“With that, we are expecting 2026 sales ranging from $92 billion to $94 billion, with comparable sales in a range of flat to up 2%.”

In context

“for the year. I would like to discuss our 2026 financial outlook. While short-term interest rates have been coming down, affordability and the lock-in effect continue to pressure demand. Consumers are still cautious about discretionary big-ticket purchases. While many homeowners will receive larger refunds this year, it is unclear how much of that will be spent on home improvement. It is also unclear when mortgage rates will ease, which will continue to exert pressure on existing home sales and new home construction. Taking all of this into account, we forecast the home improvement market to be roughly flat this year in a range of down 1% to up 1%. We remain confident in the continued execution of our Total Home strategy, which will enable us to grow faster than the market and take share. With that, we are expecting 2026 sales ranging from $92 billion to $94 billion, with comparable sales in a range of flat to up 2%. We anticipate that ADG and FBM will contribute approximately $8 billion to sales. We expect operating margin in a range of 11.2% to 11.4% and adjusted operating margin in a range of 11.6% to 11.8%. This includes 30 basis points of dilution related to the wrap of FBM and ADG in 2026. As a reminder, the acquisitions drive approximately 50 basis points of dilution on an annualized basis. We expect gross margin to decline approximately 75 basis points compared to the prior year when we factor in the dilution related to the acquisitions. However, the acquisitions are accretive to consolidated SG&A as a % of sales. We will continue to drive our perpetual productivity improvement, or PPI initiatives, across the enterprise with a target of roughly $1 billion of productivity again this year. This”