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Aug 02
Target Q2 2025 Earnings Report
Target reported a slight revenue decline and lower earnings in Q2 2025 amid ongoing macro pressures.
Key Takeaways
Target's Q2 2025 performance reflected a modest revenue dip and significant decrease in net income, driven by lower store traffic and category mix pressure, partially offset by growth in digital and non-merchandise sales.
Revenue totaled $25.2B, down 0.9% YoY.
Net income fell 21.5% to $935M.
Comparable digital sales rose 4.3%, while store traffic declined 1.3%.
Adjusted and GAAP EPS both came in at $2.05.
Target
Target
Target Revenue by Segment
Target Revenue by Geographic Location
Revenue by Segment
Apparel & Accessories Revenue
CapyFin.comBeauty Revenue
CapyFin.comFood & Beverage Revenue
CapyFin.comHardlines Revenue
CapyFin.comHome Furnishing & Décor Revenue
CapyFin.comHousehold Essentials Revenue
CapyFin.comOther Merchandise Revenue
CapyFin.comCredit Card Profit Sharing Revenue
CapyFin.comOther Non-Merchandise Revenue
CapyFin.comRevenue by Geographic Location
United States Revenue
CapyFin.com Forward Guidance
Target maintained its full-year 2025 guidance with EPS expected between $8.00 and $10.00, and adjusted EPS projected between $7.00 and $9.00.
Positive Outlook
- Guidance for GAAP EPS reaffirmed at $8.00–$10.00.
- Adjusted EPS forecast maintained at ~$7.00–$9.00.
- Digital channel continues to grow with 4.3% increase.
- Non-merchandise revenue growth at 14.2%.
- Improved trends in store traffic vs. Q1.
Challenges Ahead
- Comparable store sales fell 3.2%.
- Operating income dropped nearly 20%.
- Gross margin declined to 29.0%.
- SG&A expense rate slightly increased to 21.3%.
- After-tax ROIC fell to 14.3% from 16.6% YoY.