Big news out of Atlanta today. The Home Depot had it’s first annual sales decline ever! Whoa! Don’t get your panties in a wad. They still made a lot of money.

Despite a year of retooling its business model by going back to retail basics, Home Depot in 2007 suffered its first-ever decline in annual sales.

In a quarterly earnings report Tuesday, Home Depot said annual sales dipped 2.1 percent, from $79 billion to $77.3 billion. Those results included a 53rd week. Excluding that week, sales for the year declined 3.5 percent, to $76.2 billion. Comparable store sales — which excludes revenue from new stores opened during the year — declined 6.7 percent.

Atlanta-based Home Depot, the nation’s largest home improvement retailer, also missed earnings estimates by three pennies for the fourth quarter of 2007.

Analysts, on average, estimated Home Depot would earn 43 cents a share on sales of $18 billion, according to Thomson Financial.

Instead, the company earned 40 cents per share, on sales of $17.7 billion.

Can Home Depot recover from this decline? What will their shareholders think when they are looking for those missing three cents? Oh, if anything screamed “There goes the economy” this report could be it. (cough)

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