The Target logo is displayed at a Target store on August 20, 2024 in Los Angeles, California. Target is set to release its second quarter earnings report before tomorrow's opening bell. Mario Tama/Getty Images
Target announced on August 21, that that it had achieved a 3% increase in sales for its fiscal second quarter, as shard by CNBC. Following better-than-expected results, Target's stock also soared, which is massive return to growth after a period of sluggish sales and reduced profits.
The company also exceeded Wall Street's expectations for both earnings and revenue, hence, the rise in its share price.
As specified by Target itself, the increase in sales was driven by more visits to Target's stores and website, as well as higher purchases of non-essential items like clothing. While this is is a positive performance, Target has taken a cautious approach to its full-year sales forecast.
Per Investopedia, the company expects comparable sales to be in the lower range of its previous guidance, projecting growth from flat to up 2%. This tempered outlook considers ongoing uncertainties about consumer behavior amid economic concerns.
Unlike sales forecast, however, the same report also stated that Target raised its profit guidance. The company now anticipates adjusted earnings per share to range from $9 to $9.70, up from its earlier forecast of $8.60 to $9.60. This boost in profit expectations means they are now getting confident with their improved financial health and its ability to attract customers with competitive pricing and new merchandise.
With these quarter earnings, Target's net income jumped over 40% year-over-year to $1.19 billion, or $2.57 per share, compared to $835 million, or $1.80 per share, in the same quarter last year. The retailer also benefited from higher digital sales, which grew by 8.7%, as more customers used services like curbside pickup and home delivery.
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