Target (TGT) Q2 2025 Earnings
How Did TGT Stock React to Q2 2025 Earnings?
S&P 500 over the same 30 days: +4.50%.
Did TGT Beat Earnings? Q2 2025 Results
Yes. Target reported Q2 2025 earnings of $2.05 a share on Aug 20, 2025, beating the $2.04 consensus estimate by 0.7%. Revenue was $25.2B against a $24.9B estimate.
Target delivered a modest beat on both the top and bottom lines in Q2 2025, though the headline numbers told a story of a retailer still working through a difficult stretch. Adjusted diluted EPS came in at $2.05, edging past the $2.04 consensus estimate by 0.72%, while revenue of $25.21 billion topped expectations by 1.23%, even as sales slipped 0.9% from a year ago. The quarter's most consequential development may have been off the income statement entirely, with the board unanimously naming COO Michael Fiddelke as the company's next CEO, signaling a deliberate transition as Target navigates its prolonged sales recovery. Profitability remained under pressure, with gross margin contracting 100 basis points to 29.0% as tariff-related costs and higher markdown rates weighed on results, pushing operating income down 19.4% year-over-year to $1.32 billion. Digital comparable sales growth of 4.3% and same-day delivery expansion offered brighter signals within an otherwise mixed report. Management maintained its full-year outlook, projecting a low-single digit sales decline and adjusted EPS of approximately $7.00 to $9.00.
- Traffic and sales trends improved meaningfully compared with Q1, particularly in stores
- All six core merchandising categories saw comparable sales improvements versus Q1
- Digital comparable sales grew 4.3%, with same-day delivery powered by Target Circle 360 growing more than 25%
- Non-merchandise sales grew 14.2% with Roundel, membership and marketplace revenues all growing double digits
- Strong expense management and efficiency gains helped offset tariff-related and other cost pressures
- Lower inventory shrink partially offset gross margin headwinds
- Gross margin rate declined 100 basis points to 29.0% due to higher markdown rates, purchase order cancellation costs, and category mix pressure
“With the board's unanimous decision to appoint Michael Fiddelke as Target's next CEO, I want to express my full confidence in his leadership and focus on driving improved results and sustainable growth. He's contributed meaningfully during times of change and played a critical role in establishing the differentiated capabilities that will continue to drive Target forward. Michael brings a deep understanding of our business and a genuine commitment to accelerating our progress.”
Target CEO, on the earnings call
What Was Target's Outlook in Q2 2025?
For fiscal 2025, Target is maintaining its expectation of a low-single digit decline in sales, GAAP EPS of $8.00 to $10.00, and Adjusted EPS of approximately $7.00 to $9.00. The Adjusted EPS excludes $0.97 per share in gains from Q1 interchange fee litigation settlements. Full-year GAAP EPS may include additional discrete items which would be excluded from Adjusted EPS.
TGT YoY Financials
| Metric | Q2 2025 | Q2 2024 | Year over year |
|---|---|---|---|
| Revenue | $25.2B | $25.5B | −0.9% |
| Gross Profit | $7.3B | $7.6B | −4.2% |
| Operating Income | $1.3B | $1.6B | −19.5% |
| Net Income | $935.0M | $1.2B | −21.6% |
TGT Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.