The big-box retailer that sells you milk and underwear is in search of a bullseye. Target plans to refocus on the needs of “busy families,” new CEO Michael Fiddelke told investors yesterday as the retail chain tries to win back customers.
The issue: Target has been struggling to turn itself around ever since a pandemic-era revenue boom subsided into stagnancy. Some customers told CNBC that they feel store inventory is lacking and that they aren’t fans of Target’s DEI rollbacks.
The potential fix: More baby care and groceries, and less of being “an everything store,” Fiddelke said. The company said it’ll invest an additional $1 billion in its supply chain, technology, and stores, including staffing (meanwhile, Target cut 1,800 corporate jobs in October).
For now
Fiddelke laid out this turnaround vision after the company shared a somewhat bad (but also somewhat good) earnings report for its most recent quarter, ending Jan. 31:
- The bad: Target posted its fourth straight quarter of declining store and online traffic, and revenue came in even lower than Wall Street’s already low expectations.
- The good: The retailer’s earnings actually beat estimates. Another bright spot: Target’s same-day deliveries—which compete with Walmart’s and Amazon’s offerings—grew more than 30%.
Looking ahead…Target expects to get out of its slump soon and projects 2% growth in net sales for this fiscal year.—ML
This report was originally published by Morning Brew.
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