Target (TGT) has consistently delivered on one thing in 2025: Serving up brutal warnings about its business on earnings days.
The discount retailer cut its full-year profit guidance on Wednesday and warned of a tepid holiday season as strapped consumers battle through an affordability crisis for food, healthcare, and housing.
"Many of the themes remain largely consistent with what we've shared in prior quarters. Guests are choiceful, stretching budgets and prioritizing value. They're spending where it matters most, especially in food, essentials, and beauty," Target chief commercial officer Rick Gomez said on a call with reporters, adding that shoppers are looking for deals on discretionary items.
Target stock fell in premarket trading after the report.
The cautious spending wasn't hard to find in Target's results.
The number of transactions declined year over year. Sales dropped in more discretionary departments, such as beauty and home furnishings.
Target promised to ramp up capital expenditures by 25% in 2026 to improve the appearance of its stores. The company said it cut prices on 3,000 food and household essential items last week.
"We believe there is a path to win regardless of how the macro environments will continue to evolve around us," incoming Target CEO Michael Fiddelke said.
Fiddelke — a Target veteran — will succeed longtime CEO Brian Cornell officially on Feb. 1, 2026.
The market is calling Fiddelke's bluff in that the company could win in a mixed to softening US economic backdrop, one also where tariffs are weighing on costs.
Most analysts on the Street have Neutral or Sell ratings on Target's stock, despite it being down 35% this year.
"We see increasing longer-term sales and margin risks for Target on slowing digital sales growth, a lack of scale in digital advertising and third-party marketplace, elevated tariff, pricing and merchandising headwinds, and increasing competitive threats from Walmart (WMT) and Amazon (AMZN)," Bank of America analyst Robert Ohmes said.
"Target also has higher tariff exposure vs. Walmart," he added, "and we think merchandising leadership and partnership changes (including Ulta Beauty (ULTA)) could potentially exacerbate risks in the dynamic and challenging sourcing environment."
Target drops 2% pre-market after cutting full-year EPS outlook and warns of weak holiday demand as affordability crisis hits consumers
byu/callsonreddit inwallstreetbets
Posted by callsonreddit
11 Comments
Didn’t this say 3% an hour ago lol
SPY +0.27%
TGT -3.64%
https://preview.redd.it/68sfy5r8z72g1.png?width=1004&format=png&auto=webp&s=4b29138a06f4c37651bca10d189c024e847996ee
And they’re partnering with OpenAi, lol.
Shit is just getting comical at this point.
I think the only retailers that come out unscathed are Costco (upper middle class shoppers) and Walmart (lower class shoppers), everything else gets weak guidance.
Target is genuinely a garbage company. Every store you walk into is staffed by teenage girls and each department looks like a tornado rolled through it.
To add, the sell stuff at a premium and almost everything is gutter quality. Idk how they will survive.
Target has higher prices for the same items that Walm and Amazon sell. Historically Target’s competitive advantage was the in store shopping experience being better than Walm, but online ordering, free deliveries for those eligible, delivery apps have taken away a lot of that advantage.
Target made a big PR deal of announcing in 2024 that they were lowering prices on thousands of items, but it wasn’t true and shoppers knew it. So with inflation still a problem, higher interest rates, high gasoline prices then that equals bad earnings for Target. Even if gasoline prices went to $1 a gallon, Target would have to fight to maintain relevance with shoppers. Only buy the stock if you believe Amazon will merge with them.
Bullish, stupid poors don’t matter
Main street Lower/middle class recession indicator.
“Publicly owned companies shocked that they can’t forever increase profits 15% year over year for eternity”
Lmao modern capitalism is the dumbest shit
Not sure about the rest of the country, but in NYC it seems like literally every item that you can also find on Amazon is cheaper on Amazon, and you don’t need to ask somebody to unlock it and it gets delivered to your door… i don’t know how this company survives
Yeah, what else is new