Target Feels the Impact of Inflation as Quarterly Profits Continue to Fall

Target, Feels the Impact of Inflation , as Quarterly Profits Continue to Fall.
According to CNN, Target reported that profits
plummeted 90% in the second quarter as inflation
drives consumers to cut back on spending.
The retailer's quarterly
net income dropped
to $183 million.
At the same time in 2021,
Target had a net income
of $1.8 billion. .
Target was forced to cut prices on general
merchandise due to excess inventory,
but the move did little to drive up sales.
The retailer ended the quarter with
1.5% more inventory than three months earlier
and 36% more than the same time last year.
After the lower-than-expected
profits were reported, shares in
Target fell 2% in premarket trading.
CNN reports that this marks
the second consecutive quarter
of plummeting earnings for Target.
The losing streak comes
after seven quarters
of strong profit growth.
On August 17, CEO Brian Cornell told investors that while
the environment for retailers remains "challenging," he believes
that earnings will start to recover in the next quarter.
On August 17, CEO Brian Cornell told investors that while
the environment for retailers remains "challenging," he believes
that earnings will start to recover in the next quarter.
The high-level story is:
The vast majority of the financial
impact of these inventory
actions is now behind us, Brian Cornell, Target CEO, via CNN.
Cornell said the company was seeing , "an encouraging start to the, back-to-school" shopping season