Target cuts annual forecast post-sales dip

Bloomberg

Target Corp. cut its annual forecast after sales slumped last quarter, hit by what Chief Executive Officer Brian Cornell described as a “difficult retail environment.”
The company now expects earnings of $4.80 to $5.20 a share, excluding some items, compared with an earlier forecast of as much as $5.40.
In the face of a skittish retail economy and the rise of online competitors, Cornell has been using cutting costs to bolster profit. While that helped earnings beat estimates last quarter, the company risks sliding into a deeper slump. Cornell had warned investors in May that sales could be down as much as 2 percent in the second quarter, blaming weather and slowing consumer demand.
Target’s same-store sales ultimately fell 1.1 percent in the period, the company said. Analysts had predicted a 1 percent drop in sales, according to Consensus Metrix.
“While we recognize there are opportunities in the business, and are addressing the challenges we are facing in a difficult retail environment, we are pleased that our team delivered second quarter profitability above our expectations,” Cornell said in a statement.