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NEW YORK (AP) -- Target reported its second straight quarter of comparable sales gains on Wednesday, saying that a merchandising overhaul under the retailer's new CEO is attracting more customers and boosting sales throughout its stores.
The retailer also benefited from a tariff refund of $994 million after the U.S. Supreme Court ruled this year that the Trump administration had overstepped its authority when the tariffs were implemented.
There is a lot of interest in how tariff refunds from the U.S. government will impact retailers and whether those refunds will be used to lower prices for customers.
Chief Financial Officer Jim Lee, when asked about tariff refunds this week, said the company continues to invest in lowering prices. Target reduced the prices of more than 10,000 items over the past year and "there's more to come even as we're facing headwinds overall," Lee said.
Comparable sales, those coming from stores and digital channels operating for at least 12 months, rose 3.8% in the second quarter. The company also upgraded its annual profit and sales outlook, citing the solid performance during the first half of the year.
Target is emerging from more than a year of weak comparable sales. A 5.6% jump in the first quarter offset a 3.8% decline in 2025. The second-quarter gain followed a 1.9% drop a year ago.
Target CEO Michael Fiddelke, a 20-year company veteran who became chief executive in February, said the latest quarter was "an important step forward in the plan we laid out earlier this year to open a new chapter of growth for Target."
Target also reported an increase in the number of customers going to its stores and shopping on its website from May through July.