Press Release

Target Reports Second Quarter 2019 Earnings

  • Aug 21, 2019


Comparable Sales Increase of 3.4 Percent Drives EPS Growth of More Than 20 Percent

Company Raises Full-Year EPS Guidance by 15 Cents

  • Second quarter comparable sales grew 3.4 percent, driven by 2.4 percent traffic growth.
  • Comparable sales have grown approximately 10 percent over the last two years — the best performance in more than a decade.
  • Second quarter comparable digital channel sales grew 34 percent.
  • Same-day fulfillment services (Order Pick Up, Drive Up and Shipt) accounted for nearly 1.5 percentage points of the Company’s overall comparable sales growth.
  • Second quarter operating income of $1.324 billion was 16.9 percent higher than a year ago. Operating income margin rate improved 80 basis points compared with last year, reflecting year-over-year improvement in both gross margin and SG&A rates.
  • GAAP EPS from continuing operations and Adjusted EPS of $1.82 were up over 20 percent from last year and established new all-time highs for the Company. 
  • Target now expects full-year 2019 GAAP EPS from continuing operations and Adjusted EPS of $5.90 to $6.20, compared with the prior range of $5.75 to $6.05
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Target Corporation (NYSE: TGT) today announced its second quarter 2019 performance, including comparable sales growth of 3.4 percent driven by a 2.4 percent increase in comparable traffic. The Company reported GAAP earnings per share (EPS) from continuing operations of $1.82 in second quarter 2019, up 22.0 percent from $1.49 in second quarter 2018.  Second quarter Adjusted EPS of $1.82 was 23.9 percent higher than $1.47

in second quarter 2018. The attached tables provide a reconciliation of non-GAAP to GAAP measures. All earnings per share figures refer to diluted EPS.

Brian Cornell, chairman and CEO of Target, said “We are really pleased with our second quarter performance, which demonstrates the strength of our strategy and the durable financial model we’ve built over the last several years. By appealing to shoppers through a compelling assortment, a suite of convenience-driven fulfillment options, competitive prices and an enjoyable shopping experience, we’re increasing Target’s relevancy and deepening the relationship between our guests and our brand. Traffic and sales continue to grow while our EPS reached an all-time high, driven by the strength of our team’s execution and their focus on delivering for our guests. Because of our outstanding performance in the first half of the year and our confidence moving forward, we are increasing our guidance for full-year earnings per share.”

Third Quarter and Full-Year 2019 Guidance
For both the third quarter and second half of 2019, Target expects comparable sales growth in line with the 3.4 percent comparable sales growth the company delivered in the second quarter of 2019. For the third quarter, the Company expects both GAAP EPS from continuing operations and Adjusted EPS of $1.04 to $1.24.

For full-year 2019, Target now expects GAAP EPS from continuing operations and Adjusted EPS of $5.90 to $6.20 compared with the prior range of $5.75 to $6.05. Third quarter and full-year 2019 GAAP EPS from continuing operations may include the impact of certain discrete items which will be excluded in calculating Adjusted EPS. The Company is not currently aware of any such discrete items.

Operating Results
Total revenue of $18.4 billion increased 3.6 percent from $17.8 billion last year, reflecting sales growth combined with a 6.3 percent increase in other revenue. Second quarter sales growth of 3.6 percent reflected comparable sales growth of 3.4 percent combined with the contribution from non-mature stores. Comparable digital sales grew 34 percent, contributing 1.8 percentage points to comparable sales growth.  Operating income was $1,324 million in second quarter 2019, up 16.9 percent from $1,133 million in 2018.

Second quarter operating income margin rate was 7.2 percent in 2019, compared with 6.4 percent in 2018. Second quarter gross margin rate was 30.6 percent, compared with 30.3 percent in 2018, reflecting the benefit of merchandising efforts to optimize costs, pricing, promotions and assortment, combined with the benefit of favorable category sales mix. This favorability was partially offset by higher digital fulfillment and supply chain costs. Second quarter SG&A expense rate was 21.2 percent in 2019, compared with 21.7 percent in 2018. This improvement reflected favorability in asset impairments, timing of certain expenses and other cost savings.

Interest Expense and Taxes from Continuing Operations
The Company’s second quarter 2019 net interest expense was $120 million, compared with $115 million last year. Second quarter 2019 effective income tax rate from continuing operations was 23.0 percent, compared with 21.8 percent last year. Last year’s effective income tax rate included benefits from the resolution of certain income tax matters unrelated to current period operations.

Shareholder Returns
The Company returned $669 million to shareholders in second quarter 2019, including:

  • Dividends of $328 million, compared with $330 million in second quarter 2018, reflecting a decline in share count partially offset by a 3.2 percent increase in the dividend per share.
  • Share repurchases totaling $341 million that retired 4.3 million shares of common stock at an average price of $80.02.

At the end of the second quarter, the Company had approximately $1.0 billion of remaining capacity under its current $5 billion share repurchase program.

For the trailing twelve months through second quarter 2019, after-tax return on invested capital (ROIC) was 15.2 percent, compared with 16.0 percent for the twelve months through second quarter 2018. Excluding the discrete impacts of the Tax Cuts and Jobs Act of 2017, ROIC was 15.0 percent for the trailing twelve months ended August 3, 2019, compared with 14.2 percent in the comparable prior-year period.  See the tables of this release for additional information about the Company’s ROIC calculation.

Conference Call Details
Target will webcast its second quarter earnings conference call at 7:00 a.m. CDT today. Investors and the media are invited to listen to the call at (hover over “investors” then click on “events & presentations”). A telephone replay of the call will be available beginning at approximately 10:30 a.m. CDT today through the end of business on August 23, 2019. The replay number is 888-566-0623.

Statements in this release regarding third quarter and full-year 2019 earnings per share and comparable sales guidance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties which could cause the Company’s actual results to differ materially. The most important risks and uncertainties are described in Item 1A of the Company’s Form 10-K for the fiscal year ended February 2, 2019. Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update any forward-looking statement.

About Target 

Minneapolis-based Target Corporation (NYSE: TGT) serves guests at more than 1,850 stores and at Since 1946, Target has given 5% of its profit to communities, which today equals millions of dollars a week. For the latest store count or more information, visit For a behind-the-scenes look at Target, visit or follow @TargetNews on Twitter.