Target blames a “highly challenging environment”.
Yahoo!Finance reports Target shares drop: Misses Q1 earnings estimates, cuts full-year outlook
Target reported first-quarter earnings on Wednesday that fell short of analyst expectations and lowered its full-year guidance, sending shares down more than 6% at the open.
The retail giant posted adjusted earnings per share of $1.30 for the quarter ended April 29, missing the analyst consensus of $1.65. Revenue came in at $23.85 billion, below estimates of $24.35 billion and down 2.8% YoY.
Comparable sales decreased 3.8% in the first quarter, reflecting a 5.7% decline in comparable store sales partially offset by 4.7% growth in digital sales. The company cited a “highly challenging environment” for the weaker-than-expected performance.
For fiscal 2025, Target now expects a low-single digit decline in sales and adjusted EPS of $7.00 to $9.00. The retailer previously guided for net sales growth in a range around 1% and adjusted EPS between $8.80 and $9.80
To address current challenges, Target announced the establishment of a “multi-year acceleration office” led by Michael Fiddelke, aimed at enabling faster decision-making and execution of strategic initiatives to support a return to growth.
“Q1 [was] very messy,” stated analysts at Mizuho reacting to the earnings release. However, they add that ” while [it was] a negative print, investors were braced for the worst.”
“The company also lowered the midpoint of their guide…, but given the negative momentum in the biz, potential future price investments and tariffs, we suspect there is risk even to that range,” added the firm. “While the market for discretionary goods remains soft (even Walmart (NYSE:WMT) [WMT, Buy] just posted a slight decline in General Merchandise sales), we also believe that Target is being adversely impacted by competition – especially from Walmart.”
Highly Challenging Market Translated
- Tariffs
- Budget policy
- Trump-sponsored inflation
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Well la de da. So what?
Trump Tells Auto CEOs No Price Hikes, Did Comrade Kamala Win?
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Also consider New Economic Theory “Tariffs Are a Tax Cut for the American People”
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