Target Corp. reported disappointing first-quarter results on Wednesday, missing Wall Street estimates and revising its full-year outlook downward. The news weighed on the stock, which slipped 1.5% in premarket trading.
For the quarter ending April 29, the retail giant posted adjusted earnings per share of $1.30, falling short of analysts’ expectations of $1.65. Revenue came in at $23.85 billion, below the consensus estimate of $24.35 billion and representing a 2.8% year-over-year decline.
The company experienced a 3.8% drop in comparable sales, driven largely by a 5.7% decrease in in-store sales, which was partially offset by 4.7% growth in digital revenue.
“While our sales fell short of our expectations, we saw several bright spots in the quarter, including healthy digital growth, led by a 36% increase in same-day delivery through Target Circle 360,” said CEO Brian Cornell, commenting on the results amid what the company called a “highly challenging environment.”
Looking ahead, Target now anticipates a slight decline in sales for fiscal 2025, with adjusted earnings per share expected to land between $7.00 and $9.00. That marks a significant reduction from its prior guidance, which projected modest sales growth of about 1% and EPS in the $8.80 to $9.80 range.
In response to the current headwinds, Target announced the launch of a “multi-year acceleration office” to drive organizational efficiency and strategic execution. The initiative will be led by Michael Fiddelke, who will oversee efforts to streamline decision-making and help return the business to growth.