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1、Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-Q(Mark One)QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended October 30,2022or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURI
2、TIES EXCHANGE ACT OF 1934For the transition period from to Commission File Number:1-8207THE HOME DEPOT,INC.(Exact name of registrant as specified in its charter)Delaware95-3261426(State or other jurisdiction of incorporation or organization)(I.R.S.Employer Identification No.)2455 Paces Ferry RoadAtl
3、anta,Georgia30339(Address of principal executive offices)(Zip Code)(770)433-8211(Registrants telephone number,including area code)Not Applicable(Former name,former address and former fiscal year,if changed since last report)Securities registered pursuant to Section 12(b)of the Act:Title of each clas
4、sTrading SymbolName of each exchange on which registeredCommon Stock,$0.05 Par Value Per ShareHDNew York Stock ExchangeIndicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 duringthe preceding 12 months
5、(or for such shorter period that the registrant was required to file such reports),and(2)has been subject to such filing requirements forthe past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to
6、 Rule 405 ofRegulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller
7、 reporting company,or anemerging growth company.See the definitions of“large accelerated filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”inRule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerg
8、ing 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 orrevised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the
9、 registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No Indicate the number of shares outstanding of each of the issuers classes of common stock,as of the latest practicable date.1,019,186,022 shares of common stock,$0.05 par value,outstanding as of November 15,2022TABLE
10、OF CONTENTSCommonly Used or Defined TermsiiForward-Looking StatementsiiiPART I FINANCIAL INFORMATION1Item 1.Financial Statements.1Consolidated Balance Sheets1Consolidated Statements of Earnings2Consolidated Statements of Comprehensive Income3Consolidated Statements of Stockholders Equity4Consolidate
11、d Statements of Cash Flows5Notes to Consolidated Financial Statements6Note 1.Summary of Significant Accounting Policies6Note 2.Net Sales7Note 3.Property and Leases7Note 4.Debt and Derivative Instruments8Note 5.Stockholders Equity10Note 6.Fair Value Measurements10Note 7.Weighted Average Common Shares
12、11Note 8.Contingencies11Report of Independent Registered Public Accounting Firm12Item 2.Managements Discussion and Analysis of Financial Condition and Results of Operations.13Item 3.Quantitative and Qualitative Disclosures About Market Risk.20Item 4.Controls and Procedures.20PART II OTHER INFORMATIO
13、N20Item 1A.Risk Factors.20Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.21Item 6.Exhibits.22SIGNATURES23iTable of ContentsCOMMONLY USED OR DEFINED TERMSTermDefinitionASUAccounting Standards UpdateComparable salesAs defined in the Results of Operations section of MD&AExchange Act
14、Securities Exchange Act of 1934,as amendedFASBFinancial Accounting Standards Boardfiscal 2021Fiscal year ended January 30,2022fiscal 2022Fiscal year ending January 29,2023GAAPU.S.generally accepted accounting principlesMD&AManagements Discussion and Analysis of Financial Condition and Results of Ope
15、rationsNOPATNet operating profit after taxRestoration PlanHome Depot FutureBuilder Restoration PlanROICReturn on invested capitalSECSecurities and Exchange CommissionSecurities ActSecurities Act of 1933,as amendedSG&ASelling,general and administrative2021 Form 10-KAnnual Report on Form 10-K for fisc
16、al 2021 as filed with the SEC on March 23,2022iiTable of ContentsFORWARD-LOOKING STATEMENTSCertain statements contained herein,as well as in other filings we make with the SEC and other written and oral information we release,regarding our performance or other events or developments in the future co
17、nstitute“forward-looking statements”as defined in the PrivateSecurities Litigation Reform Act of 1995.Forward-looking statements may relate to,among other things,the impact of the COVID-19 pandemicand the related recovery on our business,results of operations,cash flows and financial condition(which
18、,among other things,may affect manyof the items listed below);the demand for our products and services;net sales growth;comparable sales;the effects of competition;our brandand reputation;implementation of store,interconnected retail,supply chain and technology initiatives;inventory and in-stock pos
19、itions;the stateof the economy;the state of the housing and home improvement markets;the state of the credit markets,including mortgages,home equityloans,and consumer credit;impact of tariffs;issues related to the payment methods we accept;demand for credit offerings;management ofrelationships with
20、our associates,potential associates,suppliers and service providers;cost and availability of labor;costs of fuel and otherenergy sources;international trade disputes,natural disasters,climate change,public health issues(including pandemics and quarantines,related shut-downs and other governmental or
21、ders,and similar restrictions,as well as subsequent re-openings),cybersecurity events,militaryconflicts or acts of war,and other business interruptions that could disrupt operation of our stores,distribution centers and other facilities,ourability to operate or access communications,financial or ban
22、king systems,or supply or delivery of,or demand for,the Companys products orservices;our ability to meet environmental,social and governance(“ESG”)goals;continuation or suspension of share repurchases;net earningsperformance;earnings per share;dividend targets;capital allocation and expenditures;liq
23、uidity;return on invested capital;expense leverage;commodity or other price inflation and deflation;our ability to issue debt on terms and at rates acceptable to us;the impact and expectedoutcome of investigations,inquiries,claims,and litigation,including compliance with related settlements;the effe
24、ct of accounting charges;theeffect of adopting certain accounting standards;the impact of regulatory changes,including changes to tax laws and regulations;store openingsand closures;financial outlook;and the impact of acquired companies on our organization and the ability to recognize the anticipate
25、d benefits ofthose acquisitions.Forward-looking statements are based on currently available information and our current assumptions,expectations and projections about futureevents.You should not rely on our forward-looking statements.These statements are not guarantees of future performance and are
26、subject tofuture events,risks and uncertainties many of which are beyond our control,dependent on the actions of third parties,or currently unknown tous as well as potentially inaccurate assumptions that could cause actual results to differ materially from our historical experience and ourexpectatio
27、ns and projections.These risks and uncertainties include,but are not limited to,those described in Part II,Item 1A,Risk Factors andelsewhere in this report and also as may be described from time to time in future reports we file with the SEC.You should read such informationin conjunction with our co
28、nsolidated financial statements and related notes and Managements Discussion and Analysis of Financial Conditionand Results of Operations in this report.There also may be other factors that we cannot anticipate or that are not described herein,generallybecause we do not currently perceive them to be
29、 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 asrequired by law.You are advised,however,to review any further disclosures we make o
30、n related subjects in our filings with the SEC and in ourother public statements.iiiTable of ContentsPART I FINANCIAL INFORMATIONItem 1.Financial Statements.THE HOME DEPOT,INC.CONSOLIDATED BALANCE SHEETS(Unaudited)in millions,except per share dataOctober 30,2022January 30,2022AssetsCurrent assets:Ca
31、sh and cash equivalents$2,462$2,343 Receivables,net3,732 3,426 Merchandise inventories25,719 22,068 Other current assets1,768 1,218 Total current assets33,681 29,055 Net property and equipment25,240 25,199 Operating lease right-of-use assets6,523 5,968 Goodwill7,434 7,449 Other assets3,988 4,205 Tot
32、al assets$76,866$71,876 Liabilities and Stockholders EquityCurrent liabilities:Short-term debt$1,035 Accounts payable12,402 13,462 Accrued salaries and related expenses1,934 2,426 Sales taxes payable640 848 Deferred revenue3,173 3,596 Current installments of long-term debt1,224 2,447 Current operati
33、ng lease liabilities942 830 Other accrued expenses3,965 4,049 Total current liabilities24,280 28,693 Long-term debt,excluding current installments41,740 36,604 Long-term operating lease liabilities5,807 5,353 Other long-term liabilities3,741 2,922 Total liabilities75,568 73,572 Common stock,par valu
34、e$0.05;authorized:10,000 shares;issued:1,793 shares at October 30,2022and 1,792 shares at January 30,2022;outstanding:1,020 shares at October 30,2022 and 1,035shares at January 30,202290 90 Paid-in capital12,385 12,132 Retained earnings75,467 67,580 Accumulated other comprehensive loss(856)(704)Trea
35、sury stock,at cost,773 shares at October 30,2022 and 757 shares at January 30,2022(85,788)(80,794)Total stockholders equity(deficit)1,298(1,696)Total liabilities and stockholders equity$76,866$71,876 See accompanying notes to consolidated financial statements.1Table of ContentsTHE HOME DEPOT,INC.CON
36、SOLIDATED STATEMENTS OF EARNINGS(Unaudited)Three Months EndedNine Months Endedin millions,except per share dataOctober 30,2022October 31,2021October 30,2022October 31,2021Net sales$38,872$36,820$121,572$115,438 Cost of sales25,648 24,257 80,720 76,468 Gross profit13,224 12,563 40,852 38,970 Operatin
37、g expenses:Selling,general and administrative6,468 6,168 19,735 18,975 Depreciation and amortization608 600 1,830 1,780 Total operating expenses7,076 6,768 21,565 20,755 Operating income6,148 5,795 19,287 18,215 Interest and other(income)expense:Interest income and other,net(7)(15)(12)(26)Interest e
38、xpense413 341 1,166 1,006 Interest and other,net406 326 1,154 980 Earnings before provision for income taxes5,742 5,469 18,133 17,235 Provision for income taxes1,403 1,340 4,390 4,154 Net earnings$4,339$4,129$13,743$13,081 Basic weighted average common shares1,020 1,049 1,024 1,059 Basic earnings pe
39、r share$4.25$3.94$13.42$12.35 Diluted weighted average common shares1,023 1,053 1,028 1,063 Diluted earnings per share$4.24$3.92$13.37$12.31 See accompanying notes to consolidated financial statements.2Table of ContentsTHE HOME DEPOT,INC.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(Unaudited)Thre
40、e Months EndedNine Months Endedin millionsOctober 30,2022October 31,2021October 30,2022October 31,2021Net earnings$4,339$4,129$13,743$13,081 Other comprehensive income(loss),net of tax:Foreign currency translation adjustments(187)(20)(158)35 Cash flow hedges3 3 6 7 Other 27 Total other comprehensive
41、 income(loss),net of tax(184)(17)(152)69 Comprehensive income$4,155$4,112$13,591$13,150 See accompanying notes to consolidated financial statements.3Table of ContentsTHE HOME DEPOT,INC.CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY(Unaudited)Three Months EndedNine Months Endedin millionsOctober 30,2
42、022October 31,2021October 30,2022October 31,2021Common Stock:Balance at beginning of period$90$90$90$89 Shares issued under employee stock plans 1 Balance at end of period90 90 90 90 Paid-in Capital:Balance at beginning of period12,309 11,797 12,132 11,540 Shares issued under employee stock plans(2)
43、18(21)50 Stock-based compensation expense78 74 274 299 Balance at end of period12,385 11,889 12,385 11,889 Retained Earnings:Balance at beginning of period73,074 63,560 67,580 58,134 Net earnings4,339 4,129 13,743 13,081 Cash dividends(1,946)(1,738)(5,856)(5,264)Balance at end of period75,467 65,951
44、 75,467 65,951 Accumulated Other Comprehensive Income(Loss):Balance at beginning of period(672)(585)(704)(671)Foreign currency translation adjustments,net of tax(187)(20)(158)35 Cash flow hedges,net of tax3 3 6 7 Other,net of tax 27 Balance at end of period(856)(602)(856)(602)Treasury Stock:Balance
45、at beginning of period(84,564)(72,793)(80,794)(65,793)Repurchases of common stock(1,224)(3,500)(4,994)(10,500)Balance at end of period(85,788)(76,293)(85,788)(76,293)Total stockholders equity$1,298$1,035$1,298$1,035 See accompanying notes to consolidated financial statements.4Table of ContentsTHE HO
46、ME DEPOT,INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)Nine Months Endedin millionsOctober 30,2022October 31,2021Cash Flows from Operating Activities:Net earnings$13,743$13,081 Reconciliation of net earnings to net cash provided by operating activities:Depreciation and amortization2,216 2,128
47、Stock-based compensation expense286 312 Changes in receivables,net(312)(533)Changes in merchandise inventories(3,748)(3,871)Changes in other current assets(568)(375)Changes in accounts payable and accrued expenses(1,568)1,918 Changes in deferred revenue(413)672 Changes in income taxes payable30(10)C
48、hanges in deferred income taxes129(73)Other operating activities226 137 Net cash provided by operating activities10,021 13,386 Cash Flows from Investing Activities:Capital expenditures(2,216)(1,737)Payments for businesses acquired,net(416)Other investing activities(29)21 Net cash used in investing a
49、ctivities(2,245)(2,132)Cash Flows from Financing Activities:Repayments of short-term debt,net(1,035)Proceeds from long-term debt,net of discounts6,942 2,979 Repayments of long-term debt(2,423)(1,480)Repurchases of common stock(5,136)(10,374)Proceeds from sales of common stock146 190 Cash dividends(5
50、,856)(5,264)Other financing activities(185)(160)Net cash used in financing activities(7,547)(14,109)Change in cash and cash equivalents229(2,855)Effect of exchange rate changes on cash and cash equivalents(110)27 Cash and cash equivalents at beginning of period2,343 7,895 Cash and cash equivalents a
51、t end of period$2,462$5,067 Supplemental Disclosures:Cash paid for interest,net of interest capitalized$1,160$1,021 Cash paid for income taxes4,173 4,170 See accompanying notes to consolidated financial statements.5Table of ContentsTHE HOME DEPOT,INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudi
52、ted)1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBusinessThe Home Depot,Inc.,together with its subsidiaries(the“Company,”“Home Depot,”“we,”“our”or“us”),is a home improvement retailer thatsells a wide assortment of building materials,home improvement products,lawn and garden products,dcor items,and fa
53、cilities maintenance,repair and operations products,and provides a number of services,in stores and online.We operate in the U.S.(including the Commonwealth ofPuerto Rico and the territories of the U.S.Virgin Islands and Guam),Canada,and Mexico,each representing one of our three operatingsegments,wh
54、ich we aggregate into one reportable segment due to the similar nature of their operations and economic characteristics.Basis of PresentationThe accompanying consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10-Q anddo not include all of
55、the information and footnotes required by GAAP for complete financial statements.In the opinion of management,alladjustments(consisting of normal recurring accruals)considered necessary for a fair presentation have been included.Results of operations forinterim periods are not necessarily indicative
56、 of results for the entire year.As a result,these consolidated financial statements should be read inconjunction with the consolidated financial statements and notes thereto included in our 2021 Form 10-K.There were no significant changes to our significant accounting policies as disclosed in the 20
57、21 Form 10-K.Recently Adopted Accounting PronouncementsWe did not adopt any new accounting pronouncements during the first nine months of fiscal 2022 that had a material impact on our consolidatedfinancial condition,results of operations or cash flows.Recently Issued Accounting PronouncementsASU No.
58、2022-04.In September 2022,the FASB issued ASU No.2022-04,“LiabilitiesSupplier Finance Programs(Topic 405-50)-Disclosureof Supplier Finance Program Obligations,”to enhance the transparency of supplier finance programs used by an entity in connection with thepurchase of goods and services.The standard
59、 requires entities that use supplier finance programs to disclose the key terms,including adescription of payment terms,the confirmed amount outstanding under the program at the end of each reporting period,a description of wherethose obligations are presented on the balance sheet,and an annual roll
60、forward,including the amount of obligations confirmed and the amountpaid during the period.The guidance does not affect the recognition,measurement,or financial statement presentation of obligations covered bysupplier finance programs.ASU No.2022-04 is effective for fiscal years beginning after Dece
61、mber 15,2022,including interim periods withinthose fiscal years,except for the requirement on rollforward information,which is effective for fiscal years beginning after December 15,2023.Early adoption is permitted.We are currently evaluating the impact of the standard on our consolidated financial
62、statements and relateddisclosures.Recent accounting pronouncements pending adoption not discussed above or in the 2021 Form 10-K are either not applicable or will not have orare not expected to have a material impact on our consolidated financial condition,results of operations or cash flows.6Table
63、of Contents2.NET SALESThe following table presents net sales,classified by geography:Three Months EndedNine Months Endedin millionsOctober 30,2022October 31,2021October 30,2022October 31,2021Net sales in the U.S.$35,784$33,736$111,834$106,095 Net sales outside the U.S.3,088 3,084 9,738 9,343 Net sal
64、es$38,872$36,820$121,572$115,438 The following table presents net sales by products and services:Three Months EndedNine Months Endedin millionsOctober 30,2022October 31,2021October 30,2022October 31,2021Net sales products$37,448$35,383$117,261$111,371 Net sales services1,424 1,437 4,311 4,067 Net sa
65、les$38,872$36,820$121,572$115,438 The following table presents major product lines and the related merchandising departments(and related services):Major Product LineMerchandising DepartmentsBuilding MaterialsBuilding Materials,Electrical/Lighting,Lumber,Millwork,and PlumbingDcorAppliances,Dcor/Stora
66、ge,Flooring,Kitchen and Bath,and PaintHardlinesHardware,Indoor Garden,Outdoor Garden,and ToolsThe following table presents net sales by major product lines(and related services):Three Months EndedNine Months Endedin millionsOctober 30,2022October 31,2021October 30,2022October 31,2021Building Materia
67、ls$15,343$13,809$46,095$41,880 Dcor13,070 12,783 40,040 38,060 Hardlines10,459 10,228 35,437 35,498 Net sales$38,872$36,820$121,572$115,438 Deferred RevenueFor products and services sold in stores or online,payment is typically due at the point of sale.When we receive payment from customersbefore th
68、e customer has taken possession of the merchandise or the service has been performed,the amount received is recorded as deferredrevenue until the sale or service is complete.Such performance obligations are part of contracts with expected original durations of typicallythree months or less.As of Oct
69、ober 30,2022 and January 30,2022,deferred revenue for products and services was$2.2 billion and$2.6 billion,respectively.We further record deferred revenue for the sale of gift cards and recognize the associated revenue upon the redemption of those gift cards,which generally occurs within six months
70、 of gift card issuance.As of both October 30,2022 and January 30,2022,our performance obligationsfor unredeemed gift cards were$1.0 billion.Gift card breakage income,which is our estimate of the portion of our gift card balance not expectedto be redeemed,was immaterial during the three and nine mont
71、hs ended October 30,2022 and October 31,2021.3.PROPERTY AND LEASESNet Property and EquipmentNet property and equipment includes accumulated depreciation and finance lease amortization of$27.5 billion as of October 30,2022 and$26.1billion as of January 30,2022.7Table of ContentsLeasesThe following ta
72、ble presents the consolidated balance sheet location of assets and liabilities related to operating and finance leases:in millionsConsolidated Balance Sheet ClassificationOctober 30,2022January 30,2022Assets:Operating lease assetsOperating lease right-of-use assets$6,523$5,968 Finance lease assets N
73、et property and equipment2,890 2,896 Total lease assets$9,413$8,864 Liabilities:Current:Operating lease liabilitiesCurrent operating lease liabilities$942$830 Finance lease liabilitiesCurrent installments of long-term debt224 198 Long-term:Operating lease liabilitiesLong-term operating lease liabili
74、ties5,807 5,353 Finance lease liabilitiesLong-term debt,excluding current installments3,038 3,038 Total lease liabilities$10,011$9,419(1)Finance lease assets are recorded net of accumulated amortization of$1.2 billion as of October 30,2022 and$1.0 billion as of January 30,2022.The following table pr
75、esents supplemental non-cash information related to leases:Nine Months Endedin millionsOctober 30,2022October 31,2021Lease assets obtained in exchange for new operating lease liabilities$1,308$637 Lease assets obtained in exchange for new finance lease liabilities234 581 4.DEBT AND DERIVATIVE INSTRU
76、MENTSShort-Term DebtIn July 2022,we expanded our commercial paper program from$3.0 billion to$5.0 billion to further enhance our financial flexibility.All of ourshort-term borrowings in the first nine months of fiscal 2022 were under our commercial paper program,and the maximum amount outstandingat
77、any time was$2.7 billion.In connection with our program,we have back-up credit facilities with a consortium of banks.In July 2022,we alsoexpanded the borrowing capacity under these back-up facilities from$3.0 billion to$5.0 billion,by entering into a five-year$3.5 billion creditfacility scheduled to
78、 expire in July 2027 and a 364-day$1.5 billion credit facility scheduled to expire in July 2023.These facilities replaced ourpreviously existing five-year$2.0 billion credit facility,which was scheduled to expire in December 2023,and our 364-day$1.0 billion creditfacility,which was scheduled to expi
79、re in December 2022.At October 30,2022,we had no outstanding borrowings under our commercial paperprogram,and at January 30,2022,we had$1.0 billion of outstanding borrowings under our commercial paper program.Long-Term DebtSeptember 2022 Issuance.In September 2022,we issued three tranches of senior
80、notes.The first tranche consisted of$750 million of 4.00%senior notes due September 15,2025 at a discount of$0.3 million.Interest on thesenotes is due semi-annually on March 15 and September 15 of each year,beginning March 15,2023.The second tranche consisted of$1.25 billion of 4.50%senior notes due
81、 September 15,2032 at a discount of$1 million.Interest onthese notes is due semi-annually on March 15 and September 15 of each year,beginning March 15,2023.(1)8Table of ContentsThe third tranche consisted of$1.0 billion of 4.95%senior notes due September 15,2052 at a discount of$14 million.Interest
82、on thesenotes is due semi-annually on March 15 and September 15 of each year,beginning March 15,2023.Issuance costs totaled$15 million.March 2022 Issuance.In March 2022,we issued four tranches of senior notes.The first tranche consisted of$500 million of 2.70%senior notes due April 15,2025 at a disc
83、ount of$1 million.Interest on these notes isdue semi-annually on April 15 and October 15 of each year,beginning October 15,2022.The second tranche consisted of$750 million of 2.875%senior notes due April 15,2027 at a discount of$4 million.Interest on thesenotes is due semi-annually on April 15 and O
84、ctober 15 of each year,beginning October 15,2022.The third tranche consisted of$1.25 billion of 3.25%senior notes due April 15,2032 at a discount of$6 million.Interest on these notes isdue semi-annually on April 15 and October 15 of each year,beginning October 15,2022.The fourth tranche consisted of
85、$1.5 billion of 3.625%senior notes due April 15,2052 at a discount of$32 million.Interest on thesenotes is due semi-annually on April 15 and October 15 of each year,beginning October 15,2022.Issuance costs totaled$22 million.Each of these senior notes may be redeemed by us at any time,in whole or in
86、 part,at the redemption price plus accrued interest up to theredemption date.Prior to the Par Call Date,as defined in the notes,the redemption price is equal to the greater of(1)100%of the principalamount of the notes to be redeemed or(2)the sum of the present values of the remaining scheduled payme
87、nts of principal and interest to thePar Call Date.On or after the Par Call Date,the redemption price is equal to 100%of the principal amount of the notes.Additionally,if a Changein Control Triggering Event occurs,as defined in the notes,holders of all such notes have the right to require us to redee
88、m those notes at 101%of the aggregate principal amount of the notes plus accrued interest up to the redemption date.The indenture governing the notes does not generally limit our ability to incur additional indebtedness or require us to maintain financial ratios orspecified levels of net worth or li
89、quidity.The indenture governing the notes contains various customary covenants;however,none are expectedto impact our liquidity or capital resources.Repayments.In March 2022,we repaid our$700 million 3.25%senior notes and$300 million floating rate senior notes at maturity.In May 2022,we repaid our$1
90、.25 billion 2.625%senior notes,which had a maturity date of June 2022,at the Par Call Date for the notes.Derivative Instruments and Hedging ActivitiesWe had outstanding interest rate swap agreements with combined notional amounts of$5.4 billion at both October 30,2022 and January 30,2022.These agree
91、ments are accounted for as fair value hedges that swap fixed for variable rate interest to hedge changes in the fair values ofcertain senior notes.At October 30,2022,the fair values of these agreements totaled$1.0 billion,all of which is recognized within other long-term liabilities on the consolida
92、ted balance sheet.At January 30,2022,the fair values of these agreements totaled$191 million,with$249 millionrecognized in other long-term liabilities and$58 million recognized in other assets on the consolidated balance sheet.All of our interest rate swap agreements designated as fair value hedges
93、meet the shortcut method requirements under GAAP.Accordingly,thechanges in the fair values of these agreements offset the changes in the fair value of the hedged long-term debt.There were no material changes to the other hedging arrangements disclosed in our 2021 Form 10-K,and all related activity w
94、as immaterial forthe periods presented within this document.Collateral.We generally enter into master netting arrangements,which are designed to reduce credit risk by permitting net settlement oftransactions with the same counterparty.To further limit our credit risk,we enter into collateral securit
95、y arrangements that provide for collateral tobe received or posted when the net fair value of certain derivative instruments exceeds or falls below contractually established thresholds.Thecash collateral posted by the Company related to derivative instruments under our collateral security arrangemen
96、ts was$883 million as ofOctober 30,2022,which was recorded in other current assets on the consolidated balance sheet.We did not hold any cash collateral as ofOctober 30,2022,and cash collateral both held and posted was immaterial as of January 30,2022.9Table of Contents5.STOCKHOLDERS EQUITYStock Rol
97、lforwardThe following table presents a reconciliation of the number of shares of our common stock outstanding and cash dividends per share:shares in millionsThree Months EndedNine Months EndedOctober 30,2022October 31,2021October 30,2022October 31,2021Common stock:Balance at beginning of period1,793
98、 1,791 1,792 1,789 Shares issued under employee stock plans 1 2 Balance at end of period1,793 1,791 1,793 1,791 Treasury stock:Balance at beginning of period(769)(735)(757)(712)Repurchases of common stock(4)(10)(16)(33)Balance at end of period(773)(745)(773)(745)Shares outstanding at end of period1,
99、020 1,046 1,020 1,046 Cash dividends per share$1.90$1.65$5.70$4.95 Share RepurchasesIn August 2022,our Board of Directors approved a$15.0 billion share repurchase authorization that replaced the previous authorization of$20.0 billion,which was approved in May 2021.This new authorization does not hav
100、e a prescribed expiration date.As of October 30,2022,$14.0 billion of the$15.0 billion share repurchase authorization remained available.The following table presents information about our repurchases of common stock,all of which were completed through open market purchases:in millionsThree Months En
101、dedNine Months EndedOctober 30,2022October 31,2021October 30,2022October 31,2021Total number of shares repurchased4 10 16 33 Total cost of shares repurchased$1,224$3,500$4,994$10,500 These amounts may differ from the repurchases of common stock amounts in the consolidated statements of cash flows du
102、e to unsettled sharerepurchases at the end of a period.6.FAIR VALUE MEASUREMENTSThe fair value of an asset is considered to be the price at which the asset could be sold in an orderly transaction between unrelatedknowledgeable and willing parties.A liabilitys fair value is defined as the amount that
103、 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 athree-tier fair value hierarchy,which prioritizes the inputs used in measuring fair value.Th
104、e levels of the fair value hierarchy are:Level 1:observable inputs such as quoted prices in active markets for identical assets or liabilities;Level 2:inputs other than quoted prices in active markets in Level 1 that are either directly or indirectly observable;andLevel 3:unobservable inputs for whi
105、ch little or no market data exists,therefore requiring management judgment to develop theCompanys own models with estimates and assumptions.10Table of ContentsAssets and Liabilities Measured at Fair Value on a Recurring BasisThe following table presents the assets and liabilities that are measured a
106、t fair value on a recurring basis:October 30,2022January 30,2022in millions Level 1Level 2Level 3Level 1Level 2Level 3Derivative agreements assets$58$Derivative agreements liabilities(977)(249)Total$(977)$(191)$The fair values of our derivative instruments are determined using an income approach and
107、 Level 2 inputs,which include the respective interestrate or foreign currency forward curves and discount rates.Our derivative instruments are discussed further in Note 4.Assets and Liabilities Measured at Fair Value on a Nonrecurring BasisLong-lived assets,goodwill,and other intangible assets are s
108、ubject to nonrecurring fair value measurement for the assessment of impairment.During the third quarter of fiscal 2022,we completed our annual assessment of the recoverability of goodwill for our U.S.,Canada and Mexicoreporting units based on qualitative factors.We performed a qualitative assessment
109、 to determine if there were any indicators of impairment andconcluded that while there have been events and circumstances in the macro-environment that have impacted us,we have not experienced anyentity-specific indicators that would indicate that it is more likely than not that the fair value of an
110、y of our reporting units were less than theircarrying amounts.Additionally,during the third quarter of fiscal 2022,we completed our annual assessment of the recoverability of our indefinite-lived intangibles based on quantitative factors and concluded no impairment losses should be recognized.We did
111、 not have any material assets or liabilities that were measured at fair value on a nonrecurring basis during the three and nine monthsended October 30,2022 or October 31,2021.Other Fair Value DisclosuresThe carrying amounts of cash and cash equivalents,receivables,accounts payable,and short-term deb
112、t approximate fair value due to theirshort-term nature.The following table presents the aggregate fair values and carrying values of our senior notes:October 30,2022January 30,2022in millions Fair Value(Level 1)CarryingValueFair Value(Level 1)CarryingValueSenior notes$35,453$39,702$39,397$35,815 7.W
113、EIGHTED AVERAGE COMMON SHARESThe following table presents the reconciliation of our basic to diluted weighted average common shares:in millionsThree Months EndedNine Months EndedOctober 30,2022October 31,2021October 30,2022October 31,2021Basic weighted average common shares1,020 1,049 1,024 1,059 Ef
114、fect of potentially dilutive securities 3 4 4 4 Diluted weighted average common shares1,023 1,053 1,028 1,063 Anti-dilutive securities excluded from diluted weighted average commonshares1 1 (1)Represents the dilutive impact of stock-based awards.8.CONTINGENCIESWe are involved in litigation arising i
115、n the normal course of business.In managements opinion,any such litigation is not expected to have amaterial adverse effect on our consolidated financial condition,results of operations or cash flows.(1)11Table of ContentsREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTo the Stockholders and
116、 Board of DirectorsThe Home Depot,Inc.:Results of Review of Interim Financial InformationWe have reviewed the consolidated balance sheet of The Home Depot,Inc.and subsidiaries(the“Company”)as of October 30,2022,therelated consolidated statements of earnings,comprehensive income,and stockholders equi
117、ty for the three-month and nine-month periodsended October 30,2022 and October 31,2021,the related consolidated statements of cash flows for the nine-month periods ended October 30,2022 and October 31,2021,and the related notes(collectively,the“consolidated interim financial information”).Based on o
118、ur reviews,we arenot 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 Ove
119、rsight Board(United States)(“PCAOB”),the consolidated balance sheet of the Company as of January 30,2022,and the related consolidated statements of earnings,comprehensiveincome,stockholders equity,and cash flows for the fiscal year then ended(not presented herein);and in our report dated March 23,20
120、22,weexpressed an unqualified opinion on those consolidated financial statements.In our opinion,the information set forth in the accompanyingconsolidated balance sheet as of January 30,2022,is fairly stated,in all material respects,in relation to the consolidated balance sheet fromwhich it has been
121、derived.Basis for Review ResultsThis consolidated interim financial information is the responsibility of the Companys management.We are a public accounting firm registeredwith the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.federal securities laws
122、and theapplicable 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 consistsprincipally of applying analytical procedures and making inquiries of
123、persons responsible for financial and accounting matters.It is substantiallyless in scope than an audit conducted in accordance with the standards of the PCAOB,the objective of which is the expression of an opinionregarding the financial statements taken as a whole.Accordingly,we do not express such
124、 an opinion./s/KPMG LLPAtlanta,GeorgiaNovember 21,202212Table of ContentsItem 2.Managements Discussion and Analysis of Financial Condition and Results of Operations.The following discussion provides an analysis of the Companys financial condition and results of operations from managements perspectiv
125、eand should be read in conjunction with the consolidated financial statements and related notes included in this report and in the 2021 Form 10-Kand with our MD&A included in the 2021 Form 10-K.Our MD&A includes the following sections:Executive SummaryResults of OperationsLiquidity and Capital Resou
126、rcesCritical Accounting PoliciesEXECUTIVE SUMMARYThe following table presents quarter-to-date and year-to-date highlights of our financial performance:dollars in millions,except per share dataThree Months EndedNine Months EndedOctober 30,2022October 31,2021October 30,2022October 31,2021Net sales$38,
127、872$36,820$121,572$115,438 Net earnings4,339 4,129 13,743 13,081 Diluted earnings per share$4.24$3.92$13.37$12.31 Net cash provided by operating activities$10,021$13,386 Proceeds from long-term debt,net of discounts6,942 2,979 Repayments of long-term debt2,423 1,480 Repurchases of common stock5,136
128、10,374 We reported net sales of$38.9 billion in the third quarter of fiscal 2022.Net earnings were$4.3 billion,or$4.24 per diluted share.For the firstnine months of fiscal 2022,net sales were$121.6 billion and net earnings were$13.7 billion,or$13.37 per diluted share.During the third quarter of fisc
129、al 2022,we opened one new store in the U.S.and two new stores in Mexico,and we had no store closures,resulting in a store count of 2,319 at the end of the quarter.As of October 30,2022,a total of 313 stores,or 13.5%of our total store count,werelocated in Canada and Mexico.For the third quarter of fi
130、scal 2022,sales per retail square foot were$618.50,and for the first nine months offiscal 2022,sales per retail square foot were$646.81.Our inventory turnover ratio was 4.3 times at the end of the third quarter of fiscal 2022,compared to 5.4 times at the end of the third quarter of fiscal 2021.The d
131、ecrease in our inventory turnover ratio was driven by an increase inaverage inventory levels during the first nine months of fiscal 2022 resulting from strategic investments to promote higher in-stock levels and pullforward merchandise in response to ongoing global supply chain disruption,as well as
132、 continued investment in our new supply chain facilitiesand carry over of some spring seasonal inventory.We generated$10.0 billion of cash flow from operations and issued$6.9 billion of long-term debt,net of discounts,during the first nine months offiscal 2022.This cash flow,together with cash on ha
133、nd,was used to fund cash payments of$5.9 billion for dividends and$5.1 billion for sharerepurchases.In addition,we repaid$2.4 billion of long-term debt and$1.0 billion of net short-term debt and funded$2.2 billion in capitalexpenditures.In February 2022,we announced a 15%increase in our quarterly ca
134、sh dividend to$1.90 per share.Our ROIC for the trailing twelve-month period was 43.3%at the end of the third quarter of fiscal 2022 and 43.9%at the end of the third quarter offiscal 2021.See the Non-GAAP Financial Measures section below for our definition and calculation of ROIC,as well as a reconci
135、liation ofNOPAT,a non-GAAP financial measure,to net earnings(the most comparable GAAP financial measure).13Table of ContentsRESULTS OF OPERATIONSThe following table presents the percentage relationship between net sales and major categories in our consolidated statements of earnings.FISCAL 2022 AND
136、FISCAL 2021 THREE MONTH COMPARISONSThree Months EndedOctober 30,2022October 31,2021dollars in millions$%ofNet Sales$%ofNet SalesNet sales$38,872$36,820 Gross profit13,224 34.0%12,563 34.1%Operating expenses:Selling,general and administrative6,468 16.6 6,168 16.8 Depreciation and amortization608 1.6
137、600 1.6 Total operating expenses7,076 18.2 6,768 18.4 Operating income6,148 15.8 5,795 15.7 Interest and other(income)expense:Interest income and other,net(7)(15)Interest expense413 1.1 341 0.9 Interest and other,net406 1.0 326 0.9 Earnings before provision for income taxes5,742 14.8 5,469 14.9 Prov
138、ision for income taxes1,403 3.6 1,340 3.6 Net earnings$4,339 11.2%$4,129 11.2%Note:Certain percentages may not sum to totals due to rounding.Three Months EndedSelected financial and sales data:October 30,2022October 31,2021%ChangeComparable sales(%change)4.3%6.1%N/AComparable customer transactions(%
139、change)(4.4)%(5.8)%N/AComparable average ticket(%change)8.8%12.7%N/ACustomer transactions(in millions)409.8 428.2(4.3)%Average ticket$89.67$82.38 8.8%Sales per retail square foot$618.50$587.28 5.3%Diluted earnings per share$4.24$3.92 8.2%(1)Does not include results for HD Supply.(2)Average ticket re
140、presents the average price paid per transaction and is used by management to monitor the performance of the Company,as it represents aprimary driver in measuring sales performance.(3)Sales per retail square foot represents annualized sales divided by retail store square footage.Sales per retail squa
141、re foot is a measure of the efficiency ofsales based on the total square footage of our stores and is used by management to monitor the performance of the Companys retail operations as anindicator of the productivity of owned and leased square footage for these retail operations.SalesWe assess our s
142、ales performance by evaluating both net sales and comparable sales.Net Sales.Net sales for the third quarter of fiscal 2022 were$38.9 billion,an increase of 5.6%from$36.8 billion for the third quarter of fiscal2021.The increase in net sales for the third quarter of fiscal 2022 primarily reflected th
143、e impact of positive comparable sales driven by anincrease in comparable average ticket,partially offset by a decrease in comparable customer transactions.A stronger U.S.dollar negativelyimpacted net sales by$132 million in the third quarter of fiscal 2022.(1)(1)(1)(1)(2)(1)(3)14Table of ContentsOnl
144、ine sales,which consist of sales generated through our websites and mobile applications for products picked up at our stores or delivered tocustomer locations,represented 13.3%of net sales during the third quarter of fiscal 2022 and grew by 9.6%compared to the third quarter offiscal 2021.The increas
145、e in online sales for the third quarter of fiscal 2022 was a result of customers continuing to leverage our digital platformsand reflects our ongoing investments to enhance these platforms and related fulfillment capabilities,which support our interconnected retailstrategy.Comparable Sales.Comparabl
146、e sales is a measure that highlights the performance of our existing locations and websites by measuring thechange in net sales for a period over the comparable prior period of equivalent length.Comparable sales includes sales at all locations,physicaland online,open greater than 52 weeks(including
147、remodels and relocations)and excludes closed stores.Retail stores become comparable onthe Monday following their 52 week of operation.Acquisitions are typically included in comparable sales after they have been owned for morethan 52 weeks.Comparable sales is intended only as supplemental information
148、 and is not a substitute for net sales presented in accordancewith GAAP.Total comparable sales for the third quarter of fiscal 2022 increased 4.3%,reflecting an 8.8%increase in comparable average ticket,partiallyoffset by a 4.4%decrease in comparable customer transactions compared to the third quart
149、er of fiscal 2021.The increase in comparableaverage ticket was primarily driven by inflation,as well as demand for new and innovative products.The decrease in comparable customertransactions reflects the impact of macroeconomic factors including the broader inflationary environment.During the third
150、quarter of fiscal 2022,11 of our 14 merchandising departments posted positive comparable sales compared to the third quarterof fiscal 2021,led by Building Materials,Plumbing,Lumber,Millwork,Paint,and Hardware,which posted comparable sales above the Companyaverage.Our Appliances,Flooring,and Indoor G
151、arden departments posted negative comparable sales.Gross ProfitGross profit for the third quarter of fiscal 2022 increased 5.3%to$13.2 billion from$12.6 billion for the third quarter of fiscal 2021.Gross profit asa percentage of net sales,or gross profit margin,was 34.0%for the third quarter of fisc
152、al 2022 compared to 34.1%for the third quarter of fiscal2021.The decrease in gross profit margin during the third quarter of fiscal 2022 was primarily driven by investments in our supply chain networkand higher product and transportation costs,offset by the benefit from higher retail prices.Operatin
153、g ExpensesOur operating expenses are composed of SG&A and depreciation and amortization.Selling,General&Administrative.SG&A for the third quarter of fiscal 2022 increased$300 million,or 4.9%,to$6.5 billion from$6.2 billion forthe third quarter of fiscal 2021.As a percentage of net sales,SG&A was 16.
154、6%for the third quarter of fiscal 2022 compared to 16.8%for thethird quarter of fiscal 2021,primarily reflecting leverage from a positive comparable sales environment and lower incentive compensation,partially offset by wage investments for hourly associates and increased operational costs,including
155、 investments designed to drive efficiencies inour stores.Depreciation and Amortization.Depreciation and amortization for the third quarter of fiscal 2022 increased$8 million,or 1.3%,to$608 millionfrom$600 million for the third quarter of fiscal 2021.As a percentage of net sales,depreciation and amor
156、tization was 1.6%for the third quarter ofboth fiscal 2022 and fiscal 2021,primarily reflecting leverage from a positive comparable sales environment,offset by increased depreciationexpense from strategic investments in the business.Interest and Other,netInterest and other,net,was$406 million for the
157、 third quarter of fiscal 2022 compared to$326 million for the third quarter of fiscal 2021.Interestand other,net,as a percentage of net sales was 1.0%for the third quarter of fiscal 2022 compared to 0.9%for the third quarter of fiscal 2021,primarily reflecting higher interest expense due to higher d
158、ebt balances and increased variable rate interest from our interest rate swaps duringthe third quarter of fiscal 2022,partially offset by leverage from a positive comparable sales environment.Provision for Income TaxesOur combined effective income tax rate was 24.4%for the third quarter of fiscal 20
159、22 compared to 24.5%for the third quarter of fiscal 2021.nd15Table of ContentsDiluted Earnings per ShareDiluted earnings per share were$4.24 for the third quarter of fiscal 2022 compared to$3.92 for the third quarter of fiscal 2021.The increase indiluted earnings per share was driven by higher net e
160、arnings during the third quarter of fiscal 2022,as well as lower diluted shares due to sharerepurchases.FISCAL 2022 AND FISCAL 2021 NINE MONTH COMPARISONSNine Months EndedOctober 30,2022October 31,2021dollars in millions$%ofNet Sales$%ofNet SalesNet sales$121,572$115,438 Gross profit40,852 33.6%38,9
161、70 33.8%Operating expenses:Selling,general and administrative19,735 16.2 18,975 16.4 Depreciation and amortization1,830 1.5 1,780 1.5 Total operating expenses21,565 17.7 20,755 18.0 Operating income19,287 15.9 18,215 15.8 Interest and other(income)expense:Interest income and other,net(12)(26)Interes
162、t expense1,166 1.0 1,006 0.9 Interest and other,net1,154 0.9 980 0.8 Earnings before provision for income taxes18,133 14.9 17,235 14.9 Provision for income taxes4,390 3.6 4,154 3.6 Net earnings$13,743 11.3%$13,081 11.3%Note:Certain percentages may not sum to totals due to rounding.Nine Months EndedS
163、elected financial and sales data:October 30,2022October 31,2021%ChangeComparable sales(%change)4.2%12.5%N/AComparable customer transactions(%change)(5.3)%1.1%N/AComparable average ticket(%change)9.7%11.5%N/ACustomer transactions(in millions)1,287.9 1,357.2(5.1)%Average ticket$90.45$82.43 9.7%Sales p
164、er retail square foot$646.81$615.98 5.0%Diluted earnings per share$13.37$12.31 8.6%(1)Does not include results for HD Supply.(2)Average ticket represents the average price paid per transaction and is used by management to monitor the performance of the Company,as it represents aprimary driver in mea
165、suring sales performance.(3)Sales per retail square foot represents annualized sales divided by retail store square footage.Sales per retail square foot is a measure of the efficiency ofsales based on the total square footage of our stores and is used by management to monitor the performance of the
166、Companys retail operations as anindicator of the productivity of owned and leased square footage for these retail operations.SalesWe assess our sales performance by evaluating both net sales and comparable sales.Net Sales.Net sales for the first nine months of fiscal 2022 were$121.6 billion,an incre
167、ase of 5.3%from$115.4 billion for the first nine monthsof fiscal 2021.The increase in net sales for the first nine months of fiscal 2022 primarily reflected the impact of positive comparable sales drivenby an increase in comparable average ticket,partially offset by a decrease in comparable customer
168、 transactions.A stronger U.S.dollarnegatively impacted net sales by$284 million for the first nine months of fiscal 2022.(1)(1)(1)(1)(2)(1)(3)16Table of ContentsOnline sales,which consist of sales generated through our websites and mobile applications for products picked up in our stores or delivere
169、d tocustomer locations,represented 13.8%of net sales during the first nine months of fiscal 2022 and grew by 8.4%compared to the first ninemonths of fiscal 2021.The increase in online sales for the first nine months of fiscal 2022 was a result of customers continuing to leverage ourdigital platforms
170、 and reflects our ongoing investments to enhance these platforms and related fulfillment capabilities,which support ourinterconnected retail strategy.Comparable Sales.Total comparable sales for the first nine months of fiscal 2022 increased 4.2%,reflecting a 9.7%increase in comparableaverage ticket,
171、partially offset by a 5.3%decrease in comparable customer transactions compared to the first nine months of fiscal 2021.Theincrease in comparable average ticket was primarily driven by inflation,as well as demand for new and innovative products.The decrease incomparable customer transactions reflect
172、s the impact of macroeconomic factors including the broader inflationary environment,as well ascycling favorable weather and government stimulus during the first nine months of fiscal 2021.During the first nine months of fiscal 2022,11 of our 14 merchandising departments posted positive comparable s
173、ales when compared to the firstnine months of fiscal 2021,led by Building Materials,Plumbing,Millwork,Paint,Hardware,and Kitchen and Bath,which posted comparablesales above the Company average.Our Indoor Garden,Outdoor Garden and Appliances departments posted negative comparable sales.Gross ProfitGr
174、oss profit for the first nine months of fiscal 2022 increased 4.8%to$40.9 billion from$39.0 billion for the first nine months of fiscal 2021.Grossprofit as a percentage of net sales,or gross profit margin,was 33.6%for the first nine months of fiscal 2022 compared to 33.8%for the first ninemonths of
175、fiscal 2021.The decrease in gross profit margin during the first nine months of fiscal 2022 was primarily driven by investments in oursupply chain network and higher product and transportation costs,offset by the benefit from higher retail prices.Operating ExpensesOur operating expenses are composed
176、 of SG&A and depreciation and amortization.Selling,General&Administrative.SG&A for the first nine months of fiscal 2022 increased$760 million,or 4.0%to$19.7 billion from$19.0billion for the first nine months of fiscal 2021.As a percentage of net sales,SG&A was 16.2%for the first nine months of fisca
177、l 2022 compared to16.4%for the first nine months of fiscal 2021,primarily reflecting leverage from a positive comparable sales environment and lower incentivecompensation,partially offset by wage investments for hourly associates and increased operational costs,including investments designed todrive
178、 efficiencies in our stores.Depreciation and Amortization.Depreciation and amortization for the first nine months of fiscal 2022 increased$50 million,or 2.8%to$1.8billion.As a percentage of net sales,depreciation and amortization was 1.5%for the first nine months of both fiscal 2022 and fiscal 2021,
179、reflecting leverage from a positive comparable sales environment,offset by increased depreciation expense from strategic investments in thebusiness.Interest and Other,netInterest and other,net for the first nine months of fiscal 2022 was$1.2 billion compared to$980 million for the first nine months
180、of fiscal 2021.Interest and other,net,as a percentage of net sales was 0.9%for the first nine months of fiscal 2022 and 0.8%for the first nine months of fiscal2021,primarily reflecting higher interest expense due to higher debt balances and increased variable rate interest from our interest rate swa
181、psduring the first nine months of fiscal 2022,partially offset by leverage from a positive comparable sales environment.Provision for Income TaxesOur combined effective income tax rate was 24.2%for the first nine months of fiscal 2022 compared to 24.1%for the first nine months of fiscal2021.Diluted
182、Earnings per ShareDiluted earnings per share were$13.37 for the first nine months of fiscal 2022,compared to$12.31 for the first nine months of fiscal 2021.Theincrease in diluted earnings per share was driven by higher net earnings during the first nine months of fiscal 2022,as well as lower diluted
183、shares due to share repurchases.17Table of ContentsNON-GAAP FINANCIAL MEASURESTo provide clarity on our operating performance,we supplement our reporting with certain non-GAAP financial measures.However,thissupplemental information should not be considered in isolation or as a substitute for the rel
184、ated GAAP measures.Non-GAAP financial measurespresented herein may differ from similar measures used by other companies.Return on Invested CapitalWe believe ROIC is meaningful for investors and management because it measures how effectively we deploy our capital base.We define ROICas NOPAT,a non-GAA
185、P financial measure,for the most recent twelve-month period,divided by average debt and equity.We define averagedebt 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 following table presents the cal
186、culation of ROIC,together with a reconciliation of NOPAT to net earnings(the most comparable GAAPmeasure):Twelve Months Endeddollars in millionsOctober 30,2022October 31,2021Net earnings$17,095$15,938 Interest and other,net1,477 1,307 Provision for income taxes5,540 5,053 Operating income24,112 22,2
187、98 Income tax adjustment(5,844)(5,378)NOPAT$18,268$16,920 Average debt and equity$42,222$38,519 ROIC43.3%43.9%(1)Income tax adjustment is defined as operating income multiplied by our effective tax rate for the trailing twelve months.LIQUIDITY AND CAPITAL RESOURCESAt October 30,2022,we had$2.5 billi
188、on in cash and cash equivalents,of which$719 million was held by our foreign subsidiaries.We believethat our current cash position,cash flow generated from operations,funds available from our commercial paper program,and access to the long-term debt capital markets should be sufficient not only for
189、our operating requirements,any required debt payments,and satisfaction of othercontractual obligations,but also to enable us to invest in the business,fund dividend payments,and fund any share repurchases through thenext several fiscal years.In addition,we believe that we have the ability to obtain
190、alternative sources of financing,if necessary.Our material cash requirements include contractual and other obligations arising in the normal course of business.These obligations primarilyinclude long-term debt and related interest payments,operating and finance lease obligations,and purchase obligat
191、ions.In addition to our cash requirements,we follow a disciplined approach to capital allocation.This approach first prioritizes investing in thebusiness,followed by paying dividends,with the intent of then returning excess cash to shareholders in the form of share repurchases.For fiscal2022,we plan
192、 to invest approximately$3 billion back into the business in the form of capital expenditures,in line with our expectation ofapproximately two percent of net sales on an annual basis.However,we may adjust our capital expenditures to support the operations of thebusiness,to enhance long-term strategi
193、c positioning,or in response to the economic environment,as necessary or appropriate.In February 2022,we announced a 15%increase in our quarterly cash dividend from$1.65 to$1.90 per share.During the first nine months offiscal 2022,we paid cash dividends of$5.9 billion to shareholders.We intend to pa
194、y a dividend in the future;however,any future dividend issubject to declaration by our Board of Directors based on our earnings,capital requirements,financial condition,and other factors consideredrelevant by our Board of Directors.(1)18Table of ContentsIn August 2022,our Board of Directors approved
195、 a$15.0 billion share repurchase authorization that replaced the previous authorization of$20.0 billion,which was approved in May 2021.This new authorization does not have a prescribed expiration date.As of October 30,2022,approximately$14.0 billion of the$15.0 billion share repurchase authorization
196、 remained available.During the first nine months of fiscal 2022,wehad cash payments of$5.1 billion for repurchases of our common stock through open market purchases.DEBTIn July 2022,we expanded our commercial paper program from$3.0 billion to$5.0 billion to further enhance our financial flexibility.
197、All of ourshort-term borrowings in the first nine months of fiscal 2022 were under our commercial paper program,and the maximum amount outstandingat any time was$2.7 billion.In connection with our program,we have back-up credit facilities with a consortium of banks.In July 2022,we alsoexpanded the b
198、orrowing capacity under these back-up facilities from$3.0 billion to$5.0 billion,by entering into a five-year$3.5 billion creditfacility scheduled to expire in July 2027 and a 364-day$1.5 billion credit facility scheduled to expire in July 2023.These facilities replaced ourpreviously existing five-y
199、ear$2.0 billion credit facility,which was scheduled to expire in December 2023,and our 364-day$1.0 billion creditfacility,which was scheduled to expire in December 2022.At October 30,2022,we had no outstanding borrowings under our commercial paperprogram,and we were in compliance with all of the cov
200、enants contained in our credit facilities,none of which are expected to impact our liquidityor capital resources.We also issue senior notes from time to time as part of our capital management strategy.In March 2022,we issued$4.0 billion of senior notes.The net proceeds from this issuance were used f
201、or general corporate purposes,including repayment of outstanding indebtedness andrepurchases of shares of our common stock.In September 2022,we issued$3.0 billion of senior notes.The net proceeds from this issuance arebeing used for general corporate purposes,including repurchases of shares of our c
202、ommon stock.During the first nine months of fiscal 2022,werepaid an aggregate of$2.25 billion of senior notes.The indentures governing our senior notes do not generally limit our ability to incur additional indebtedness or require us to maintain financialratios or specified levels of net worth or li
203、quidity.The indentures governing our notes contain various customary covenants;however,none areexpected to impact our liquidity or capital resources.See Note 4 to our consolidated financial statements for further discussion of our debtarrangements.CASH FLOWS SUMMARYOperating ActivitiesCash flow gene
204、rated from operations provides us with a significant source of liquidity.Our operating cash flows result primarily from cashreceived from our customers,offset by cash payments we make for products and services,associate compensation,operations,occupancycosts,and income taxes.Cash provided by or used
205、 in operating activities is also subject to changes in working capital.Working capital at anypoint in time is subject to many variables,including seasonality,inventory management and category expansion,the timing of cash receipts andpayments,vendor payment terms,and fluctuations in foreign exchange
206、rates.Net cash provided by operating activities decreased by$3.4 billion in the first nine months of fiscal 2022 compared to the first nine months offiscal 2021,primarily driven by changes in working capital,slightly offset by an increase in net earnings.Working capital was impacted by highermerchan
207、dise inventories and reduced inventory turnover,timing of vendor payments,and decreases in deferred revenue in fiscal 2022.Ourinventory position reflects the impact of inflation,along with strategic investments to promote higher in-stock levels and pull forward merchandisein response to ongoing glob
208、al supply chain disruption,as well as continued investment in our new supply chain facilities and carry over of somespring seasonal inventory.Investing ActivitiesCash used in investing activities increased by$113 million in the first nine months of fiscal 2022 compared to the first nine months of fi
209、scal 2021,primarily resulting from increased capital expenditures,partially offset by cash paid for an acquired business during the first nine months of fiscal2021.19Table of ContentsFinancing ActivitiesCash used in financing activities in the first nine months of fiscal 2022 primarily reflected$5.9
210、 billion of cash dividends paid,$5.1 billion of sharerepurchases,$2.4 billion of repayments of long-term debt,and$1.0 billion of net repayments of short-term debt,partially offset by$6.9 billion ofnet proceeds from long-term debt.Cash used in financing activities in the first nine months of fiscal 2
211、021 primarily reflected$10.4 billion of sharerepurchases,$5.3 billion of cash dividends paid,and$1.5 billion of repayments of long-term debt,partially offset by$3.0 billion of net proceedsfrom long-term debt.CRITICAL ACCOUNTING POLICIESDuring the first nine months of fiscal 2022,there were no change
212、s to our critical accounting policies as disclosed in the 2021 Form 10-K.Refer toNote 1 to our consolidated financial statements for further discussion regarding our significant accounting policies.ADDITIONAL INFORMATIONFor information on accounting pronouncements that have impacted or are expected
213、to materially impact our consolidated financial condition,results of operations or cash flows,see Note 1 to our consolidated financial statements.Item 3.Quantitative and Qualitative Disclosures about Market Risk.Our exposure to market risk results primarily from fluctuations in interest rates in con
214、nection with our long-term debt portfolio.We are alsoexposed to risks from foreign currency exchange rate fluctuations on the translation of our foreign operations into U.S.dollars and on thepurchase of goods by these foreign operations that are not denominated in their local currencies.Additionally
215、,we may experience inflation anddeflation related to our purchase of certain commodity products.There have been no material changes to our exposure to market risks,includingthe types of instruments we use to manage our exposure to such risks,from those disclosed in the 2021 Form 10-K.Item 4.Controls
216、 and Procedures.Under the direction and with the participation of our Chief Executive Officer and Chief Financial Officer,we evaluated our disclosure controls andprocedures(as defined in Rule 13a-15(e)under the Exchange Act)and concluded that our disclosure controls and procedures were effective aso
217、f October 30,2022.We are in the process of an ongoing business transformation initiative,which includes upgrading and migrating certain accounting and financesystems.We plan to continue to migrate additional business processes over the course of the next few years and have modified and willcontinue
218、to modify the design and implementation of certain internal control processes as the transformation continues.Except as described above,there were no other changes in our internal control over financial reporting during the fiscal quarter endedOctober 30,2022 that have materially affected,or are rea
219、sonably likely to materially affect,our internal control over financial reporting.PART II OTHER INFORMATIONItem 1A.Risk Factors.In addition to the other information set forth in this report,you should carefully consider the factors discussed under Part I,Item 1A,“RiskFactors”and elsewhere in the 202
220、1 Form 10-K.These risks and uncertainties could materially and adversely affect our business,consolidatedfinancial condition,results of operations,or cash flows.Our operations could also be affected by additional factors that are not presently knownto us or by factors that we currently do not consid
221、er material to our business.There have been no material changes in the risk factors discussedin the 2021 Form 10-K.20Table of ContentsItem 2.Unregistered Sales of Equity Securities and Use of Proceeds.ISSUER PURCHASES OF EQUITY SECURITIESThe following table presents the number and average price of s
222、hares purchased in each fiscal month of the third quarter of fiscal 2022:PeriodTotal Number ofShares Purchased Average PricePaid Per ShareTotal Number ofShares Purchased as Part ofPublicly Announced ProgramDollar Value ofShares that May YetBe Purchased Under theProgram August 1,2022 August 28,20221,
223、006,934$311.63 1,002,575$14,906,250,890 August 29,2022 September 25,20221,042,671 285.15 1,041,201 14,609,360,775 September 26,2022 October 30,20222,192,077 282.02 2,179,438 13,994,589,035 4,241,682 289.82 4,223,214(1)These amounts include repurchases pursuant to our Omnibus Stock Incentive Plan,as
224、Amended and Restated May 19,2022,and our 1997 Omnibus StockIncentive Plan(collectively,the“Plans”).Under the Plans,participants may surrender shares as payment of applicable tax withholding on the vesting ofrestricted stock.Participants in the Plans may also exercise stock options by surrendering sh
225、ares of common stock that the participants already own aspayment of the exercise price.Shares so surrendered by participants in the Plans are repurchased pursuant to the terms of the Plans and applicable awardagreement and not pursuant to publicly announced share repurchase programs.(2)On August 18,
226、2022,our Board of Directors approved a$15.0 billion share repurchase authorization that replaced the previous authorization of$20.0 billion,which was approved on May 20,2021.This new authorization does not have a prescribed expiration date.SALES OF UNREGISTERED SECURITIESDuring the third quarter of
227、fiscal 2022,we issued 579 deferred stock units under The Home Depot,Inc.Nonemployee Directors Deferred StockCompensation Plan pursuant to the exemption from registration provided by Section 4(a)(2)of the Securities Act and Rule 506 of the SECsRegulation D thereunder.The deferred stock units were cre
228、dited during the third quarter of fiscal 2022 to the accounts of those non-employeedirectors who elected to receive all or a portion of board retainers in the form of deferred stock units instead of cash.The deferred stock unitsconvert to shares of common stock on a one-for-one basis following a ter
229、mination of service as described in this plan.During the third quarter of fiscal 2022,we credited 1,108 deferred stock units to participant accounts under the Restoration Plan pursuant to anexemption from the registration requirements of the Securities Act for involuntary,non-contributory plans.The
230、deferred stock units convert toshares of common stock on a one-for-one basis following a termination of service as described in this plan.(1)(1)(2)(2)21Table of ContentsItem 6.Exhibits.Exhibits marked with an asterisk(*)are incorporated by reference to exhibits or appendices previously filed with th
231、e SEC,as indicated by thereferences in brackets.All other exhibits are filed or furnished herewith.ExhibitDescription3.1*Amended and Restated Certificate of Incorporation of The Home Depot,Inc.Form 10-Q filed on September 1,2011,Exhibit 3.13.2*By-Laws of The Home Depot,Inc.(Amended and Restated Effe
232、ctive February 28,2019)Form 8-K filed on March 4,2019,Exhibit 3.24.1*Form of 4.000%Note due September 15,2025Form 8-K filed on September 19,2022,Exhibit 4.24.2*Form of 4.500%Note due September 15,2032Form 8-K filed on September 19,2022,Exhibit 4.34.3*Form of 4.950%Note due September 15,2052Form 8-K
233、filed on September 19,2022,Exhibit 4.415.1Acknowledgement of Independent Registered Public Accounting Firm31.1Certification of the Chair,President and Chief Executive Officer pursuant to Rule 13a-14(a)31.2Certification of the Executive Vice President and Chief Financial Officer pursuant to Rule 13a-
234、14(a)32.1Certification of the Chair,President and Chief Executive Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Actof 200232.2Certification of the Executive Vice President and Chief Financial Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002101.INSXBRL Ins
235、tance Document-the instance document does not appear in the Interactive Data file because its XBRL tags areembedded within the Inline XBRL document101.SCHInline XBRL Taxonomy Extension Schema Document101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document101.DEFInline XBRL Taxonomy Exten
236、sion Definition Linkbase Document101.LABInline XBRL Taxonomy Extension Label Linkbase Document101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document104Cover Page Interactive Data File(formatted as inline XBRL and contained in Exhibit 101)22Table of ContentsSIGNATURESPursuant to the req
237、uirements of the Securities Exchange Act of 1934,the registrant has duly caused this report to be signed on its behalf by theundersigned thereunto duly authorized.THE HOME DEPOT,INC.(Registrant)By:/s/EDWARD P.DECKEREdward P.Decker,Chair,President and Chief Executive Officer(Principal Executive Offic
238、er)/s/RICHARD V.MCPHAILRichard V.McPhail,Executive Vice President and Chief FinancialOfficer(Principal Financial Officer)/s/STEPHEN L.GIBBSStephen L.Gibbs,Vice President,Chief Accounting Officer andCorporate Controller(Principal Accounting Officer)Date:November 21,202223Exhibit 15.1ACKNOWLEDGEMENT O
239、F INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTo the Stockholders and Board of DirectorsThe Home Depot,Inc.:We acknowledge our awareness of the use of our report dated November 21,2022 related to our review of interim financial information includedwithin the Quarterly Report on Form 10-Q of The Hom
240、e Depot,Inc.for the three-month and nine-month periods ended October 30,2022,andincorporated by reference in the following Registration Statements:DescriptionRegistrationStatement NumberForm S-3Depot Direct stock purchase programDebt securitiesForm S-8The Home Depot,Inc.1997 Omni
241、bus Stock Incentive Plan333-61733The Home Depot Canada Registered Retirement Savings Plan333-38946The Home Depot,Inc.Restated and Amended Employee Stock Purchase PlanThe Home Depot,Inc.Amended and Restated Employee Stock Purchase PlanThe Home Depot,Inc.Non-Qualified Stock Option
242、and Deferred Stock Units Plan and Agreement333-56722The Home Depot,Inc.2005 Omnibus Stock Incentive PlanThe Home Depot,Inc.2005 Omnibus Stock Incentive PlanThe Home Depot FutureBuilder and The Home Depot FutureBuilder for Puerto RicoPursuant to Rule 436 under the Securi
243、ties Act of 1933(“the Act”),such report is not considered part of a registration statement prepared orcertified by an independent registered public accounting firm,or a report prepared or certified by an independent registered public accountingfirm within the meaning of Sections 7 and 11 of the Act.
244、/s/KPMG LLPAtlanta,GeorgiaNovember 21,2022Exhibit 31.1CERTIFICATIONI,Edward P.Decker,certify that:1.I have reviewed this quarterly report on Form 10-Q of The Home Depot,Inc.;2.Based on my knowledge,this report does not contain any untrue statement of a material fact or omit to state a material fact
245、necessary tomake the statements made,in light of the circumstances under which such statements were made,not misleading with respect to theperiod covered by this report;3.Based on my knowledge,the financial statements,and other financial information included in this report,fairly present in all mate
246、rialrespects the financial condition,results of operations and cash flows of the registrant as of,and for,the periods presented in this report;4.The registrants other certifying officer(s)and I are responsible for establishing and maintaining disclosure controls and procedures(asdefined in Exchange
247、Act Rules 13a-15(e)and 15d-15(e)and internal control over financial reporting(as defined in Exchange Act Rules13a-15(f)and 15d-15(f)for the registrant and have:a)Designed such disclosure controls and procedures,or caused such disclosure controls and procedures to be designed under oursupervision,to
248、ensure that material information relating to the registrant,including its consolidated subsidiaries,is made known tous by others within those entities,particularly during the period in which this report is being prepared;b)Designed such internal control over financial reporting,or caused such intern
249、al control over financial reporting to be designedunder our supervision,to provide reasonable assurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles;c)Evaluated the effect
250、iveness of the registrants disclosure controls and procedures and presented in this report our conclusionsabout the effectiveness of the disclosure controls and procedures,as of the end of the period covered by this report based onsuch evaluation;andd)Disclosed in this report any change in the regis
251、trants internal control over financial reporting that occurred during the registrantsmost recent fiscal quarter(the registrants fourth fiscal quarter in the case of an annual report)that has materially affected,or isreasonably likely to materially affect,the registrants internal control over financi
252、al reporting;and5.The registrants other certifying officer(s)and I have disclosed,based on our most recent evaluation of internal control over financialreporting,to the registrants auditors and the audit committee of the registrants board of directors(or persons performing the equivalentfunctions):a
253、)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting whichare reasonably likely to adversely affect the registrants ability to record,process,summarize and report financial information;andb)Any fraud,whether or not material,tha
254、t involves management or other employees who have a significant role in the registrantsinternal control over financial reporting.Date:November 21,2022/s/Edward P.Decker Edward P.DeckerChair,President and Chief Executive OfficerExhibit 31.2CERTIFICATIONI,Richard V.McPhail,certify that:1.I have review
255、ed this quarterly report on Form 10-Q of The Home Depot,Inc.;2.Based on my knowledge,this report does not contain any untrue statement of a material fact or omit to state a material fact necessary tomake the statements made,in light of the circumstances under which such statements were made,not misl
256、eading with respect to theperiod covered by this report;3.Based on my knowledge,the financial statements,and other financial information included in this report,fairly present in all materialrespects the financial condition,results of operations and cash flows of the registrant as of,and for,the per
257、iods presented in this report;4.The registrants other certifying officer(s)and I are responsible for establishing and maintaining disclosure controls and procedures(asdefined in Exchange Act Rules 13a-15(e)and 15d-15(e)and internal control over financial reporting(as defined in Exchange Act Rules13a
258、-15(f)and 15d-15(f)for the registrant and have:a)Designed such disclosure controls and procedures,or caused such disclosure controls and procedures to be designed under oursupervision,to ensure that material information relating to the registrant,including its consolidated subsidiaries,is made known
259、 tous by others within those entities,particularly during the period in which this report is being prepared;b)Designed such internal control over financial reporting,or caused such internal control over financial reporting to be designedunder our supervision,to provide reasonable assurance regarding
260、 the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles;c)Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusionsabout t
261、he effectiveness of the disclosure controls and procedures,as of the end of the period covered by this report based onsuch evaluation;andd)Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrantsmost recent fiscal quarter(t
262、he registrants fourth fiscal quarter in the case of an annual report)that has materially affected,or isreasonably likely to materially affect,the registrants internal control over financial reporting;and5.The registrants other certifying officer(s)and I have disclosed,based on our most recent evalua
263、tion of internal control over financialreporting,to the registrants auditors and the audit committee of the registrants board of directors(or persons performing the equivalentfunctions):a)All significant deficiencies and material weaknesses in the design or operation of internal control over financi
264、al reporting whichare reasonably likely to adversely affect the registrants ability to record,process,summarize and report financial information;andb)Any fraud,whether or not material,that involves management or other employees who have a significant role in the registrantsinternal control over fina
265、ncial reporting.Date:November 21,2022/s/Richard V.McPhail Richard V.McPhailExecutive Vice President and Chief Financial OfficerExhibit 32.1CERTIFICATION PURSUANT TO18 U.S.C.SECTION 1350AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002In connection with the Quarterly Report of The H
266、ome Depot,Inc.(the“Company”)on Form 10-Q(“Form 10-Q”)for the period ended October 30,2022 as filed with the Securities and Exchange Commission,I,Edward P.Decker,Chair,President and Chief Executive Officer of the Company,certify,pursuant to 18 U.S.C.Section 1350,as adopted pursuant to Section 906 of
267、the Sarbanes-Oxley Act of 2002,that,to my knowledge:(1)The Form 10-Q fully complies with the requirements of section 13(a)or 15(d)of the Securities Exchange Act of 1934;and(2)The information contained in the Form 10-Q fairly presents,in all material respects,the financial condition and results of op
268、erations ofthe Company./s/Edward P.DeckerEdward P.DeckerChair,President and Chief Executive OfficerNovember 21,2022Exhibit 32.2CERTIFICATION PURSUANT TO18 U.S.C.SECTION 1350AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002In connection with the Quarterly Report of The Home Depot,In
269、c.(the“Company”)on Form 10-Q(“Form 10-Q”)for the period ended October 30,2022 as filed with the Securities and Exchange Commission,I,Richard V.McPhail,Executive Vice President and Chief Financial Officer of theCompany,certify,pursuant to 18 U.S.C.Section 1350,as adopted pursuant to Section 906 of th
270、e Sarbanes-Oxley Act of 2002,that,to myknowledge:(1)The Form 10-Q fully complies with the requirements of section 13(a)or 15(d)of the Securities Exchange Act of 1934;and(2)The information contained in the Form 10-Q fairly presents,in all material respects,the financial condition and results of operations ofthe Company./s/Richard V.McPhail Richard V.McPhailExecutive Vice President and Chief Financial OfficerNovember 21,2022