What to Expect From Target’s Earnings Tomorrow
Target (TGT) will report fiscal third‑quarter results tomorrow before the market opens, and expectations are muted as the retailer continues to battle sluggish discretionary demand, margin pressure, and a widening performance gap versus Walmart. Analysts broadly expect another soft quarter, though signs of stabilization in traffic and inventory could help shape sentiment heading into the holiday season.
Analyst Expectations
Wall Street forecasts Q3 adjusted earnings per share of $1.71–$1.72, according to consensus estimates aggregated by Yahoo Finance and LSEG (source; source).
That would mark an 8% year‑over‑year decline and continue a pattern of mixed quarterly execution following several revenue misses over the past two years.
Revenue is projected to come in around $25.3 billion, effectively flat versus last year. Analysts have held estimates steady over the past month, suggesting limited conviction in either a positive or negative surprise.
Same-Store Sales and Demand Trends
Comparable sales remain the biggest pressure point. Analysts expect comps to decline 1–2%, with discretionary categories like home, apparel, and seasonal merchandise still soft. LSEG estimates point to roughly a 2% drop in comparable sales, while credit and debit card data tracked by D.A. Davidson shows a 2.8% decline in card spending, a slight deterioration from last quarter’s trend (source).
Consumer strain is another factor. According to recent commentary, the prolonged U.S. federal government shutdown—delaying pay and food‑stamp benefits—has weighed on low‑to‑middle income shoppers, a core demographic for Target.
Margin Outlook
While comps remain under pressure, margin performance is a key area of focus for investors. Last quarter, Target’s operating income declined 19%, weighed down by higher cost of sales and ongoing mix challenges, according to its previous earnings release (source).
Analysts expect modest margin stabilization this quarter: