Although there are several reports of a dive in retail sales and growth as consumers have become more discerning in their spending, due to several factors, TJX Cos. recorded higher growth and sales when compared with analysts’ estimates. However, another retail giant, Target (TGT), has seen a slide in profits and growth.
TJX Cos. which includes T.J. Maxx, Marshalls and HomeGoods raised its outlook for 2023 on Wednesday after posting an increase in both sales and profits. The group announced that year-over-year sales saw a 7.7 percent rise while profits leapt up by 23 percent.
TJX Cos fiscal second quarter results posted an earnings per share of 85 cents while Refinitiv had estimated earnings of 77 cents per share. Wall Street analysts had predicted a revenue of $12.45 billion. However, the off-price giant posted a revenue of $12.76 billion.
TJX Cos. said that high customer traffic had increased sales. The conglomerate also said that many high-end retailers had been eager to offload their excess inventories and the discounter benefited from the windfall of premium merchandise which flew off its shelves as consumers bought these items.
Target’s second-quarter earnings fell by 5.4 percent year-over-year. It decreased its outlook of profit for the year on Tuesday.
Target said that factors such as a general decline in the economy, an increase in interest rates, and uncertainty after the restart of student loan payments would affect its growth this year.
The second quarter was also challenging as it faced incidents in stores where shoppers threatened staff for Pride month displays. Merchandise and displays with Pride themes were also destroyed.
Target said that sales trends saw a gradual improvement after Target addressed the assortment. Target has taken a cautious outlook for the full year due to all of the above-mentioned factors.
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