Home improvement demand is closely related to the underlying strength of the housing market. Most people undergo renovation projects just before selling a house or after buying a new place. Visits to Home Depot stores dropped 2.2% year over year in the second quarter, according to foot-traffic data from Placer.ai.

In Q1, Home Depot experienced solid demand for smaller projects and seasonal activities; however, high interest rates deterred many consumers

Home Depot's Q2 earnings fell slightly short of Wall Street's target, but the company announced some news that has potentially huge implications.