OAN Staff James Meyers
8:18 AM – Wednesday, November 20, 2024
Target reported earnings Wednesday that came in well below Wall Street’s expectations, which the big retail chain blamed on slower than expected demand.
The company announced profits fell short of estimates by 20%, which is its largest miss in two years. Revenues also came in under expectations for the first time in more than a year.
The poor results happened despite a heavily touted campaign to discount thousands of items, as consumers have fought inflation prices over the past few years.
On a call with reporters, Target CEO Brian Cornell blamed the dismal quarter on “lingering softness in discretionary categories,” as well as costs associated with preparing for the port strike in October.
Target Chief Operating Officer Michael Fiddelke added that it was “disappointing that a deceleration in discretionary demand combined with some cost pressures have caused us to take our guidance back down after raising it last quarter.”
However, Target lowered its profit and sales goals for the year, but Fiddelke said the company feels confident in its long-term outlook.
As a result of the earnings downfall, Target’s shares plummeted 15% in premarket trading due to the announcement.
Additionally, Target’s report comes just a day after rival Walmart reported earnings and revenues that beat expectations.
Despite beating expectations, Walmart pointed out that customers were still holding back in purchasing for compelling deals as the cost of food and other items has risen.
“We’re expecting this holiday period to be very consistent with that,” Walmart Chief Financial Officer John David Rainey told CNBC. “They’re focused on price and value.”
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