Target Corporation reported fiscal third‑quarter 2025 results on November 19, 2025, with net sales of $25.27 billion—a 1.5% year‑over‑year decline—and comparable sales down 2.7%. Adjusted earnings per share rose to $1.78, beating the consensus estimate of $1.72, while GAAP diluted EPS was $1.51, reflecting the company’s focus on core profitability after excluding non‑recurring charges. Compared with the prior year, net sales were $25.70 billion and comparable sales increased 0.3%, underscoring a gradual shift in consumer spending patterns.
Gross margin contracted to 28.2% from 28.3% in the same quarter last year, a compression driven by higher markdowns to clear inventory, increased promotional activity, and modest inventory shrinkage. The company’s cost‑control initiatives helped keep the margin decline modest, but the pricing pressure in discretionary categories and the need to maintain competitive pricing in the face of discount retailers contributed to the squeeze.
Digital channels continued to be a growth engine: same‑day delivery volumes grew more than 35%, while digitally‑originated comparable sales increased 2.4% year‑over‑year—slightly below the 4.7% figure previously reported. The stronger delivery performance reflects Target’s investment in logistics and technology, whereas the modest digital sales growth indicates that the broader shift toward online shopping is still evolving.
Target trimmed its full‑year adjusted EPS outlook to $7.00‑$8.00 from the prior $7.00‑$9.00 range, citing ongoing consumer uncertainty, tariff headwinds, and a low‑single‑digit decline in comparable sales for the holiday season. The guidance cut signals management’s caution about near‑term demand, even as the company remains confident in its digital and non‑merchandise initiatives.
CEO Michael Fiddelke said the quarter’s performance was “in line with expectations” amid “multiple challenges,” and highlighted a focus on merchandising authority, an enhanced shopping experience, and technology acceleration to drive sustainable growth. The remarks underscore the company’s intent to navigate a challenging retail environment while investing in long‑term transformation.
Investors reacted with caution, reflecting concerns about the guidance cut and the continued softness in comparable sales, even as the company’s digital and non‑merchandise segments showed resilience.
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