The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
NEW YORK, United States — Target Corp's second quarter sales and profit beat estimates on Wednesday, sending its shares up 4 percent in premarket trade, helped by strong online sales and higher customer visits that grew the most in a decade.
The retailer said customer traffic at its stores grew 6.4 percent helped by a strong economy. Rising wages, lower unemployment and tax cuts have put more money in US consumers' pockets this year spurring them to shop more.
That has translated to rising sales for retailers including Target's rivals like Walmart Inc and Nordstrom Inc .
Target has also benefitted from the demise of weaker competitors in the past year. Retail chains including Toys 'R' Us Inc and department store operator Bon Ton Store Inc have either shut down operations or filed for bankruptcy this year. Roughly 4,000 retail stores had shut in the US this year through August 10, according to Coresight Research.
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Second-quarter same-store sales at Target were higher than estimates, rising 4.9 percent. Analysts expected a 3.99 percent increase, according to Thomson Reuters I/B/E/S.
Online sales rose 41 percent in the second quarter, up from a 32 percent rise a year ago and above the 28 percent rise in the first quarter. Excluding items, Target earned a profit of $1.47 per share in the quarter ended August 4, above the average analyst estimate of $1.40. Revenue rose to $17.78 billion, topping the average estimate of $17.31 billion.
For the full year, Target raised its forecast, expecting adjusted earnings of $5.30 to $5.50, compared with the prior range of $5.15 to $5.45. Shares of the Minneapolis-based chain have risen more than 27 percent so far in 2018 and over 47 percent in the past 12 months.
By Nandita Bose; Editor: Patrick Graham and Chizu Nomiyama.
Fast-growing start-ups like Hettas, Saysh and Moolah Kicks created sneakers designed specifically for active women. The sportswear giants are watching closely.
The companies agreed to cap credit-card swipe fees in one of the most significant antitrust settlements ever, following a legal fight that spanned almost two decades.
In an era of austerity on Wall Street, apparel businesses are more likely to be valued on their profits rather than sales, which usually means lower payouts for founders and investors. That is, if they can find a buyer in the first place.
The fast fashion giant occupies a shrinking middle ground between Shein and Zara. New CEO Daniel Ervér can lay out the path forward when the company reports quarterly results this week.