Target reported increases in sales figures for the year despite the credit card breach that occurred earlier this year.
Target reports an increase in sales
Target reported on Wednesday an increase in same-store sales for the past four quarters and a quarterly profit above analyst expectations, reported Reuters. Shares rose by 5.4 percent to $71.15 after the financial results were announced.
The company indicated that consumers were responsive to Halloween and back-to-school promotions, which offset a drop in clothing sales due to warmer weather during the fall season. Lower gas prices were mentioned as giving consumers more disposable income, which was partly responsible for the increase in sales, reported the news source.
Brian Cornell, chief executive who took over in August, is now expected to keep the momentum going. Cornell plans to focus on Target’s Canada business, where sales have been lagging, reported ABC News. Cornell indicated that business in Canada has improved just before the start of the holiday season, and that changes were introduced to products and prices recently.
“We’re encouraged by the improving trend we’ve seen in our U.S. business throughout the year and our fourth-quarter plans are designed to sustain this momentum,” said Cornell, according to the news source.
Target expansions and product deals paid off
A few years ago Target expanded into groceries during the recession to increase in-store traffic. Over the past eight years, home furnishings and fashion sales have dropped significantly, while household items and food sales have risen, reported ABC News.
This year Target has a plan to lure customers during the holidays by offering them attractive deals on products. The company will be competing with the likes of Wal-Mart and Amazon. Wal-Mart recently announced that it will be lowering its prices on electronics and popular toys on Black Friday to match or beat deals from other major retailers, the news source added.
For the quarter ending Nov 1., Target revenue grew by 2.8 percent to $17.7 billion. The results show that Target has a good chance of attracting a significant share of holiday shoppers this year. The credit card breach that occurred earlier this year led to the theft of at least 40 million customer card numbers, according to Reuters. Surprisingly, through the use of promotions, and because of favorable economic conditions, Target was able to overcome obstacles and recover from that breach to deliver top-line results. The company now expects to continue with that positive growth.Back To Blog