Target (TGT) Q3 2025 earnings summary

Executive summary

• Comparable sales rose 0.3% in Q3 2024, driven by 2.4% traffic growth and 10.8% digital sales growth, with strong performance in beauty and frequency categories.

• Total revenue for Q3 2024 was $25.7 billion, up 1.1% year-over-year, with sales up 0.9% and other revenue up 11.5%.

• Over 10 million more transactions compared to Q3 2023, driven by events like Target Circle Week.

• GAAP and Adjusted EPS were $1.85, down 11.9% from $2.10 in Q3 2023.

• Operating income declined 11.2% to $1.2 billion, with margin rate at 4.6%, down from 5.2% last year.

Financial highlights

• Gross margin rate declined by 20 basis points to 27.2%, mainly due to higher digital fulfillment and supply chain costs.

• SG&A expense rate increased to 21.4% from 20.9% last year, reflecting higher pay, benefits, and liability expenses.

• Net earnings for Q3 2024 were $854 million, down from $971 million in Q3 2023.

• EBITDA for Q3 2024 was $1.95 billion, up 4.2% year-over-year.

• Digital sales grew 10.8%, with same-day delivery up nearly 20% and drive-up services showing double-digit growth.

Outlook and guidance

• Q4 comparable sales expected to be around flat, with continued softness in discretionary categories and calendar headwinds.

• Full-year 2024 expected GAAP and Adjusted EPS range: $8.30–$8.90, bracketing the lower end of initial guidance.

• CapEx for 2024 expected near $3 billion, with 2025 CapEx projected at $4–$5 billion for new stores, remodels, and technology.

• The company is planning cautiously for Q4, aiming to end the year with a clean inventory position.

• Strategic investments and exclusive holiday offerings are set to drive continued momentum.