Target’s shares are surging more than 17% in Wednesday premarket trading following a stellar earnings report that saw the retailer hike its outlook for the full year.
During the second quarter, the Minneapolis-based company posted profits of $938 million on adjusted earnings of $1.82 per share — a 23.9% jump from the previous year and better than Wall Street’s forecasts of $1.62 a share. Revenues climbed 3.6% to $18.42 billion, topping estimates of $18.34 billion.
The big-box chain likely saw a sales boost from its Deal Days promotional event held on July 15 and 16 that competed with Amazon’s 48-hour Prime Day shopping extravaganza. (According to Adobe Analytics, U.S. online retailers with annual revenue of at least $1 billion saw sales increase 64% on July 15 compared with an average Monday and 72% on July 16 compared with an average Tuesday.)
“By appealing to shoppers through a compelling assortment, a suite of convenience-driven fulfillment options, competitive prices and an enjoyable shopping experience, we’re increasing Target’s relevancy and deepening the relationship between our guests and our brand,” said chairman and CEO Brian Cornell.
In the past year, Target has accelerated its omnichannel strategy with same-day fulfillment options and developed its portfolio of private label brands as well as remodeled and opened more stores. Despite a two-hour long cash register outage that hit stores nationwide in mid-June, the company logged same-store sales of 3.4%, growing about 10% over the last two years — its best performance, added the retail giant, in more than a decade.
“Traffic and sales continue to grow while our EPS reached an all-time high,” Cornell added, “driven by the strength of our team’s execution and their focus on delivering for our guests.”
Target’s performance in the first half of the year led to an increase in its overall guidance. The company now expects adjusted earnings per share in the range of $5.90 to $6.20, compared with the prior $5.75 to $6.05.
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