Target (TGT) Q1 2026 earnings
target on Wednesday posted earnings and income that beat Wall Street expectations, and reported that internet gross sales grew greater than 6% 12 months over 12 months because the retailer tries to win again prospects amid slumping gross sales.
Target’s same-store gross sales jumped 5.6%, its first constructive same-store gross sales quantity in 5 quarters.
The retailer stated it noticed broad-based power throughout its classes, with visitors throughout shops and digital platforms rising 4.4% in comparison with the primary fiscal quarter final 12 months. Digital comparable gross sales elevated 8.9%, progress the corporate attributed to same-day supply by way of its membership, Target Circle 360.
“Even with this early progress, we know our work is just beginning, and we have confidence we’re on the right path because guests are responding in areas where we are leaning in and driving change,” CEO Michael Fiddelke stated on a name with reporters. “These are areas where we bring style, design, and value to not only the products we sell, but how we sell them, creating a distinctly Target experience.”
Notably, non-merchandise gross sales spiked practically 25%, together with from what the corporate recognized as robust progress in its membership income and the Target+ market. Target, like Walmart and Amazon, has tried to develop these enterprise models each to supply extra comfort to prospects and improve their earnings.
The firm stated it noticed gross sales improve throughout all six of its core merchandising classes, with significantly robust responses from customers in its well being and wellness, toys and child segments. It opened seven new shops within the first fiscal quarter, with greater than 100 transform tasks in progress.
Here’s what the retailer reported for its fiscal first quarter in comparison with what Wall Street anticipated, based mostly on a survey of analysts by LSEG:
- Earnings per share: $1.71 vs. $1.46 anticipated
- Revenue: $25.44 billion vs. $24.64 billion anticipated
As it reported the first-quarter beats, Target additionally raised its full-year income outlook. The retailer stated it expects internet gross sales progress of 4% in comparison with 2025, a rise of two share factors from its prior outlook. It additionally expects its earnings per share to come back in close to the excessive finish of its beforehand offered steering vary of $7.50 to $8.50. Analysts have been anticipating earnings of $8.14 per share.
“Despite our updated guidance, we’re maintaining a cautious outlook given the work we know we have in front of us and ongoing uncertainty in the macroeconomic environment,” Fiddelke instructed reporters.
Shares of the corporate rose barely in premarket buying and selling.
For the three-month interval that ended May 2, Target reported internet revenue of $781 million, or $1.71 per share, down from $1.04 billion, or $2.27 per share, within the year-ago interval. Adjusted earnings per share have been $1.30 within the year-ago interval.
It reported merchandise income of $24.89 billion, beating estimates of $24.18 billion. Target’s income beat reported Wednesday was the biggest since November 2021.
Some of Target’s strongest power this quarter was in its baby and kids categoryFiddelke instructed reporters, with a greater than 5 share level acceleration within the second half of the quarter, along with product additions within the well being and wellness class that drove double-digit gross sales progress in that phase.
Target’s gross margin got here in at 29% for the primary quarter, in comparison with Wall Street estimates of 28.7%.
The firm has been struggling as it really works to show to buyers that it may finish its gross sales stoop and win again model loyalty from customers. Wednesday’s earnings come as Wall Street retains a eager eye on a extra selective client, hit by hovering gasoline costs and macroeconomic uncertainty.
Despite excessive gasoline costs and an general pullback in discretionary spending, executives stated the patron continues to indicate curiosity in new gadgets that Target is bringing into its assortment.
“We see a consumer that continues to be resilient, even though they faced a mix of headwinds and tailwinds in the first quarter,” Fiddelke stated.
Target stated it is targeted on bettering its merchandising, visitor expertise and expertise because it hopes to return to sustainable progress.
CFO Jim Lee said in March that Target would improve its spending this 12 months to speed up its turnaround, with capital expenditures totaling about $5 billion for the 12 months, a greater than $1 billion improve from final fiscal 12 months. Those investments will go towards its provide chain and funding in its shops, amongst different areas.
For the present second fiscal quarter, Target stated its key priorities embrace what it referred to as its “largest food and beverage transition” in additional than a decade, along with launching the Target Beauty Studio throughout greater than 600 shops and overhauling practically 75% of ornamental equipment.
“We will not confuse this progress with potential,” Fiddelke stated. “Our focus is on delivering consistent growth, not just in 2026 but for decades to come.”
Lee instructed reporters the corporate is “working through the process” of making use of for tariff refunds and acknowledged that the tariff setting stays dynamic. He stated it is early to find out how coverage adjustments are affecting margins.
