Target posted mixed fourth-quarter results, beating Wall Street on earnings despite a comparable sales slip as the retailer looks to strengthen merchandising under new CEO Michael Fiddelke.
Net earnings were $1.05 billion, or $2.30 per diluted share, versus $1.1 billion, or $2.41 per diluted share, in the year-earlier quarter. Adjusted for one-time events, Target earnings per diluted share were $2.44 versus $2.41 in the period a year previous, the company reported.
An analyst consensus estimate published by Zacks Investment Research called for earnings per adjusted diluted share of $2.17, with revenues of $30.52 billion.
Fourth-quarter comparable sales slipped 2.5% year over year, reflecting a com store sales decline of 3.9% and a comp digital sales increase of 1.9%. Net sales were $30.45 billion versus $30.92 billion in the year-prior quarter. Operating income was $1.38 billion versus $1.47 billion in the year-before period, while adjusted operating income was $1.47 billion versus $1.47 billion.
According to Target, the Food and Beverage, Beauty and Toys departments delivered net sales growth in the quarter, along with stronger trends in Essentials and Home versus the third quarter.
For the full fiscal year, Target net earnings were $3.71 billion, or $8.13 per diluted share, versus $4.09 billion, or $8.86 per diluted share in the year earlier. Adjusted diluted earnings per share were $7.57 versus $8.86 in the year previous the company stated.
Net sales were $104.78 billion versus $106.57 billion in the year prior. Operating income was $5.12 billion versus $5.57 billion in the year before, and adjusted operating income was $4.78 billion versus $5.57 billion.
Target revealed guidelines for the fiscal year ahead including net sales growth in a range around 2% versus 2025 and adjusted earnings per share of $7.50 to $8.50.
In announcing the financial results, Fiddelke said, “Our team is firmly focused on writing Target’s next chapter of growth, rooted in strengthening our merchandising authority, delivering an elevated and differentiated shopping experience, advancing our use of technology and continuing to serve and invest in our team and communities. Target saw a healthy, positive sales increase in February, serving as an important milestone on our path back to growth this year and reinforcing my confidence in the momentum we’re building and the future we’re creating together.”
