Target reported its fourth-quarter earnings on Tuesday, revealing continued struggles. Net sales fell 1.5 percent to $30.5 billion compared with last year. Comparable sales declined 2.5 percent, with store traffic dropping significantly. However, the retailer's adjusted earnings of $2.44 per share beat expectations. Shares rose as investors responded to the better-than-expected profit.
The company has experienced roughly flat annual sales for four consecutive years. Customer traffic has fallen for three straight quarters across stores and online. Target also cut 1,800 corporate jobs in October during its first major layoff in a decade. These disappointing results stand in contrast to rivals like Walmart and Costco. Those competitors have posted stronger growth and attracted shoppers across all incomes.
New CEO Michael Fiddelke is leading an ambitious turnaround strategy for the company. He plans to prioritize design-led merchandising and an elevated shopping experience. Target will invest approximately five billion dollars in capital spending this year. The retailer is also leveraging technology, including artificial intelligence, across its operations. Its membership revenue more than doubled, and same-day delivery grew over thirty percent.
Looking ahead, Target expects net sales to grow around two percent this year. Sales turned positive in February, which management called an important milestone. Analysts remain cautious, noting that the recovery could take considerable time. If Target executed its strategy well, it would regain lost market share gradually. The coming quarters will reveal whether this turnaround is genuine or temporary.