/usr/web/www.marshallindependent.com/wp-content/themes/coreV2/single.php
×

Target bursts into the holiday season with a bang

NEW YORK (AP) — Target is bursting into the critical holiday season with strong third-quarter earnings as the company pushes faster delivery and invests in stores and on new fashion brands.

The retailer raised its expectations for the year and shares closed up more than 14% at $126.43.

Target’s quarterly sales of clothing rose 10% year over year, helped by its focus on creating its own brands and updating its clothing displays.

While Target is boosting sales, department sales are struggling to attract shoppers. Kohl’s has cut its profit outlook for the year after a disappointing third quarter dragged down by poor women’s clothing sales. J.C. Penney’s latest report showed its continued malaise in clothing. Macy’s and Nordstrom report Thursday.

“Everyone is chasing the same stuff, and it’s not working,” said Stacey Widlitz, president of SW Retail Advisors. “Target is taking the best of retail and putting it into the store. Or the worst of retail and making it better.”

During a call with reporters Wednesday, Target CEO Brian Cornell said the chain is picking up market share from both department stores and smaller mall stores. He also noted that store remodels have helped. Shoppers who previously just bought household essentials are now picking up clothing and home goods.

Overall, growth in stores open at least a year and online rose 4.5%. For just online, sales rose 31%.

Target is demonstrating how an intense focus on both low prices and customer convenience can put traditional retailers on a competitive footing with Amazon.com, which has upended the retail sector. Walmart last week raised its annual profit expectations after reporting strong third-quarter results helped by its grocery business.

Still, the holiday season is expected to be brutally competitive. Faced with the shortest holiday shopping season since 2013, retailers want to get into the minds of potential customers early.

Target is spending $50 million more on its payroll this quarter than it did during the same period last year to ensure customers can find help whenever they need it.

Newsletter

Today's breaking news and more in your inbox

Today's breaking news and more in your inbox
Are you a paying subscriber to the newspaper? *
   

Starting at $4.38/week.

Subscribe Today