Target warns operation in “very challenging environments”

Target CEO Brian Cornell said Wednesday that a softer than expected revenue and a quarter of ongoing profit pressure are tackling a “very challenging environment” after being forced to cut sales prospects for the full year.

Minneapolis-based retailers are bashing traffic and trying to return to growth, but for the past three months, in particular, they have been marked by a broader industry headwind: President Donald Trump’s tariff war.

The company had already warned earlier this year that there was year-over-year profit pressure in the first quarter compared to the rest of the year due to some of the uncertainty in tariffs.

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Back to long-term profitable growth, we have developed a new multi-year growth initiative called the Enterprise Acceleration Office and made changes to our executive suite.

“In the first quarter, our team navigated through a highly challenging environment and focused on providing outstanding assortment, experience and valuable guests from our target,” CEO Brian Cornell said in a statement Wednesday.

The change, announced Tuesday, is intended to “position key features that build more speed and agility to how we operate and drive profitable growth over the long term,” Cornell says.

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The Enterprise Acceleration Office Initiative, led by Target’s Chief Operating Officer Michael Fidelke, will particularly help the company operate more subtlely.

In the first fiscal quarter, Target reported that its first quarter net sales were $23.8 billion, down 2.8% from the same period last year, falling below Wall Street’s $24.32 billion forecast. The earnings per share adjustment was $1.30, below Wall Street’s $1.63 forecast.

Target store in the 1900 block of Snellville’s Scenic Highway (Google Maps / Google Maps)

Target said it will be open for at least one year, but Target remains healthy digital growth, led by a 36% increase in same-day delivery through its loyalty program, Target Circle 360.

Target is currently expecting a single digit decline in sales for fiscal year 2025. Adjusted earnings per share are expected to be around $7-$9 for fiscal year 2025.

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“Though these highlights strengthen our confidence in the health underlying our business, we know that we are not satisfied with our current performance and we have the opportunity to bring faster progress on our roadmap for growth,” Cornell said.

Earlier this year, Cornell was one of the chief executives who warned of the consequences of slapsing tariffs on key trading partners and even met with Trump to discuss ongoing trade negotiations with other countries and the impact of tariffs imposed on imported products.