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Lowe's posts earnings miss, revenue beat on big ticket sales

Lowe's missed earnings expectations on Wednesday but reported a 4.5 percent rise in quarterly sales as demand rose for products such as appliances and outdoor power equipment.

The shift toward bigger ticket items most likely accounted for slight weakness in gross margins, said Brian Nagel senior equity research analyst at Oppenheimer. Those high-priced items typically have lower margins, so while they boost revenues, they hurt profitability, he told CNBC's "Squawk Box."

Shares of Lowe's were down 1 percent in premarket trading. (Get the latest quote here.)

The No. 2 U.S. home improvement chain posted second-quarter earnings of $1.20 per share, up from $1.04 a share in the year-earlier period.

Revenue rose to $17.35 billion from $16.6 billion a year ago.

Read MoreLowe's still lags Home Depot on execution: Analyst

Wall Street had expected Lowe's to deliver quarterly earnings per share of $1.24 on $17.27 billion in revenue, according to consensus estimates from Thomson Reuters.

The company's same-store sales rose 4.3 percent in the second quarter, stronger than the 3.9 percent expected by analysts polled by research firm Consensus Metrix.

Lowe's said it expects full-year earnings of $3.29 per share.

On Tuesday, Home Depot attributed its earnings beat to the ongoing recovery of the U.S. housing market, and U.S. data showed housing starts approached an eight-year-high in July.

Read MoreRecovery in US housing market drives Home Depot sales beat

Last month, Lowe's announced it plans to open two Manhattan locations over the next few months, its first in the city.

Lowe's shares are up 6 percent year to date, while the S&P 500 index is up nearly 2 percent. The retailer's stock is up 45 percent in the last 12 months.

—CNBC's Krystina Gustafson and Tom DiChristopher and Reuters contributed to this report.