10-Q

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)
ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 3, 2003
- -OR -
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                             to

Commission file number 1-8207

THE HOME DEPOT, INC.
(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)	95-3261426 (I.R.S. Employer Identification Number)
2455 Paces Ferry Road N.W.    Atlanta, Georgia (Address of principal executive offices)	30339 (Zip Code)

(770) 433-8211
(Registrant's telephone number, including area code)

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ý    No o

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

$.05 par value 2,367,336,007 Shares, as of September 3, 2003

Page 1 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

INDEX TO FORM 10-Q

		Page
Part I. Financial Information
Item 1.	Financial Statements
	CONSOLIDATED STATEMENTS OF EARNINGS—     Three-Month and Six-Month Periods     Ended August 3, 2003 and August 4, 2002	3
	CONSOLIDATED BALANCE SHEETS—     As of August 3, 2003 and February 2, 2003	4
	CONSOLIDATED STATEMENTS OF CASH FLOWS—     Six-Month Periods     Ended August 3, 2003 and August 4, 2002	5
	CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME—     Three-Month and Six-Month Periods     Ended August 3, 2003 and August 4, 2002	6
	NOTE TO CONSOLIDATED FINANCIAL STATEMENTS	7-8
	INDEPENDENT ACCOUNTANTS' REVIEW REPORT	9
Item 2.	Management's Discussion and Analysis of Results     of Operations and Financial Condition	10-14
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	14
Item 4.	Controls and Procedures	14-15
Part II. Other Information:
Item 2.	Changes in Securities	15
Item 4.	Submission of Matters to a Vote of Security Holders	16-17
Item 5.	Other Information	18
Item 6.	Exhibits and Reports on Form 8-K	18
Signatures		19
Index to Exhibits		20

Page 2 of 20

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)

(In Millions, Except Per Share Data)

			Three Months Ended						Six Months Ended
			August 3, 2003			August 4, 2002			August 3, 2003			August 4, 2002
NET SALES			$	17,989		$	16,277		$	33,093		$	30,559
Cost of Merchandise Sold				12,384			11,331			22,659			21,253
	GROSS PROFIT			5,605			4,946			10,434			9,306
Operating Expenses:
	Selling and Store Operating			3,230			2,810			6,325			5,555
	Pre-Opening			17			23			32			48
	General and Administrative			292			236			563			464
		Total Operating Expenses		3,539			3,069			6,920			6,067
		OPERATING INCOME		2,066			1,877			3,514			3,239
Interest Income (Expense):
	Interest and Investment Income			15			25			27			42
	Interest Expense			(16	)		(8	)		(34	)		(15	)
		Interest, Net		(1	)		17			(7	)		27
		EARNINGS BEFORE PROVISION FOR INCOME TAXES		2,065			1,894			3,507			3,266
Provision for Income Taxes				766			712			1,301			1,228
		NET EARNINGS	$	1,299		$	1,182		$	2,206		$	2,038
Weighted Average Common Shares				2,295			2,354			2,294			2,352
BASIC EARNINGS PER SHARE			$	0.57		$	0.50		$	0.96		$	0.87
Diluted Weighted Average Common Shares				2,302			2,363			2,300			2,364
DILUTED EARNINGS PER SHARE			$	0.56		$	0.50		$	0.96		$	0.86
Dividends Declared Per Share			$	0.07		$	0.05		$	0.13		$	0.10

See accompanying note to consolidated financial statements.

Page 3 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(Unaudited)

(In Millions, Except Per Share Data)

			August 3, 2003			February 2, 2003
ASSETS
Current Assets:
	Cash and Cash Equivalents		$	5,209		$	2,188
	Short-Term Investments			45			65
	Receivables, Net			1,379			1,072
	Merchandise Inventories			8,621			8,338
	Other Current Assets			313			254
		Total Current Assets		15,567			11,917
Property and Equipment, at cost				22,306			20,733
Less: Accumulated Depreciation and Amortization				4,043			3,565
	Net Property and Equipment			18,263			17,168
Notes Receivable				109			107
Cost in Excess of the Fair Value of Net Assets Acquired				590			575
Other Assets				83			244
			$	34,612		$	30,011
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
	Accounts Payable		$	5,875		$	4,560
	Accrued Salaries and Related Expenses			873			809
	Sales Taxes Payable			454			307
	Deferred Revenue			1,334			998
	Income Taxes Payable			643			227
	Other Accrued Expenses			1,210			1,134
		Total Current Liabilities		10,389			8,035
Long-Term Debt, excluding current installments				1,327			1,321
Other Long-Term Liabilities				601			491
Deferred Income Taxes				362			362
STOCKHOLDERS' EQUITY
	Common Stock, par value $0.05, authorized: 10,000 shares, issued and     outstanding 2,365 shares at August 3, 2003 and 2,362 shares at February 2, 2003			118			118
	Paid-In Capital			5,990			5,858
	Retained Earnings			17,901			15,971
	Accumulated Other Comprehensive Income (Loss)			24			(82	)
	Unearned Compensation			(72	)		(63	)
	Treasury Stock at cost, 69 shares at August 3, 2003 and February 2, 2003			(2,028	)		(2,000	)
		Total Stockholders' Equity		21,933			19,802
			$	34,612		$	30,011

See accompanying note to consolidated financial statements.

Page 4 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

(In Millions)

			Six Months Ended
			August 3, 2003			August 4, 2002
CASH FLOWS FROM OPERATIONS:
Net Earnings			$	2,206		$	2,038
Reconciliation of Net Earnings to Net Cash Provided by Operations:
	Depreciation and Amortization			505			434
	Increase in Receivables, Net			(303	)		(256	)
	Increase in Merchandise Inventories			(255	)		(471	)
	Increase in Accounts Payable and Accrued Expenses			1,659			2,297
	Increase in Deferred Revenue			335			301
	Increase in Income Taxes Payable			425			313
	Other			49			(32	)
		Net Cash Provided by Operations		4,621			4,624
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital Expenditures				(1,671	)		(1,273	)
Payments for Business Acquired, Net				(1	)		(59	)
Proceeds from Sale of Business, Net				—			22
Proceeds from Sales of Property and Equipment				187			66
Purchases of Investments				(74	)		(381	)
Proceeds from Maturities of Investments				164			258
Other				—			9
		Net Cash Used In Investing Activities		(1,395	)		(1,358	)
CASH FLOWS FROM FINANCING ACTIVITIES:
(Repayments of) Proceeds from Long-Term Debt				(6	)		4
Proceeds from Sale of Common Stock, Net				91			226
Repurchase of Common Stock				(24	)		—
Cash Dividends Paid to Stockholders				(276	)		(235	)
		Net Cash Used In Financing Activities		(215	)		(5	)
Effect of Exchange Rate Changes on Cash and Cash Equivalents				10			(4	)
Increase in Cash and Cash Equivalents				3,021			3,257
Cash and Cash Equivalents at Beginning of Period				2,188			2,477
Cash and Cash Equivalents at End of Period			$	5,209		$	5,734

See accompanying note to consolidated financial statements.

Page 5 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)

(In Millions)

		Three Months Ended					Six Months Ended
		August 3, 2003		August 4, 2002			August 3, 2003		August 4, 2002
Net Earnings		$	1,299	$	1,182		$	2,206	$	2,038
Other Comprehensive Income(1):
	Foreign Currency Translation Adjustments		23		(28	)		106		60
	Change in Fair Value of Derivatives Accounted for as Hedges		—		5			—		8
	Total Other Comprehensive Income (Loss)		23		(23	)		106		68
Comprehensive Income		$	1,322	$	1,159		$	2,312	$	2,106

(1)

Components of comprehensive income are reported net of related taxes.

See accompanying notes to consolidated condensed financial statements.

Page 6 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

NOTE TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        Basis of Presentation—The accompanying consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended February 2, 2003, as filed with the Securities and Exchange Commission (File No. 1-8207).

        Change in Accounting for Stock-Based Compensation—Effective February 3, 2003, the Company adopted the fair value method of recording compensation expense related to all employee stock-based compensation issued after February 2, 2003, in accordance with Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation," and SFAS No. 148, "Accounting for Stock-Based Compensation—Transition and Disclosure." Beginning in the first quarter of fiscal 2003, the fair value of employee stock-based compensation issued after February 2, 2003 as determined using the Black-Scholes option-pricing model is being expensed over the vesting period of the related stock-based compensation. Awards under the Company's option plans typically vest 25% per year commencing on the first anniversary date of the grant. The stock-based compensation expense included in the determination of net earnings for the first six months of fiscal 2003 is less than that which would have been recognized if the fair value based method had been applied to all such compensation since the original effective date of SFAS No. 123. Prior to February 3, 2003, the Company accounted for its plans under the recognition and measurement provisions of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," and related interpretations, and accordingly no stock-based compensation expense related to stock option awards was recorded in the first six months of fiscal 2002. The following table shows the effect on net earnings and earnings per share if the fair value based method had been applied to all employee stock-based compensation in each period.

		Three Months Ended						Six Months Ended
		August 3, 2003			August 4, 2002			August 3, 2003			August 4, 2002
Net Earnings, as reported		$	1,299		$	1,182		$	2,206		$	2,038
Add: Stock-based employee compensation expense included in reported net earnings, net of related tax			8			1			12			2
Deduct: Total stock-based compensation expense determined under the fair value based method for all awards, net of related tax effects			(64	)		(60	)		(127	)		(120	)
Pro forma net earnings		$	1,243		$	1,123		$	2,091		$	1,920
Basic earnings per share:
	As reported	$	0.57		$	0.50		$	0.96		$	0.87
	Pro forma	$	0.54		$	0.48		$	0.91		$	0.82
Diluted earnings per share:
	As reported	$	0.56		$	0.50		$	0.96		$	0.86
	Pro forma	$	0.54		$	0.48		$	0.91		$	0.81

Page 7 of 20

Service Revenues

        Total revenues include service revenues generated through a variety of installation and home maintenance programs. In these programs, the customer selects and purchases material for a project and the Company arranges professional installation. When the Company subcontracts the installation of a project and the subcontractor provides material as part of the installation, both the material and labor are included in service revenues. The Company recognizes this revenue when the service for the customer is completed. All payments received prior to the completion of services are recorded as Deferred Revenue in the accompanying Consolidated Balance Sheets. Net service revenues, including the impact of deferred revenue, were $696 million and $1.3 billion for the three and six-months ended August 3, 2003, respectively, compared to $480 million and $894 million for the three and six-months ended August 4, 2002.

Valuation Reserves

        As of the end of the second quarter of fiscal 2003, the valuation allowances for merchandise inventories and uncollectible accounts receivable were not material.

Page 8 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

INDEPENDENT ACCOUNTANTS' REVIEW REPORT

The Board of Directors and Stockholders
The Home Depot, Inc.:

        We have reviewed the accompanying consolidated balance sheet of The Home Depot, Inc. and subsidiaries as of August 3, 2003, and the related consolidated statements of earnings and comprehensive income for the three and six-month periods ended August 3, 2003 and the related consolidated statement of cash flows for the six month period ended August 3, 2003. These consolidated financial statements are the responsibility of the Company's management.

        We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

        Based on our review, we are not aware of any material modifications that should be made to the consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.

        We previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet of The Home Depot, Inc. and subsidiaries as of February 2, 2003, and the related consolidated statements of earnings, stockholders' equity and comprehensive income, and cash flows for the year then ended (not presented herein); and in our report dated February 24, 2003, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of February 2, 2003, is fairly presented, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ KPMG LLP KPMG LLP
Atlanta, Georgia

August 18, 2003

Page 9 of 20

THE HOME DEPOT, INC. AND SUBSIDIARIES

Item 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION

SELECTED CONSOLIDATED STATEMENTS OF EARNINGS DATA

        The data below reflect selected sales data, the percentage relationship between sales and major categories in the Consolidated Statements of Earnings and the percentage change in the dollar amounts of each of the items.

			Three Months Ended						Six Months Ended						Percentage Increase (Decrease) in Dollar Amounts
			August 3, 2003			August 4, 2002			August 3, 2003			August 4, 2002			Three Months		Six Months
NET SALES				100.0	%		100.0	%		100.0	%		100.0	%	10.5	%	8.3	%
GROSS PROFIT				31.2			30.4			31.5			30.5		13.3		12.1
Operating Expenses:
	Selling and Store Operating			18.0			17.3			19.1			18.2		14.9		13.9
	Pre-Opening			0.1			0.1			0.1			0.2		(26.1	)	(33.3	)
	General and Administrative			1.6			1.5			1.7			1.5		23.7		21.3
		Total Operating Expenses		19.7			18.9			20.9			19.9		15.3		14.1
OPERATING INCOME				11.5			11.5			10.6			10.6		10.1		8.5
Interest Income (Expense):
	Interest and Investment Income			0.1			0.2			0.1			0.1		(40.0	)	(35.7	)
	Interest Expense			(0.1	)		(0.1	)		(0.1	)		(0.0	)	100.0		126.7
		Interest, Net		(0.0	)		0.1			(0.0	)		0.1		(105.9	)	(125.9	)
EARNINGS BEFORE PROVISION FOR     INCOME TAXES				11.5			11.6			10.6			10.7		9.0		7.4
Provision for Income Taxes				4.3			4.3			3.9			4.0		7.6		5.9
		NET EARNINGS		7.2	%		7.3	%		6.7	%		6.7	%	9.9	%	8.2	%
Selected Sales Data(1)
Number of Transactions (in millions)				350			323			646			606		8.4	%	6.6	%
Average Sale per Transaction			$	50.60		$	50.13		$	50.92		$	50.26		0.9		1.3
Weighted Average Weekly Sales per     Operating Store (000's)			$	861		$	883		$	805		$	846		(2.5	)	(4.8	)
Weighted Average Sales per Square Foot			$	415		$	421		$	390		$	403		(1.4	)%	(3.2	)%

(1)

Includes all retail locations excluding Apex Supply Company, Georgia Lighting, Maintenance Warehouse, Your "other" Warehouse, Designplace Direct (formerly National Blinds and Wallpaper) and HD Builder Solutions Group locations.

Page 10 of 20

FORWARD-LOOKING STATEMENTS

        Certain statements made herein regarding implementation of store initiatives, gross margin expansion, store openings, capital expenditures, and the effect of adopting certain accounting standards constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations. These risks and uncertainties include, but are not limited to, fluctuations in and the overall condition of the U.S. economy, stability of costs and availability of sourcing channels, conditions affecting new store development, our ability to implement new technologies and processes, our ability to attract, train and retain highly-qualified associates, unanticipated weather conditions, the impact of competition, and the effects of regulatory and litigation matters. You should not place undue reliance on such forward-looking statements as such statements speak only as of the date on which they are made. Additional information concerning these and other risks and uncertainties is contained in our periodic filings with the Securities and Exchange Commission.

RESULTS OF OPERATIONS

        Net sales for the second quarter of fiscal 2003 increased 10.5% to $18.0 billion from $16.3 billion in the second quarter of fiscal 2002. For the first six months of fiscal 2003, sales increased 8.3% to $33.1 billion from $30.6 billion for the comparable period in fiscal 2002. The sales increase for both periods was primarily attributable to new stores opened since the end of the second quarter of fiscal 2002 (1,607 stores open at the end of the second quarter of fiscal 2003 compared with 1,437 at the end of the second quarter of fiscal 2002). Comparable store-for-store sales increased 2.2% in the second quarter of fiscal 2003 and increased 0.4% in the first six months of fiscal 2003. The increase in comparable store-for-store sales for the first three and six months of fiscal 2003 was attributable to strong performance in our lawn and garden category, led by outdoor power equipment with continued strength from John Deere tractors as well as in walk-behind mowers. Paint was another strong category, led by power pressure washers and interior paint. Strong sales in concrete and roofing materials contributed to strength in our building materials category. Additionally, sales in our services business including the flooring companies we acquired last year, gained 45.1% over the prior year, driven by HVAC, countertops, sheds and flooring. The strength of these categories was partially offset by lumber price deflation and a decline in comparable store-for-store sales in soft flooring, as we did not repeat certain promotional activities from last year.

        In order to meet our customer service objectives, we strategically open stores near market areas served by existing strong performing stores ("cannibalize") to enhance service levels, gain incremental sales and increase market penetration. Our new stores cannibalized approximately 18% of our existing stores as of the end of the second quarter of fiscal 2003 with an estimated reduction in comparable store-for-store sales of 3%. Additionally, we believe that our sales performance has been, and could continue to be, negatively impacted by the level of competition that we encounter in various markets. However, due to the highly-fragmented U.S. home improvement industry, in which we estimate our market share is approximately 10%, measuring the impact on our sales by our competitors is extremely difficult.

        In the second quarter of fiscal 2003, we continued the implementation or expansion of a number of in-store initiatives. We believe these initiatives will increase customer loyalty and operating efficiencies as they are fully implemented in our stores. The professional business customer ("Pro") initiative adds programs to our stores to enhance service levels to the Pro customer base. At the end of the second quarter of fiscal 2003, the Pro initiative was in 1,293 stores or 80% of total stores, of which 68 stores were added during the second quarter of fiscal 2003 compared to a total of 921 stores or 64% of total stores at the end of the second quarter of fiscal 2002. We expect to have the Pro initiative in 1,365 stores by the end of fiscal 2003.

Page 11 of 20

        In addition to Pro, we continue to implement the Appliance initiative in our stores. The Appliance initiative was in 965 stores or 60% of total stores as of the end of the second quarter of fiscal 2003 compared to 292 stores or 20% of total stores as of the end of the second quarter of fiscal 2002. We expect to have the Appliance initiative in 1,541 stores by the end of fiscal 2003. The Appliance initiative provides customers with an assortment of in-stock name brand appliances, including General Electric® and Maytag®, and offers the ability to special order over 2,300 additional related products through computer kiosks located in the stores. In these stores we have enhanced the offering of appliances through 1,500 to 2,000 square feet of dedicated appliance selling space.

        In addition to our Appliance and Pro initiatives, we continue to implement our DesignPlace^SM initiative. This initiative offers an enhanced shopping experience to our design and décor customers by providing personalized service from specially-trained associates and an enhanced merchandise selection in an attractive setting. Although the DesignPlace initiative is in its early stages, stores generally show a positive sales trend after implementation. The DesignPlace initiative was in 1,141 stores or 71% of total stores as of the end of the second quarter of fiscal 2003 compared to 581 stores or 40% of total stores as of the end of the second quarter of fiscal 2002. We expect to have the DesignPlace initiative in 1,603 stores by the end of fiscal 2003.

        Gross profit increased 13.3% to $5.6 billion in the second quarter of fiscal 2003 from $4.9 billion in the second quarter of fiscal 2002. Gross profit increased 12.1% to $10.4 billion for the first six months of fiscal 2003 from $9.3 billion in the first six months of fiscal 2002. The gross profit rate as a percent of sales increased to 31.2% in the second quarter of fiscal 2003 from 30.4% in the second quarter of fiscal 2002. In the first six months of fiscal 2003, gross profit as a percent of sales was 31.5% compared with 30.5% in the comparable period of fiscal 2002. The gross profit rate increase in both periods was primarily attributable to continued but slowing benefit from centralized purchasing as we rationalized vendors and improved assortments, lower markdowns as we did not repeat the Yellow Tag Clearance event held in the second quarter of fiscal 2002 and increased penetration of import products, which typically have a lower cost, to 9% in the second quarter of fiscal 2003 from 7% in the second quarter of fiscal 2002. We expect only modest gross margin expansion for fiscal 2003 as we anniversary last year's strong gains, particularly in the third quarter of 2003.

        Selling and store operating expenses increased 14.9% to $3.2 billion in the second quarter of fiscal 2003 from $2.8 billion in the second quarter of fiscal 2002. As a percent of sales, selling and store operating expenses were 18.0% in the second quarter of fiscal 2003 compared to 17.3% in the same period in fiscal 2002. For the first six months of fiscal 2003, selling and store operating expenses increased 13.9% to $6.3 billion from $5.6 billion in the first six months of fiscal 2002. As a percent of sales, selling and store operating expenses were 19.1% in the first six months of fiscal 2003 compared to 18.2% in the same period in fiscal 2002. The increase in both the second quarter of fiscal 2003 and the first six months of fiscal 2003 was primarily attributable to increased expense for workers' compensation and general liability due in large part to increased medical costs. The increase in store selling and operating costs in the first six months of fiscal 2003 was also attributable to an increased investment in labor in our stores to ensure better in-stock position and customer service and an increased investment in our customers shopping experience as we executed our plan to reset, repair and remodel our stores.

        Pre-opening expenses of $17 million decreased 26.1% and as a percent of sales were 0.1% in the second quarter of fiscal 2003 compared with 0.1% and $23 million in the second quarter of fiscal 2002. For the first six months of fiscal 2003, pre-opening expenses of $32 million decreased 33.3% and as a percent of sales were 0.1% compared with 0.2% and $48 million in the first six months of fiscal 2002. The decrease in pre-opening expenses for the three and six months ended August 3, 2003 was due to fewer stores opened as compared to the same periods last year and a decrease in the average pre-opening cost per store.

Page 12 of 20

        General and administrative expenses of $292 million increased 23.7% and as a percent of sales were 1.6% in the second quarter of fiscal 2003 compared to 1.5% and $236 million in the second quarter of fiscal 2002. In the first six months of fiscal 2003, general and administrative expenses increased 21.3% and as a percent of sales were 1.7% and $563 million compared to 1.5% and $464 million in the same period in fiscal 2002. The increase as a percent of sales in both periods was primarily due to an increase in incremental spending in technology and growth initiatives.

        As a percent of sales, interest and investment income was 0.1% and $15 million in the second quarter of fiscal 2003 compared to 0.2% and $25 million in the second quarter of fiscal 2002. For the first six months of fiscal 2003, as a percent of sales, interest and investment income was 0.1% and $27 million compared to 0.1% and $42 million in the same period in fiscal 2002. The decrease in both periods reflects a lower average cash balance and a lower interest rate environment. Interest expense as a percent of sales was 0.1% and $16 million in the second quarter of fiscal 2003 as compared to 0.1% and $8 million in the second quarter of fiscal 2002. Interest expense as a percent of sales was 0.1% and $34 million in the first six months of fiscal 2003 compared to 0.0% and $15 million in the same period in fiscal 2002. The increase in interest expense in both periods was attributable to lower capitalized interest due to the timing of store openings and site development.

        The provision for income taxes was 4.3% as a percent of sales in both the second quarter of fiscal 2003 and fiscal 2002. In the first six months of fiscal 2003, the provision for income taxes was 3.9% as a percent of sales compared to 4.0% in the same period in fiscal 2002. Our combined federal and state effective income tax rate decreased to 37.1% in the second quarter and first six months of fiscal 2003 from 37.6% for the comparable periods of fiscal 2002. The decrease in our combined federal and state effective income tax rate was attributable to higher projected tax credits and a lower effective state income tax rate.

        Diluted earnings per share were $0.56 and $0.96 in the second quarter and first six months of fiscal 2003, respectively, compared to $0.50 and $0.86 in the second quarter and first six months of fiscal 2002, respectively. Diluted earnings per share were favorably impacted by approximately $0.02 and $0.03 per diluted share in the second quarter and first six months of fiscal 2003, respectively, as a result of the repurchase of shares of our common stock in fiscal 2002.

LIQUIDITY AND CAPITAL RESOURCES

        Cash flow generated from store operations provides a significant source of liquidity. Cash provided by operations was $4.6 billion in the first six months of both fiscal 2003 and fiscal 2002, and was driven by net working capital improvements and stronger net earnings. Days payable outstanding was 43 at the end of the second quarter of fiscal 2003 unchanged from the second quarter last year. We believe we have realized the majority of the benefit from our renegotiated payment terms.

        Cash used in investing activities was $1.4 billion in the first six months of both fiscal 2003 and fiscal 2002. Cash used in investing activities reflects a 31% increase in capital expenditures to $1.7 billion in the first six months of fiscal 2003 compared to $1.3 billion in the same period last year. The increase in capital expenditures was the result of a higher investment in store remodeling, technology and other initiatives and was offset by an increase in proceeds from the sale of property and equipment and a decrease in investments purchased in the first six months of fiscal 2003 as compared to the same period in fiscal 2002.

        We plan to open 125 stores during the second half of fiscal 2003. We expect total capital expenditures to be approximately $3.6 billion to $3.8 billion in fiscal 2003, which includes a higher level of investment in store remodeling, technology and other initiatives as compared to 2002.

        During the first six months of fiscal 2003, cash used in financing activities was $215 million compared with $5 million in the same period of fiscal 2002. The increase in cash used in financing

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activities was primarily due to a decrease in proceeds from the sale of common stock as a result of a decrease in the number of stock options exercised and the repurchase of 851,000 shares of common stock during the first six months of fiscal 2003.

        We have a commercial paper program that allows borrowings up to a maximum of $1 billion. As of August 3, 2003, there were no borrowings outstanding under this program. In connection with the program, we have a back-up credit facility with a consortium of banks for up to $800 million. The credit facility, which expires in 2004, contains various restrictive covenants, none of which are expected to impact our liquidity and capital resources.

        As of August 3, 2003, we had $5.3 billion in cash, cash equivalents and short-term investments. We believe that our current cash position, cash flow generated from operations, funds available from the $1 billion commercial paper program and the ability to obtain alternate sources of financing should be sufficient to enable us to complete our capital expenditure programs through the next several fiscal years.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

        In January 2003, the Emerging Issues Task Force ("EITF") issued EITF 02-16, "Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor," which states that cash consideration received from a vendor is presumed to be a reduction of the prices of the vendor's products or services and should, therefore, be characterized as a reduction of Cost of Merchandise Sold when recognized in our Consolidated Statements of Earnings. That presumption is overcome when the consideration is either a reimbursement of specific, incremental and identifiable costs incurred to sell the vendor's products, or a payment for assets or services delivered to the vendor. EITF 02-16 is effective for contracts entered into after December 31, 2002. The adoption of EITF 02-16 will not have a material impact on net earnings in fiscal year 2003, as we entered into substantially all of our fiscal year 2003 vendor contracts prior to December 31, 2002. We estimate that this change in accounting will reduce fiscal year 2004 diluted earnings per share by as much as $0.05 per diluted share with the majority of the impact on net earnings occurring in the first quarter of fiscal 2004. This change in accounting will not impact our cash flow or the expected amount of payments to be received from our vendors.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

        Our exposure to market risks results primarily from fluctuations in interest rates. There have been no material changes to our exposure to market risks from those disclosed in our Annual Report on Form 10-K for the year ended February 2, 2003.

Item 4. Controls and Procedures

(a)

Evaluation of Disclosure Controls and Procedures

        The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company's reports under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

        The Company's Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on such

Page 14 of 20

evaluation, such officers have concluded that, as of the end of the period covered by this report, the Company's disclosure controls and procedures are effective in alerting them on a timely basis to material information relating to the Company (including its consolidated subsidiaries) required to be included in the Company's reports filed or submitted under the Exchange Act.

(b)

Change in Internal Control Over Financial Reporting

        There have not been any changes in the Company's internal control over financial reporting during the period covered by this report that have materially affected or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II. OTHER INFORMATION

Item 2. Changes in Securities

        The Company's Board of Directors approved amendments to the By-Laws which, among other things, (i) changed the timing of notice to the Company and other procedures for stockholders to bring business before the annual meeting of stockholders, (ii) removed Article II. Section 12 regarding the independence of directors (because the standards set forth therein are no longer consistent with the standards of independence set forth in the New York Stock Exchange's proposed listing standards and the Company has adopted new standards for independence set forth in its Corporate Governance Guidelines), and (iii) added more detailed indemnification provisions for officers and directors. The Amended and Restated By-Laws, attached hereto as Exhibit 3.2, require stockholders to submit stockholder proposals for inclusion in the Company's proxy statement and stockholder proposals to be considered at the Annual Meeting of Stockholders (but, not included in the Company's proxy statement) 120 calendar days before the date of the Company's proxy statement released to stockholders in connection with the previous year's annual meeting of stockholders. If no annual meeting was held, or if the date of the annual meeting has changed by more than 30 days from the date of the previous year's annual meting, then a stockholder must provide appropriate notice of the proposal to the Secretary of the Company not later than the later of the close of business on the 90^th day prior to such annual meeting or the 10^th day following the day on which notice of the date of the annual meeting was mailed or public disclosure of such date was made. To be considered for inclusion in the Company's proxy statement for the 2004 Annual Meeting of Stockholders or considered at such meeting (but not included in the proxy statement) stockholder proposals must be submitted by December 21, 2003.

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Item 4. Submission of Matters to a Vote of Security Holders

        At the Company's Annual Meeting of Stockholders held on May 30, 2003, the stockholders elected the following nominees to the Board of Directors to serve a one-year term. The votes cast were as follows:

Gregory D. Brenneman		Richard A. Grasso
For:	1,887,303,440	For:	1,894,216,768
Withheld:	109,385,002	Withheld:	102,471,674
Richard H. Brown		Milledge A. Hart, III
For:	1,943,172,401	For:	1,941,614,059
Withheld:	53,516,041	Withheld:	55,074,384
John L. Clendenin		Bonnie G. Hill
For:	1,931,870,220	For:	1,931,590,103
Withheld:	64,818,222	Withheld:	65,098,340
Berry R. Cox		Kenneth G. Langone
For:	1,888,209,595	For:	1,593,662,635
Withheld:	108,478,847	Withheld:	400,349,331
William S. Davila		Robert L. Nardelli
For:	1,887,229,484	For:	1,884,388,437
Withheld:	109,458,958	Withheld:	73,855,019
Claudio X. Gonzalez		Roger S. Penske
For:	1,885,596,355	For:	1,939,369,444
Withheld:	111,092,088	Withheld:	57,318,999

        The stockholders ratified the appointment of KPMG LLP as Independent Auditors of the Company for fiscal 2003. Votes cast were as follows:

For:	1,918,931,702
Withheld:	56,119,741
Abstention:	21,636,999

        The stockholders approved the material terms of the performance-based compensation payable under the Management Incentive Plan. Votes cast were as follows:

For:	1,834,213,077
Withheld:	136,716,481
Abstention:	25,758,885

        The stockholders rejected a stockholder proposal regarding outside director term limits. Votes cast were as follows:

For:	62,037,730
Withheld:	1,340,829,748
Abstention:	47,478,833
Non-votes:	546,342,132

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        The stockholders approved a stockholder proposal regarding poison pill implementation. Votes cast were as follows:

For:	905,024,630
Withheld:	497,378,071
Abstention:	47,943,603
Non-votes:	546,342,138

        The stockholders rejected a stockholder proposal regarding non-audit-related services by auditors. Votes cast were as follows:

For:	213,970,829
Withheld:	1,188,473,144
Abstention:	47,903,068
Non-votes:	546,341,402

        The stockholders rejected a stockholder proposal regarding global human rights standards. Votes cast were as follows:

For:	104,203,451
Withheld:	1,202,343,940
Abstention:	143,798,923
Non-votes:	546,342,129

        The stockholders rejected a stockholder proposal regarding the independent director as Chairman of the Board. Votes cast were as follows:

For:	517,190,683
Withheld:	883,306,981
Abstention:	49,848,652
Non-votes:	546,342,126

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Item 5. Other Information

        See "Item 2. Changes in Securities" in this report for a description of the Amended and Restated By-Laws of the Company and the deadlines for submitting stockholder proposals for inclusion in the Company's proxy statement and stockholder proposals to be considered at the Annual Meeting of Stockholders.

Item 6. Exhibits and Reports on Form 8-K

(a)

Exhibits

3.2	By-Laws of The Home Depot, Inc., as amended and restated.
10.1	Employment Agreement between The Home Depot U.S.A., Inc. and John Costello dated July 24, 2003.
10.2	Restricted Stock Exchange Agreement dated as of August 21, 2003 between The Home Depot, Inc. and Robert Nardelli
11.1	Computation of Basic and Diluted Earnings Per Share.
15.1	Letter of KPMG LLP, Independent Accountants' Acknowledgement, dated August 18, 2003.
31.1	Certification of the Chairman, President and Chief Executive Officer pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934, as amended.
31.2	Certification of the Executive Vice President and Chief Financial Officer pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934, as amended.
32.1	Certification of the Chairman, President and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of the Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(b)

Reports on 8-K

The Company filed a Current Report on Form 8-K on May 20, 2003, furnishing a press release announcing financial results for the fiscal quarter ended May 4, 2003.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		THE HOME DEPOT, INC. (Registrant)
	By:	/s/  ROBERT L. NARDELLI Robert L. Nardelli Chairman, President and Chief Executive Officer
		/s/  CAROL B. TOMÉ Carol B. Tomé Executive Vice President and Chief Financial Officer
September 2, 2003 (Date)

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THE HOME DEPOT, INC. AND SUBSIDIARIES

INDEX TO EXHIBITS

Exhibit	Description
3.2	By-Laws of The Home Depot, Inc., as amended and restated.
10.1	Employment Agreement between The Home Depot U.S.A., Inc. and John Costello dated July 24, 2003.
10.2	Restricted Stock Exchange Agreement dated as of August 21, 2003 between The Home Depot, Inc. and Robert L. Nardelli
11.1	Computation of Basic and Diluted Earnings Per Share
15.1	Letter of KPMG LLP, Independent Accountants' Acknowledgement, dated August 18, 2003
31.1	Certification of the Chairman, President and Chief Executive Officer pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934, as amended.
31.2	Certification of the Executive Vice President and Chief Financial Officer pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934, as amended.
32.1	Certification of the Chairman, President and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of the Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION

Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
PART II. OTHER INFORMATION
Item 2. Changes in Securities
Item 4. Submission of Matters to a Vote of Security Holders

Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K

SIGNATURES

EX-3.2

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Exhibit 3.2

BY-LAWS

OF

THE HOME DEPOT, INC.

(As amended and restated effective May 29, 2003)

ARTICLE I.

MEETINGS OF STOCKHOLDERS

        SECTION l. The annual meeting of the stockholders for the election of Directors and for the transaction of such other business as shall have been properly brought before the meeting shall be held on such date and at such time and place as the Board of Directors may by resolution provide. To be properly brought before an annual meeting, business must be: (a) specified in the notice of meeting given by or at the direction of the Board of Directors, (b) otherwise properly brought before the meeting by or at the direction of the Board of Directors, or (c) otherwise properly brought before the meeting by a stockholder. For business to be properly brought before an annual meeting by a stockholder: (i) the stockholder must have given timely notice thereof in writing to the Secretary of the Corporation and (ii) the subject matter thereof must be a matter which is a proper subject matter for stockholder action at such meeting.

        With regard to business to be brought before an annual meeting occurring in 2004 or thereafter, and except as otherwise provided in the Certificate of Incorporation, to be considered timely notice, a stockholder's notice must be received by the Secretary at the principal executive offices of the Corporation not less than one hundred twenty (120) calendar days before the date of the Corporation's proxy statement released to stockholders in connection with the previous year's annual meeting of stockholders. However, if no annual meeting was held in the previous year, or if the date of the applicable annual meeting has been changed by more than thirty (30) days from the date of the previous year's annual meeting, then a stockholder's notice, in order to be considered timely, must be received by the Secretary not later than the later of the close of business on the ninetieth (90^th) day prior to such annual meeting or the tenth (10^th) day following the day on which notice of the date of the annual meeting was mailed or public disclosure of such date was made. Such stockholder's notice shall set forth (a) a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made, (b) whether either such stockholder or beneficial owner, alone or as part of a group, intends to solicit or participate in the solicitation of proxies from the stockholders of the Corporation, and (c) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the proposal is made (i) the name and address of such stockholder, as they appear on the Corporation's books, and of such beneficial owner and (ii) the class and number of shares of the Corporation that are owned beneficially and held of record by such stockholder and such beneficial owner. In addition, a stockholder seeking to bring an item of business before the annual meeting shall promptly provide any other information reasonably requested by the Corporation.

        Notwithstanding the foregoing provisions of this Section 1, a stockholder who seeks to have any proposal included in the Corporation's proxy materials must provide notice as required by and otherwise comply with the applicable requirements of the rules and regulations under the Securities Exchange Act of 1934, as amended. The chairman of an annual meeting shall determine all matters relating to the conduct of the meeting, including, but not limited to, determining whether any item of business has been properly brought before the meeting in accordance with these By-Laws, and if the chairman should so determine and declare that any item of business has not been properly brought before an annual meeting, then such business shall not be transacted at such meeting.

        Notwithstanding the foregoing provisions of this Section 1, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual meeting of stockholders of the Corporation to present an item of business, such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Corporation.

        SECTION 2. Special meetings of the stockholders may be called at any time by the Chairman of the Board, the President or the Board of Directors.

        SECTION 3. Written notice of each annual or special meeting of the stockholders, specifying the place, if any, date and hour of the meeting, and the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, shall be given at least ten (10) but not more than sixty days (60) prior to such meetings to each stockholder entitled to vote at such meeting; provided, however, that notice of any meeting to take action on a proposed merger or consolidation of the Corporation or on a proposed sale of all or substantially all of the assets of the Corporation shall be given at least twenty (20) but not more than sixty days (60) prior to such meeting. Notice of a special meeting of the stockholders shall also state the purpose or purposes for which the meeting is called. Each notice of a special meeting of stockholders shall indicate that it has been issued by or at the direction of the person or persons calling the meeting.

        When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place, if any, thereof, and the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, are announced at the meeting at which the adjournment is taken unless the adjournment is for more than thirty (30) days, or unless after the adjournment a new record date is fixed for the adjourned meeting, in which event a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

        A written waiver of notice signed by the stockholder entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a stockholder at a meeting shall constitute a waiver of notice of such meeting, except when the stockholder attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice.

        SECTION 4. Every annual meeting of the stockholders shall be held at such place within or without the State of Delaware as may be determined by the Board of Directors and stated in the notice of any such meeting, and every special meeting shall be held at such place within or without the State of Delaware as may be stated in the notice of such special meeting. The Board of Directors may determine that a meeting shall not be held at any place, but may instead be held solely by means of remote communications in accordance with Section 211(a)(2) of the General Corporation Law of the State of Delaware. If authorized by the Board of Directors in its sole discretion, and subject to such guidelines and procedures as the Board of Directors may adopt, stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication (a) participate in a meeting of stockholders; and (b) be deemed present in person and vote at a meeting of stockholders whether such meeting is to be held at a designated place or solely by means of remote communication, provided that (i) the Corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder; (ii) the Corporation shall implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings; and (iii) if any stockholder or proxyholder

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votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the Corporation.

        SECTION 5. No business shall be transacted at any special meeting of the stockholders except that business which related to the purpose or purposes set forth in the notice of the meeting.

        SECTION 6. At each meeting of the stockholders there shall be present, either in person or by proxy, the holders of a majority of the shares of the Corporation entitled to vote thereat in order to constitute a quorum. Any meeting of the stockholders at which a quorum is not present may be adjourned from time to time to some other time by a majority of the stockholders represented thereat, but no other business shall be transacted at such meeting. At an adjourned meeting at which a quorum is present or represented, any business may be transacted which might have been transacted at the original meeting.

        SECTION 7. At all meetings of the stockholders, all questions, other than the election of directors and except as otherwise required by the laws of the State of Delaware or as otherwise provided in the Certificate of Incorporation, shall be determined by a majority of the votes cast at the meeting of the holders of shares entitled to vote thereon. Directors shall be elected by a plurality of the votes cast. Upon all questions, every stockholder of record shall be entitled at every meeting of stockholders to one vote for every share of common stock standing in his name on the books of the Corporation and qualified to vote.

        SECTION 8. At all meetings of the stockholders, absent stockholders entitled to vote thereat may vote by proxy or by the attorney-in-fact thereof. No proxy shall be valid after the expiration of three years from the date thereof unless otherwise provided in the proxy. Every proxy shall be revocable at the pleasure of the person executing it except as otherwise provided by the laws of the State of Delaware.

        SECTION 9. The Secretary shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at such meeting, arranged in alphabetical order, showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, for a period of at least ten (10) days prior to the meeting, either (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided in the notice of the meeting or (ii) during ordinary business hours, at the principal place of business of the Corporation. In the event that the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable steps to ensure that such information is available only to stockholders of the Corporation. If the meeting is to be held at a place, the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. If the meeting is to be held solely by means of remote communication, the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting.

ARTICLE II.

DIRECTORS

        SECTION 1. The business and affairs of the Corporation shall be managed by and under the direction of the Board of Directors. Except as otherwise provided by law and except as hereinafter otherwise provided for filling vacancies, the directors of the Corporation shall be elected by the stockholders entitled to vote at the annual meeting of the stockholders, to hold office until the expiration of the term for which he is elected and until his successor has been elected and qualified or until his earlier resignation or removal.

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        SECTION 2. Regular meetings of the Board of Directors may be held without notice at such time and place as shall from time to time be determined by the Board of Directors.

        SECTION 3. Special meetings of the Board of Directors shall be called at any time by the Secretary at the direction of the Chairman of the Board, the President or a majority of the directors then in office.

        SECTION 4. Written notice of the time and place of each special meeting of the Board of Directors shall be given to each director at least forty-eight hours before the start of the meeting, or if sent by first class mail, at least seven days before the start of the meeting. A written waiver of notice signed by the director entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except when the director attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the directors need be specified in any written waiver of notice.

        SECTION 5. Members of the Board of Directors, or of any committee thereof, may participate in a meeting by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting pursuant to this section shall constitute presence in person at such meeting.

        SECTION 6. A majority of the total number of directors shall be necessary to constitute a quorum for the transaction of business and the act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Any regular or special meeting of the Board at which a quorum is not present may be adjourned from time to time to some other place or time or both by a majority of the directors present without any notice other than an announcement at the meeting at which the adjournment is taken.

        SECTION 7. The Board of Directors may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Any such committee, to the extent provided in the resolution of the Board of Directors and to the extent permitted by law, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority to (i) amend the certificate of incorporation, (ii) adopt an agreement of merger or consolidation, (iii) recommend to the stockholders the sale, lease or exchange of all or substantially all of the Corporation's property and assets, (iv) recommend to the stockholders a dissolution of the Corporation or a revocation of a dissolution or (v) amend the By-Laws of the Corporation. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board.

        SECTION 8. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing or by electronic transmission and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

        SECTION 9. The Board of Directors of the Corporation shall consist of not less than three nor more than fifteen members, the exact number of Directors to be determined from time to time by resolution adopted by affirmative vote of a majority of the entire Board of Directors.

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        SECTION 10. Directors may receive compensation for services to the Corporation in their capacities as directors or otherwise in such manner and in such amounts as may be fixed from time to time by resolution of the Board of Directors.

ARTICLE III.

OFFICERS

        SECTION 1. The Board of Directors shall appoint a Chairman of the Board, a President, a Treasurer and a Secretary. The Board may at any time appoint one or more Vice Presidents, Assistant Treasurers, Assistant Secretaries and such other officers and agents with such powers and duties as it shall deem necessary. Each such officer shall serve from the time of his appointment until a successor shall be chosen and qualified or until his earlier resignation or removal.

        SECTION 2. The Chairman of the Board shall preside at all meetings of stockholders and of the Board of Directors. He shall be the chief executive officer and head of the Corporation and, subject to the Board of Directors, shall have the general control and management of the business and affairs of the Corporation. He shall vote any shares of stock or other voting securities owned by the Corporation. In general, he shall perform all duties incident to the office of the Chairman of the Board and such other duties as may from time to time be assigned to him by the Board.

        SECTION 3. The President shall be the chief operating officer of the Corporation and, subject to the Board of Directors and the Chairman of the Board, shall have control of the operational aspects of the business and affairs of the Corporation. He shall see that all orders of the Chairman of the Board are carried into effect, and shall perform all other duties necessary to his office or properly required of him by the Board or the Chairman of the Board. The President, in the absence of the Chairman of the Board, shall preside at all meetings of stockholders and of the Board of Directors.

        SECTION 4. Vice Presidents shall perform such duties and have such powers as the Board of Directors, the Chairman of the Board, the President or another more senior Vice President shall designate from time to time. During the absence or disability of the President, or during a vacancy in the office of President, the Vice President with the greatest seniority shall perform the duties and have the powers of the President.

        SECTION 5. The Secretary shall have custody of the seal of the Corporation. He shall keep the minutes of the Board of Directors, and of the stockholders, and shall attend to the giving and serving of all notices of the Corporation. He shall have charge of the certificate book and such other books and papers as the Board may direct; and he shall perform such other duties as may be incidental to his office or as may be assigned to him by the Board of Directors. He shall also keep or cause to be kept a stock book, containing the names, alphabetically arranged, of all persons who are stockholders of the Corporation showing their respective addresses, the number of shares registered in the name of each, and the dates when they respectively became the owners of record thereof, and such books shall be open for inspection as prescribed by the laws of the States of Delaware. During the absence or disability of the Secretary, or during a vacancy in the office of Secretary, the Assistant Secretary with the greatest seniority shall perform the duties and have the powers of the Secretary.

        SECTION 6. The Treasurer shall have the care and custody of the funds and securities of the Corporation and shall deposit the same in the name of the Corporation in such bank or banks as the Board of Directors may determine. During the absence or disability of the Treasurer, or during a vacancy in the office of Treasurer, the Assistant Treasurer with the greatest seniority shall perform the duties and have the powers of the Treasurer.

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ARTICLE IV.

RESIGNATIONS, REMOVALS AND VACANCIES

OF DIRECTORS AND OFFICERS

        SECTION 1. Any director or officer may resign his office at any time, such resignation to be made in writing and to take effect from the time of its receipt by the Corporation, unless some future time be fixed in the resignation and in that case from that time. The acceptance of a resignation shall not be required to make it effective. Nothing herein shall be deemed to affect any contractual rights of the Corporation.

        SECTION 2. Any officer may be removed with or without cause at any time by the Board of Directors. The removal of an officer without cause shall be without prejudice to his contractual rights, if any. The election or appointment of an officer shall not of itself create contractual rights. Any director or the entire Board may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors.

        SECTION 3. Any vacancy on the Board of Directors that results from an increase in the number of directors may be filled by a majority vote of the Directors then in office, and any other vacancy occurring in the Board of Directors may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director, and directors so chosen shall hold office until such director's successor shall have been duly elected and qualified. If the office of any officer becomes vacant for any reason, the vacancy may be filled by the Board of Directors.

ARTICLE V.

INDEMNIFICATION OF OFFICERS AND DIRECTORS

        SECTION 1. The Corporation shall indemnify and hold harmless, to the fullest extent permitted by the General Corporation Law of the State of Delaware, as it presently exists or may hereafter be amended, any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit, or proceeding, whether civil, criminal, administrative or investigative, (a "proceeding") by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, against all expenses, liability and loss (including attorneys' fees) reasonably incurred by such person. The Corporation shall be required to indemnify a person in connection with a proceeding (or part thereof) initiated by such person only if the proceeding (or part thereof) was authorized by the Board of Directors of the Corporation.

        SECTION 2. Subject to any applicable laws, the Corporation shall pay the expenses (including attorneys' fees) incurred by an officer or director of the Corporation in defending any proceeding in advance of its final disposition, provided, however, that the payment of such expenses shall be made only upon receipt of an undertaking by the director or officer to repay all amounts advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified. Expenses incurred by former directors and officers or other employees and agents of the Corporation may be advanced upon such terms and conditions as the Corporation deems appropriate.

        SECTION 3. If a claim for indemnification or payment of expenses (including attorneys' fees) under this Article is not paid in full within sixty (60) days after a written claim has been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of such claim and, if successful in whole or in part, subject to any applicable laws, the

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claimant shall be entitled to be paid the expense (including attorneys' fees) of prosecuting such claim. In any such action, the Corporation shall have the burden of proving that the claimant was not entitled to the requested indemnification or payment of expenses under applicable law.

        SECTION 4. The rights conferred on any person by this Article shall not contravene the provisions of any applicable laws and such rights shall not be exclusive of any other rights that such person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, agreement, vote of stockholders or disinterested directors, or otherwise.

        SECTION 5. The Corporation's obligation, if any, to indemnify any person who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, or other enterprise shall be reduced by any amount such person may collect as indemnification from such other corporation, partnership, joint venture, trust or other enterprise.

        SECTION 6. The Corporation may purchase and maintain insurance to protect itself and any person who is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

        SECTION 7. The rights provided by or granted pursuant to this Article shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person. Subject to any applicable laws, all rights provided by or granted pursuant to this Article shall be deemed to be a contract between the Corporation and each director, officer, employee or agent of the Corporation who serves or served in such capacity at any time while this Article is in effect. Any repeal or modification of this Article shall not in any way diminish any rights to indemnification of such directors, officers, employees or agents, or the obligations of the Corporation arising hereunder.

ARTICLE VI.

COMMON STOCK

        SECTION 1. Certificates for shares of the common stock of the Corporation shall be numbered and registered on the books of the Corporation in the order in which they shall be issued and shall be signed by the Chairman of the Board, the President or a Vice President, and the Secretary or an Assistant Secretary, or the Treasurer or an Assistant Treasurer and sealed with the seal of the Corporation. Any or all of the signatures on the certificate may be a facsimile signature. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.

        SECTION 2. Transfers of shares shall be made upon the books of the Corporation (i) only by the holder thereof, in person or by power of attorney duly executed and filed with the Corporation (ii) upon the surrender to the Corporation of the certificate or certificates for such shares.

        SECTION 3. The Board of Directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the Corporation and alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming that the certificate of stock has been lost, stolen or destroyed. When authorizing such issuance of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or such owner's legal representative, to indemnify the Corporation in such manner as the Board of

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Directors shall require and/or to give the Corporation a bond, in such form and amount as the Board of Directors may direct, as indemnity against any claim that may be made against the Corporation with respect to the certificate or certificates alleged to have been lost, stolen or destroyed.

        SECTION 4. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person whether or not it shall have express or other notice thereof, except as otherwise may be provided by the General Corporation Law of the State of Delaware.

ARTICLE VII.

CHECKS, DRAFTS AND NOTES

        The Chairman of the Board or the President or any officers designated by resolution of the Board of Directors shall sign all checks and drafts necessary to be drawn and may accept any drafts drawn upon the Corporation in due course of business. No check or draft shall be endorsed by the Corporation and no promissory note, bond, debenture or other evidence of indebtedness shall be made, signed, issued or endorsed by the Corporation unless signed by the Chairman or the President or any officer designated under powers given by a resolution of the Board except that any officer may endorse for collection or deposit only, expressly stating the purpose of such endorsements, checks, drafts and promissory notes to the order of the Corporation.

ARTICLE VIII.

SEAL

        The seal of the Corporation shall be in the custody of the Secretary. It shall be circular in form and shall have engraved upon it the name of the Corporation arranged in a circle and the words and figures "Incorporated 1978 Delaware" across the center of the space enclosed.

ARTICLE IX

BUSINESS COMBINATIONS WITH INTERESTED STOCKHOLDERS

        The Corporation shall not be subject to the provisions of Section 203 of the General Corporation Law of the State of Delaware (Business Combination with Interested Stockholders). This Article X shall not be amended only by the affirmative vote of a majority of the Corporation's stockholders entitled to vote on such matter.

ARTICLE X.

NOTICES

        SECTION 1. Whenever, under any provisions of these By-Laws, notice is required to be given to any stockholder, the same shall be given in writing, either (a) by personal delivery or by mailing such notice to the stockholder's last known post office address as the same shall appear on the record of stockholders of the Corporation or its transfer agent or, if he shall have filed with the Secretary of the Corporation a written request that notices to him be mailed to him at some other address, then addressed to him at such other address, or (b) by a form of electronic transmission consented to by the stockholder to whom the notice is given, except to the extent prohibited by Section 232(e) of the General Corporation Law of the State of Delaware. Any consent to receive notice by electronic transmission shall be revocable by the stockholder by written notice to the Corporation. Any such consent shall be deemed revoked if (i) the Corporation is unable to deliver by electronic transmission two consecutive notices given by the Corporation in accordance with such consent and (ii) such inability

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becomes known to the Secretary or an Assistant Secretary of the Corporation or to the transfer agent, or other person responsible for the giving of notice; provided, however, that the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action.

        SECTION 2. Any notice required to be given to any director may be given by the methods stated in Section 1 above. Any such notice, other than one which is delivered personally, shall be sent to such post office address, facsimile number or electronic mail address as such director shall have filed in writing with the Secretary of the Corporation, or, in the absence of such filing, to the last known post office address of such director. It shall not be necessary that the same method of giving notice be employed in respect of all directors, but one permissible method may be employed in respect of any one or more, and any other permissible method or methods may be employed in respect of any other or others.

        SECTION 3. All notices given by mail, as above provided, shall be deemed to have been given when deposited, postage prepaid, in a United States post office or official depository. All notices given to stockholders by a form of electronic transmission, as above provided, shall be deemed to have been given: (a) if by facsimile, when directed to a number at which the stockholder has consented to receive notice; (b) if by electronic mail, when directed to an electronic mail address at which the stockholder has consented to receive notice; (c) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (i) such posting and (ii) the giving of such separate notice; and (d) if by any other form of electronic transmission, when directed to the stockholder. All notices given to directors by form of electronic transmission, as above provided, shall be deemed to have been given when directed to the electronic mail address, facsimile number, or other location filed in writing by the director with the Secretary of the Corporation.

        SECTION 4. Whenever notice is to be given to the Corporation by a stockholder under any provision of law or of the Certificate of Incorporation or the By-Laws of the Corporation, such notice shall be delivered to the Secretary at the principal executive offices of the Corporation. If delivered by electronic mail or facsimile, the stockholder's notice shall be directed to the Secretary at the electronic mail address or facsimile number, as the case may be, specified in the Corporation's most recent proxy statement.

ARTICLE XI.

ELECTRONIC TRANSMISSION

        When used in these By-Laws, the terms "written" and "in writing" shall include any "electronic transmission," as defined in Section 232(c) of the General Corporation Law of the State of Delaware, including without limitation any telegram, cablegram, facsimile transmission and communication by electronic mail.

ARTICLE XII.

AMENDMENT OF BY-LAWS

        Except as otherwise provided herein, the Board of Directors shall have the power to adopt, amend or repeal the By-Laws of the Corporation by the affirmative action of a majority of its members. The By-Laws may be adopted, amended or repealed by the affirmative vote a majority of the shares present in person or by proxy and entitled to vote on the matter at any regular meeting of the stockholders or at any special meeting of the stockholders if notice of such proposed adoption, amendment or repeal be contained in the notice of such meeting.

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BY-LAWS OF THE HOME DEPOT, INC. (As amended and restated effective May 29, 2003)

EX-10.1

Exhibit 10.1

July 24, 2003

Mr. John Costello

Dear John,

I am pleased to confirm Home Depot U.S.A., Inc.'s offer and your acceptance of an appointment to Executive Vice President, Merchandising & Marketing, effective August 4, 2003, reporting directly to me. Your current compensation arrangements shall be modified as follows:

Your new base annual salary will be $650,000, payable in equal bi-weekly installments. Your next salary review will be held in April of 2004. At the next meeting of The Home Depot, Inc. Compensation Committee following the commencement of your service in your new position, you will receive a grant of 100,000 non-qualified stock options exercisable in accordance with the 1997 Omnibus Stock Option Plan. Twenty-five percent of the stock options will become exercisable on the second, third, fourth, and fifth anniversaries of the grant date. Expiration of all stock options will be the earlier of ten years from the grant date or termination of employment.

Except as specifically amended hereby, the employment terms as outlined in your original offer letter dated September 26, 2002 will remain in full force and effect.

John, I look forward to a long, successful working relationship. Attached are two copies of the form to process this appointment. Please sign and date both copies, keep one for your records and send the other to Tim Crow for processing.

Sincerely,

Robert Nardelli
Chairman, President & Chief Executive Officer

I accept this offer
/s/  JOHN COSTELLO	Date 07/25/03
John Costello

pc:

Dennis Donovan
Frank Fernandez
Carol Tomé
Tim Crow

EX-10.2

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Exhibit 10.2

RESTRICTED STOCK EXCHANGE AGREEMENT

        This Agreement is entered into as of August 21, 2003, by and between THE HOME DEPOT, INC. (the "Company"), a Delaware corporation, and ROBERT L. NARDELLI (the "Executive").

W I T N E S S E T H:

WHEREAS, the Company has adopted The Home Depot, Inc. 1997 Omnibus Stock Incentive Plan (the "Plan") which is administered by the Compensation Committee of the Board of Directors of the Company (the "Committee"); and

WHEREAS, Executive is an officer and employee of the Company eligible to receive grants of awards of Restricted Stock and Deferred Shares under the Plan; and

WHEREAS, on August 26, 2002, the Committee granted to Executive an award of two hundred fifty thousand (250,000) shares of Restricted Stock under the terms of the Plan (the "Restricted Stock Award); and

WHEREAS, all of the shares of the Restricted Stock Award have not yet vested and remain subject to a substantial risk of forfeiture; and

WHEREAS, the Committee desires to permit Executive to surrender the Restricted Stock Award in exchange a the grant of an identical number of Deferred Shares (the "Deferred Shares") and the Company's Board of Directors has reviewed and approved such exchange,

NOW, THEREFORE, for and in consideration of the mutual promises herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

        1.    Grant of Deferred Shares.    Company hereby grants to Executive an award of Deferred Shares under the Plan for two hundred fifty thousand (250,000) shares of the $.05 par value common stock of the Company, subject to the terms and conditions set forth in the Deferred Share Agreement attached hereto as Exhibit A.

        2.    Cancellation of Restricted Stock Award.    In consideration of the foregoing award of Deferred Shares, Executive (i) hereby surrenders all of his rights and interests in the Restricted Stock Agreement attached hereto as Exhibit B, and (ii) agrees that the Restricted Stock Agreement shall be cancelled by the Company and any shares held in escrow by the Company under such agreement shall be returned to and shall become the exclusive property of the Company. Executive shall be entitled to retain any dividends previously paid to him under the Restricted Stock Agreement.

        3.    Controlling Law.    This Agreement shall be governed by, and construed in accordance with, the laws of the State of Georgia (without giving effect to the choice of law principles) and any action arising out of or related thereto shall be brought in either the United States District Court for the Northern District of Georgia, Atlanta Division, or the Superior Court of Cobb County, Georgia.

        4.    Construction.    The Agreement contains the entire understanding between the parties and supersedes any prior understanding and agreements between them representing the subject matter hereof. There are no representations, agreements, arrangements or understandings, oral or written, between and among the parties hereto relating to the subject matter hereof which are not fully expressed herein.

        5.    Headings.    Section and other headings contained in the Agreement are for reference purposes only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of the Agreement or any provision hereof.

THE HOME DEPOT, INC. COMPENSATION COMMITTEE
By:	/s/  CLAUDIO X. GONZÁLEZ Claudio X. González, Chair
EXECUTIVE:
/s/  ROBERT L. NARDELLI Robert L. Nardelli

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EXHIBIT A

DEFERRED SHARE AWARD

        This Deferred Share Award is made to ROBERT L. NARDELLI this 21^st day of August, 2003, by THE HOME DEPOT, INC., a Delaware corporation.

W I T N E S S E T H:

WHEREAS, the Company has adopted The Home Depot, Inc. 1997 Omnibus Stock Incentive Plan which is administered by the Committee; and

WHEREAS, Executive is an officer and employee of the Company eligible to receive an award of Deferred Shares under the Plan; and

WHEREAS, pursuant to the Restricted Stock Exchange Agreement entered into with Executive on August 21, 2003, a copy attached hereto as Exhibit A, the Committee agreed to exchange the two hundred fifty thousand (250,000) restricted shares granted to Executive on August 26, 2002 for two hundred fifty thousand (250,000) deferred shares under the 1997 Omnibus Stock Incentive Plan;

NOW, THEREFORE, the Committee hereby makes an award of Deferred Shares under the Plan to Executive pursuant to the following terms and conditions:

        1.    Definitions.    As used herein, the following terms shall be defined as set forth below:

        (a)   "Award" means the Deferred Share Award to Executive, as set forth herein, and as may be amended as provided herein.

        (b)   "Board" means the Company's Board of Directors.

        (c)   "Company" means The Home Depot, Inc., a Delaware corporation, with offices at 2455 Paces Ferry Road, Atlanta, Georgia 30339.

        (d)   "Cause" means that Executive has been convicted of a felony involving theft or moral turpitude, or engaged in conduct that constitutes willful gross neglect or willful gross misconduct with respect to Executive's employment duties which results in material economic harm to the Company; provided, however, that for purposes of determining whether conduct constitutes willful gross misconduct, no act on Executive's part shall be considered "willful" unless it is done by Executive in bad faith and without reasonable belief that his action was in the best interests of the Company; Cause shall not be deemed to exist for purposes of this Award unless: (1) a determination that Cause exists is made and approved by the Board, (2) Executive is given at least thirty (30) days' written notice of the Board meeting called to make such determination, and (3) Executive and his legal counsel are given the opportunity to address such meeting.

        (e)   "Change in Control" means the occurrence of any of the following events: (1) any "person" (as defined in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), excluding for this purpose, (A) the Company or any subsidiary of the Company, or (B) any employee benefit plan of the Company or any subsidiary of the Company, or any person or entity organized, appointed or established by the Company for or pursuant to the terms of any such plan which acquires beneficial ownership of voting securities of the Company, is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than twenty percent (20%) of the combined voting power of the Company's then outstanding securities; provided, however, that no Change in Control will be deemed to have occurred as a result of a change in ownership percentage resulting solely from an acquisition of securities by the Company; or (2) during any two (2) consecutive years (not including any period beginning before the Grant Date, individuals who at the beginning of such two (2) year period constitute the Board and any new director (except for a director designated by a person who has entered into an agreement with the Company to effect a transaction described elsewhere in this definition of Change in Control)

whose election by the Board or nomination for election by the Company's stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved cease for any reason to constitute at least a majority of the Board; or (3) consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a "Business Combination"), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Company immediately before such Business Combination beneficially own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the company resulting from such Business Combination (including, without limitation, a company which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately before such Business Combination of the outstanding voting securities of the Company; or (4) approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

        (f)    "Committee" means the Compensation Committee of the Board.

        (g)   "Deferred Shares" means the award of the Company's common stock to Executive set forth in Section 2.

        (h)   "Executive" means Robert L. Nardelli, the Company's Chairman, President and Chief Executive Officer.

        (i)    "Disability" means Executive's inability to substantially perform his duties under the Employment Agreement, with reasonable accommodation, as evidenced by a certificate signed either by a physician mutually acceptable to the Company and Executive or, if the Company and Executive cannot agree upon a physician, by a physician selected by agreement of a physician designated by the Company and a physician designated by Executive; provided, however, that if such physicians cannot agree upon a third physician within thirty (30) days, such third physician shall be designated by the American Arbitration Association.

        (j)    "Employment Agreement" means that certain employment agreement entered into between the Company and Executive effective as of December 4, 2000.

        (k)   "Good Reason" means, without Executive's consent, (1) the assignment to Executive of any duties inconsistent in any material respect with Executive's position (including status, offices, titles and reporting relationships), authority, duties or responsibilities as contemplated by Section 3 of the Employment Agreement, or any other action by the Company which results in a significant diminution in such position, authority, duties or responsibilities, excluding any isolated and inadvertent action not taken in bad faith and which is remedied by the Company within ten (10) days after receipt of notice thereof given by Executive; (2) any failure by the Company to comply with any of the provisions of Sections 4 or 5 of the Employment Agreement other than an isolated and inadvertent failure not committed in bad faith and which is remedied by the Company within ten (10) days after receipt of notice thereof given by Executive; (3) Executive being required to relocate to a principal place of employment more than twenty-five (25) miles from his principal place of employment with the Company as of the Grant Date; (4) delivery by the Company of a notice discontinuing the automatic extension provision of Section 2 of the Employment Agreement; (5) failure by the Company to elect Executive to the position of sole Chairman of the Board in compliance with the terms of Section 3.1 of the Employment Agreement; or (6) any purported termination by the Company of Executive's employment otherwise than as expressly permitted by the Employment Agreement.

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        (l)    "Grant Date" means August 21, 2003, the date the Committee granted the award of Deferred Shares to Executive pursuant to the Restricted Stock Exchange Agreement entered into with Executive on August 21, 2003.

        (m)  "Latest Deferral Date" means December 31 of the calendar year preceding the calendar year in which the Deferred Shares vest.

        (n)   "Plan" means The Home Depot, Inc. 1997 Omnibus Stock Incentive Plan, as amended from time to time.

        2.    Deferred Shares Award.    Company hereby grants to Executive an award of Deferred Shares under the Plan for two hundred fifty thousand (250,000) shares of the $.05 par value common stock of the Company, subject to the condition set forth herein.

        (a)   Vesting. Sixty-Two Thousand Five Hundred (62,500) Deferred Shares shall vest and become transferable on August 26, 2005; an additional Sixty-Two Thousand Five Hundred (62,500) Deferred Shares shall vest and become transferable on August 26, 2008; and the remaining One Hundred Twenty-Five Thousand Deferred Shares shall vest and become transferable upon the date on which Executive reaches age 62; provided that, except as provided in Section 2(d), Executive is employed by the Company or an Affiliate on the applicable vesting date.

        (b)   Delivery of Shares. Unless Executive has elected to defer receipt of the Deferred Shares in accordance with Section 2(c), the Company shall cause a stock certificate representing the vested portion of the Deferred Shares to be transferred to Executive as soon as practicable after each vesting date.

        (c)   Deferral. Executive may elect in writing on or before the Latest Deferral Date to defer the issuance of all or a part of such vested Deferred Shares. Any such election shall specify the date of issuance for the Deferred Shares and shall be irrevocable after the Latest Deferral Date.

        (d)   Termination of Employment; Change in Control. If (1) the Company terminates Executive's employment other than for Cause, (2) Executive, upon fifteen (15) days' prior written notice, terminates his employment for Good Reason, (3) Executive's employment terminates due to death or Disability, or (4) a Change in Control occurs while Executive is employed by the Company, any Deferred Shares that have not yet vested shall immediately vest. Unless Executive has elected pursuant to Section 2(c) to defer issuance to a later date, the Company shall issue such Deferred Shares to Executive within ten (10) days after the termination of Executive's employment.

        3.    Limitation of Rights; Dividend Equivalents.    Executive shall not have any right to transfer any rights under the Deferred Shares except as permitted by Section 4, shall not have any rights of ownership of the shares of the Company's common stock subject to the Deferred Shares before the issuance of such shares, and shall not have any right to vote such shares. Executive, however, shall receive a cash payment equal to the cash dividends paid on shares underlying outstanding Deferred Shares when cash dividends are paid to shareholders of the Company.

        4.    Transferability.    Except as otherwise provided in this Section 4, the Deferred Shares shall not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner, whether by the operation of law or otherwise. Executive may transfer the Deferred Shares, in whole or in part, to a spouse or lineal descendant (a "Family Member"), a trust for the exclusive benefit of Executive and/or Family Members, a partnership or other entity in which all the beneficial owners are Executive and/or Family Members, or any other entity affiliated with Executive that may be approved by the Committee (a "Permitted Transferee"). Subsequent transfers of the Deferred Shares shall be prohibited except in accordance with this Section 4. All terms and conditions of the Deferred Shares, including provisions relating to the termination of Executive's employment with the Company, shall continue to apply

3

following a transfer made in accordance with this Section 4. Any attempted transfer of the Deferred Shares prohibited by this Section 4 shall be null and void.

        5.    Adjustments.    The number of shares covered by the Deferred Shares and, if applicable, the kind of shares covered by the Deferred Shares shall be adjusted to reflect any stock dividend, stock split, or combination of shares of the Company's Common Stock. In addition, the Committee may make or provide for such adjustment in the number of shares covered by the Deferred Shares, and the kind of shares covered the Deferred Shares, as the Committee in its sole discretion may in good faith determine to be equitably required in order to prevent dilution or enlargement of Executive's rights that otherwise would result from (a) any exchange of shares of the Company's Common Stock, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, spin-out, split-off, split-up, reorganization, partial or complete liquidation or other distribution of assets (other than a normal cash dividend), issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event, the Committee may provide in substitution for the Deferred Shares such alternative consideration as it may in good faith determine to be equitable under the circumstances and may require in connection therewith the surrender of the Deferred Shares so replaced.

        6.    Fractional Shares.    The Company shall not be required to issue any fractional shares pursuant to this Award, and the Committee may round fractions down.

        7.    Withholding.    Executive shall pay all applicable federal, state and local income and employment taxes (including taxes of any foreign jurisdiction) which the Company is required to withhold at any time with respect to the Deferred Shares and any cash dividend equivalents paid thereon. Such payment shall be made in full, at Executive's election, in cash or check, by withholding from the Executive's next normal payroll check, or by the tender of Deferred Shares payable under this Award. Deferred Shares tendered as payment of required withholding shall be valued at the closing price per share of the Company's common stock on the date such withholding obligation arises.

        8.    No Impact on Other Benefits and Employment.    This Award shall not confer upon Executive any right with respect to continuance of employment or other service with the Company and shall not interfere in any way with any right that the Company would otherwise have to terminate Executive's employment at any time, subject to the terms of the Employment Agreement. Nothing herein contained shall affect Executive's right to participate in and receive benefits under and in accordance with the then current provisions of any pension, insurance or other employment plan or program of the Company or any of its subsidiaries nor constitute an obligation for continued employment.

        9.    Plan Provisions.    In addition to the terms and conditions set forth herein, this award of Deferred Shares is subject to and governed by the terms and conditions set forth in the Plan, which is hereby incorporated by reference. Unless the context otherwise requires, capitalized terms used in this Award and not otherwise defined herein shall have the meanings set forth in the Plan. In the event of any conflict between the provisions of the Award and the Plan, the Plan shall control.

        10.    Notice.    Any written notice required or permitted by this Award shall be mailed, certified mail (return receipt requested) or hand-delivered, addressed to Company's Executive Vice President—Human Resources at Company's corporate headquarters in Atlanta, Georgia as set forth in Section 1(c), or to Executive at his most recent home address on record with the Company. Notices are effective upon receipt.

        11.    Miscellaneous.

        (a)   Limitation of Rights.    The granting of the award of Deferred Shares shall not give Executive any rights to similar grants in future years or any right to be retained in the employ or service of the Company or to interfere in any way with the right of the Company to terminate

4

Executive's services at any time or the right of Executive to terminate his or her services at any time.

        (b)   Claim and Review Procedures.    The claim and review procedures set forth in the Home Depot U.S.A., Inc. Deferred Compensation Plan For Officers are incorporated herein by reference.

        (c)   Rights Unsecured.    The Company shall remain the owner of all amounts deferred by Executive pursuant to Section 2(c) and Executive shall have only Company's unfunded, unsecured promise to pay. The rights of Executive hereunder shall be that of an unsecured general creditor of the Company, and Executive shall not have any security interest in any assets of the Company.

        (d)   Limitation of Actions.    Any lawsuit with respect to any matter arising out of or relating to this Award must be filed no later than one (1) year after the Company provides Executive with a written denial of any claim made by Executive hereunder.

        (e)   Offset.    The Company shall have the right to deduct from amounts otherwise payable under this Award all amounts owed by Executive to Company and its affiliates to the maximum extent permitted by applicable law.

        (f)    Controlling Law.    This Award shall be governed by, and construed in accordance with, the laws of the State of Georgia (without giving effect to the choice of law principles) and any action arising out of or related thereto shall be brought in either the United States District Court for the Northern District of Georgia, Atlanta Division, or the Superior Court of Cobb County, Georgia.

        (g)   Severability.    If any term, provision, covenant or restriction contained in the Award is held by a court or a federal regulatory agency of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions contained in the Award shall remain in full force and effect, and shall in no way be affected, impaired or invalidated.

        (h)   Construction.    The Award contains the entire understanding between the parties and supersedes any prior understanding and agreements between them representing the subject matter hereof, except that this Award shall be subject to the terms and conditions set forth in the Employment Agreement between Executive and Company, if any. There are no representations, agreements, arrangements or understandings, oral or written, between and among the parties hereto relating to the subject matter hereof which are not fully expressed herein.

        (i)    Headings.    Section and other headings contained in the Award are for reference purposes only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of the Award or any provision hereof.

THE HOME DEPOT, INC. COMPENSATION COMMITTEE
By:	/s/  CLAUDIO X. GONZÁLEZ Claudio X. González, Chair

5

EXHIBIT B

THE HOME DEPOT, INC.
RESTRICTED STOCK AGREEMENT

        This Restricted Stock Agreement (the "Agreement") is entered into as of the 26th day of August, 2002, by and between THE HOME DEPOT, INC., a Delaware corporation (the "Company") and ROBERT L NARDELLI ("Employee").

W I T N E S S E T H:

WHEREAS, the Company has adopted The Home Depot, Inc. 1997 Omnibus Stock Incentive Plan (the "Plan") which is administered by a Committee appointed by the Company's Board of Directors (the "Committee"); and

WHEREAS, Employee is an Employee of the Company or its Subsidiary eligible to receive grants of Awards under the Plan;

WHEREAS, the Committee has granted to Employee an award of restricted stock under the terms of the Plan (the "Award") to promote Employee's long-term interests in the success of the Company; and

WHEREAS, to comply with the terms of the Plan and to further the interests of the Company and Employee, the parties hereto have set forth the terms of such award in writing in the Agreement;

NOW, THEREFORE, for and in consideration of the mutual promises herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

        1.Stock Award.

        The Company hereby grants to Employee an award of 250,000 shares of the $.05 par value common stock of the Company, subject to the restrictions and other conditions set forth herein. Such shares are hereinafter referred to as the "Restricted Shares."

        2.Restrictions.

        The Restricted Shares shall vest and become transferable as follows: twenty-five percent (25%) of the shares granted shall vest and become transferable upon the third anniversary of the date of grant; twenty-five percent (25%) of the shares granted shall vest and become transferable upon the sixth anniversary of the date of grant; and fifty percent (50%) of the shares granted shall vest and become transferable upon the date on which Employee reaches age 62. Restricted Shares that have not vested may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated. Restricted Shares that have not vested shall be subject to forfeiture as provided in Section 3. Upon a Change in Control of the Company (as defined in paragraph 8) all unvested Restricted Shares shall immediately vest and become transferable. In the event of termination due to death or permanent and total disability, any unvested Restricted Shares shall immediately vest and become transferable by the Employee or the Employee's estate.

        3.Change in Employment Status.

        If Employee's employment with the Company and its subsidiaries is terminated for reasons other than death or permanent and total disability, or if Employee commences employment in a position which the Company deems to be ineligible for this restricted stock grant, any Restricted Shares which had been granted to Employee which have not yet become vested and transferable, as of the date of Employee's termination or upon Employee's commencing employment in a non-eligible position, shall be immediately forfeited by Employee.

        4.Book Entry Account

        Within a reasonable time after the date of execution of the Agreement, the Company shall instruct its transfer agent to establish a book entry account representing the Restricted Shares in the name of Employee, provided that the Company shall retain control of such account until the Restricted Shares have become vested in accordance with the Agreement.

        5.Stockholder Rights.

        Upon the issuance of a stock certificate representing the Restricted Shares, the Employee shall have all of the rights of a stockholder with respect to the Restricted Shares, including the right to vote the shares and to receive all dividends or other distributions paid or made available with respect to such shares. Notwithstanding the foregoing, any stock dividends or other in-kind dividends or distributions shall be held by the Company until the related Restricted Shares have become vested in accordance with this Agreement and shall remain subject to the forfeiture provisions applicable to the Restricted Shares to which such dividends or distributions relate.

        6.Withholding

        Employee shall pay an amount equal to the amount of all applicable Federal, state and local employment taxes (including taxes of any foreign jurisdiction) which the Company is required to withhold at any time. Such payment may be made in cash or check suitable to the Company, by withholding from Employee's normal pay, or by delivery of shares of the Company's common stock (including shares then vesting under this Agreement).

        7.Plan Provisions.

        In addition to the terms and conditions set forth herein, the Award is subject to and governed by the terms and conditions set forth in the Plan, which is hereby incorporated by reference. Unless the context otherwise requires, capitalized terms used in this Agreement shall have the meanings set forth in the Plan. In the event of any conflict between the provisions of the Agreement and the Plan, the Plan shall control.

        8.Change in Control

        For purposes of this agreement, "Change in Control" shall mean a change in control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A under the Securities Exchange Act of 1934 ("1934 Act") as in effect at the time of such change in control, provided that such a change in control shall be deemed to have occurred at such time as (i) any "person" (as that term is used in Sections 13(d) and 14(d) (2) of the 1934 Act), is or becomes the "beneficial owner", directly or indirectly, of securities representing 20% or more of the combined voting power for election of directors of the then outstanding securities of the Company or any successor of the Company; (ii) during any period of two (2) consecutive years or less, individuals who at the beginning of such period constituted the Board of Directors of the Company cease, for any reason, to constitute at least a majority of the Board of Directors, unless the election or nomination for election of each new director was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period; (iii) the stockholders of the Company approve any merger or consolidation as a result of which the common stock of the Company shall be changed, converted or exchanged (other than a merger with a wholly owned subsidiary of the Company) or any liquidation of the Company or any sale or other disposition of 50% or more of the assets or earning power of the Company; or (iv) the stockholders of the Company approve any merger or consolidation to which the Company is a party as a result of which the persons who were stockholders of the Company immediately prior to the effective date of the merger or consolidation shall have beneficial ownership of less than 55% of the combined voting power for election of directors of the surviving corporation following the effective date of such merger or consolidation.

        9.Miscellaneous.

        (a)Limitation of Rights.    The granting of the Award and the execution of the Agreement shall not give Employee any rights to similar grants in future years or any right to be retained in the employ or service of the Company or its subsidiary or interfere in any way with the right of the Company or any such subsidiary to terminate Employee's services at any time, the right of the Company or its subsidiary to assign Employee to a position that is ineligible for this restricted stock grant, or the right of Employee to terminate his services at any time.

        (b)Severability.    If any term, provision, covenant or restriction contained in the Agreement is held by a court or a federal regulatory agency of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions contained in the Agreement shall remain in full force and effect, and shall in no way be affected, impaired or invalidated.

        (c)Controlling Law.    This Agreement shall be construed, interpreted and applied in accordance with the law of the State of Delaware, without giving effect to the choice of law provisions thereof. Employee and the Company hereby irrevocably submit to the exclusive concurrent jurisdiction of the courts of Delaware. Employee and the Company also both irrevocably waive, to the fullest extent permitted by applicable law, any objection either may now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute, and both parties agree to accept service of legal process in Delaware.

        (d)Construction.    The Agreement contains the entire understanding between the parties and supersedes any prior understanding and agreements between them representing the subject matter hereof. There are no representations, agreements, arrangements or understandings, oral or written, between and among the parties hereto relating to the subject matter hereof which are not fully expressed herein.

        (e)Headings.    Section and other headings contained in the Agreement are for reference purposes only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of the Agreement or any provision hereof.

IN WITNESS WHEREOF, the parties hereto have executed the Agreement as of day and year first set forth above.

THE HOME DEPOT, INC.

By:	/s/  FRANK L. FERNANDEZ Frank L. Fernandez Executive Vice President General Counsel and Secretary
EMPLOYEE:
By:	/s/  ROBERT L. NARDELLI ROBERT L. NARDELLI

Cc:

John L. Clendenin
Dennis Donovan

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RESTRICTED STOCK EXCHANGE AGREEMENT
DEFERRED SHARE AWARD
THE HOME DEPOT, INC. RESTRICTED STOCK AGREEMENT

EX-11.1

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Exhibit 11.1

THE HOME DEPOT, INC. AND SUBSIDIARIES

COMPUTATION OF BASIC AND DILUTED
EARNINGS PER SHARE

(In Millions, Except Per Share Data)

			Three Months Ended				Six Months Ended
			August 3, 2003		August 4, 2002		August 3, 2003		August 4, 2002
BASIC
Net Earnings Available to Common Shareholders			$	1,299	$	1,182	$	2,206	$	2,038
Weighted Average Common Shares				2,295		2,354		2,294		2,352
		Basic Earnings Per Share	$	0.57	$	0.50	$	0.96	$	0.87
DILUTED
Net Earnings Available to Common Shareholders			$	1,299	$	1,182	$	2,206	$	2,038
Weighted Average Common Shares				2,295		2,354		2,294		2,352
Effect of Potentially Dilutive Securities:
	Employee Stock Plans			7		9		6		12
Diluted Weighted Average Common Shares				2,302		2,363		2,300		2,364
		Diluted Earnings Per Share	$	0.56	$	0.50	$	0.96	$	0.86

Employee stock plans represent options and shares granted under the Company's employee stock purchase, stock option and deferred compensation stock plans. Options to purchase 67.2 million and 56.3 million shares of common stock at August 3, 2003 and August 4, 2002, respectively, were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive.

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THE HOME DEPOT, INC. AND SUBSIDIARIES COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE

EX-15.1

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Exhibit 15.1

INDEPENDENT ACCOUNTANT'S ACKNOWLEDGEMENT

To the Shareholders and Board of Directors of The Home Depot, Inc.:

We acknowledge our awareness of the incorporation by reference of our report dated August 18, 2003, included within the Quarterly Report on Form 10-Q of The Home Depot, Inc. for the quarter ended August 3, 2003, in the following Registration Statements:

DESCRIPTION		REGISTRATION STATEMENT NUMBER
Form S-3
	DepotDirect stock purchase program	333-03497
	DepotDirect stock purchase program	333-81485
Form S-8
	The Home Depot, Inc. Amended and Restated 1981 Incentive Stock Option Plan	33-22299
	The Home Depot, Inc. Employee Stock Purchase Plan	33-22531
	The Home Depot, Inc. 1991 Omnibus Stock Option Plan	33-46476
	The Home Depot, Inc. Non-U.S. Employee Stock Purchase Plan	033-58807
	The Home Depot Futurebuilder	333-01385
	The Home Depot, Inc. Employee Stock Purchase Plan	333-16695
	The Maintenance Warehouse Futurebuilder	333-91943
	The Home Depot Futurebuilder	333-85759
	The Home Depot, Inc. 1997 Omnibus Stock Incentive Plan	333-61733
	The Home Depot Futurebuilder for Puerto Rico	333-56207
	The Home Depot Canada Registered Retirement Savings Plan	333-38946
	The Home Depot, Inc. Restated and Amended Employee Stock Purchase Plan	333-56724
	The Home Depot, Inc. Non-Qualified Stock Option and Deferred Stock Units Plan and Agreement	333-56722
	The Home Depot, Inc. Deferred Stock Units Plan and Agreement	333-62316
	The Home Depot, Inc. Deferred Stock Units Plan and Agreement	333-62318
	The Home Depot, Inc. Deferred Stock Units Plan and Agreement	333-72016

Pursuant to Rule 436(c) under the Securities Act of 1933, such report is not considered part of a registration statement prepared or certified by an accountant, or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

/s/ KPMG LLP KPMG LLP
Atlanta, Georgia
September 5, 2003

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INDEPENDENT ACCOUNTANT'S ACKNOWLEDGEMENT

EX-31.1

Exhibit 31.1

I, Robert L. Nardelli, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of The Home Depot, Inc.;

2.

Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

(a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

(b)

evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

(c)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

(a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: September 2, 2003
	/s/  ROBERT L. NARDELLI Robert L. Nardelli Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

I, Carol B. Tomé, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of The Home Depot, Inc.;

2.

Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

(a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

(b)

evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

(c)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

(a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: September 2, 2003
	/s/  CAROL B. TOMÉ Carol B. Tomé Executive Vice President and Chief Financial Officer

EX-32.1

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Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 *

In connection with the Quarterly Report of The Home Depot, Inc. (the "Company") on Form 10-Q for the period ended August 3, 2003 as filed with the Securities and Exchange Commission (the "Report"), I, Robert L. Nardelli, Chairman, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/  ROBERT L. NARDELLI Robert L. Nardelli
Chairman, President and
Chief Executive Officer
September 2, 2003

*

A signed original of this written statement required by Section 906 has been provided to The Home Depot, Inc. and will be retained by The Home Depot, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

EX-32.2

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Exhibit 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 *

In connection with the Quarterly Report of The Home Depot, Inc. (the "Company") on Form 10-Q for the period ended August 3, 2003 as filed with the Securities and Exchange Commission (the "Report"), I, Carol B. Tomé, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/  CAROL B. TOMÉ Carol B. Tomé
Executive Vice President and
Chief Financial Officer
September 2, 2003

*

A signed original of this written statement required by Section 906 has been provided to The Home Depot, Inc. and will be retained by The Home Depot, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002