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Home Depot tightens operations amid a cooling housing market

Home Depot is reshaping its corporate workforce as it navigates a prolonged slowdown in home improvement demand. The company confirmed it is laying off roughly 800 employees while also requiring corporate staff to return to the office five days a week starting April 6.

In an internal memo, CEO Ted Decker said the moves are designed to boost the company’s “speed and agility,” streamline operations, and bring teams closer to store-level realities.

“To extend our industry-leading position, we must move faster and stay more closely connected to our customers and frontline associates,” Decker wrote, emphasizing that in-person collaboration is key to delivering stronger results and reinforcing Home Depot’s people-first culture.

Of the 800 roles being eliminated, about 150 are based at the company’s Atlanta headquarters. The remaining cuts primarily affect remote employees, with a significant portion coming from Home Depot’s technology organization, alongside reductions across other corporate teams.

The company employs more than 465,000 people globally, meaning the layoffs represent a small percentage of its overall workforce. Still, they mark one of the retailer’s most notable corporate restructurings in recent years.

Return-to-office mandate begins in April

Alongside the layoffs, Home Depot is ending flexible corporate work arrangements. Beginning the week of April 6, corporate employees will be expected to work in the office full time.

Decker framed the decision as essential to simplifying the business and sharpening execution.

“In-person engagement enables more meaningful support for store and field associates, drives results, and strengthens our inverted pyramid culture,” he said, referring to Home Depot’s long-standing philosophy that prioritizes frontline workers and customers.

The move aligns Home Depot with a growing number of large U.S. companies that have recently tightened return-to-office policies, particularly as executives seek faster decision-making, tighter accountability, and stronger cross-team collaboration.

Slower sales pressure performance

The restructuring comes as Home Depot continues to face weaker-than-expected sales, driven largely by a sluggish U.S. housing market. Fewer Americans are buying homes, and many homeowners are delaying big-ticket renovation projects due to elevated mortgage rates, persistent inflation, and broader economic uncertainty.

After a pandemic-era boom in DIY spending, demand has cooled significantly. Company leaders have repeatedly pointed to high borrowing costs and cautious consumers as major headwinds.

In November, Home Depot missed Wall Street earnings expectations for the third consecutive quarter. Management said it expects fiscal 2025 revenue to rise around 3%, with comparable sales turning slightly positive after a prolonged period of declines.

Comparable sales exclude one-time factors such as new store openings and calendar shifts, making them a key indicator of underlying demand.

Stock performance and investor outlook

Home Depot shares have lagged the broader market over the past year, falling about 10% while the S&P 500 gained roughly 15% over the same period. Despite that underperformance, the stock has shown signs of recovery in recent weeks, rising about 9% so far this year, compared with nearly 2% for the S&P 500.

Analysts remain divided on the retailer’s near-term outlook. Some see stabilization ahead if mortgage rates ease and housing activity rebounds, while others caution that discretionary home improvement spending may remain under pressure through much of 2026.

Home Depot is scheduled to report its fiscal fourth-quarter earnings on Feb. 24, an update investors will closely watch for signs of improving traffic, project demand, and professional contractor activity.

A broader reset for corporate America

Home Depot’s decision reflects a wider shift across corporate America. As companies adapt to slower growth and higher costs, many are reevaluating headcount, remote work policies, and organizational structures. Technology teams in particular have faced increased scrutiny as businesses prioritize efficiency and near-term returns on investment.

For Home Depot, the message is clear: the retailer is betting that tighter teams, in-person collaboration, and sharper focus on customers will help it regain momentum in a challenging retail and housing environment.

While the company is not immune to macroeconomic pressures, leadership believes these changes will position Home Depot to respond faster to market shifts and be ready when home improvement demand eventually rebounds.

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