Target Shatters Sales Growth Record, But Hedges Bets On Future Performance

Target has posted massive sales gains during 2020’s fourth quarter, adding more in one year than the previous decade combined. The pandemic boost has raised Target’s stock price 80% in 12 months, but economic uncertainty has the retailer cautious about future plans, CNN reports.

In total, Target’s sales shot up 19.8% from $78.1 billion to $93.6 billion. The average was bolstered by a 145% increase in online sales.

That translated to a 33% increase in net earnings, to a total of $4.4 billion.

"Following years of investment to build a durable, scalable and sustainable business model, we saw record growth in 2020," Target CEO Brian Cornell told CNN.

Smart development can’t take all the credit for Target’s blockbuster year: the COVID-19 pandemic has benefitted large retail operations with strong online presences. Malls and department stores, less able to adjust to COVID-19 safety measures, have floundered.

Other stores that offer delivery, online ordering and same-day pickup saw an average of 20.5% growth, according to The Wall Street Journal. By Target’s estimates, $9 billion of its increased revenue was traffic that would normally go to other stores.

Another important element is the product a store carries: Macy’s saw sales drop almost 30% as consumers stopped buying apparel for outside the home. Home Depot saw sales rise by 20% as Americans repaired and expanded their houses.

Almost all retailers, however, are nervous about what the future might hold after the pandemic is blunted by expanding vaccination efforts. Target declined to make any prediction for the coming year, offering the now-common refrain of “the highly fluid and uncertain outlook for consumer shopping patterns and the impact of Covid-19.”