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The Target Bullseye logo appears on the exterior of its store in the Lycoming Crossing Shopping Center.
Paul Weaver | Rocket Lite | Getty Images
goal The company will report earnings on Wednesday morning as the big-box retailer prepares for the holiday season, prepares to hire a new CEO and tries to overcome declining sales.
Here’s what Wall Street expects for the Minneapolis-based retailer’s fiscal third quarter, according to a survey of analysts by LSEG:
- Earnings per share: $1.72 expected
- profit: $25.32 billion expected
Target’s sales have been nearly stagnant for four years as it faces intense competition and weakness in some of the areas that have distinguished it in the past, including its attractive merchandise, well-organized stores, and friendly, helpful customer service. Some customers also boycotted the retailer after it rolled back key diversity, equity and inclusion programs, a dynamic that Target partly blamed in May for its poor sales results.
Target expects sales to decline again this year by the low single digits. Adjusted earnings per share for the year, excluding gains from lawsuit settlements, will range from about $7 to $9, she said. Most of that range will come below last year, when adjusted EPS was $8.86.
Target announced in August that Michael Fidelke, the company’s former chief operating officer and chief financial officer, would become the company’s next CEO. He will succeed CEO Brian Cornell next February.
On an earnings call in August, the day of the Target CEO announcement, Fiddelke laid out his three biggest priorities: reestablishing Target’s reputation as a retailer with stylish, unique items, providing a more consistent customer experience, and using technology more effectively to run an efficient business.
He said he won’t wait until he’s in the role to make changes.
Last month, Target announced it would cut 1,800 jobs at the company — the largest layoffs in a decade. It has taken steps to hone its merchandise and restore its fashion sense, including sending its designers to rodeos and ski lodges for inspiration. It has adjusted its online fulfillment strategy in stores to try to free up staff time to stock shelves and help customers.
It also rolled out a policy change that shoppers might notice during the holiday season, which it calls the 10-4 program. When store employees are within 10 feet of a customer, Target asks them to smile and display friendly, welcoming body language, such as waving and making eye contact. When a customer is 4 feet away, Target asks store employees to start a conversation by personally greeting the shopper with a smile.
Target isn’t the only big retailer getting a new CEO. Rival Walmart announced last week that John Furner, CEO of its U.S. business, will succeed longtime CEO Doug McMillon. The role will begin on February 1, the same day Fiddelke takes over at Target.
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