HOME DEPOT, INC. HD

26% shingled-prose overlap between the two filings.

2025: 58,431 chars · 2026: 59,985 chars

• Committee Report:38% overlap (6,000 → 2,621 chars)
• Pay Ratio (Item 402(u)):41% overlap (4,494 → 4,733 chars)
• Say-on-Pay proposal:7% overlap (25,000 → 25,000 chars)

• changedThis section of the Proxy Statement provides our discussion and analysis of the Company’s Fiscal 2025 2024executive compensation program, focusing on the compensation of our named executive officers, or “NEOs.” Our NEOs for Fiscal 2025 2024were as follows:
• changedDecker, Chair, President and CEO CEO.
• changedMcPhail, Executive Vice President and CFO CFO.
• changed•Ann-Marie Campbell, Senior Executive Vice President President.
• changedBastek, Executive Vice President – Merchandising Merchandising.
• new•Jordan Broggi, Executive Vice President – Customer Experience and President – Online
• new•Hector A.
• newPadilla, former Executive Vice President – U.S. Stores and Operations, who served in this role until September 12, 2025
• new•Fahim Siddiqui, former Executive Vice President and Chief Information Officer, who served in this role until May 29, 2025
• newEXECUTIVE SUMMARY55Fiscal 2025 Business Objectives and Performance55Compensation Philosophy and Objectives: Pay for Performance55Executive Compensation Report Card: The Home Depot Pays for Performance56Performance-Based Features of Fiscal 2025 Compensation and Compensation Best Practices57Impact of Fiscal 2025 Business Results on Executive Compensation58Opportunity for Shareholder Feedback58EXECUTIVE COMPENSATION DETERMINATION PROCESS59Benchmarking59Mitigating Compensation Risk60Consideration of Last Year’s Say-on-Pay Vote61ELEMENTS OF OUR COMPENSATION PROGRAMS61Base Salaries61Annual Cash Incentive62Long-Term Incentives64Deferred Compensation Plans67Perquisites67Other Benefits67MANAGEMENT OF COMPENSATION-RELATED RISK67SEVERANCE AND CHANGE IN CONTROL ARRANGEMENTS69
• new54The Home Depot 2026 Proxy Statement
• changedFiscal 2025 2024Business Objectives and Performance
• changedDespitecontinuedpressureonhomeimprovementdemanddrivenbyongoingmacroeconomicuncertaintyandpersistentlyhighinterestrates,Our strategy allowed us to continue to execute at a high level in Fiscal 2025 despite continued macroeconomic uncertainties and other macroeconomic factors, including a persisting high interest rate environment, that continue to pressure broader home improvement demand. 2024.
• newIn Fiscal 2025, we remained focused on executing our strategy to drive core and culture, deliver a frictionless, interconnected experience and win with Pros.
• newWe drove core and culture by supporting our associates so they could deliver an exceptional customer service experience.
• newWe also delivered an increasingly frictionless, interconnected experience for our customers across all channels, including in our stores and online.
• newFinally, we prioritized strengthening our relationship with the Pro, and our differentiated value proposition is earning a greater share of their wallet.
• newIn addition, in September 2025, SRS acquired GMS, one of the leading distributors of specialty building products, including drywall, ceilings, steel framing and other complementary products related to remodeling and construction projects in residential and commercial end markets.
• newOur results for Fiscal 2025, which was a 52-week year compared to Fiscal 2024, which was a 53-week year, were as follows:
• changed•Net sales increased by 3.2% 4.5%to $164.7 $159.5billion.
• changed•Operating income decreased by 3.0% 0.8%to $20.9 $21.5billion.
• changed•Net earnings decreased by 4.4% 2.2%to $14.2 $14.8billion and diluted earnings per share decreased by 4.6% 1.3%to $14.23. $14.91.
• changedAdjusted(1) diluted earnings per share decreased by 3.6% 0.1%to $14.69. $15.24.
• changed•Generated $16.3 $19.8billion in operating cash flow.
• changed•Generated ROIC(1) of 25.7%, 31.3%,compared to 31.3% 36.7%in Fiscal 2024. 2023.
• changedThe 53rd week in Fiscal 2024 added approximately $2.5 billion of net sales to Fiscal 2024 and increased each of diluted earnings per share and adjusted diluted earnings per share for Fiscal 2024 by approximately $0.30.
• changedAs a result of our significant cash flow from operations and disciplined capital allocation, we were also able to return value to our shareholders during Fiscal 2025 2024through $9.2 $8.9billion in dividends.
• changedAtthesametime,We also continued to operate by aligning our decisions and actions with twoofour core values, including values—Doing the Right Thing and Taking Care of our People, which maintains People—maintainingour focus on the safety and well-being of our associates and customers. customersandprovidingourcustomersandcommunitieswiththeproductsandservicesthattheyneed.
• newThis investment included Success Sharing bonus payments of approximately $288.4 million earned by our associates in Fiscal 2025.
• newIn addition, we made a significant investment in our people in Fiscal 2025 by increasing equity awards to field leadership, including store managers and assistant store managers.
• changedWe have designed our compensation program for associates at all levels with the intent to align pay with performance.
• changedThe principal elements of our compensation program for executive officers are base salary, the annual cash incentive, incentivesand long-term equity incentives.
• changedWe use several of the financial measures metricshighlighted above, which drive shareholder value, as the basis for key performance measures metricsin our compensation programs.
• changedThe following Executive Compensation Report Card highlights the alignment between pay and performance for each of these elements of our compensation program. programforFiscal2024.
• changed1 The Company reports its financial results in accordance with U.S.GAAP.
• newThe Home Depot 2026 Proxy Statement55
• changedFISCAL2024EXECUTIVE COMPENSATION REPORT CARD:THE HOME DEPOT PAYS FOR PERFORMANCE
• newThe LDC Committee and, with respect to our CEO, the Board considered the importance of maintaining strong alignment with the shareholder experience when establishing NEO compensation in Fiscal 2025.
• changedApproximately 91.3% 90.8%of our CEO’s target compensation for Fiscal 2025, and approximately 84.9% of the target compensation 2024(approximately81.5%on average for our other NEOs employed at the end of Fiscal 2025, NEOs)was at risk and in large part contingent upon the achievement of corporate performance objectives. objectivesand/orsharepriceperformance.
• changedThe components of total target compensation for Fiscal 2025 2024were as shown below:
• newBelow are the variable components of total target compensation for Fiscal 2025, including the performance measures used for each and, where the performance period has already concluded, actual Company performance or achievement status relevant to those measures and the resulting compensation paid to our NEOs employed at the end of Fiscal 2025.
• newFiscal 2025 Performance Measures and Actual PerformanceExecutive Compensation ResultsManagement Incentive Plan (MIP):($ in billions)MeasuresThresholdTargetMaximumActual**Continuing NEOsPerformance as% of TargetMIP PayoutSales (50%)$147.56 $163.95 $180.35 $162.81 E.
• newDecker 95%$2,657,631Operating Profit (30%)$19.22 $21.35 $23.49 $21.17 R.
• newMcPhail95%$928,747Inventory Turns (10%)4.06 4.51 4.97 4.33 A.
• changedCampbell95%$1,258,697Pro Campbell98%$1,261,535ProStrategic Goal (10%)n/aIncreased managed account sales**n/aAchievedW.
• newBastek95%$759,323J.
• newBroggi95%$702,374Performance Share Award (50% of Fiscal 2025 equity mix):MeasuresFiscal 2025-2027 Performance SharesFiscal 2023-2025 Performance SharesThree-Year Average ROIC (50%)At the end of the first year of the three-year performance period, results are tracking between the threshold level and the target level.
• newShares will be received following the end of the three-year performance period, if and to the extent the performance measures are met.
• newThe Fiscal 2023-2025 performance share period concluded, with Company performance resulting in a payout of 70.1% due to average ROIC and operating profit of 37.4% and $21.15 billion, respectively, which reflected results between the threshold level and the target level for each measure.Three-Year Average Operating Profit (50%)* Amounts do not include total target compensation for Mr. Padilla or Mr. Siddiqui, both of whom departed the Company in 2025 following the termination by the Company of their employment without cause.
• newSee “Potential Payments Upon Termination or Change in Control—Departure of Former Executives in Fiscal 2025” starting on page 83 below.** See “—Elements of Our Compensation Programs—Annual Cash Incentive—Performance Goals” beginning on page 62 below,“—Elements of Our Compensation Programs—Annual Cash Incentive—Potential Adjustments” on page 63 below, “—Elements of Our Compensation Programs—Annual Cash Incentive—Fiscal 2025 MIP Results” on page 64 below, and “—Elements of Our Compensation Programs—Long-Term Incentives—Performance Shares” starting on page 65 below.
• new56The Home Depot 2026 Proxy Statement
• newFiscal 2025 Performance Measures and Actual PerformanceExecutive Compensation ResultsPerformance-Based Restricted Stock (30% of Fiscal 2025 equity mix):Restricted stock is forfeited if Fiscal 2025 operating profit is not at least 90% of the MIP target.This performance condition was satisfied, and the shares of restricted stock will vest in equal installments on the 30 and 60-month anniversaries of the grant date.($ in billions)MeasureThreshold(90% of Target)TargetActual***Operating Profit $19.22 $21.35 $21.17 Stock Options (20% of Fiscal 2025 equity mix):Based on stock price performance – annual grant with an exercise price of $362.13 made on March 26, 2025.At the end of Fiscal 2025, options were in-the-money by $12.46 per share.
• changedOptions vest 25% on eachofthe second, third, fourth and fifth anniversaries of the grant date.***See date.*See“—Elements of Our Compensation Programs—Annual Cash Incentive—Potential Adjustments” beginningon page 63 46below, “—Elements of Our Compensation Programs—Annual Cash Incentive—Fiscal 2025 2024MIP Results” startingon page 64 below 47below,and “—Elements of Our Compensation Programs—Long-Term Incentives—Performance-Based Restricted Stock” startingon page 66 50below.
• changedPerformance-Based Features of Fiscal 2025 2024Compensation and Compensation Best Practices
• changedü 100% of the annual incentive compensation under our Fiscal 2025 2024MIP was tied to performance against pre-established, specific, measurable performance goals.
• changedü One half of the annualFiscal 2025 2024equity grant was in the form of a three-year performance share award, with payout contingent on achieving pre-established average ROIC and average operating profit targets over the three-year performance period.
• changedü Our performance-based restricted stock awards, which comprised 30% of the annualFiscal 2025 2024equity grant, were forfeitable if Fiscal 2025 2024operating profit was less than 90% of the Fiscal 2025 2024MIP operating profit target.
• changedDividends on performance-based restricted stock grantsare accrued and notpaid outto executive officers only if unlessanduntilthe performance condition goalis met.
• changedü Our equity awards have longer vesting periods than those of many of our peers, with the performance-based restricted stock awardsand stock options vesting over five years and the performance shares vesting cliff-vestingin full after the three-year performance period, subject threeyears(subjectto achievement of applicable performance goals, goals),which aligns executive officers’ interests with the interests of our shareholders in the long-term performance of the Company.
• newü Approximately 91.3% of our CEO’s total target compensation was at risk and in large part contingent upon the achievement of corporate performance objectives.
• changedü We provide only limited perquisites to NEOs, and we do not provide guaranteed salary increases, guaranteed bonuses or tax reimbursements, also known as “gross-ups,” to NEOs; we also havelimitedperquisites;andwedo not have any change in control agreements, supplemental executive retirement plans, or defined benefit pension plans, guaranteedsalaryincreasesorguaranteedbonusesfor executive officers.
• changedü We maintain robust stock ownership and retention guidelines for executive officers and directors. officers.
• changedü Our executive compensation clawback policy, applicable to all Section 16 executiveofficers, extends beyond mandated requirements and allows the LDC Committee, in its discretion, to recoup any bonus, incentive payment, equity award or other compensation if, among other things, the executive officer engaged in intentional misconduct that caused the Company material financial or reputational harm.
• newThe Home Depot 2026 Proxy Statement57
• changedImpact of Fiscal 2025 2024Business Results on Executive Compensation
• newThe amount of incentive compensation paid to our executive officers, if any, is driven by our performance.
• newThis includes our performance against the Fiscal 2025 business plan reviewed with our Board at the beginning of the fiscal year, which we intended to be challenging in light of the prevailing economic conditions, yet attainable through disciplined execution of our strategy.
• changedConsistent with our business plan, andduetothecontinuinguncertaintyregardingmacroeconomicconditionsandthepersistentlyhighinterestrateenvironment,afteradjustingforthe53rdweekinFiscal2024,our executive compensation program targets reflected increases amodestdecreasein the sales and operating profit goals from prior year theactual results fortheprioryearand a decrease modestincreasein the inventory turns goals from prior year actual results, excluding the impact of the 53rd week in Fiscal 2024. results.
• newWe also continued to reinforce our strategic focus on Pros with the Pro strategic goal.
• changedThe compensation earned by our NEOs employed at the end of Fiscal 2025 reflects our Company performance against those measures. metrics.
• new•Our MIP paid out slightly below the target level.
• changed•The performance condition on the performance-based restricted stock granted in Fiscal 2025 2024was satisfied, with althoughthe shares remaining stillremainsubject to time-based vesting requirements for up to 60 months from the grant date. requirements.
• changed•The NEOs earned 70.1% 25.6%of their Fiscal 2023-2025 2022-2024performance share award due to average ROIC and average operating profit over the three-year performance period of 37.4% 39.4%and $21.15 $22.24billion, respectively, reflecting results between belowthe threshold level foraverageROICand abovethe target thresholdlevel for each measure. averageoperatingprofit.
• new58The Home Depot 2026 Proxy Statement
• changedParticipantRole in the Executive Compensation Determination ProcessIndependent Members of the Board•The independent members of the Board, consisting of all directors in Fiscal 2025 2024other than Mr. Decker, evaluated the performance and determined the compensation of the CEO.LDC Committee•The LDC Committee evaluated the CEO’s performance and made recommendations to the independent members of the Board regarding his compensation.•The LDC Committee evaluated the performance and determined the compensation of our executive officers other than the CEO.•The LDC Committee may delegate its responsibilities to subcommittees but did not delegate any of its authority with respect to the compensation of any executive officer for Fiscal 2025. 2024.
• changedExecutive Officers•The CEO and our EVP-HR made recommendations to the LDC Committee as to the amount and form of executive compensation for executive officers (other than the CEO’s compensation).•At the request of the LDC Committee, the EVP-HR and the CEO regularly attended LDC Committee meetings. meetings,excludingexecutivesessions.
• newThe CEO did not attend or participate in any LDC Committee or Board discussions pursuant to which his compensation was established.Independent CompensationConsultant•Pursuant to the independent compensation consultant policy adopted by the LDC Committee, the compensation consultant provides services solely to the LDC Committee and is prohibited from providing services or products of any kind to the Company.
• changedFurther, affiliates of the compensation consultant may not receive payments from the Company that would exceed 2% of the consolidated gross revenues of the compensation consultant and its affiliates during any year. year.•PayGovernanceprovidedservicessolelytotheLDCCommitteeinFiscal2024,andnoneofitsaffiliatesprovidedanyservicestotheCompany.
• changed•In November 2024, Inaddition,undertheCompany’sindependentcompensationconsultantpolicy,the LDC Committee assessed Pay Governance’s independence and whether its work raised any conflicts of interest, taking into consideration the independence factors set forth in applicable SEC and NYSE rules.
• changedPay Governance also confirmed that its services complied with the CEOdidnotparticipateinorattendanyLDC Committee policy.•Following that assessment, orBoarddiscussionspursuanttowhichhiscompensationwasestablished.IndependentCompensationConsultant•InNovember2023,the LDC Committee engaged Pay Governance as its independent compensation consultant for Fiscal 2025 2024to provide research, market data, survey information and design expertise in developing executive and director compensation programs.

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