Target’s (NYSE: TGT) profit tumbled nearly 50% in its fiscal third quarter as it cleared unwanted inventory and sales slowed amid the approaching holidays. Amid the results, the company lowered its expectations for its most important time of year. Target shares fell over 15% on Wednesday.
The big box department store chain reported earnings of USD1.54 per share, compared to the expected USD2.13 a share. Revenue amounted to USD26.52 Billion, higher than analysts anticipated USD26.38 Billion.
“I’m really pleased with the underlying performance of our business, which continues to grow traffic and sales while delivering broad-based unit-share gains in a very challenging environment,” said Brian Cornell, chairman, and chief executive officer of Target Corporation. “I want to thank our team for their tireless work to deliver on the inventory rightsizing goals we announced in June. While these inventory actions put significant pressure on our near-term profitability, we’re confident this was the right long-term decision in support of our guests, our team, and our business. Looking ahead, the team is energized and ready to serve our guests in the back half of the year, with a safe, clean, uncluttered shopping experience, compelling value across every category, and a fresh assortment to serve our guests wants and needs.”
The retailer’s sales fell as people dealt with increasing prices, battling what they want and what they actually need. Ultimately, all signs point to a potentially slow holiday shopping season.
Target’s shares have fallen over 22% throughout the year and have a current market value of approximately USD83.38 Billion.