NEW YORK (AP) 鈥� Sales and profits slipped for Target during the crucial holiday quarter as customers held back on spending and the company said there will be 鈥渕eaningful pressure鈥� on its profits to start the year because of tariffs and other costs.
The retailer beat most estimates, however, but shares fell 4.5% in morning trading as the overall market sell-off continued.
Target reported net income of $1.1 billion, or $2.41 per share, far better than the $2.26 that Wall Street was expecting, according to a survey by FactSet. That is down from the $1.38 billion profit the company reported in the same period last year, though the most recent quarter had one fewer week of sales.
Revenue fell to $30.91 billion, from $31.9 billion, but that also beat expectations.
Americans and retailers face a lot of uncertainty in the year ahead.
long-threatened went into effect Tuesday, pushing markets in Asia, Europe, and the U.S. lower, and setting up costly retaliations by the United States鈥� North American allies, not to mention China.
China said Tuesday that it will impose on imports of key U.S. farm products, including chicken, pork, soy and beef, and also expanded controls on doing business with key U.S. companies.
Consumers have already been pulling back on discretionary spending because the costs of groceries have risen so sharply. That is an area where Target can be vulnerable because like clothing, electronics purchases.
Target said Tuesday that it expects sales to be flat in 2025, and that its earnings per share will be between $8.80 to $9.80. Wall Street had been projecting per-share earnings of $9.29 for the year.
During the most recent quarter, comparable sales 鈥� those from stores and digital channels operating for at least 12 months 鈥� rose 1.5%. That was higher than the 0.3% gain during the third quarter. Target posted a 2% gain in the second quarter and a 3.7% drop in the first quarter.
Speaking about the current quarter, Chief Financial Officer Jim Lee said that sales declined in February in part because of brutal weather across the U.S. But sales should pick up, Lee said.
鈥淲e will continue to monitor these trends and will remain appropriately cautious with our expectations for the year ahead,鈥� Lee said.
Anne D'innocenzio, The Associated Press
