Adjusted operating income, adjusted operating margin (calculated as adjusted operating income divided by total net sales), and adjusted diluted earnings per share are presented as supplemental financial measures in the evaluation of our business that are not required by or presented in accordance with GAAP. The Company excludes the impact of amortization expense from acquired intangible assets from adjusted operating income and adjusted operating margin, and the impact of amortization expense from acquired intangible assets, including the related tax effects, from adjusted diluted earnings per share. We do not adjust for the revenue that is generated in part from the use of our acquired intangible assets. Amortization expense, unlike the related revenue, is not affected by operations in any particular period unless an intangible asset becomes impaired, or the useful life of an intangible asset is revised.

When used in conjunction with our GAAP results, we believe these non-GAAP measures provide investors with meaningful supplemental measures of our performance period to period, make it easier for investors to compare our underlying business performance to peers, and align to how management analyzes trends and evaluates performance internally. The Company provides non-GAAP financial information on this basis to facilitate comparability when we report earnings results. These non-GAAP measures should not be a substitute for their comparable GAAP financial measures. Investors should rely primarily on our GAAP results and use non-GAAP financial measures only supplementally in making investment decisions. Our calculation of non-GAAP measures may not be comparable to similarly titled measures reported by other companies and other companies may not define these non-GAAP financial measures in the same way, which may limit their usefulness as comparative measures.

Our adjusted operating margin guidance for fiscal 2024 excludes an expected approximately 30 basis point impact from acquired intangible asset amortization.

 

Our adjusted diluted earnings per share guidance for fiscal 2024 excludes an expected after-tax impact of approximately $0.30 from acquired intangible asset amortization.

 

SOURCE The Home Depot

SOURCE: The Home Depot

Financial Community, Isabel Janci, Vice President of Investor Relations and
Treasurer, 770-384-2666, isabel_janci@homedepot.com, News Media, Sara Gorman, Senior
Director of Corporate Communications, 770-384-2852, sara_gorman@homedepot.com

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