Home Depot continues to invest in capex despite tough market conditions

Despite a tough macroecoeconomc environment where high housing prices and low turnover have dampened demand for renovation projects, Home Depot continued to ramp up capex spending in 2025.

The company spent $3.7 billion on capital expenditures in fiscal 2025, per its latest earning results. That’s up from $3.5 billion in 2024, $3.2 billion in 2023, $3.1 billion in 2022, and $2.6 billion in 2021.

As a percentage of sales, this number has also ticked upward. In 2021, Home Depot’s capex spending was 1.7% of sales. In 2025, the exact percentage was closer to 2.25%, and the company is forecasting spending 2.5% of sales in fiscal 2026, with the goal of growing market share regardless of the macroeconomic situation.

“We plan to continue investing in our business with capital expenditures of approximately 2.5% of sales for fiscal 2026,” CEO Richard McPhail told shareholders. “We believe that we will grow market share in any environment by strengthening our competitive position with our customers and delivering the best customer experience in home improvement.”

In early 2025, McPhail said Home Depot had historically stuck to around 2% of sales for capex spending, but that it was raising that expectation to 2.5% for two reasons: One, it was happy with the returns generated by those investments, and two, investing in new stores was a now priority.

In the Q4 call, McPhail said these “principles haven’t changed,” adding that “we have a high bar for what we're willing to invest in. Every project has to provide an exceptional return on investment.”

The potential upside for Home Depot is huge share gains in the pro market. CEO Ted Decker said the sector represents “$200 billion of white space for us,” which it plans to capture through continued investment.