Target (TGT) Q2 2027 earnings summary

Executive summary

• Net sales for Q2 rose 5.3% year-over-year to $26.5B, with comparable sales up 3.8% and traffic up 3.6%.

• All six core merchandising categories posted year-over-year net sales growth, led by double-digit gains in Fun 101 and high single-digit growth in Food & Beverage and Beauty.

• Digital comparable sales grew 8.7%, driven by over 25% growth in same-day delivery.

• Strategic focus on merchandising authority, guest experience, technology acceleration, and exclusive partnerships is driving engagement and sales.

• Significant in-store transitions and investments in technology, AI, and supply chain are enhancing personalization, inventory reliability, and fulfillment speed.

Financial highlights

• GAAP and Adjusted EPS were $4.11, up 100% from $2.05 last year, including a $1.65 per share benefit from $994M in tariff refunds; excluding refunds, EPS grew ~20% year-over-year.

• Net sales rose 5.3% year-over-year to $26.5B; comparable sales up 3.8%.

• Operating margin rate reached 9.6% (5.9% excluding tariff refunds), up from 5.2% last year.

• Gross margin rate was 33.7%, up 4.7 percentage points, including a 3.7-point benefit from $994M in tariff refunds; excluding refunds, gross margin improved by 1 percentage point.

• SG&A expense rate increased slightly to 21.6% from 21.3%, reflecting higher compensation and capital project spending.

Outlook and guidance

• Raised full-year net sales growth guidance to ~5%, 1 point higher than prior outlook.

• Full-year operating margin rate (excluding tariff refunds) expected to be ~0.5 point higher than last year’s 4.6%.

• Increased full-year EPS guidance to $9.90–$10.90, including $1.65 from tariff refunds; midpoint excluding refunds is $0.75 higher than prior range.

• Guidance excludes any potential future tariff refunds.