Latest news with #TargetCircle360
Yahoo
23-05-2025
- Business
- Yahoo
Target: Price hikes to cover Trump tariffs ‘very last resort'
Target's CEO Brian Cornell said on Wednesday that hiking prices on customers due to President Trump's tariff agenda would be the retail giant's 'very last resort.' 'The difficulty level has been incredibly high given the rates we're facing and the uncertainty about how these rates in different categories might evolve,' Cornell said during a call with analysts, according to ABC News. 'We're focused on supporting American families and how they manage their budgets.' Cornell's remarks come as Target reported a dip in store sales, pointing to weaker consumer confidence and tighter spending over Trump's trade war. Target reported having $23.8 billion in net sales during the first quarter of 2025, lower than the $24.5 billion in 2024. 'While our sales fell short of our expectations, we saw several bright spots in the quarter, including healthy digital growth, led by a 36 percent increase in same-day delivery through Target Circle 360, and our strongest designer collaboration in more than a decade, Kate Spade for Target,' Cornell said in a statement on Wednesday. Target's approach to combat the effects of tariffs appears to be different from Walmart's, which announced last week that it would raise its prices due to the costs of the president's trade battles. Walmart said the price hikes will come this month, along with in early summer. Trump then slammed Walmart, pressing the retail behemoth to absorb the additional cost. 'Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain. Walmart made BILLIONS OF DOLLARS last year, far more than expected,' the president said on Saturday. 'Between Walmart and China they should, as is said, 'EAT THE TARIFFS,' and not charge valued customers ANYTHING,' Trump added. 'I'll be watching, and so will your customers!!!' After conducting talks in Switzerland earlier this month, the United States lowered tariffs on Chinese goods from 145 percent to 30 percent for 90 days. Likewise, China dropped the tariff rate from 125 percent to 10 percent. Best Buy warned two months ago that the impacts of tariffs would hit the technology retailer, which could then pass down the additional cost to consumers. 'While Best Buy only directly imports 2 percent to 3 percent of our overall assortment, we expect our vendors across our entire assortment will pass along some level of tariff costs to retailers, making price increases for American consumers highly likely,' Best Buy CEO Corie Barry said during an earnings call in early March. 'The fiscal '26 guidance we provided this morning does not include the impact of the recently enacted tariffs.' Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. Sign in to access your portfolio
Yahoo
22-05-2025
- Business
- Yahoo
Target and TJX Take Diverging Paths Through Tariff Turbulence—Speed vs. Flexibility
Although Target's 2025 outlook to a hit due to uncertainty surrounding tariffs and consumer spending, the mass merchant is keeping its foot on the gas when it comes to delivery. The retail giant's average click-to-deliver speed was nearly 20 percent faster than the year prior, according to Michael Fiddelke, chief operating officer. More from Sourcing Journal LA Port Director Predicts 'Muted' Peak Season Despite Expected Cargo Surge Target Challenged by Tariffs, Weak Q1 Sales and Profit Miss US Ports Warn of $6.7B Bill if 100% Tariff on China-Made Cranes Kicks in That number doubles the 11 percent faster delivery speeds experienced throughout 2024, in yet another example of national retailers cutting down delivery times on e-commerce orders. Walmart's U.S. operation nearly doubled the number of deliveries it made within a three-hour window from the year prior, the company revealed this month. Fiddelke said in a Wednesday earnings call that faster delivery was one of many factors that contributed to the company's comparable digital sales growth of 4.7 percent. The company touted its same-day delivery capabilities, with the option seeing 36 percent year-over-year growth in the company's first quarter. The growth is an acceleration from the 25 percent annual growth Target's same-day alternative experienced in the prior quarter. Target also saw 'healthy growth' in the Drive Up curbside pickup option, which now accounts for nearly half the retailer's total digital sales. 'We fulfilled more than 70 percent of all Q1 digital orders within a day,' Fiddelke said, also noting that Shipt's driver network fulfilled 24 percent more packages year over year. The talk of same-day services came two days after the company's announcement that it would remove same-day delivery price markups from more than 100 retailers and grocers through the Target Circle 360 paid membership program. Previously, Circle 360 customers would have to pay more for same-day deliveries ordered from Target's network of retailers selling on the Shipt Marketplace, including CVS, PetSmart and Lowe's. The successful delivery growth at Target couldn't save the company from posting largely disappointing first-quarter financial numbers. Net sales dipped 2.8 percent to $23.8 billion in the quarter, reflecting a merchandise sales decrease of 3.1 percent. Total transactions declined 2.4 percent, with same-store sales dropping 3.8 percent. Net income increased 10 percent to $1 billion. But the downward adjustment of its full-year guidance tells a bigger story. Target now expects a low-single-digit decline in sales this fiscal year, compared with a previous forecast of net sales growth of about 1 percent. The retailer said it expects adjusted earnings per share, excluding gains from litigation settlements, to be about $7 to $9, compared with the prior anticipated range of $8.80 to $9.80. CEO Brian Cornell wasn't as overt about tariffs resulting in higher prices as his counterpart at Walmart, Doug McMillon, but he acknowledged it was an option on the table, calling price 'the very last resort.' Cornell said 'adjusting order timing—and where necessary—prices' would be levers to pull to minimize tariff headwinds, alongside negotiating with vendor partners, reevaluating assortment decisions and changing country of production. China is the single largest source of merchandise Target imports, and it accounts for 30 percent of the goods the retailer sells within its private brands. TJX, the off-price retailer operating the TJ Maxx and Marshall's brands, is more confident in navigating the tariff-heavy environment. The company maintained its full-year sales and earnings outlook, with CEO Ernie Hermann saying that TJX expects to offset tariff pressures on both direct and indirect imports. 'We believe we can do this primarily through our buying process and our ability to adjust our ticket while maintaining our value gap and our ability to diversify our sourcing,' said Hermann in an earnings call Wednesday. Hermann said the retailer could potentially see less inventory availability in some categories if vendor wholesalers or traditional retailers cut back on shipments, but the buying team would flow to adjacent value-focused categories in such a scenario. The CEO also indicated that price changes were on the table, but that TJX would ensure it maintains its gap between its prices and those from traditional retailers. 'We believe there's opportunity for us to buy better. If retails do move out there, we will adjust our retails to preserve that gap. That could mean [prices] go up on certain items. If somebody actually adjusts—this is always the case—if they adjusted a retail down, we would do that as well.' China, which had initially been slapped with the highest tariff rate of all countries at 145 percent, has a smaller footprint in TJX's supply chains than many retailers. Hermann said that less than 10 percent of the merchandise that retailer purchases for its U.S. businesses is directly imported from China. Hermann calls that a 'very brand-driven' decision to have 'eclectic, well-balanced' mixes and assortments, rather than any intentional avoidance of the Chinese market. 'We don't swing the pendulum on those places,' Hermann said. 'So that is not something you'd see us play with a lot because obviously, we can move sourcing countries on our direct imports around and we could have China be less of a percentage. But we tend to hover around that 10-percent number.' With that in mind, despite the recent acceleration in freight rates, in which containers from Shanghai to U.S. West Coast ports soared as much as 32 percent in the week ahead of May 16, TJX hasn't felt much of the effect given its small concentration of ocean freight. 'Our ocean freight rates are approximately 20 percent to 25 percent of our overall freight, so we're not as impacted on the ocean freight side,' said TJX chief financial officer John Klinger. 'We have not seen, to the point, costs go up. But again, it's early. The tariffs were just lowered.' As far as China's impact on TJX businesses overseas like U.K. banner T.K. Maxx, Klinger said he has 'nothing significant' regarding shipments out of the country being redirected to Europe instead of the U.S.
Miami Herald
22-05-2025
- Business
- Miami Herald
Target expands same-day delivery to 100s of retailers
What's your favorite thing about large supermarkets and grocery chains? One of the reasons large retail chains are so popular, besides the obvious (many offerings at one place, affordable prices, etc.), is their continued focus on customer satisfaction. Today's competition in the retail industry is fierce. Businesses are also facing challenges such as a post-pandemic economic climate and rising inflation, among others. To stay competitive, retailers must innovate with their offerings and promotions while maintaining consistent quality. Do all this, and customer loyalty grows. Related: Walmart issues urgent message about the alarming cost of food Target (TGT) , the seventh-largest retailer in the United States and a component of the S&P 500 Index, frequently upgrades its offerings. In March 2024, the retail chain launched "Express Self-Checkout" across close to 2,000 stores. It set up a strict 10-item or fewer limit to make the lines quicker. With this faster self-checkout system, Target addressed one of the issues consumers hate the most: long frustrating lines. Fast forward to one year later. The strategy proved successful, with overall transaction times across both staffed and self-checkout lanes improving by almost 8%. What's more, customers begin to report a better overall experience. Target's Net Promoter Score for wait times increased by 5 points, and its score for team member interactions jumped by 3 points. Now, Target has another surprise for loyal customers. Image source: Universal Images Group via Getty Images The retail giant revealed on May 19 that it is removing price markups on same-day delivery from over 100 popular retailers and grocers outside of Target. While same-day delivery from Target has always been free from price markups, this upgrade will also make same-day delivery from many more retailers more affordable. "From the start, Target Circle 360 has been about building strong relationships with our guests and growing with them to deliver more value and ease. We've never charged markups on same-day delivery from Target, and now Target Circle 360 members can exclusively enjoy this no-markup benefit from more than 100 retailers and grocers across Shipt's network, too," stated Cara Sylvester, Target executive vice president and chief guest experience officer. "We've built a true digital shopping center experience - making your Saturday errand run easier, faster, and more affordable." More on retail: Popular convenience store makes major expansion in new statesCostco solves key problem for parentsStarbucks faces new threat from China rival set to enter US market Target Circle 360 doesn't limit its members to a single retailer. Rather, it offers them unlimited same-day delivery from Target and Shipt's curated marketplace of over 100 retailers and grocers. These include CVS, Lowe's Home Improvement, PetSmart, Hy-Vee, Giant Eagle, Lowers Foods, and more. The latest upgrade makes Target Circle360 into a digital shopping center. The company estimates that members can save seven hours a month and more than $300 a year on average. Not everything has been running smoothly at one of the biggest retailers in the U.S. Risks emerge with each new decision, and there's no way to be 100% certain how Target's large customer base will react. In 2023, Target saw a huge boycott from consumers over its Pride collection, due to backlash over items marketed toward children. Since then, Target's diversity, equity, and inclusion policies have been under scrutiny, and even its sales have been affected for several quarters. More recently, the retail giant scaled back its DEI initiative, which caused more protests and lower store traffic. Target discontinued its three-year DEI goals and ended programs supporting Black employees and businesses. While CEO Brian Cornell admitted mistakes and tried to assure employees about the company's core values, new boycott threats, most notably from The People's Union USA, are scheduled for June. Related: Popular firearms brand closes down, goes out of business The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Fibre2Fashion
22-05-2025
- Business
- Fibre2Fashion
US' Target's Q1 FY25 sales dip 2.8%, digital growth eases store slump
American retail company Target Corporation in its first quarter (Q1) of fiscal 2025 (FY25) ended May 3, has generated net sales of $23.8 billion, down 2.8 per cent year-over-year (YoY), reflecting a merchandise sales decrease of 3.1 per cent and a 13.5 per cent increase in other revenue. Digital comparable sales grew 4.7 per cent YoY reflecting more than 35 per cent growth in same-day delivery. Apparel and accessories sales declined to $3.71 billion, and home furnishings and decor dropped to $3.22 billion. Other merchandise sales also saw a modest decline. Among additional revenue streams, advertising revenue rose to $163 million, credit card profit sharing held steady at $141 million, and other income increased to $137 million. Target Corporation has posted net sales of $23.8 billion in Q1 FY25, down 2.8 per cent YoY, with merchandise sales falling 3.1 per cent. Digital comparable sales rose 4.7 per cent, driven by strong same-day delivery growth. Operating income rose 13.6 per cent to $1.5 billion. GAAP EPS reached $2.27. Target anticipates a low-single digit sales decline and adjusted EPS of $7 to $9 for FY25. In Q1, selling, general and administrative (SG&A) expense and operating income included $593 million in pre-tax gains from the settlement of credit card interchange fee litigation. First quarter GAAP earnings per share (EPS) was $2.27 compared with $2.03 last year and adjusted EPS was $1.30. The comparable sales decreased 3.8 per cent in Q1, reflecting a comparable store sales decline of 5.7 per cent and comparable digital sales growth of 4.7 per cent. First quarter operating income of $1.5 billion was 13.6 per cent higher than last year. The company's limited-time collaboration with Kate Spade marked its most successful designer partnership in the past decade, Target Corporation said in a financial statement. 'In the first quarter, our team navigated a highly challenging environment and focused on delivering the outstanding assortment, experience and value guests expect from Target. While our sales fell short of our expectations, we saw several bright spots in the quarter, including healthy digital growth, led by a 36 per cent increase in same-day delivery through Target Circle 360,' said Brian Cornell, chair and chief executive officer (CEO) at Target Corporation . For FY25, the company expects a low-single digit decline in sales, GAAP EPS of $8 to $10, and adjusted EPS of $7 to $9. Fibre2Fashion News Desk (SG)
The Hill
21-05-2025
- Business
- The Hill
Target: Price hikes to cover Trump tariffs ‘very last resort'
Target's CEO Brian Cornell said on Wednesday that hiking prices on customers due to President Trump's tariff agenda would be the retail giant's 'very last resort.' 'The difficulty level has been incredibly high given the rates we're facing and the uncertainty about how these rates in different categories might evolve,' Cornell said during a call with analysts, according to ABC News. 'We're focused on supporting American families and how they manage their budgets.' Cornell's remarks come as Target reported a dip in store sales, pointing to weaker consumer confidence and tighter spending over Trump's trade war. Target reported having $23.8 billion in net sales during the first quarter of 2025, lower than the $24.5 billion in 2024. 'While our sales fell short of our expectations, we saw several bright spots in the quarter, including healthy digital growth, led by a 36 percent increase in same-day delivery through Target Circle 360, and our strongest designer collaboration in more than a decade, Kate Spade for Target,' Cornell said in a statement on Wednesday. Target's approach to combat the effects of tariffs appears to be different from Walmart's, which announced last week that it would raise its prices due to the costs of the president's trade battles. Walmart said the price hikes will come this month, along with in early summer. Trump then slammed Walmart, pressing the retail behemoth to absorb the additional cost. 'Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain. Walmart made BILLIONS OF DOLLARS last year, far more than expected,' the president said on Saturday. 'Between Walmart and China they should, as is said, 'EAT THE TARIFFS,' and not charge valued customers ANYTHING,' Trump added. 'I'll be watching, and so will your customers!!!' After conducting talks in Switzerland earlier this month, the United States lowered tariffs on Chinese goods from 145 percent to 30 percent for 90 days. Likewise, China dropped the tariff rate from 125 percent to 10 percent. Best Buy warned two months ago that the impacts of tariffs would hit the technology retailer, which could then pass down the additional cost to consumers. 'While Best Buy only directly imports 2 percent to 3 percent of our overall assortment, we expect our vendors across our entire assortment will pass along some level of tariff costs to retailers, making price increases for American consumers highly likely,' Best Buy CEO Corie Sue Barry said during an earnings call in early March. 'The fiscal '26 guidance we provided this morning does not include the impact of the recently enacted tariffs.'
