What Investors Need to SEE About Lowe's (LOW) Stock

The next time you walk into Lowe's, I want you to have your head on a swivel...

Because you're going to see your familiar hardware store a little differently.

Take out your phone and open the Lowe's app.

Look at the cameras above the checkout.

And the next time you're wandering around the fastener aisle, wondering which of the bolts has the correct thread count...

Look up.

Something may be looking back at you.

Lowe's is experimenting with (and deploying) artificial intelligence throughout its stores.

Computer vision. Intelligent cameras. Virtual replicas of entire stores.

And AI that sells more products.

But some of the biggest changes are happening where you can't see them...

Behind the scenes, thousands of people manage inventory, suppliers, pricing, marketing, and all the other things required to run an $86 billion business.

AI is coming for those jobs, too.

And over the next two issues, I'll prove it to you by exploring how AI is transforming two companies within driving distance of every American.

Lowe's and Home Depot.

Not because they're AI companies...

But to show you how AI is helping them survive through a period of economic change.

The $86 Billion Hardware Store

First, consider how Lowe's makes money.

In fiscal 2025, the company generated $86.3 billion in revenue across roughly 1,760 retail stores.

Or $50 million per store.

That's a lot of lumber.

But Lowe's actually serves several different customers.

There's the DIY homeowner buying paint, Klein tools, a random tomato plant, and random fasteners to make three trips before finding the right one.

Then there's the professional contractor.

Electricians. Plumbers. Roofers. General contractors.

These customers buy frequently. They need supplies in volume, reliable inventory, and delivery to job sites.

Professional customers now represent roughly 30% of Lowe's sales, up substantially from several years ago.

And Lowe's has expanded into larger contractor markets through acquisitions, including Foundation Building Materials and Artisan Design Group.

Then there are the upscale homeowners.

They want a new fan or dishwasher or deck or flooring and have the disposable income to pay someone else to do it.

Naturally, the business is seasonal.

Spring brings lawn care, gardening, decks, and outdoor projects. Christmas decorations help during the holidays, but winter is still the slowest season.

And operating all these stores is expensive.

Electricity. Trucks. Warehouses. Inventory. Employees.

Now, let's take a trip to one...

An Expert in Your Pocket

Before you leave for Lowe's, open its app.

You'll find an AI assistant called Mylow.

Ask it how to repair a leaky faucet. Or what materials you need for a deck.

It can help explain a project, recommend products, check availability, and point you toward what you need.

And here's something especially interesting for readers with compatible iPhones.

Lowe's now supports Apple's Visual Intelligence for shopping.

Take a photograph (or even a screenshot) and use it to discover similar products and styles sold by Lowe's.

Your phone's camera is becoming a shopping assistant.

Imagine finding a mysterious part in your garage.

Instead of trying to describe the thing, you show it to a computer.

This is one of the most important advances in AI: the ability to interpret images rather than depend entirely on words.

It's called computer vision.

And when computer vision works with a language model, the software can begin answering questions about the physical world.

But there's a business reason Lowe's is doing all this.

In August, CEO Marvin Ellison reported that Mylow had answered more than 25 million questions from customers and employees.

Even more interesting: Customers using Mylow online converted into buyers at three times the rate of customers who didn't.

So...

AI doesn't just answer questions.

It can help turn uncertainty into a sale.

The Cameras Are Getting Smarter

Now let's go inside the store.

At my local Lowe's, I can scan and pay for my purchases at self-checkout.

But the Romex electrical wire?

As I've written about before... it's safe from thieves, locked behind bars.

Apparently, DD's copper call has done so well that the wire now needs its own security detail.

And finding someone with a key can be an adventure.

It's an interesting contradiction.

Lowe's trusts customers to operate the cash register...

But not to retrieve certain merchandise.

The company has a technological answer to part of this problem.

It's called Nudge.

Developed with NVIDIA, Nudge uses AI-powered computer vision at assisted self-checkout to detect discrepancies when a customer fails to scan an item.

The system prompts the customer to correct the mistake. If the mismatch remains unresolved, it can alert an employee.

Next time you're checking out at Lowe's, look at the cameras around the scanning area.

Some checkout stations may use technology that does more than record video.

The software is interpreting what happens.

Not every camera is an AI camera, and Lowe's hasn't disclosed that every checkout uses Nudge.

But the direction is clear.

Traditional surveillance records the world for playback.

Computer vision tries to understand it in real time.

And it isn't confined to the checkout.

Is Somebody Watching the Fastener Aisle?

Suppose you're standing in front of a wall of fasteners.

You pick up one. Put it back.

Pick up another. Scratch your head.

Lowe's has developed a computer-vision application called Dwell.

Using camera feeds, the system identifies areas where customers linger and may need help.

It can alert nearby employees to offer assistance.

The camera doesn't have to know your name.

It just needs to recognize a pattern.

Someone's been standing and staring at screws for a while...

Perhaps a salesperson should check on them.

Of course, some customers may prefer to be left alone...

But from Lowe's perspective, this is an opportunity to make employees more productive.

Instead of wandering the aisles looking for customers, employees can be directed toward people who might actually need assistance.

And that's only part of what the company is building.

Working with NVIDIA, Lowe's has created digital twins of more than 1,750 stores.

Think of them as detailed virtual replicas.

Management can experiment with layouts, merchandise placement, and inventory arrangements inside a computer before moving any physical products.

Even better, these digital models can incorporate changing store information.

A task that once required spreadsheets, physical inspections, and a small army of planners can increasingly be simulated.

The hardware store is becoming a computer model of itself.

Which brings us to all those employees you don't see...

The White-Collar Wipeout?

Now consider the people working behind the scenes.

Lowe's reported approximately 276,000 employees at the end of fiscal 2025.

About 167,000 were full-time. Another 109,000 were part-time.

In fiscal 2023, Lowe's employed 284,000 people.

By fiscal 2024, that number had dropped to 270,000.

That's 14,000 fewer employees in a single year.

Then, in fiscal 2025, employment increased by 6,000.

At first glance, that looks like Lowe's is hiring again.

But there's a catch.

Lowe's acquired two companies in 2025: Artisan Design Group and Foundation Building Materials.

Those acquisitions brought approximately 11,000 employees into the business.

Think about that.

Lowe's added roughly 11,000 people through acquisitions.

Yet its total workforce increased by only 6,000.

That suggests the rest of the business may have actually shed approximately 2% or 5,000 positions.

We don't know what those positions were.

But consider what you've already seen.

The Lowe's app can answer questions about home repairs, recommend products, and even tell you which aisle and bay contains what you're looking for.

Those are questions you might once have asked a salesperson.

Meanwhile, Lowe's has equipped its store associates with Mylow Companion, which helps even inexperienced employees answer questions about products and projects across departments.

One employee can potentially accomplish more.

Lowe's hasn't disclosed a reduction in sales-floor staffing attributable to AI...

But the implications for future hiring are obvious.

If customers can help themselves, and employees become more productive, does Lowe's need to hire as many people as its business grows?

Also, consider the workers you never see.

Buyers. Merchandisers. Analysts. Accountants. Technology workers. Marketing teams.

In December 2025, CEO Marvin Ellison described how merchants might spend half their time building spreadsheets, responding to emails, and communicating with suppliers.

What if AI could take that work away?

Ellison suggested employees could redirect that time toward increasing sales.

That's certainly possible.

But what happens when a company no longer needs as many people to do the same amount of work?

In February 2026, Lowe's eliminated approximately 600 corporate and support positions.

The company said the reductions would help redirect resources toward stores and customer service.

It didn't say AI caused the layoffs.

But last November, Ellison reported that AI-assisted software development and code reviews were already producing double-digit productivity gains in the company's technology operations.

And that's the investment implication.

AI may allow Lowe's to grow without increasing employment at the same pace.

Some jobs could disappear through layoffs.

Others through retirements, attrition, and positions that simply aren't refilled.

The White-Collar Wipeout may have begun without anyone announcing a wipeout.

And notice the irony.

In the store, AI helps an inexperienced employee become more capable.

At headquarters, the same technology may eventually reduce how many employees the company needs.

For investors, that creates an intriguing opportunity.

Not necessarily a business that sells dramatically more.

A business that can accomplish dramatically more with the people it already employs...

And will do well in the next housing cycle.

Half a Percent Is a Lot of Money

Now consider the economics of efficiency.

Lowe's has $86.3 billion in annual sales.

Suppose smarter inventory systems, computer vision, and AI-powered office automation collectively improve its operating margin by just half a percentage point.

That's roughly $431 million in additional annual operating profit.

Not revenue. Operating profit.

Of course, that's not a forecast of AI savings...

But there are plenty of opportunities for improved efficiency...

• Better forecasting means less inventory collecting dust.

• Smarter checkout can reduce theft and scanning errors.

• AI-assisted employees might make more sales.

• And automated office work could reduce administrative expenses.

But Lowe's also has a significant problem.

Energy Costs

Its costs aren't standing still.

In its second-quarter 2026 results, Lowe's said higher fuel and transportation costs ate up most of a tariff-refund benefit.

Ellison also identified elevated transportation, energy, and other input costs as pressures the company was absorbing.

The trucks need diesel. The stores need electricity. Employees need wages and benefits.

And customers don't particularly want to pay more for a tool they've seen double in price since the last time they replaced it.

AI doesn't eliminate these costs.

But it might help offset them.

That's why I increasingly see AI as a survival technology for mature businesses.

Not necessarily a way to grow sales 50%.

A way to defend profits when the economy refuses to cooperate.

The Housing Market Won't Help Much

Unfortunately, Lowe's has one problem artificial intelligence can't solve.

ChatGPT can't convince me to give up my 2.99% mortgage.

(I was upset at the time because I could have gotten one at 2.75%!)

Millions of homeowners like me are staying put rather than moving and financing another house at today's higher rates.

Younger buyers face expensive homes, large down payments, and affordability problems.

In a 2025 National Association of Realtors survey, first-time buyers represented just 21% of homebuyers.

Their median age had climbed to 40.

That's not encouraging for a company that benefits when people move, renovate, and improve their houses.

And last month, Harvard's Joint Center for Housing Studies released another disappointing forecast.

It expects annual spending on improvements and repairs to owner-occupied homes to hover around $525 billion through the third quarter of 2027.

Essentially flat.

That said...

Eventually, the enormous transfer of wealth from older Americans to their children may help unlock housing demand...

But that's not something investors can confidently put on next year's calendar.

Meanwhile, Lowe's must operate in the housing market we actually have.

There's a silver lining.

Houses don't get younger.

Air conditioners break.

Roofs leak.

Pipes burst.

And older homeowners staying in their properties still need repairs, replacements, and accessibility improvements.

The demand for home maintenance doesn't disappear just because home sales slow.

The Stock: Buy the Hardware Store?

As of November 6, Lowe's stock closed at approximately $225, trading at about 19 times trailing earnings.

That's a more reasonable valuation than many high-growth technology stocks.

But don't confuse Lowe's with an AI startup.

Its future still depends heavily on home-improvement demand, competition, and operating costs.

The company has also taken on debt to expand its contractor-supply business.

And its biggest competitor, Home Depot, isn't standing still.

As we'll see in my next issue, it has its own ambitious AI program.

For a patient investor, I see it as a potential housing-recovery and productivity investment.

At this valuation, it's worth considering a modest position for the long term...

But I'm not expecting an AI-driven earnings explosion next quarter.

I'm one of those people who enjoy going to Lowe's not just to buy a niche tool I'll only use once...

But also for the boots-on-the-ground research.

At home, I'll be following the quarterly reports for you because...

I want to see whether all this technology begins producing measurable improvements in operating margins, customer spending, and efficiency.

And I want to see what happens when the housing market finally recovers.

Because that's when things could get interesting.

A more efficient company. Serving more customers.

With a workforce capable of accomplishing more than it did before.

That's operating leverage.

And it may be where the next phase of the AI investment story takes us.

Not just building bigger AI models.

But using intelligence to make enormous, familiar businesses work better.

The Next Time You Walk Into Lowe's...

Open the app.

Look at the cameras.

Watch how employees find products and answer questions.

Think about the thousands of people behind the scenes who keep those shelves stocked.

And remember: The store you see is only half the business.

The other half is becoming increasingly digital.

The intelligence running the operation is changing...

And if Lowe's gets this right, the hardware store of the future may look almost exactly like the one you already know.

It'll just be a much more efficient (and profitable) business.

Until then, I'll be waiting for the day I can ask Mylow for a roll of Romex... and hear the cage unlock.

Next issue, we'll visit Home Depot (a farther drive for me) and see how computer vision and AI are moving beyond the retail store into America's construction industry.

Always be prospering,

Harry Seldon
Moonshot Minute

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