Home Depot beat fourth-quarter earnings expectations but missed on revenue and issued disappointing guidance for fiscal 2023.

Home-improvement retailer Home Depot (ticker: HD) reported earnings per share of $3.30 in the fourth quarter, beating estimates of $3.28, according to FactSet.

Revenue of $35.8 billion for the three months ended Jan. 29, were below estimates of $36 billion. Comparable sales in the U.S. fell 0.3%.

The company guided for per-share earnings to decline by a mid-single-digit percentage in the full-year 2023. Analysts were expecting per-share earnings to be largely flat in 2023. Home Depot said it expected full-year sales growth to be flat, but analysts were looking for a slight uptick.

Home Depot increased its quarterly dividend by 10% to $2.09 a share, but that, along with the earnings beat, appeared to be overshadowed in the minds of investors by the sales miss and lackluster outlook.

The company also said it will invest $1 billion to give its hourly workers a wage increase.

The stock fell 3.2% in premarket trading Tuesday.

This is a breaking news story with more updates to come. Below is a preview of Home Depot's earnings.

Investors should tread lightly heading into Home Depot's earnings on Tuesday.

With the housing market in a slump thanks to rising mortgage and interest rates, home-improvement demand has softened, analysts say. That augurs poorly for Home Depot's (ticker: HD) fourth-quarter results.

"The softness related to the housing and macro environment should eventually weigh on the broader home improvement demand and HD (and others) would likely not be insulated from industrywide headwinds," wrote Credit Suisse analyst Karen Short. She has a Neutral rating on the stock.

Home Depot stock is down 0.1% this year, and has lost 9% over the course of the past 12 months.

The consensus forecast among Wall Street analysts is that the company will post adjusted earnings of $3.28 a share and $36 billion in revenue, according to FactSet estimates. But J.P. Morgan analyst Christopher Horvers said in a research note that he thinks the numbers may fall a bit short.

Same-store sales are projected to tick up by 0.3%. In the year-ago quarter, same-store sales rose by 8.1%, topping estimates for 5% growth.

It isn't just analysts who are turning wary. Companies that make home building materials, such as Sherwin-Williams (SHW), have recently struck a cautious note on spending trends for 2023.

"We will not be immune from what we expect to be a very challenging demand environment in 2023," said Sherwin Williams CEO John Morikis in late January. "Visibility beyond our first half of the year is limited."

It's still possible that the home improvement retailer's earnings will be "relatively in-line" with estimates, wrote Bradley Thomas, analyst at KeyBanc Capital Markets. After all, Home Depot has beat or met expectations for the past 10 consecutive quarters.

And indeed, there may be a couple of bright spots in Tuesday's report. The company's Pro sales , to contractors, have generally performed well, Thomas wrote, and often do better than those at rival Lowe's (LOW). Home Depot's strength in that market is a good thing in the short term because there is still a lot of work on contractors' books that could drive demand in the first half of the year, analysts say.

What happens to the stock likely will depend on management's financial forecasts. Whether Home Depot echoes Sherwin Williams or opts for a cheerier tune could go a long way in setting expectations for the sector throughout the rest of the year.

Horvers predicts that Home Depot's guidance will be a bit weaker than the Street has predicted, given the economic environment. He kept an Overweight rating on the stock, however, saying he believes Home Depot is "one of the best long-term stories in retail."