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Target’s Q1 Results: ‘Strong’ in ‘Choppy’ Retail World

Target released its first-quarter financial results Wednesday, citing a comparable sales decline of 1.3 percent over sales in the first quarter of 2016.

Target chairman and CEO Brian Cornell says the company performed better than expected in the first three months of the year, especially in March, but also says that there will be obstacles for the retailer moving forward.

“Target’s first-quarter financial performance was better than our expectations, reflecting strong execution by our team as they delivered for our guests in a very choppy environment,” Cornell says in the statement. “We are in the early stage of a multi-year effort to position Target for profitable, consistent long-term growth, and while we are confident in our plans, we are facing multiple headwinds in the current landscape. As a result, we will continue to plan our business prudently while preparing our team to chase business when we have an opportunity.”

The big-box store says comparable sales declines were due to “small declines in both traffic and basket size.” Digital sales increased 22 percent over the same period in 2016, which contributed to 0.8 percentage points of the comparable sales, according to the company’s financial results press release.

The Wall Street Journal reports that “Target plans to invest $7 billion over the next three years on store improvements, new brands and developing its digital and supply-chain capabilities.” In addition, the retailer will lower prices to compete with Walmart and Amazon, which will total about $1 billion in lost profits, according to The Wall Street Journal.

Hardware Retailing recently published a 360-degree overview of Target, including the company’s history, its innovations and its plans to compete in today’s challenging retail environment. Click here to read more about Target, and click here to read Hardware Retailing‘s in-depth reports on Amazon, Tractor Supply Co. and Walmart.

About Melanie Moul

Melanie is the communications and content manager for the North American Hardware and Paint Association. She joined the NHPA team in 2016 as an editor for Hardware Retailing and now helps lead the communications team to deliver relevant, timely content to the industry.

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