Target revenue metric misses forecasts for May
Minneapolis (AP) — Target Corp. said Thursday that its May revenue at stores open at least a year climbed 2.8 percent, but shoppers remained cautious and the figure fell short of Wall Street's forecast.
Analysts polled by Thomson Reuters anticipated a 3.5 percent increase in the figure, on average. The metric rose 1.3 percent in May 2010.
The comparison is important because it excludes stores that recently opened or closed.
Chairman, President and CEO Gregg Steinhafel said in a statement that customer traffic slowed during the second half of the month. He said higher gas prices and other inflationary pressures crimped customer spending and slowed growth more than Target expected.
The chain also said last month that gas and food price hikes made shoppers more cautious during the first quarter.
Target's total revenue for the four weeks that ended May 28 rose 3.8 percent to $4.8 billion.
The company said in a prerecorded message Thursday that grocery and clothing sales rose, but revenue from home goods and items like electronics, toys and health and beauty products fell.
For the year so far, Target's revenue at stores open at least a year has increased 2.2 percent and total revenue has risen 3 percent to $20.38 billion.
Target anticipates June revenue at stores open at least a year will rise by a low- to mid-single-digit percentage.
Last month Target said its first-quarter net income climbed 2.7 percent, compared with a year earlier, as expenses fell in its credit card business.
Target has 1,755 stores in 49 states.
The Minneapolis-based company's stock added 4 cents to $48.60 in premarket trading Thursday.
(Copyright 2011 by The Associated Press. All Rights Reserved.)