Target Corp. (NYSE: TGT) announced its financial results for the fourth quarter, with comparable sales dropping.
For the fourth quarter, comparable sales declined 1.5%, which was in the guidance range of 1.5% to 1.0%. The results included 3.3% drop at physical stores open at least one year. Revenue dropped 4.3% to $20.7 billion, which was in line with the estimates. Net earnings for the fourth quarter was down 42.7% to $817 million, missing the estimate of $854 million. GAAP EPS for the fourth quarter was $1.46 per share, and adjusted EPS was $1.45 per share, which was also in the range of $1.45 to $1.55. However, EPS results missed expectations of $1.51 per share.
“Our fourth quarter results reflect the impact of rapidly-changing consumer behavior, which drove very strong digital growth but unexpected softness in our stores,” Brian Cornell, the chairman and CEO of Target, said in the statement on Tuesday.
“We will accelerate our investments in a smart network of physical and digital assets as well as our exclusive and differentiated assortment, including the launch of more than 12 new brands, represent more than $10 billion of our sales, over the next two years. In addition, we will invest in lower gross margins to ensure we are clearly and competitively priced every day,” he said.
Based on the financial results, the company provided the guidance for 2017. For the first quarter of 2017, Target expects that the comparable sales will decline in a low-to-mid single digit. GAAP EPS and adjusted earnings are expected to be between $0.8 and $1.0 per share. For the full-year 2017, the company expects a low-single digit drop in comparable sales, and expects that GAAP EPS will be between $3.8 and $4.2 per share.