MINNEAPOLIS — Minnesota-based Target is hitting the earnings bullseye, posting record sales for the quarter ending Aug. 1.
Target Corp. on Wednesday reported fiscal second-quarter net income of $1.69 billion, a figure CNBC says is up 80.3 %. Target said it had profit of $3.35 per share and that earnings, adjusted for one-time gains and costs, came to $3.38 per share.
The results more than doubled Wall Street expectations. The average estimate of 12 analysts surveyed by Zacks Investment Research was for earnings of $1.64 per share.
Sales online and at stores open for at least a year climbed by 24.3% during the quarter, an all-time high for the retailer. Same-store sales climbed by 10.9% while the company’s digital sales nearly tripled from a year earlier.
"Our second quarter comparable sales growth of 24.3 percent is the strongest we have ever reported, which is a true testament to the resilience of our team and the durability of our business model," said Target CEO Brian Cornell in a written statement. "Our stores were the key to this unprecedented growth, with in-store comp sales growing 10.9 percent and stores enabling more than three-quarters of Target's digital sales, which rose nearly 200 percent."
Target posted revenue of $22.98 billion in the period, also exceeding Wall Street forecasts. Seven analysts surveyed by Zacks expected $20.24 billion.
Target shares have climbed nearly 7% since the beginning of the year, while the Standard & Poor's 500 index has risen almost 5%. The stock has climbed 58% in the last 12 months.
Target, Walmart and Home Depot have all benefited as Americans limit their trips to a few stores and focus on stay-at-home activities, from cooking to do-it-yourself projects and decorating. Minneapolis-based Target said Wednesday that comparable sales, which include online sales, soared 24.3% in the three-month period that ended Aug. 1. Online sales surged 195%. The company says shoppers bought a wide variety of items from food to clothing.
Walmart, Home Depot and now Target have reported eye-popping sales over the past three months as Americans limit their supply runs to fewer stores and do more cooking and do-it-yourself projects at home.
The shift in behavior is reshaping the retail landscape at the expense of mall-based retailers and other stores forced to close this year. Many were struggling before the pandemic because of what Americans buy and where they buy it.
The pandemic has put those retailers in further in peril.
Dozens, including J.C. Penney, Neiman Marcus and J.Crew, have filed for bankruptcy protection this year. Another wave is expected in the fall with the U.S. failure to contain the virus accelerating the demise of more companies in the sector.
Americans came to rely on big box retailers for supplies early when the economy was under lock down. The surge in new infections is keeping Americans closer to home in many places, and they're increasingly relying on same-day delivery and curbside pickup. Big box retailers had pushed aggressively into those areas before the pandemic, attempting to keep pace with Amazon.com.
