Target rises above expectations in Q1

Target had a record-breaking first quarter, with market share gains of $1 billion as shoppers flocked to its stores and sales of its owned brands continued to surge.

“Our performance in the first quarter was outstanding on every measure, and showcased the power of putting our stores at the center of our strategy,” stated chairman and CEO Brian Cornell. “Importantly, market-share gains of more than $1 billion in the first quarter, on top of $1 billion in share gains a year ago, demonstrate Target’s continued relevance with our guests, even as they have many more shopping options compared with a year ago.”

The discounter’s net income jumped to $2.097 billion, or $4.17 per share, from $284.0 million, or $0.56 per share, in the year-ago period. Excluding items, the retailer earned an all-time high of $3.69 per share, blowing past the $2.21 per share expected by analysts.

Sales rose 23% to $23.88 billion, also ahead of estimates. Comparable sales rose 22.9% with stores up 18% and digital comp sales up 50%. Basket size grew by 5%. Target said its owned brands experienced a record 36% sales growth. 

Same-day services, including order pickup and drive-up,  increased 90% year-over-year. Drive-up services had the biggest growth, rising 123%. Store fulfilled more than three-quarters of Target’s digital sales 

On a call with reporters, Cornell noted that Target’s stores served as fulfillment hubs for the chain’s advancing digital sales. All told, stores accounted for more than 95% of the company’s total sales.

“Our stores were the star of the show this quarter,” he said.

Target’s strongest category during the quarter was apparel, with sales rising by about 60% versus the year-ago period. Hardlines posted grew in the high 30% range and home sales grew in the mid-30% range. Sales of food and beverage and essentials have grown in the low-to-mid single digits.

This story originally appeared on Chain Store Age.