6%	$	2.27	$	2.08	9.1%

—————


(1)	~~The calculation for the three months ended April 30, 2017 does not include results for Interline, which was acquired in the fiscal year ended January 31, 2016.~~


~~(2)~~	Does not include results for Interline.

~~First Quarter of Fiscal 2018 Compared to First Quarter of Fiscal 2017~~

Sales. We assess our sales performance by evaluating both net sales and comparable sales.

Net Sales. Net sales for the first quarter of fiscal ~~2018~~2019 increased ~~4.4%~~5.7% to $26.4 billion from $24.9 billion ~~from $23.9 billion for~~in the first quarter of fiscal ~~2017~~.2018. The increase in net sales in the first quarter of fiscal ~~2018~~2019 primarily reflected the impact of positive comparable sales driven by ~~a 5.8%~~an increase in comparable average ticket and ~~a benefit of $33 million resulting from the adoption of ASU No. 2014-09, partially offset by a decline in~~comparable customer transactions. ~~See~~ ~~Note 1~~Online sales, which consist of sales generated online through our websites for products picked up in our stores or delivered to ~~our consolidated financial statements for further discussion.~~customer locations, represented 8.9% of net sales and grew 23.0% during the first quarter of fiscal 2019. A stronger U.S. dollar negatively impacted sales growth by $76 million in the first quarter of fiscal 2019.

Comparable Sales. Comparable sales is a measure that highlights the performance of our existing locations and websites by measuring the change in net sales for a period over the comparable prior-period of equivalent length. Comparable sales includes sales at all locations, physical and online, open greater than 52 weeks (including

remodels and relocations) and excluding closed stores. Retail stores become comparable on the Monday following their ~~365th~~365^th day of operation. Acquisitions, digital or otherwise, are included in comparable sales after we own ~~them~~the acquired assets for ~~greater~~more than 52 weeks. Comparable sales includes new product and service offering sales that have been offered for more than 52 weeks. Comparable sales excludes prior-year sales of product and service offerings that we have exited in the current period. Fiscal 2019 includes 52 weeks ~~(with the exception~~and fiscal 2018 included 53

weeks. For our calculation of ~~Interline, which is excluded from~~ comparable sales ~~for periods prior to~~in fiscal ~~2018).~~2019, we will compare weeks 1 through 52 in fiscal 2019 against weeks 2 through 53 in fiscal 2018. Comparable sales is intended only as supplemental information and is not a substitute for net sales presented in accordance with GAAP.

Total comparable sales increased ~~4.2%~~2.5% in the first quarter of fiscal ~~2018~~.2019, consisting of a 2.0% increase in comparable average ticket and a 0.5% increase in comparable customer transactions. The increase in comparable sales ~~reflects~~reflected a number of factors, including ~~the~~ execution of our ~~strategy~~strategic efforts to drive an enhanced interconnected experience in both the physical and ~~broad-based growth across our stores and online. Online~~digital worlds. Comparable sales ~~which consist of sales generated online through our websites for products picked up~~ in ~~our stores or delivered to customer locations, represented 7.6% of net sales and grew 20.2% during~~ the first quarter of fiscal 2019 reflected a negative impact due to a shift in the comparable base as a result of the 53^rd week in fiscal 2018. Total comparable sales in the first quarter of 2019 also reflected the impact of lumber price deflation, wet weather in February, and higher prior-year hurricane-related sales.

All of our departments except for ~~three,~~four posted positive comparable sales in the first quarter of fiscal ~~2018.~~2019. Comparable sales for our Appliances, ~~Electrical, Lumber,~~Indoor Garden, Dé~~cor,~~cor/Storage, Tools, ~~Plumbing, Flooring, Millwork,~~Outdoor Garden, Building Materials, ~~Kitchen and Bath, Paint,~~Plumbing, and Hardware merchandising departments were above ~~or at~~ the Company average in the first quarter of fiscal ~~2018.~~2019. Comparable sales ~~in our Indoor~~for Flooring and ~~Outdoor Garden merchandising departments~~Millwork were slightly negative due to the impact of higher prior-year hurricane-related sales. Electrical/Lighting was negatively impacted by ~~extreme winter weather in the quarter,~~light bulbs while ~~comparable sales for Lighting were lower due to LED~~Lumber was negatively impacted by commodity price deflation. ~~Our comparable average ticket increased 5.8% during the first quarter of fiscal 2018, due in part to strong sales in big ticket purchases in certain merchandising departments, such as Appliances.~~

Gross Profit. Gross profit increased ~~5.7%~~$400 million to $9.0 billion in the first quarter of fiscal 2019 from $8.6 billion in the first quarter of fiscal ~~2018 from $8.2 billion in the first quarter of fiscal 2017.~~2018. Gross profit as a percent of net sales, or gross profit margin, was 34.2% for the first quarter of fiscal 2019 compared to 34.5% for the first quarter of fiscal ~~2018 compared to 34.1% for the~~ ~~first~~ ~~quarter of fiscal~~ ~~2017~~.2018. The ~~increase~~decrease in gross profit margin ~~for the first quarter of fiscal 2018~~was primarily ~~reflected $131 million of benefit from the adoption of ASU 2014-09, expansion due to changes~~driven by a change in product mix, ~~and the benefit of recent acquisitions, partially offset by~~ higher shrink, and higher ~~transportation costs in our~~ supply ~~chain.~~chain and fulfillment expense.

Operating Expenses. Our operating expenses are composed of SG&A and depreciation and amortization.

Selling, General & Administrative. SG&A increased ~~9.6%~~$161 million to ~~$4.8 billion in the~~ ~~first~~ ~~quarter of fiscal~~ ~~2018~~ ~~from $4.4~~$4.9 billion in the first quarter of fiscal ~~2017~~.2019 from $4.8 billion in the first quarter of fiscal 2018. As a percent of net sales, SG&A was 18.7% for the first quarter of fiscal 2019 compared to 19.2% for the first quarter of fiscal ~~2018 compared to 18.3% for the first quarter of fiscal 2017.~~2018. The ~~increase~~decrease in SG&A as a percent of net sales for the first quarter of fiscal ~~2018~~ ~~reflected an increase of $131 million from the adoption of ASU 2014-09, and incremental investments made in the business, partially offset~~2019 was primarily driven by expense leverage resulting from the positive comparable sales environment and continued expense control.

Depreciation and Amortization. Depreciation and amortization increased ~~2.9%~~$23 million to ~~$457~~$480 million ~~in the~~ ~~first~~ ~~quarter of fiscal~~ ~~2018~~ ~~from $444 million in the~~ ~~first~~ ~~quarter of fiscal~~ ~~2017. The decrease in depreciation and amortization as a percent of net sales to 1.8% in the~~ ~~first~~ ~~quarter of fiscal~~ ~~2018~~ ~~from 1.9%~~ in the first quarter of fiscal ~~2017 reflected expense~~2019 from $457 million in the first quarter of fiscal 2018. As a percent of net sales, depreciation and amortization was 1.8% in the first quarter of both fiscal 2019 and fiscal 2018, reflecting the offsetting effects of strategic investments in the business, leverage resulting from the positive comparable sales ~~environment.~~environment, and timing of asset additions.

Interest and Other, net. Interest and other, net, was $273 million in the first quarter of fiscal 2019 compared to $239 million in the first quarter of fiscal ~~2018~~ ~~compared to $241 million in the~~ ~~first~~ ~~quarter of fiscal~~ ~~2017~~.2018. Interest and other, net, as a percent of net sales was 1.0% for the first quarter of both fiscal ~~2018~~2019 and ~~2017~~fiscal 2018 and primarily reflected higher interest expense resulting from higher ~~short-term and long-term~~ debt ~~balances, partially offset by higher interest income.~~balances.

Provision for Income Taxes. Our combined effective income tax rate was 24.4% for the first quarter of fiscal 2019 compared to 23.5% for the first quarter of fiscal ~~2018 compared to 35.2% for the first quarter of fiscal 2017.~~2018. The ~~decrease~~increase in the provision for income taxes in the first quarter of fiscal ~~2018~~2019 was primarily ~~attributable~~due to the ~~enactment~~prior-year impact of ~~the Tax Act.~~certain state tax settlements.

Diluted Earnings per Share. Diluted earnings per share were ~~$2.08 for the~~ ~~first~~ ~~quarter of fiscal~~ ~~2018~~ ~~compared to $1.67~~$2.27 for the first quarter of fiscal ~~2017. Diluted earnings per share~~2019 compared to $2.08 for the first quarter of fiscal ~~2018 reflected a benefit of $0.32 per diluted share resulting from the enactment of the Tax Act.~~2018.

Non-GAAP Financial Measures

To provide clarity, internally and externally, about our operating performance, we supplement our reporting with certain non-GAAP financial measures. However, this supplemental information should not be considered in isolation or as a substitute for the related GAAP measures. Non-GAAP financial measures presented herein may differ from similar measures used by other companies.

Return on Invested Capital. We believe ROIC is meaningful for investors and management because it measures how effectively we deploy our capital base. We define ROIC as NOPAT, a non-GAAP financial measure, for the most recent twelve-month period, divided by average debt and equity. We define average debt and equity as the average of beginning and ending long-term debt (including current installments) and equity for the most recent twelve-month period.

The calculation of ROIC, together with a reconciliation of NOPAT to net earnings (the most comparable GAAP measure), follows.


	Twelve Months Ended						Twelve Months Ended
dollars in millions	April 29, 2018			April 30, 2017			May 5, 2019			April 29, 2018
Net earnings	$	9,020		$	8,168		$	11,230		$	9,020
Interest and other, net	981			940			1,008			981
Provision for income taxes	4,712			4,591			3,508			4,712
Operating income	14,713			13,699			15,746			14,713
Income tax adjustment ⁽¹⁾	(4,988		)	(4,936		)	(3,745		)	(4,988		)
NOPAT	$	9,725		$	8,763		$	12,001		$	9,725

Average debt and equity	$	27,014		$	27,091		$	26,437		$	27,014

ROIC	36.0		%	32.3		%	45.4		%	36.0		%

—————


(1)	Income tax adjustment is defined as operating income multiplied by our effective tax ~~rate.~~rate for the trailing twelve months.

Additional Information

For information on accounting pronouncements that have impacted or are expected to materially impact our consolidated financial condition, results of operations, or cash flows, see Note 1 to our consolidated financial statements.

Liquidity and Capital Resources

Cash and Cash Equivalents

At ~~April 29, 2018,~~May 5, 2019, we had ~~$3.6~~$1.9 billion in cash and cash equivalents, of which ~~$3.2~~$1.5 billion was held by our foreign subsidiaries. We believe that our current cash position, access to the long-term debt capital markets, ~~and~~ cash flow generated from operations, and funds available under our commercial paper programs should be sufficient not only for our operating requirements but also to enable us to complete our capital expenditure programs and fund dividend payments, share repurchases, and any required long-term debt payments through the next several fiscal years. In addition, we believe that we have ~~funds available from our commercial paper programs and~~ the ability to obtain alternative sources of financing.

As we ~~accelerate~~continue our investments in the business within our disciplined approach to capital allocation, we expect capital expenditures of approximately ~~$2.5~~$2.7 billion in fiscal ~~2018.~~2019.

Debt and Derivatives

We have commercial paper programs that allow for borrowings of up to $3.0 billion. All of our short-term borrowings in the first ~~quarter~~three months of fiscal ~~2018~~2019 were under these commercial paper programs, and the maximum amount outstanding at any time ~~during the first quarter of fiscal 2018~~ was ~~$2.4~~$2.1 billion. In connection with these programs, we have back-up credit facilities with a consortium of banks for borrowings up to $3.0 ~~billion. Our back-up credit facilities~~billion, which consist of a five-year $2.0 billion credit facility scheduled to expire in December 2022 and a 364-day $1.0 billion credit facility scheduled to expire in December ~~2018.~~2019. At ~~April 29, 2018,~~May 5, 2019, we were in compliance with all of the covenants contained in the credit facilities, and none are expected to impact our liquidity or capital resources. At ~~April 29, 2018,~~May 5, 2019, there were ~~$350~~$372 million of borrowings outstanding under the commercial paper programs. We also issue senior notes from time to time.

We use derivative financial instruments in the management of our exposure to fluctuations in foreign currency exchange rates and interest rates on certain long-term debt. ~~See~~ ~~Note 5~~ ~~to our consolidated financial statements for further discussion.~~

Share Repurchases

In ~~December 2017,~~February 2019, our Board of Directors authorized a new $15.0 billion share repurchase program that replaced the previous authorization. In the first ~~quarter~~three months of fiscal ~~2018,~~2019, we repurchased ~~4.7~~6.5 million shares of our common stock for ~~$1.0~~$1.3 billion through ~~an ASR agreement and~~ open market ~~transactions. See~~ ~~Note 4~~ ~~to our consolidated financial statements for further discussion on the ASR agreement.~~purchases.

Cash Flows Summary

Operating Activities. Cash flow generated from operations provides us with a significant source of liquidity. Our operating cash flows result primarily from cash received from our customers, offset by cash payments we make for products and services, employee compensation, operations, and occupancy costs.

Net cash provided by operating activities ~~decreased $583~~increased $594 million in the first ~~quarter~~three months of fiscal 2019 compared to the first three months of fiscal 2018 ~~compared to the same period last year~~ and was primarily ~~reflected increased merchandise inventory purchases, offset~~driven by ~~an increase in~~ net ~~earnings, excluding~~cash inflows associated with changes in working capital and ~~non-cash items from operations.~~an increase in net earnings. The increase in net earnings ~~resulted from higher~~during the first three months of fiscal 2019 was due to the positive comparable sales environment and expense ~~leverage in the first quarter of fiscal 2018, as well as a lower effective income tax rate in the first quarter of fiscal 2018 resulting from the enacting of the Tax Act.~~leverage.

Cash provided by or used in operating activities is also subject to changes in working capital. Working capital at any specific point in time is subject to many variables, including seasonality, inventory management and category expansion, the timing of cash receipts and payments, vendor payment terms, and fluctuations in foreign exchange rates.

Investing Activities. Cash used in investing activities primarily reflected capital expenditures ~~for~~from the continuation of our strategic investments in our business of $681 million during the first three months of fiscal 2019 compared to $556 million of capital expenditures in the first ~~quarter~~three months of fiscal ~~2018 and $458 million in the first quarter of fiscal 2017.~~2018.

Financing Activities. Cash used in financing activities primarily reflected:

$1.5 billion of cash dividends paid, $1.4 billion of share repurchases, and $967 million of net repayments of short-term debt in the first three months of fiscal 2019, and

$1.2 billion of net repayments of short-term ~~borrowings;~~debt, $1.2 billion of cash dividends ~~paid;~~paid, and $1.1 billion of share repurchases in the first ~~quarter~~three months of fiscal ~~2018 and~~

~~$1.3 billion of share repurchases; $1.1 billion of cash dividends paid; and $710 million of repayments of short-term borrowings in the first quarter of fiscal 2017.~~2018.

Critical Accounting Policies

There were no changes during fiscal 2019 to our critical accounting policies as disclosed in the 2018 Form 10-K. Our significant accounting policies are disclosed in Note 1 to our consolidated financial statements. ~~There were no changes during the first quarter of fiscal 2018 to our critical accounting policies as disclosed in the 2017 Form 10-K.~~


Item 3.	Quantitative and Qualitative Disclosures about Market Risk.

Our exposure to market risks results primarily from fluctuations in interest rates. We are also exposed to risks from foreign currency exchange rate fluctuations on the translation of our foreign operations into U.S. dollars and on the purchase of goods by these foreign operations that are not denominated in their local currencies. There have been no material changes to our exposure to market risks from those disclosed in the ~~2017~~2018 Form 10-K.


Item 4.	Controls and Procedures.

Under the direction and with the participation of ~~the~~ our Chief Executive Officer and Chief Financial Officer, we evaluated our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) and concluded that our disclosure controls and procedures were effective as of ~~April 29, 2018.~~May 5, 2019. There has been no change in our internal control over financial reporting during the fiscal quarter ended ~~April 29, 2018,~~May 5, 2019, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

Except as set forth below, there were no material changes during the first quarter of fiscal 2019 to our disclosure in Item 3 of our 2018 Form 10-K.

SEC regulations require us to disclose certain information about proceedings arising under federal, state or local environmental provisions if we reasonably believe that such proceedings may result in monetary sanctions of $100,000 or more.

As previously reported, in January 2017, we became aware of an investigation by the EPA’s criminal investigation division into our compliance with lead-safe work practices for certain jobs performed through our installation services business. We have also previously responded to civil document requests from several EPA regions. In the second quarter of fiscal 2018, we received a subpoena for documents from the EPA civil enforcement division. We are currently in discussions with the civil division of the EPA. We are continuing to cooperate with the EPA.

Item 1A. Risk Factors.

In addition to the other information set forth in this report, you should carefully consider the factors discussed under Item 1A, "Risk Factors" and elsewhere in the ~~2017~~2018 Form 10-K. These risks and uncertainties could materially and adversely affect our business, consolidated financial condition, results of operations, or cash flows. Our operations could also be affected by additional factors that are not presently known to us or by factors that we currently do not consider material to our business. There have been no material changes in the risk factors discussed in the ~~2017~~2018 Form 10-K.


Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.

Issuer Purchases of Equity Securities

Since the inception of our initial share repurchase program in fiscal 2002 through the end of the first quarter of fiscal 2018, we have repurchased shares of our common stock having a value of approximately $76.1 billion. The number and average price of shares purchased in each fiscal month of the first quarter of fiscal ~~2018~~2019 follow.

Period
Total
Number of
Shares
Purchased⁽¹⁾

Average Price
Paid
Per Share⁽¹⁾

Total Number of
Shares Purchased as
Part of Publicly
Announced Program⁽²⁾

Dollar Value of
Shares that May Yet
Be Purchased
Under the Program⁽²⁾
January 29, 2018 – February 25, 2018 168,708
$186.49
149,500
$12,917,104,510
February 26, 2018 – March 25, 2018 ⁽³⁾
4,805,927
178.55
4,581,219
11,945,001,414
March 26, 2018 – April 29, 2018 447
183.71
—
11,945,001,414
Total 4,975,082
178.82
4,730,719



Period	Total Number of Shares Purchased⁽¹⁾	Average Price Paid Per Share⁽¹⁾		Total Number of Shares Purchased as Part of Publicly Announced Program⁽²⁾	Dollar Value of Shares that May Yet Be Purchased Under the Program⁽²⁾
February 4, 2019 – March 3, 2019	2,108,993	$	187.10	2,013,140	$	14,900,864,636
March 4, 2019 – March 31, 2019	2,565,752	185.94		2,140,646	14,504,027,705
April 1, 2019 – May 5, 2019	2,357,235	202.22		2,354,860	14,027,829,292
Total	7,031,980	191.75		6,508,646

—————

(1) These amounts include repurchases pursuant to our Amended and Restated 2005 Omnibus Stock Incentive Plan and our 1997 Omnibus Stock Incentive Plan (collectively, the "Plans"). Under the Plans, participants may surrender shares as payment of applicable tax withholding on the vesting of restricted stock and deferred share awards. Participants in the Plans may also exercise stock options by surrendering shares of common stock that the participants already own as payment of the exercise price. Shares so surrendered by participants in the Plans are repurchased pursuant to the terms of the Plans and applicable award agreement and not pursuant to publicly announced share repurchase programs.

(2) In ~~December 2017,~~February 2019, our Board of Directors authorized a $15.0 billion share repurchase program that replaced the previous authorization. The program does not have a prescribed expiration date.

~~(3) In~~Sales of Unregistered Securities

During the first quarter of fiscal ~~2018, we paid $750 million under an ASR agreement and received an initial delivery of 3.4 million shares. See~~ ~~Note 4~~ ~~to our consolidated financial statements for further discussion.~~

~~Sales of Unregistered Securities~~

~~During the~~ ~~first~~ ~~quarter of fiscal~~ ~~2018~~,2019, we issued ~~569~~644 deferred stock units under the Home Depot, Inc. Nonemployee Directors’ Deferred Stock Compensation Plan pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506 of the SEC’s Regulation D thereunder. The deferred stock units were credited to the accounts of those non-employee directors who elected to receive all or a portion of board retainers in the form of deferred stock units instead of cash during the first quarter of fiscal ~~2018~~.2019. The deferred stock units convert to shares of common stock on a one-for-one basis following a termination of service as described in this plan.

During the first quarter of fiscal ~~2018~~,2019, we credited ~~1,209~~1,386 deferred stock units to participant accounts under the Restoration Plan pursuant to an exemption from the registration requirements of the Securities Act for involuntary, non-contributory plans. The deferred stock units convert to shares of common stock on a one-for-one basis following a termination of service as described in this plan.


Item 6.	Exhibits.

~~Item 6.~~ ~~Exhibits.~~

Exhibits marked with an asterisk (*) are incorporated by reference to exhibits or appendices previously filed with the SEC, as indicated by the references in brackets. All other exhibits are filed or furnished herewith.



Exhibit		Description
3.1	*	Amended and Restated Certificate of Incorporation of The Home Depot, Inc.
3.1	*	[Form 10-Q filed on September 1, 2011, Exhibit 3.1]
3.2	*	By-Laws of The Home Depot, Inc. (Amended and Restated Effective ~~March 3, 2016).~~February 28, 2019)
3.2	*	[Form 8-K filed on March ~~8, 2016,~~4, 2019, Exhibit 3.2]
~~12.1~~		~~Statement of Computation of Ratio of Earnings to Fixed Charges.~~15.1
~~15.1~~		Acknowledgement of Independent Registered Public Accounting Firm ~~dated May 21, 2018.~~
31.1		Certification of the Chief Executive Officer and President pursuant to Rule 13a-14(a).
31.2		Certification of the Chief Financial Officer and Executive Vice President – Corporate Services pursuant to Rule 13a-14(a).
32.1		Certification of Chief Executive Officer and President furnished pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2002.~~2002
32.2		Certification of Chief Financial Officer and Executive Vice President – Corporate Services furnished pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2002.~~2002
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the ~~Registrant~~registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



THE HOME DEPOT, INC. (Registrant)

By:		/s/ CRAIG A. MENEAR
		Craig A. Menear, Chairman, Chief Executive Officer and President

		/s/ CAROL B. TOMÉ
		Carol B. Tomé, Chief Financial Officer, and Executive Vice President – Corporate Services

Date:	May ~~21, 2018~~28, 2019

1821



in millions	As Reported		ASU No. 2014-09 Effect ⁽¹⁾			Excluding ASU No. 2014-09 Effect
Receivables, net	$	2,296	$	(46	)	$	2,342
Other current assets	887		269			618
Other accrued expenses	2,804		223			2,581



in millions	As Reported		ASU No. 2014-09 Effect			Excluding ASU No. 2014-09 Effect
Net sales	$	24,947	$	33		$	24,914
Cost of sales	16,330		(98		)	16,428
Gross profit	8,617		131			8,486
Selling, general and administrative	4,779		131			4,648



Agreement Date	Settlement Date	Agreement Amount	Initial Shares Delivered	Additional Shares Delivered	Total Shares Delivered
Q1 2018 ⁽¹⁾	Q2 2018 ⁽²⁾	$750	3.4	0.8	4.2



	Fair Value at April 29, 2018 Using					Fair Value at January 28, 2018 Using
amounts in millions	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)
Derivative agreements - assets	$	$	200		$	$	$	235		$
Derivative agreements - liabilities	—	(29		)	—	—	(12		)	—
Total	$	$	171		$	$	$	223		$