Target hits sales record on online surge

TARGET Corp on Wednesday reported its best quarterly comparable sales growth and online revenue that nearly tripled as shoppers lapped up videogames, kitchenware and clothes during the Covid-19 pandemic using the retailer's same-day delivery services.

The surging demand seen at big-box chains at the height of the lockdown, has continued into the second quarter even as restrictions ease. "The biggest change we saw from Q1 to Q2 ... was the exceptional growth we saw in in-store shopping in an environment where many Americans were turning to digital to fulfil their needs," chief executive officer Brian Cornell told reporters.

In the second quarter ended Aug 1, Target's apparel sales grew by double-digits after a 20 per cent first-quarter drop, with electronics sales up more than 70 per cent.

Through the pandemic-ridden first half of the year, that saw numerous bankruptcies of traditional brick-and-mortar retailers including JC Penney and Neiman Marcus, Target said it won about US$5 billion in market share across categories.

The group's comparable sales, which include online and store sales, jumped 24.3 per cent in the quarter, trouncing expectations of a 8.2 per cent increase, according to IBES data from Refinitiv.

Comparable digital sales surged 195 per cent, driven largely by the success of Target's same-day services, such as in-store pick up, Drive up, and Shipt, which grew 273 per cent in the quarter.

Target said that nearly 90 per cent of its online orders were fulfilled through stores, another sign investments in swifter delivery and remodelling stores were paying off.

Target's net earnings jumped 80.3 per cent to US$1.69 billion, with adjusted earnings per share of US$3.38, well ahead of analysts' US$1.62 forecast.

Total revenue rose about 25 per cent to US$22.98 billion, also topping expectations of US$20.87 billion. REUTERS