Target posted net earnings of $834 million in the fourth quarter, an increase of 4.4% from a year earlier. Comparable-store sales were up 1.5% for the quarter ending February 1, reflecting comparable digital sales growth of 20%.
Full-year comps were up 3.4%.
“With eleven consecutive quarters of positive comparable sales growth, driven by healthy performance in both our stores and digital channels, Target’s results demonstrate that we’ve built a sustainable business model that drives strong top-line growth and consistent bottom line performance,” CEO Brian Cornell said in a statement.
Target said revenue of $23.4 billion was a tick below expectations because of tepid sales of toys, electronics and home goods over the holidays.
Same-day services accounted for more than 80% of its comparable digital sales growth in the fourth quarter, the company said. Target offers same-day pickup in store and by drive-up and has same-day delivery of packages through Shipt.
“The strategic investments we’ve made over the past several years to elevate the shopping experience, curate our multi-category assortment at scale, and deliver ease and convenience through our fulfillment capabilities are deepening our relationship with our guest,” Cornell said.
Fiscal 2019 revenue increased 3.7% to $78.1 billion, reflecting sales growth of 3.6% and a 6.3% increase in other revenue.
Target said full-year gross margin rate was 28.9%, up from 28.4% a year earlier, due to merchandising efforts to optimize costs, pricing, promotions and assortment, combined with the benefit of favorable category sales mix, partially offset by higher supply chain and fulfillment costs. Full-year SG&A expense rate was 20.8% in 2019, essentially unchanged from the prior year. Store labor productivity and lower incentive compensation in 2019 offset pressure from wage growth, Target said in its earnings statement.
In fiscal 2020, Target has said earnings per share will range from $6.70 to $7 along with comparable-store sales increases in the low single digits.