Target raised its full-year 2026 net sales growth forecast to approximately 5 percent on Tuesday, up from prior guidance of 4 percent, after the Minneapolis-based retailer beat second-quarter earnings expectations and reported strong comparable sales growth. The company reported second-quarter diluted earnings per share of $4.11, compared with $2.05 a year earlier, though the quarter included $1.65 per share in benefits from tariff refunds received during the period.
Second-quarter net sales grew 5.3 percent to $26.5 billion, beating Wall Street expectations of $26.15 billion. Comparable sales—a key retail metric measuring sales from stores open at least 13 months plus digital channels—rose 3.8 percent, driven by a 3.6 percent increase in comparable traffic, signaling renewed customer engagement. Store comparable sales increased 2.7 percent, while digital comparable sales surged 8.7 percent, led by same-day delivery services growing more than 25 percent.
The updated full-year earnings per share guidance now ranges from $9.90 to $10.90, up from prior guidance of $7.50 to $8.50. Excluding the tariff refund benefits, the midpoint of the new range reflects a $0.75 increase from the prior guidance midpoint, signaling confidence in underlying operational performance. The company also updated its full-year operating income margin guidance to around 6 percent, which includes approximately 90 basis points of benefit from the Q2 tariff refunds.
The results mark a significant milestone in Target’s turnaround effort. After enduring 13 consecutive quarters of weak or negative comparable sales, the company posted its first positive comparable sales in five quarters during the first quarter of fiscal 2026, when comparable sales rose 5.6 percent. The second-quarter results suggest that momentum is accelerating rather than fading, a critical test of whether CEO Michael Fiddelke’s strategy of balancing value with elevated merchandising is gaining traction.
Fiddelke, who took the helm in late 2025 to lead the turnaround, credited the momentum to Target’s strategic initiatives. “Second quarter results build on the encouraging momentum we saw in the first quarter, giving us increasing confidence that our strategy is resonating with our guests,” he said in the earnings release. Over the past year, Target has reduced prices on more than 10,000 frequently purchased items while investing in newness, store design, and convenience services. Merchandise categories showed broad strength, with double-digit growth in the Fun category (toys and hardlines) and high single-digit gains in food and beverage and beauty.
The earnings beat was supported by broader resilience in consumer spending. Target noted that topline strength was broad-based across sales channels, demographics, and merchandise categories throughout the quarter, suggesting the recovery is not concentrated in any single segment. The company’s updated guidance also reflects higher-margin advertising and marketplace revenue, which contributed to improved operational efficiency.
Sources
- ECIKS.org — Target Q2 2026 earnings results, sales growth, comparable sales, EPS guidance, tariff refund details, and CEO commentary
- Quartz — Target Q2 2026 earnings beat, net sales growth to 5 percent, comparable sales data
- ProactiveInvestors — Target Q2 earnings beat and full-year sales growth guidance increase
- Target Corporation official press release — Q2 2026 earnings release with same-day delivery growth, merchandise category performance, and operating margin guidance
- CNBC — Target Q1 2026 earnings and comparable sales growth context
- Wall Street Journal — Target Q1 2026 comparable sales gain and strategic initiatives
