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 November 2, 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 2,275,215,659 Shares, as of December 1, 2003

Page 1 of 17

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 Nine Month Periods     Ended November 2, 2003 and November 3, 2002	3
	CONSOLIDATED BALANCE SHEETS—     As of November 2, 2003 and February 2, 2003	4
	CONSOLIDATED STATEMENTS OF CASH FLOWS—     Nine Month Periods     Ended November 2, 2003 and November 3, 2002	5
	CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME—     Three Month and Nine Month Periods     Ended November 2, 2003 and November 3, 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 6.	Exhibits and Reports on Form 8-K	15
Signatures		16
Index to Exhibits		17

Page 2 of 17

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						Nine Months Ended
			November 2, 2003			November 3, 2002			November 2, 2003			November 3, 2002
NET SALES			$	16,598		$	14,475		$	49,691		$	45,034
Cost of Merchandise Sold				11,405			9,895			34,064			31,148
		GROSS PROFIT		5,193			4,580			15,627			13,886
Operating Expenses:
	Selling and Store Operating			3,072			2,813			9,397			8,368
	Pre-Opening			20			19			52			67
	General and Administrative			278			252			841			716
		Total Operating Expenses		3,370			3,084			10,290			9,151
		OPERATING INCOME		1,823			1,496			5,337			4,735
Interest Income (Expense):
	Interest and Investment Income			14			21			41			63
	Interest Expense			(14	)		(10	)		(48	)		(25	)
		Interest, Net		—			11			(7	)		38
		EARNINGS BEFORE PROVISION FOR INCOME TAXES		1,823			1,507			5,330			4,773
Provision for Income Taxes				676			567			1,977			1,795
		NET EARNINGS	$	1,147		$	940		$	3,353		$	2,978
Weighted Average Common Shares				2,280			2,337			2,289			2,347
BASIC EARNINGS PER SHARE			$	0.50		$	0.40		$	1.46		$	1.27
Diluted Weighted Average Common Shares				2,287			2,343			2,295			2,356
DILUTED EARNINGS PER SHARE			$	0.50		$	0.40		$	1.46		$	1.26
Dividends Declared Per Share			$	0.07		$	0.06		$	0.20		$	0.16

See accompanying note to consolidated financial statements.

Page 3 of 17

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(Unaudited)

(In Millions, Except Per Share Data)

			November 2, 2003			February 2, 2003
ASSETS
Current Assets:
	Cash and Cash Equivalents		$	4,944		$	2,188
	Short-Term Investments			22			65
	Receivables, Net			1,432			1,072
	Merchandise Inventories			9,002			8,338
	Other Current Assets			297			254
		Total Current Assets		15,697			11,917
Property and Equipment, at cost				23,165			20,733
Less: Accumulated Depreciation and Amortization				4,289			3,565
	Net Property and Equipment			18,876			17,168
Notes Receivable				96			107
Cost in Excess of the Fair Value of Net Assets Acquired				631			575
Other Assets				74			244
			$	35,374		$	30,011
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
	Accounts Payable		$	6,380		$	4,560
	Accrued Salaries and Related Expenses			851			809
	Sales Taxes Payable			426			307
	Deferred Revenue			1,411			998
	Income Taxes Payable			205			227
	Current Installments of Long-Term Debt			508			7
	Other Accrued Expenses			1,191			1,127
		Total Current Liabilities		10,972			8,035
Long-Term Debt, excluding current installments				847			1,321
Deferred Income Taxes				686			362
Other Long-Term Liabilities				608			491
STOCKHOLDERS' EQUITY
	Common Stock, par value $0.05, authorized: 10,000 shares, issued and     outstanding 2,369 shares at November 2, 2003 and 2,362 shares at     February 2, 2003			119			118
	Paid-In Capital			6,120			5,858
	Retained Earnings			18,888			15,971
	Accumulated Other Comprehensive Income (Loss)			105			(82	)
	Unearned Compensation			(80	)		(63	)
	Treasury Stock at cost, 96 shares at November 2, 2003 and 69 shares at     February 2, 2003			(2,891	)		(2,000	)
		Total Stockholders' Equity		22,261			19,802
			$	35,374		$	30,011

See accompanying note to consolidated financial statements.

Page 4 of 17

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

(In Millions)

			Nine Months Ended
			November 2, 2003			November 3, 2002
CASH FLOWS FROM OPERATIONS:
Net Earnings			$	3,353		$	2,978
Reconciliation of Net Earnings to Net Cash Provided by Operations:
	Depreciation and Amortization			786			665
	Increase in Receivables, Net			(363	)		(225	)
	Increase in Merchandise Inventories			(615	)		(1,574	)
	Increase in Accounts Payable and Accrued Expenses			2,148			2,421
	Increase in Deferred Revenue			411			291
	Increase (Decrease) in Income Taxes Payable			313			(19	)
	Other			108			155
		Net Cash Provided by Operations		6,141			4,692
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital Expenditures				(2,508	)		(1,954	)
Payments for Businesses Acquired, Net				(15	)		(231	)
Proceeds from Sale of Business, Net				—			22
Proceeds from Sales of Property and Equipment				220			81
Purchases of Investments				(84	)		(518	)
Proceeds from Maturities of Investments				197			483
		Net Cash Used In Investing Activities		(2,190	)		(2,117	)
CASH FLOWS FROM FINANCING ACTIVITIES:
(Repayments of) Proceeds from Long-Term Debt				(7	)		3
Proceeds from Sale of Common Stock, Net				113			272
Repurchase of Common Stock				(891	)		(1,000	)
Cash Dividends Paid to Stockholders				(436	)		(352	)
		Net Cash Used In Financing Activities		(1,221	)		(1,077	)
Effect of Exchange Rate Changes on Cash and Cash Equivalents				26			5
Increase in Cash and Cash Equivalents				2,756			1,503
Cash and Cash Equivalents at Beginning of Period				2,188			2,477
Cash and Cash Equivalents at End of Period			$	4,944		$	3,980

See accompanying note to consolidated financial statements.

Page 5 of 17

THE HOME DEPOT, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)

(In Millions)

		Three Months Ended				Nine Months Ended
		November 2, 2003		November 3, 2002		November 2, 2003		November 3, 2002
Net Earnings		$	1,147	$	940	$	3,353	$	2,978
Other Comprehensive Income(1):
	Foreign Currency Translation Adjustments		81		22		187		82
	Change in Fair Value of Derivatives     Accounted for as Hedges		—		5		—		13
	Total Other Comprehensive Income		81		27		187		95
Comprehensive Income		$	1,228	$	967	$	3,540	$	3,073

(1)

Components of comprehensive income are reported net of related taxes.

See accompanying note to consolidated financial statements.

Page 6 of 17

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 (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 three and nine months ended November 2, 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 nine 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						Nine Months Ended
		November 2, 2003			November 3, 2002			November 2, 2003			November 3, 2002
Net Earnings, as reported		$	1,147		$	940		$	3,353		$	2,978
Add: Stock-based employee compensation expense included in reported net earnings, net of related tax			11			1			24			3
Deduct: Total stock-based compensation expense determined under the fair value based method for all awards, net of related tax effects			(78	)		(95	)		(205	)		(209	)
Pro forma net earnings		$	1,080		$	846		$	3,172		$	2,772
Basic earnings per share:
	As reported	$	0.50		$	0.40		$	1.46		$	1.27
	Pro forma	$	0.47		$	0.36		$	1.39		$	1.18
Diluted earnings per share:
	As reported	$	0.50		$	0.40		$	1.46		$	1.26
	Pro forma	$	0.47		$	0.36		$	1.38		$	1.18

Page 7 of 17

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 $762 million and $2.0 billion in the three and nine months ended November 2, 2003, respectively, compared to $524 million and $1.4 billion in the three and nine months ended November 3, 2002.

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

Page 8 of 17

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 November 2, 2003, and the related consolidated statements of earnings and comprehensive income for the three and nine-month periods ended November 2, 2003 and November 3, 2002 and the related consolidated statements of cash flows for the nine-month periods ended November 2, 2003 and November 3, 2002. 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

November 17, 2003

Page 9 of 17

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						Nine Months Ended						Percentage Increase (Decrease) in Dollar Amounts
			November 2, 2003			November 3, 2002			November 2, 2003			November 3, 2002			Three Months		Nine Months
NET SALES				100.0	%		100.0	%		100.0	%		100.0	%	14.7	%	10.3	%
GROSS PROFIT				31.3			31.6			31.4			30.8		13.4		12.5
Operating Expenses:
	Selling and Store Operating			18.5			19.4			18.9			18.6		9.2		12.3
	Pre-Opening			0.1			0.2			0.1			0.1		5.3		(22.4	)
	General and Administrative			1.7			1.7			1.7			1.6		10.3		17.5
		Total Operating     Expenses		20.3			21.3			20.7			20.3		9.3		12.4
OPERATING INCOME				11.0			10.3			10.7			10.5		21.9		12.7
Interest Income (Expense):
	Interest and Investment     Income			0.1			0.2			0.1			0.2		(33.3	)	(34.9	)
	Interest Expense			(0.1	)		(0.1	)		(0.1	)		(0.1	)	40.0		92.0
		Interest, Net		0.0			0.1			0.0			0.1		(100.0	)	(118.4	)
EARNINGS BEFORE     PROVISION FOR INCOME     TAXES				11.0			10.4			10.7			10.6		21.0		11.7
Provision for Income Taxes				4.1			3.9			4.0			4.0		19.2		10.1
		NET EARNINGS		6.9	%		6.5	%		6.7	%		6.6	%	22.0	%	12.6	%
Selected Sales Data(1)
Number of Transactions     (in millions)				313			286			959			893		9.4	%	7.4	%
Average Sale per Transaction			$	52.10		$	49.66		$	51.30		$	50.07		4.9		2.5
Weighted Average Weekly Sales     per Operating Store (000's)			$	775		$	754		$	796		$	814		2.8		(2.2	)
Weighted Average Sales per     Square Foot			$	375.45		$	360.41		$	385.62		$	389.09		4.2	%	(0.9	)%

(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 17

FORWARD-LOOKING STATEMENTS

        Certain statements made herein regarding implementation of store initiatives, store openings, capital expenditures, future cash flow, 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 third quarter of fiscal 2003 increased 14.7% to $16.6 billion from $14.5 billion in the third quarter of fiscal 2002. For the first nine months of fiscal 2003, sales increased 10.3% to $49.7 billion from $45.0 billion for the comparable period in fiscal 2002. The sales increase for both periods was attributable to both new stores opened since the end of the third quarter of fiscal 2002 (1,643 stores open at the end of the third quarter of fiscal 2003 compared with 1,471 at the end of the third quarter of fiscal 2002) and an increase in comparable store-for-store sales. Comparable store-for-store sales increased 7.8% in the third quarter of fiscal 2003 and increased 2.8% in the first nine months of fiscal 2003. Lumber was the biggest driver of comparable sales increases in the third quarter of fiscal 2003. Also in the third quarter and the first nine months of fiscal 2003, strong performance in our lawn and garden category, led by outdoor power equipment with continued strength from John Deere tractors and walk-behind mowers, as well as snow throwers and blowers increased comparable store sales. Paint was also a solid category in the third quarter and first nine months of fiscal 2003, led by interior and exterior paint and power pressure washers. An increase in sales of concrete and roofing materials in the third quarter and first nine months of fiscal 2003 contributed to strength in our building materials category. Additionally, sales in our services business including the flooring companies we acquired last year, gained 45.4% and 42.5% in the third quarter and first nine months of fiscal 2003, respectively, compared to the same periods in fiscal 2002 driven by HVAC, countertops, sheds and fencing.

        In order to meet our customer service objectives, we strategically open stores near market areas served by existing stores ("cannibalize") to enhance service levels, gain incremental sales and increase market penetration. Our new stores cannibalized approximately 15% of our existing stores as of the end of the third quarter of fiscal 2003, with an estimated reduction in comparable store-for-store sales of 2.4%. 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 third quarter of fiscal 2003, we continued the implementation 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 third quarter of fiscal 2003, the Pro initiative was in 1,335 stores or 81% of total stores, of which 42 stores were added during the third quarter of fiscal 2003 compared to a total of 1,072 stores or 73% of total stores at the end of the third quarter of fiscal 2002. We expect to have the Pro initiative in 1,365 stores by the end of fiscal 2003.

Page 11 of 17

        In addition to Pro, we continue to implement the Appliance initiative in our stores. The Appliance initiative was in 1,250 stores or 76% of total stores as of the end of the third quarter of fiscal 2003 compared to 588 stores or 40% of total stores as of the end of the third 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. The DesignPlace initiative was in 1,432 stores or 87% of total stores as of the end of the third quarter of fiscal 2003 compared to 746 stores or 51% of total stores as of the end of the third quarter of fiscal 2002. We expect to have the DesignPlace initiative in 1,603 stores by the end of fiscal 2003.

        Gross profit increased 13.4% to $5.2 billion in the third quarter of fiscal 2003 from $4.6 billion in the third quarter of fiscal 2002. Gross profit increased 12.5% to $15.6 billion for the first nine months of fiscal 2003 from $13.9 billion in the first nine months of fiscal 2002. The gross profit rate as a percent of sales decreased to 31.3% in the third quarter of fiscal 2003 from 31.6% in the third quarter of fiscal 2002. In the first nine months of fiscal 2003, gross profit as a percent of sales increased to 31.4% from 30.8% in the comparable period of fiscal 2002. The gross profit rate decrease in the third quarter was primarily the result of lower volume rebates from vendors as compared to the third quarter of fiscal 2002. The increase in volume rebates in the third quarter of fiscal 2002 was the result of a build-up of our inventory levels during fiscal 2002 which was not repeated during fiscal 2003 as our inventory levels were adequate. While increased sales penetration by our lumber category caused some slight deterioration to our gross margin during the third quarter of fiscal 2003, this was offset by a change in the mix of higher margin categories. The gross profit rate increase for the first nine months was primarily attributable to continued but slowing benefit from centralized purchasing as we rationalized vendors and improved assortments, increased penetration of import products, which typically have a lower cost and lower markdowns as we did not repeat the Yellow Tag Clearance event held in the second quarter of fiscal 2002.

        Selling and store operating expenses increased 9.2% to $3.1 billion in the third quarter of fiscal 2003 from $2.8 billion in the third quarter of fiscal 2002. As a percent of sales, selling and store operating expenses were 18.5% in the third quarter of fiscal 2003 compared to 19.4% in the same period in fiscal 2002. For the first nine months of fiscal 2003, selling and store operating expenses increased 12.3% to $9.4 billion from $8.4 billion in the first nine months of fiscal 2002. As a percent of sales, selling and store operating expenses were 18.9% in the first nine months of fiscal 2003 compared to 18.6% in the same period in fiscal 2002. The decrease in the third quarter of fiscal 2003 was primarily due to higher labor productivity and some incremental benefit from our new private label credit program with Citigroup. The increase in store selling and operating costs in the first nine months of fiscal 2003 was primarily attributable to increased expense for workers' compensation and general liability due in large part to increased medical costs. Also contributing to the increase in store selling and operating costs in the first nine months of fiscal 2003 was an increased investment in labor in our stores to ensure better in-stock positions and customer service and costs incurred to improve our customers' shopping experience as we executed our plan to reset, repair and remodel our stores.

Page 12 of 17

        Pre-opening expenses of $20 million increased 5.3% and as a percent of sales were 0.1% in the third quarter of fiscal 2003 compared with 0.2% and $19 million in the third quarter of fiscal 2002. For the first nine months of fiscal 2003, pre-opening expenses of $52 million decreased 22.4% and as a percent of sales were 0.1% compared with 0.1% and $67 million in the first nine months of fiscal 2002. The decrease in pre-opening expenses in the first nine months of fiscal 2003 was due to fewer stores opened as compared to the same period last year and a decrease in the average pre-opening cost per store.

        General and administrative expenses of $278 million increased 10.3% and as a percent of sales were 1.7% in the third quarter of fiscal 2003 compared to 1.7% and $252 million in the third quarter of fiscal 2002. In the first nine months of fiscal 2003, general and administrative expenses increased 17.5% and as a percent of sales were 1.7% and $841 million compared to 1.6% and $716 million in the same period in fiscal 2002. The increase in the first nine months was primarily due to an increase in incremental spending in technology and other growth initiatives.

        As a percent of sales, interest and investment income was 0.1% and $14 million in the third quarter of fiscal 2003 compared to 0.2% and $21 million in the third quarter of fiscal 2002. For the first nine months of fiscal 2003, as a percent of sales, interest and investment income was 0.1% and $41 million compared to 0.2% and $63 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 $14 million in the third quarter of fiscal 2003 as compared to 0.1% and $10 million in the third quarter of fiscal 2002. Interest expense as a percent of sales was 0.1% and $48 million in the first nine months of fiscal 2003 compared to 0.1% and $25 million in the same period in fiscal 2002. The increase in interest expense in the first nine months of fiscal 2003 was attributable to lower capitalized interest due to the timing of store openings and site development.

        The provision for income taxes was 4.1% as a percent of sales in the third quarter of fiscal 2003 and 3.9% in the third quarter of fiscal 2002. In the first nine months of both fiscal 2003 and fiscal 2002, the provision for income taxes was 4.0% as a percent of sales. As a percent of earnings before tax our combined effective income tax rate decreased to 37.1% in the third quarter and first nine months of fiscal 2003 from 37.6% for the comparable periods of fiscal 2002. The decrease in our combined effective income tax rate was attributable to higher projected tax credits and a lower effective state income tax rate.

        Diluted earnings per share were $0.50 and $1.46 in the third quarter and first nine months of fiscal 2003, respectively, compared to $0.40 and $1.26 in the third quarter and first nine months of fiscal 2002, respectively. Diluted earnings per share were favorably impacted by approximately $0.02 and $0.05 per diluted share in the third quarter and first nine months of fiscal 2003, respectively, as a result of the repurchase of shares of our common stock in fiscal 2002 and fiscal 2003.

LIQUIDITY AND CAPITAL RESOURCES

        Cash flow generated from store operations provides a significant source of liquidity. Cash provided by operations was $6.1 billion in the first nine months of fiscal 2003 compared to $4.7 billion in the first nine months of fiscal 2002, and was driven by stronger net earnings and net working capital improvements.

        Cash used in investing activities was $2.2 billion in the first nine months of fiscal 2003 compared with $2.1 billion in the first nine months of fiscal 2002. Cash used in investing activities reflects a 28% increase in capital expenditures to $2.5 billion in the first nine months of fiscal 2003 compared to $2.0 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. The increase in cash used in investing activities was partially offset by a decrease in investments purchased in the first nine months of fiscal 2003 as compared to the same period in fiscal 2002. We expect total capital expenditures to be approximately $3.6 billion in fiscal 2003, which includes a higher level of investment in store remodeling, technology and other initiatives as compared to 2002.

Page 13 of 17

        During the first nine months of fiscal 2003, cash used in financing activities was $1.2 billion compared with $1.1 billion in the same period of fiscal 2002. The increase in cash used in financing 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 an increase in cash dividends paid to stockholders. These activities were partially offset by a decrease in the repurchase of common stock.

        We have a commercial paper program that allows borrowings up to a maximum of $1.0 billion. As of November 2, 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. During the third quarter of fiscal 2003, $500 million of our long-term debt became current and was appropriately reclassified on the consolidated balance sheet under current installments of long-term debt.

        As of November 2, 2003, we had $5.0 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 $1.0 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

        The Company will adopt the Financial Accounting Standards Board Interpretation No. 46, "Consolidation of Variable Interest Entities," ("Interpretation No. 46") in the fourth quarter of 2003. We do not expect the adoption of Interpretation No. 46 to have a material impact on our consolidated financial statements.

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 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.

Page 14 of 17

(b)

Changes 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 and Use of Proceeds

        During the first, second and third quarters of fiscal 2003, the Company issued 2,654, 9,928, and 4,324 deferred stock units, respectively, under The Home Depot, Inc. Non Employee Directors' Deferred Stock Compensation Plan (the "NED Plan") pursuant to the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended. The deferred stock units convert to shares of Common Stock on a one-for-one basis following a termination of service as described in the NED Plan. In addition, during the second quarter of fiscal 2003, the Company issued 2,206,348 shares of stock under the Restated and Amended Employee Stock Purchase Plan (the "ESPP") in excess of the number of shares that the Company had registered for issuance under the ESPP. The Company subsequently registered 15,000,000 shares for issuance under the ESPP.

Item 6.    Exhibits and Reports on Form 8-K

(a)

Exhibits



10.1

The Home Depot, Inc. Amended and Restated Employee Stock Purchase Plan, as amended and restated effective July 1, 2003.



11.1

Computation of Basic and Diluted Earnings Per Share.



15.1

Letter of KPMG LLP, Independent Accountants' Acknowledgement, dated November 17, 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 August 19, 2003, furnishing a press release announcing financial results for the fiscal quarter ended August 3, 2003.

Page 15 of 17

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
December 2, 2003 (Date)

Page 16 of 17

THE HOME DEPOT, INC. AND SUBSIDIARIES

INDEX TO EXHIBITS

Exhibit	Description
10.1	The Home Depot, Inc. Amended and Restated Employee Stock Purchase Plan, as amended and restated effective July 1, 2003.
11.1	Computation of Basic and Diluted Earnings Per Share.
15.1	Letter of KPMG LLP, Independent Accountants' Acknowledgement, dated November 17, 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.

Page 17 of 17

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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 and Use of Proceeds
Item 6. Exhibits and Reports on Form 8-K

SIGNATURES

EX-10.1

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Exhibit 10.1

THE HOME DEPOT, INC.
AMENDED AND RESTATED
EMPLOYEE STOCK PURCHASE PLAN
(As Amended and Restated Effective July 1, 2003)

Section 1
PURPOSE

        The purpose of The Home Depot, Inc. Amended and Restated Employee Stock Purchase Plan is to provide Employees of the Company and its Designated Subsidiaries with an opportunity to purchase Common Stock of the Company on a payroll or other compensation deduction basis. The Plan is intended to qualify as an "employee stock purchase plan" under Code Section 423. The Plan will, accordingly, be construed so as to extend and limit participation in a manner within the requirements of that Code section. In addition, this Plan authorizes the grant of options and issuance of Common Stock that do not qualify under Code Section 423 pursuant to rules and procedures adopted by the Committee and designed to achieve desired tax or other objectives in particular locations outside the United States.

Section 2
BACKGROUND

        The Plan is an amendment and restatement and merger of The Home Depot, Inc. Amended and Restated Employee Stock Purchase Plan and The Home Depot, Inc. Amended and Restated Non-U.S. Employee Stock Purchase Plan (the "Prior Plans"). The terms of the Plan as contained in this document will apply with respect to Purchase Periods beginning on and after the Effective Date. The terms of the Prior Plans as in effect before this amendment and restatement will apply with respect to any offerings that began before the Effective Date.

Section 3
DEFINITIONS

        As used in the Plan, the following terms, when capitalized, have the following meanings:

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

        (b)   "Business Day" means a day that the New York Stock Exchange is open if the Shares are then listed on such exchange.

        (c)   "Code" means the Internal Revenue Code of 1986, as amended.

        (d)   "Committee" means the committee described in Section 11.

        (e)   "Common Stock" means the common stock of the Company, $.05 par value per share, or any stock into which that common stock may be converted.

        (f)    "Company" means The Home Depot, Inc., a Delaware corporation, and any successor corporation.

        (g)   "Compensation" means an Employee's "benefit compensation" as determined under The Home Depot FutureBuilder. The Committee may change the definition of Compensation on a prospective basis.

        (h)   "Contributions" means all amounts credited to the Participant's Payroll Deduction Account.

        (i)    "Corporate Transaction" means (i) any stock dividend, stock split, combination or exchange of shares, recapitalization or other change in the capital structure of the Company, (ii) 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 (iii) any other corporate transaction or event having an effect similar to any of the foregoing.

        (j)    "Designated Subsidiary" means a Subsidiary that has been designated by the Board or the Committee as eligible to participate in the Plan as to its eligible Employees.

        (k)   "Disability" means, with respect to a Participant, the Participant's becoming eligible for permanent and total disability benefits under the Company's or a Designated Subsidiary's long-term disability plan.

        (l)    "Effective Date" means July 1, 2003.

        (m)  "Employee" means any person who performs services for, and who is classified as an employee on the payroll records of the Company or a Designated Subsidiary.

        (n)   "Fair Market Value" means, with respect to any date, the closing price of the Common Stock on the New York Stock Exchange on that date or, in the event that the Common Stock is not traded on that date, the closing price on the immediately preceding trading date. If the Common Stock is no longer traded on the New York Stock Exchange, then "Fair Market Value" means, with respect to any date, the fair market value of the Common Stock as determined by the Committee in good faith.

        (o)   "Offering Date" means the first Business Day of each Purchase Period.

        (p)   "Participant" means a participant in the Plan as described in Section 5.

        (q)   "Payroll Deduction Account" means the bookkeeping account established for a Participant in accordance with Section 6.

        (r)   "Plan" means The Home Depot, Inc. Amended and Restated Employee Stock Purchase Plan, as set forth herein, and as amended from time to time.

        (s)   "Purchase Date" means the last Business Day of each Purchase Period.

        (t)    "Purchase Period" means a period of six months commencing on January 1 and July 1 of each year, or such other period as determined by the Committee; provided, however, that in no event will any Purchase Period be longer than 27 months.

        (u)   "Purchase Price" means an amount equal to 85% of the Fair Market Value of a Share on the Offering Date or on the Purchase Date, whichever is lower.

        (v)   "Retirement" means, with respect to a Participant, the Participant's termination of employment with the Company or a Designated Subsidiary after completing at least 5 years of continuous employment and attaining age 60.

        (w)  "Share" means a share of Common Stock, as adjusted in accordance with Section 16.

        (x)   "Subsidiary" means a domestic or foreign corporation of which not less than 50% of the voting shares are held by the Company or a Subsidiary, whether or not such corporation now exists or is hereafter organized or acquired by the Company or a Subsidiary. The definition of Subsidiary should be interpreted so as to include any entity that would be treated as a "subsidiary corporation" under Code Section 424(f).

Section 4
ELIGIBILITY

        (a)   Eligible Employees. Any person who is an Employee as of an Offering Date in a given Purchase Period will be eligible to participate in the Plan for that Purchase Period, subject to the requirements of Section 5 and the limitations imposed by Code Section 423(b). Notwithstanding the foregoing, the Committee may, on a prospective basis, (i) exclude from participation in the Plan any or

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all Employees whose customary employment is for not more than 20 hours per week or five months per year, and (ii) impose an eligibility service requirement of up to two years of employment. The Board may also determine that a designated group of highly compensated employees (within the meaning of Code Section 414(q)) are ineligible to participate in the Plan.

        (b)   Five Percent Shareholders. Notwithstanding any other provision of the Plan, no Employee will be eligible to participate in the Plan if the Employee (or any other person whose stock would be attributed to the Employee pursuant to Code Section 424(d)) owns capital stock of the Company and/or holds outstanding options to purchase stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Company or of any Subsidiary.

Section 5
PARTICIPATION

        An Employee may become a Participant in the Plan by completing a payroll deduction authorization form and any other required enrollment documents provided by the Committee or its designee and submitting them to the Committee or its designee in accordance with the rules established by the Committee. The enrollment documents will set forth the amount of the Participant's Compensation, up to twenty percent (20%), or such other limit as is designated by the Committee including any minimum Contribution percentage, to be paid as Contributions pursuant to the Plan. The Committee may provide for a separate election (of a different percentage) for a specified item or items of pay. In countries where payroll deductions are not feasible, the Committee may permit an Employee to participate in the Plan by an alternative means, such as by check.

Section 6
CONTRIBUTIONS

        (a)   Payroll Deductions. A Participant's payroll deductions will begin on the first payroll paid following the Offering Date and will end on the last payroll paid on or before the Purchase Date of the Purchase Period, unless the Participant elects to withdraw from the Plan as provided in Section 9 or ceases Contributions pursuant to Section 6(c). A Participant's enrollment documents will remain in effect for successive Purchase Periods unless the Participant elects to withdraw from the Plan as provided in Section 9, ceases Contributions pursuant to Section 6(c), or timely submits new enrollment documents to change the rate of payroll deductions for a subsequent Purchase Period in accordance with rules established by the Committee.

        (b)   Payroll Deduction Account. The Committee will credit the amount of each Participant's Contributions to the Participant's Payroll Deduction Account. A Participant may not make any additional payments to the Participant's Payroll Deduction Account, except as expressly provided in the Plan or as authorized by the Committee.

        (c)   Changes to Payroll Deductions. A Participant may reduce the percentage of authorized payroll deductions once each Purchase Period by delivery of a new payroll deduction authorization form to the Committee or its designee. The change will become effective as soon as administratively practicable after receipt. A Participant may cease Contributions to the Plan at any time. Unless the Participant elects to withdraw from the Plan as provided in Section 9, the funds in the Participant's Payroll Deduction Account will not be refunded to the Participant but instead will be used to purchase Shares for the Participant on the Purchase Date.

        (d)   No Interest. No interest or other earnings will accrue on a Participant's Contributions to the Plan.

        (e)   Foreign Currency. Except as otherwise specified by the Committee, payroll deductions made with respect to Employees paid in currencies other than U.S. dollars will be accumulated in local currency and converted to U.S. dollars as of the Purchase Date.

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Section 7
STOCK PURCHASES

        (a)   Automatic Purchase. On each Purchase Date, each Participant will be deemed, without further action, to have elected to purchase the number of whole, or if in the Committee's discretion fractional, Shares that the Participant's Payroll Deduction Account balance can purchase at the Purchase Price on that Purchase Date. Except as otherwise specified by the Committee, any amounts that are not sufficient to purchase a whole Share will be retained in the Participant's Payroll Deduction Account for the subsequent Purchase Period. Any other amounts remaining in the Participant's Payroll Deduction Account after the Purchase Date will be returned to the Participant.

        (b)   Delivery of Shares. As soon as practicable after each Purchase Date, the Committee will arrange for the delivery of the Shares purchased by Participants on the Purchase Date. The Committee may permit or require that Shares purchased under the Plan be deposited directly with a provider designated by the Committee. The Committee may require that Shares be retained by the designated provider for a specified period of time and may restrict dispositions during that period, and the Committee may establish other procedures to permit tracking of disqualifying dispositions of the Shares or to restrict transfer of the Shares.

        (c)   Notice Restrictions. The Committee may require, as a condition of participation in the Plan, that each Participant agree to notify the Company if the Participant sells or otherwise disposes of any Shares within two years of the Offering Date or one year of the Purchase Date for the Purchase Period in which the Shares were purchased.

        (d)   Shareholder Rights. A Participant will have no interest or voting right in a Share until a Share has been purchased on the Participant's behalf under the Plan.

Section 8
LIMITATION ON PURCHASES

        Participant purchases are subject to the following limitations:

        (a)   Purchase Period Limitation. Subject to the calendar year limits provided by Section 8(b), the maximum number of Shares that a Participant will have the right to purchase in any Purchase Period will be determined by dividing (i) $25,000 by (ii) the Fair Market Value of one Share on the Offering Date for such Purchase Period.

        (b)   Calendar Year Limitation. No right to purchase Shares under the Plan will be granted to an Employee if such right, when combined with all other rights and options granted under all of the Code Section 423 employee stock purchase plans of the Company, its Subsidiaries or any parent corporation (within the meaning of Code Section 424(e)), would permit the Employee to purchase Shares with a Fair Market Value (determined at the time the right or option is granted) in excess of $25,000 for each calendar year in which the right or option is outstanding at any time, determined in accordance with Code Section 423(b)(8).

        (c)   Refunds. As of the first Purchase Date on which this Section limits a Participant's ability to purchase Shares, the Participant's payroll deductions will terminate, and the Participant will receive a refund of the balance in the Participant's Payroll Deduction Account as soon as practicable after the Purchase Date.

Section 9
WITHDRAWAL FROM PARTICIPATION

        A Participant may withdraw all, but not less than all, of the Contributions credited to the Participant's Payroll Deduction Account at any time before a Purchase Date by notifying the Committee or its designee of the Participant's election to withdraw, pursuant to rules prescribed by the

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Committee. If a Participant elects to withdraw, all of the Participant's Contributions credited to the Participant's Payroll Deduction Account will be returned to the Participant and the Participant may not make any further Contributions to the Plan for the purchase of Shares during that Purchase Period. A Participant's voluntary withdrawal during a Purchase Period will not have any effect upon the Participant's eligibility to participate in the Plan during a subsequent Purchase Period.

Section 10
EMPLOYMENT TERMINATION

        (a)   Termination Other Than Death, Disability or Retirement. If a Participant's employment with the Company or a Designated Subsidiary terminates for any reason other than death, Disability or Retirement, the Participant will cease to participate in the Plan and the Company or its designee will refund the balance in the Participant's Payroll Deduction Account.

        (b)   Ineligible Employee. In the event of a Participant's death, or the Participant ceases to be an eligible Employee for any reason other than employment termination at any time during a Purchase Period, at the election of the Participant, or the Participant's legal representative in the event of the Participant's death, the Participant's Payroll Deduction Account balance will be (i) distributed to the Participant, or to the Participant's estate in the event of the Participant's death, or (ii) held until the end of the Purchase Period and applied to purchase Shares in accordance with Section 7.

        (c)   Termination Due to Disability or Retirement. If a Participant's employment with the Company or a Designated Subsidiary terminates during a Purchase Period due to Disability or Retirement no more than three months before the Purchase Date for the Purchase Period, then, at the Participant's election, the Participant's Payroll Deduction Account balance will be (i) distributed to the Participant, or (ii) held until the end of the Purchase Period and applied to purchase Shares in accordance with Section 7. Section 10(c)(ii) shall apply in the event the Participant fails to make a timely election pursuant to rules established by the Committee.

        (d)   Leaves of Absence. The Committee may establish rules regarding when leaves of absence will be considered a termination of employment. Notwithstanding the foregoing, where a period of leave exceeds ninety (90) days, a Participant's employment relationship with the Company or a Designated Subsidiary will be deemed to have terminated on the 91^st day of such leave unless the Participant's right to reemployment is guaranteed either by statute or contract.

Section 11
PLAN ADMINISTRATION

        The Plan will be administered by the Committee, which will be appointed by the Board. The Committee will be the Compensation Committee of the Board unless the Board appoints another committee to administer the Plan. The Board from time to time may fill vacancies on the Committee. Subject to the express provisions of the Plan, the Committee will have the discretionary authority to interpret the Plan; to take any actions necessary to implement the Plan; to prescribe, amend, and rescind rules and regulations relating to the Plan; and to make all other determinations necessary or advisable in administering the Plan. All such determinations will be final and binding upon all persons. The Committee may request advice or assistance or employ or designate such other persons as are necessary for proper administration of the Plan.

Section 12
RIGHTS NOT TRANSFERABLE

        Rights under the Plan are not transferable by a Participant and, during the Participant's lifetime, may be exercised only by the Participant.

5

Section 13
RESERVED SHARES

        Subject to adjustments as provided in Section 14, the maximum number of Shares available for purchase on or after the Effective Date is: (i) 21,493,660 Shares with respect to options and issuances of Shares that are intended to qualify under Code Section 423 (less Shares issued under The Home Depot, Inc. Amended and Restated Employee Stock Purchase Plan with respect to the Purchase Period ending April 18, 2003), and (ii) 21,245,516 Shares (less Shares issued under The Home Depot, Inc. Amended and Restated Non-U.S. Employee Stock Purchase Plan with respect to the Purchase Period ending April 18, 2003) with respect to options and issuances of Shares under Section 18 that are not intended to qualify under Code Section 423. Shares issued under the Plan may be Shares of original issuance, Shares held in treasury, or Shares that have been reacquired by the Company.

Section 14
CAPITAL CHANGES

        In the event of a Corporate Transaction, other than a Corporate Transaction in which the Company is not the surviving corporation, the number and kind of shares of stock or securities of the Company to be subject to the Plan, the maximum number of shares or securities that may be delivered under the Plan, and the selling price and other relevant provisions of the Plan will be appropriately adjusted by the Committee, whose determination will be binding on all persons. If the Company is a party to a Corporate Transaction in which the Company is not the surviving corporation, the Committee may take such actions with respect to the Plan as the Committee deems appropriate.

Section 15
AMENDMENT

        The Board may at any time, or from time to time, amend the Plan in any respect. The stockholders of the Company, however, must approve any amendment that would increase the number of Shares that may be issued under the Plan pursuant to options intended to qualify under Code Section 423 (other than an increase merely reflecting a change in capitalization of the Company pursuant to Section 14) or a change in the designation of any corporations (other than a Subsidiary) whose employees become Employees under the Plan.

Section 16
PLAN TERMINATION

        The Plan and all rights of Employees under the Plan will terminate: (a) on the Purchase Date on which Participants become entitled to purchase a number of Shares greater than the number of reserved Shares remaining available for purchase as set forth in Section 13, or (b) at any date at the discretion of the Board. In the event that the Plan terminates under circumstances described in (a) above, reserved Shares remaining as of the termination date will be made available for purchase by Participants on the Purchase Date on a pro rata basis based on the amount credited to each Participant's Payroll Deduction Account. Upon termination of the Plan, each Participant will receive the balance in the Participant's Payroll Deduction Account.

Section 17
GOVERNMENT REGULATIONS

        The Plan, the grant and exercise of the rights to purchase Shares under the Plan, and the Company's obligation to sell and deliver Shares upon the exercise of rights to purchase Shares, will be subject to all applicable federal, state and foreign laws, rules and regulations, and to such approvals by any regulatory or government agency as may, in the opinion of counsel for the Company, be required or desirable. The Committee may withhold from any payment due under the Plan or take any other action it deems appropriate to satisfy any federal, state or local tax withholding requirements.

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Section 18
FOREIGN JURISDICTIONS

        The Committee may adopt rules or procedures to accommodate the requirements of local laws of foreign jurisdictions, including rules or procedures relating to the handling of payroll deductions, conversion of local currency, payroll taxes and withholding procedures. The Committee may also adopt rules and procedures applicable to specific Designated Subsidiaries or locations that are not intended to be within the scope of Code Section 423, which may differ from the other provisions of the Plan, subject to the provisions of Section 13.

Section 19
GOVERNING LAW

        The Plan will be governed by the laws of Delaware, without regard to that State's choice of law rules.

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THE HOME DEPOT, INC. AMENDED AND RESTATED EMPLOYEE STOCK PURCHASE PLAN (As Amended and Restated Effective July 1, 2003)

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				Nine Months Ended
			November 2, 2003		November 3, 2002		November 2, 2003		November 3, 2002
BASIC
Net Earnings Available to Common Shareholders			$	1,147	$	940	$	3,353	$	2,978
Weighted Average Common Shares				2,280		2,337		2,289		2,347
		Basic Earnings Per Share	$	0.50	$	0.40	$	1.46	$	1.27
DILUTED
Net Earnings Available to Common Shareholders			$	1,147	$	940	$	3,353	$	2,978
Weighted Average Common Shares				2,280		2,337		2,289		2,347
Effect of Potentially Dilutive Securities:
	Employee Stock Plans			7		6		6		9
Diluted Weighted Average Common Shares				2,287		2,343		2,295		2,356
		Diluted Earnings Per Share	$	0.50	$	0.40	$	1.46	$	1.26

        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 64.8 million and 72.1 million shares of common stock at November 2, 2003 and November 3, 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 November 17, 2003, included within the Quarterly Report on Form 10-Q of The Home Depot, Inc. for the quarter ended November 2, 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. Restated and Amended Employee Stock Purchase Plan	333-110423
	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
December 2, 2003

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INDEPENDENT ACCOUNTANT'S ACKNOWLEDGEMENT

EX-31.1

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Exhibit 31.1

CERTIFICATIONS

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

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CERTIFICATIONS

EX-31.2

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Exhibit 31.2

CERTIFICATIONS
(Continued)

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

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CERTIFICATIONS (Continued)

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 November 2, 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
December 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 November 2, 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
December 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