*

Full-year comparable sales expected to be flat vs 1.8%

growth

estimate

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Tariff uncertainties pressured Feb performance, company

says

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Heavy online shopping gave holiday quarter sales boost

By Siddharth Cavale and Juveria Tabassum

March 4 (Reuters) - Target ( TGT ) on Tuesday forecast

full-year comparable sales below estimates, and said uncertainty

around tariffs as well as consumer spending would weigh on

first-quarter profits.

The Minneapolis-based retailer joined retail bellwether

Walmart ( WMT ) in raising caution about its expectations for

the year as sticky inflation and tariffs on imports proposed and

implemented by President Donald Trump temper demand,

particularly for the non-essential categories like home

furnishings and electronics that makes up more than two-thirds

of Target's ( TGT ) sales.

Target ( TGT ) expects comparable sales to be about flat in the year

through January 2026, compared with analysts' average estimate

of 1.86% growth, according to data compiled by LSEG. It expects

earnings of $8.80 to $9.80 per share, largely in-line with Wall

Street's $9.31 estimate. Target ( TGT ) said the annual forecast does

not consider any impact from tariffs.

Consumers, however, continue to be stressed and at least

some of the noise surrounding the levies hit sales in February,

a Target ( TGT ) spokesperson said.

"The company expects to see meaningful year-over-year profit

pressure in its first quarter," it said, attributing the impact

to tariff uncertainty, as well as weak demand for apparel and

other discretionary products during February.

"We will continue to monitor these trends and will remain

appropriately cautious with our expectations for the year

ahead," Chief Financial Officer Jim Lee said in a statement.

The disappointing outlook may reflect the mood of shoppers

who in January pulled back spending far more than expected and

showed that they are much more worried about the impact of

tariffs on their wallets.

Target ( TGT ), in particular, has also faced more backlash and

boycotts by its patrons for ending its diversity and inclusion

(DEI) initiatives in January, with some noting the company's

reputation for inclusiveness had helped it attract a younger,

more diverse consumer base.

Foot traffic at Target ( TGT ) stores dropped 6.1% on average from

the week of January 27 through February 23, according to data

from Placer.ai. Target ( TGT ) did not mention any impact of ending its

DEI initiatives in its outlook.

For the holiday quarter, Target ( TGT ) reported a 1.5% rise in

comparable sales, topping estimates of a 1.3% increase,

according to data compiled by LSEG. Earnings came in at $2.41

per share, down 19.3%, with gross and operating margins

declining due to higher promotions and delivery costs.

Beauty, apparel, toys and sporting goods were top performers

during the quarter, while home decor and furnishing sales were

negative, a spokesperson said. Shoppers also did more of their

shopping online, with digital comparable sales up 8.7%, which

led to an increase in costs of box shipping, or those made

within one or two days, he noted.