Target shares sank 10% in premarket trading after the retailer posted a Q2 earnings beat but reiterated expectations for a sales drop this year.
The company also announced that longtime CEO Brian Cornell would step down.
Adjusted earnings per share came in at $2.05, versus Wall Street’s estimate of $2.04. Revenue landed at $25.2 billion, compared with forecasts of $24.9 billion. Meanwhile, same-store sales fell 1.9%, better than the projected 2.9% decline, per FactSet.
Looking ahead, Target affirmed its full-year guidance. For fiscal 2025, it expects a low single-digit sales decline and adjusted EPS ranging between $7.00 and $9.00, the midpoint of which is well above the $7.30 from analysts polled by Bloomberg.
Target has been fighting through a sales slump and lowering prices to win shoppers back. But it hasn’t been enough to stop the bleed: last week, Bank of America analysts downgraded their rating for the stock to “underperform,” warning that the retailer was already lagging peers and would need to raise prices by roughly 8% on average to fully offset tariffs expected in fiscal 2027.
And now, the retailer’s leadership is set to change. Longtime CEO Brian Cornell will step down in February after more than a decade at the helm. He’ll be succeeded by current Chief Operating Officer Michael Fiddelke, who has been with the company for nearly 20 years.
Target shares were down 23% year to date prior to earnings.
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