Facing ongoing consumer and tariff uncertainty after posting better-than-expected fourth-quarter results, Target Corp. executives warned that the rest of 2025 could be challenging as the U.S. economy faces strong headwinds.
To bring those inflation-wary consumers back to Target stores, Cornell said the company would drive $15 billion in revenue growth over the next five years and invest between $4 billion and $5 billion in new stores, supply chain operations, and technology upgrades.
“In a world where we operate today, our guests are looking for Tar-zhay,” said Cornell. “Consumers coined that term decades ago to define how we elevate the ‘everything-everyday’ to something special, [and] how we add unexpected fun into shopping that would be otherwise routine.”
In highlighting the company’s fourth-quarter and year-end results, Cornell said Target grew traffic at its nearly 2,000 U.S. stores and delivered better-than-expected sales and profitability in the biggest quarter of the year.
According to FactSet, Target’s fourth-quarter earnings were well above Wall Street’s expectations of $2.26 per share and revenue of $30.82 billion. Same-store sales, a key financial metric for store growth, aligned with analysts’ expectations. For the year, Target reported a net income of $8.86 per share on revenues of $106.6 billion.
“Given near-term uncertainty, we will be looking to maintain a larger than normal cushion on the balance sheet,” Lee said of impending tariffs by the Trump administration. “As always, our team will focus on minimizing any impact on our guests as we manage our business to deliver on our financial goals.”
Ahead of Target’s fourth-quarter report, President Donald Trump announced on March 3 that he was implementing a 25 percent tariff on Canada and Mexico under the International Emergency Economic Powers Act (IEEPA) “to combat the extraordinary threat to U.S. national security.”In response to the president’s announcement, the National Retail Federation called the decision to impose tariffs on the nation’s two North American neighbors “a significant measure.”
“Unfortunately, [it] will only hurt hard-working Americans and the businesses that strive to provide customers with the products they want and need on a daily basis,“ NRF Executive VP David French told the Epoch Times via email. ”Tariffs are just one tool at the administration’s disposal to achieve a secure border, and we urge it to explore other options to accomplish the same goals. As long as these tariffs are in place, Americans will be forced to pay higher prices on household goods.”
The NRF, the nation’s largest trade association representing Target, Walmart, Amazon, and other brick-and-mortar and e-commerce retailers nationwide, urged the Trump administration to return to the negotiating table with Canada and Mexico to resolve any outstanding border security issues.
In a research note shared with The Epoch Times, Truist Securities analyst Scot Ciccarelli said multiple factors impact Target’s sales, and broader “macro improvement will likely only get them so far” in 2025 and beyond. Facing three options, he said Target can wait for the economic environment to improve, invest more in value products, or push more aggressively into proprietary brands.
“While option three is likely the best strategy, it is also the most difficult to execute and over the years, Target has fluctuated between chic ”Tar-zhay“ with cool/innovative products and more mundane offerings,” said Ciccarelli.
Target’s stock price slid 3 percent, or $3.62, closing at $117.14 on the Nasdaq Stock Exchange on March 4. It has fallen more than 22 percent over the past year.
