American retailer Target Corporation has reported total revenue of $25.5 billion for the second quarter of fiscal 2024 (Q2 FY24), marking a 2.7 per cent increase compared to the same period last year. This growth was driven by a 2.6 per cent rise in total sales and a notable 10.8 per cent increase in other revenue.

Comparable sales for the quarter increased by 2.0 per cent, reflecting a balanced performance across different sales channels. Comparable store sales saw a modest increase of 0.7 per cent, while comparable digital sales surged by 8.7 per cent, highlighting Target’s continued strength in its online operations, the company said in a press release.

Target’s operating income for Q2 FY24 reached $1.6 billion, representing a substantial 36.6 per cent increase from the previous year. This impressive growth was attributed to both the increase in sales and an improvement in the company’s gross margin rate. The operating income margin rate for the second quarter rose to 6.4 per cent, up from 4.8 per cent in Q2 FY23.

The company’s gross margin rate also improved significantly, rising to 28.9 per cent in Q2 FY24, compared with 27.0 per cent in the same period last year. This improvement reflects Target’s effective cost management and pricing strategies, which have bolstered profitability despite the competitive retail environment.

However, the second quarter selling, general, and administrative expense rate increased slightly to 21.2 per cent in FY24, compared with 20.9 per cent in FY23.

"We made a commitment to get back to growth in the second quarter, and the team delivered, all while expanding operating margins and growing EPS by more than 40 per cent compared to last year. Importantly, our growth was driven entirely by traffic in stores and our digital channels, with double-digit growth in our same-day delivery services," said Brian Cornell, chair and chief executive officer of Target Corporation.

Fibre2Fashion News Desk (DP)