Home Depot drives $1 billion in online sales in Q2

 BY STEFANY ZAROBAN Associate Director of Research

The home improvement e-retailer boosts web sales 38% as customers respond favorably to closer ties between stores and the web.

One third of The Home Depot Inc.'s online orders are now picked up in stores, and that includes both consumer- and business-related purchases, company executives told analysts yesterday in the chain’s quarterly earnings call.

Shoppers appreciate the convenience of buying online and picking up orders inside stores, helping to drive more than $1 billion in online sales for The Home Depot during the quarter, a 38% increase compared with last year, executives said. The e-retailer offers a slew of ordering options for consumers in addition to buy online, pick up in-store. Online orders can be shipped to shoppers’ local store and returned there.

In the next six months, Home Depot, ranked No. 16 in the Internet Retailer Top 500 Guide, plans to roll out what it’s calling the next generation of its First Phone, though it didn’t elaborate on how the new version is different from the first iteration of device, which it rolled out in a limited fashion in 2012. The First Phone is a mobile device that allows clerks to complete the check-out process for in-store consumers, and to assist them with online orders.

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For the period ended Aug. 3, Home Depot reported:

• Online sales represented 4.2% of total sales for the quarter and increased 38% compared with the second fiscal quarter of last year. This amounts to approximately $1.00 billion in e-commerce revenue for the period, up from around $0.72 billion.
• Net sales were $23.81 billion, up 5.7% from $22.52 billion.
• Net earnings increased 14.2% to $2.050 billion from $1.795 billion.
• The number of customers grew 4.2% to 409.7 million from 393.2 million
• Average order value was $58.43, up 1.8% from $57.39.

For the first six months of the fiscal year, Home Depot also reported:

• Online sales of approximately $1.83 billion based on figures released for itsfirst fiscal quarter, up approximately 40.0% from $1.31 billion in the first half of last year.
• Net sales were $43.50 billion, up 4.4% from $41.65 billion.
• Net earnings grew 13.5% to $3.43 billion from $3.02 billion.