New York – Sales in Target fell more than expected in the first quarter, and the retailer warned that they will slide for 2025 years as their customers, concerned about the impact of rates and the economy, will withdraw the expense.
Target also said that customer boycots have also caused damage during the last quarter. The company reduced many initiatives for diversity, equity and inclusion in January after they were attacked by conservative activists and the White House. Target withdrawal created another violent reaction, with more customers angry at the reduction of the merchandise retailer with the LGBTQ+theme for the month of pride in June 2023.
The shares fell 3% before the opening bell on Wednesday.
Sales fell 2.8% to $ 23.85 billion in the quarter, and that was below the $ 24.23 billion Wall Street, according to Factset. Sales are also low from the $ 24.53 billion that the company reported during the same period last year.
Target reduced its annual sales projections on Wednesday. The company now expects a decrease in a low digit by 2025 after projecting a 1% increase for sales in March.
He also predicted annual profits per share of $ 7 to $ 9, excluding the profits of the legal agreements this year.
For the year, analysts expect profits per share of $ 8.34 in sales of $ 106.7 billion.
Sales of comparable stores, those of established stores and online channels, fell 3.8%. That includes a 5.7% drop in store sales and a 4.7% increase in online sales. That invests a comparable increase in sales of 1.5% stores in the previous quarter.
The number of transactions in online stores and physical fell 2.4%, and the average ticket fell 1.4%. Target said Tuesday that he could not reliably estimate the individual impact of each of the factors that harmed his business.
Target is establishing a new office to be directed by Operations Director Michael Fiddelke would focus on making faster decisions to help accelerate sales growth. The current Director of Strategy and Growth, Christina Hennington, will move to a role of strategic advisor.
Target is also intensifying efforts to attract customers who are nervous about economics and inflation. The retailer says he is offering 10,000 new items from $ 1, with the majority of less than $ 20.
“I want to be clear,” said the CEO of Target, Brian Cornell, to journalists in a call on Tuesday. “We are not satisfied with these results, so we are emerging urgently to navigate during this volatility period … we have to take the return traffic to our stores or visits to our site.”
Of 35 categories of goods, including discretionary and essential elements that the company tracks, it is winning or maintaining market share in just 15, the company said. The company cited that there were some market participation earnings in women’s bath clothes, baby clothes and young children, and active clothing.
The latest results underline Target’s continuous fight in recent years to relive sales, particularly non -essential, such as fashion and home furniture as competition becomes more fierce with people like Walmart and Amazon. Target shares have fallen more than 37% in the last 52 weeks.
Objective rival Walmart reported strong quarterly sales last week. The largest retailer in the nation said that prices have already increased in some items due to tariffs and that more price increases are on their way to this summer when the shopping season return to school is started. For example, the car seats made in China that are currently sold for $ 350 in Walmart will probably cost customers another $ 100, executives said.
Target did not offer details about the impact of prices tariffs, but said he was looking for different ways to compensate for those costs.
“We look at the competition,” Cornell told journalists. “We make adjustments literally every week, so we are constantly adjusting prices. Some are going up. Some will be reduced.”
The threatened import taxes of President Donald Trump in 145% in Chinese products were reduced to 30% In an agreement announced on May 12With some of the highest rates in pause for 90 days.
However, Americans were already withdrawing in spending as they get more and more worry about the state of the US economy. Companies Including the toy manufacturer Mattel, the Stanley Black tool manufacturer AND Giant Procter of Decker and Consumer Products AND Gamble has announced higher prices or plans to increase prices due to the trade war initiated by the United States
Walmart was able to avoid part of the tariff damage that other retailers are suffering because the groceries represent about 60% of their business in the United States. Target depends more on discretionary items such as clothes and accessories, with less than a quarter of its sales from groceries.
Target has reduced the number of its storage label products from China to 30% now 60% in 2017. The company is on the way to reduce that number to 25% at the end of next year, the company said. The goal is changing the supply to Guatemala and Honduras and is looking to supply in the United States
Target is also being pressed on other fronts.
The company in January said it would Philtered a handful of Dei initiativesIncluding a program designed to help black employees to advance their careers and promote black property businesses. Conservative activists and president Donald Trump have tried to dismantle Dei’s policies In the federal government, schools and private companies.
The pastor of a mega from Georgia who directed a country nationwide 40 days Boicot of the target stores in response called last month for a continuation of that effort.
Reverend Jamal Bryant is looking for a revitalized commitment of Target on Diversity, and wants more Target support for black property banks and companies.
The objective earned $ 1.04 billion, or $ 2.27 per share, for the period ended on May 3. That is compared to $ 942 million, or $ 2.03 per share, in the period of the previous year.
Aim It operates almost 2,000 stores Nationwide and uses more than 400,000 people.
