The retailer’s sales fell short of expectations, and it slashed its full-year financial forecast, citing a “challenging” economy and backlash over its pullback from diversity policies.
Target’s woes continue.
The underperforming retailer, which has struggled with tariff-fueled anxiety among shoppers and protests in response to its retreat from diversity policies, on Wednesday fell short of expectations for sales last quarter and slashed its full-year financial forecast. Target now expects a “low-single digit decline” in sales this year, down from a previous projection of a small gain made a few months ago.
The gloomy forecast set Target apart from some of its competitors that have in recent days maintained their outlooks, even while warning of the risks and uncertainty generated by President Trump’s tariffs.
Comparable sales at Target last quarter, which ended May 3, fell 3.8 percent from a year earlier, reflecting both fewer visits by shoppers and less spent per transaction. The retailer’s stock fell more than 3 percent in premarket trading as investors digested the weaker-than-expected report.
“We’re not satisfied with current performance,” Brian Cornell, Target’s chief executive, said in a statement. The report was the latest evidence that the retailer’s effort to rebound from a difficult 2024 — a year marked by inconsistent sales growth and a tumbling stock price — has yet to materialize.
A “highly challenging environment” dragged down Target’s financial results, it said; retailers across the board are navigating tariff-fueled cost increases and dampened consumer sentiment.
Price increases in response to tariffs have taken center stage as major U.S. retailers report their latest earnings. When Walmart said last week that it would raise prices for some products because of tariffs, the company faced swift public backlash from Mr. Trump, who called on social media for the company to “EAT THE TARIFFS.” Mattel, the toy company, faced similar ire earlier this month.