Target(US:TGT)2024-05-22 11:03Financial Performance - First quarter total revenue was $24.5 billion, a decrease of 3.1% year-over-year, with comparable sales declining 3.7%[6] - The company reported first quarter GAAP and Adjusted EPS of $2.03, down from $2.05 in 2023[3] - Net earnings for the three months ended May 4, 2024, were $942 million, a decrease of 0.8% compared to $950 million for the same period in 2023[22] - EBIT for the three months ended May 4, 2024, was $1,325 million, a decrease of 1.9% from $1,351 million in the same period last year[32] - EBITDA for the same period increased by 1.3% to $2,043 million from $2,018 million year-over-year[32] - Cash provided by operating activities was $1,101 million, down from $1,265 million in the previous year[22] Sales and Revenue Trends - Digital comparable sales grew by 1.4%, while same-day services increased nearly 9%, driven by over 13% growth in Drive Up[2] - Comparable sales decreased by 3.7%, with a decline in the number of transactions by 1.9% and average transaction amount also down by 1.9%[25] - Digitally originated comparable sales increased by 1.4%, contrasting with a decline of 3.4% in the previous year[25] - For the second quarter, the company expects a 0 to 2% increase in comparable sales and GAAP and Adjusted EPS of $1.95 to $2.35[5] Margins and Expenses - First quarter operating income margin rate improved to 5.3%, reflecting a 140 basis point increase in gross margin compared to the prior year[2] - Gross margin rate increased to 27.7% from 26.3% year-over-year, while SG&A expense rate rose to 21.1% from 19.8%[24] - Selling, general and administrative (SG&A) expense rate increased to 21.1% in Q1 2024, compared to 19.8% in Q1 2023[8] Capital and Investments - After-tax return on invested capital (ROIC) for the trailing twelve months was 15.4%, up from 11.4% in the prior year[11] - Operating income for the trailing twelve months ended May 4, 2024, was $5,675 million, up from $3,830 million in the prior year, representing a growth of 48.2%[34] - Net operating profit after taxes increased to $4,593 million from $3,213 million, reflecting a year-over-year increase of 43.0%[34] - The average invested capital rose to $29,737 million, compared to $28,199 million in the previous year, indicating a growth of 5.5%[34] - Current portion of long-term debt and other borrowings significantly increased to $2,614 million from $200 million, showing a substantial rise[34] - Noncurrent portion of long-term debt decreased to $13,487 million from $16,010 million, indicating a reduction of 15.3%[34] - Shareholders' investment increased to $13,840 million from $11,605 million, reflecting a growth of 19.2%[34] - Operating lease liabilities rose to $3,723 million from $2,921 million, representing an increase of 27.5%[34] - Cash and cash equivalents increased to $3,604 million from $1,321 million, showing a significant growth of 172.5%[34] Customer Engagement and Loyalty - The company successfully relaunched its Target Circle loyalty program, gaining over 1 million new members in the first quarter[2] - Total Target Circle Card penetration decreased to 18.0% from 19.0% year-over-year[26] Store Growth - The total number of stores increased to 1,963 from 1,954 year-over-year, with retail square feet growing to 246,654 from 244,993[27] Guidance - Adjusted diluted earnings per share guidance for Q2 2024 is set at $1.95, with full-year guidance between $8.60 and $9.60[31] Other Considerations - The trailing twelve months ended May 4, 2024, consisted of 53 weeks compared to 52 weeks in the prior-year period, which may impact year-over-year comparisons[34]