🔹 Revenue: $23.85B (Est. $24.35B) 🔴; DOWN -2.8% YoY
🔹 Adj EPS: $1.30 (Est. $1.65) 🔴
FY25 Guidance:
🔹 Revenue: Now expects low-single-digit decline (Previously: growth) 🔴
🔹 Adjusted EPS: $7.00–$9.00 (Prior: $8.80–$9.80, Est. $8.43) 🔴
Q1 Comparable Sales:
🔹 Total Comp Sales: -3.8% (Est. -1.96%) 🔴
🔹 Comp Store Sales: -5.7%
🔹 Comp Digital Sales: +4.7%
🔹 Same-Day Delivery (via Target Circle 360): +36% YoY
Other Metrics:
🔹 Operating Income: $1.5B; UP +13.6% YoY
🔹 Adj Operating Margin: 3.7% (Excludes settlement impact)
🔹 SG&A Expense Rate: 19.3% (vs. 21.0% YoY); Adjusted SG&A Rate: 21.7%
🔹 Interest Expense: $116M (vs. $106M YoY)
🔹 Effective Tax Rate: 25.0% (vs. 22.7% YoY)
Strategic and Operational Updates:
🔸 Designer collaboration with Kate Spade was Target’s strongest in over a decade
🔸 Seasonal sales during Valentine’s Day and Easter outperformed non-seasonal periods
🔸 A new multi-year "acceleration office" launched, led by Michael Fiddelke, to improve agility and drive long-term growth
🔸 Settlement of credit card interchange fee litigation added $593M in pre-tax gains in Q1
Capital Allocation:
🔹 Dividend Paid: $510M (UP +1.8% YoY)
🔹 Share Buybacks: $251M; 2.2M shares at avg. $114.60
🔹 Remaining Buyback Authorization: $8.4B
🔹 ROIC (Trailing 12 Months): 15.1% (vs. 15.4% YoY)
CEO Brian Cornell’s Commentary:
🔸 "While our sales fell short of expectations, digital grew healthily, with Target Circle 360 driving 36% YoY same-day delivery growth. Kate Spade for Target was our strongest designer collaboration in over a decade. We’re not satisfied with current performance and have initiated leadership changes and strategic acceleration to unlock future growth."