Traffic drives Target (TGT) Q3 sales growth
13:59, 17 November 2021
Target is taking on more staff as the US retailer reported third-quarter earnings that beat analyst expectations.
On an earnings call, Target CEO Brian Cornell said the company was investing $75m over the holiday season on more pay, flexibility and reliable hours for its staff.
Cornell said the company was hiring an additional 100,000 seasonal staff, plus 30,000 new supply chain team members.
Many companies in North America are experiencing a phenomenon known as “The Great Resignation” as workers in both blue- and white-collar jobs choose to quit the workforce.
For the third-quarter ended 30 October, net income rose 47% to $1.49bn from $1.01bn a year earlier, according to a press release.
Revenue rose 13% to $25.65bn from $22.63bn in the third quarter of 2020.
Adjusted earnings per share (EPS) rose 9% to $3.03 from $2.79 a year earlier.
Diluted EPS was $3.04 compared with $2.01 a year ago.
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Analysts were expecting EPS of $2.82 on sales of $24.61bn, according to figures widely available on financial news sites.
Target said comparable sales – a key retail metric – were up 12.7% in the third quarter, while digital comparable sales were up 29%.
“Following comp growth of nearly 21% a year ago, our third-quarter comp increase of 12.7% was driven entirely by traffic, and reflects continued strength in our store sales, same-day digital fulfillment services and double-digit growth in all five of our core merchandising categories,” Cornell said in the press release.
Looking ahead, the Minneapolis, Minnesota-based company said it expects comparable sales to grow in the high-single-digit to low-double-digit range compared with prior guidance for a high-single-digit increase.
Target still expects its full-year operating income margin rate will be 8% or higher.