Home Depot Inc's quarterly profit beat Wall Street estimates on Tuesday as the world's largest home improvement chain reined in expenses.

The results came the day after rival Lowe's Cos Inc reported better-than-expected quarterly earnings as it saw some strength in outdoor projects during the spring, even though consumers still kept away big-ticket home renovations.

Shares of both home improvement chains as well as homebuilders rose on Monday following the strong results from Lowe's.

Home Depot, which has been aggressively cutting costs while boosting spending to improve existing stores, also affirmed its fiscal-year outlook.

Net profit rose to $514 million, or 30 cents a share, in the first quarter ended on May 3, from $356 million, or 21 cents a share, a year earlier.

Excluding items, the company earned 35 cents a share. Analysts on average were expecting 28 cents, according to Reuters Estimates.

Sales fell 9.7 percent to $16.2 billion. Sales at stores open at least a year, an important retail performance measure, fell 10.2 percent.

The U.S. housing slump and tight credit market has curtailed demand for big-ticket remodels that powered growth at home improvement chains in recent years.

Our markets, and the consumer in general, remain under pressure, Home Depot Chief Executive Frank Blake said in a statement.

Atlanta-based Home Depot, which shed about 7,000 jobs from the closure of the Expo Design Center chain and other corporate cuts earlier this year, said operating expenses fell 16.4 percent in the first quarter.

For the full year, Home Depot sees sales down 9 percent, with comparable-store sales falling at a high single-digit percentage rate. It expects earnings per share from continuing operations to decline 7 percent.

Home Depot shares were down 2 cents at $26.00 in trading before the opening bell after jumping to $26.75 earlier in the morning.

(Reporting by Dhanya Skariachan; Editing by Lisa Von Ahn)