MINNEAPOLIS, May 21, 2025
/PRNewswire/ --
- First quarter Net Sales were $23.8
billion, compared with $24.5
billion in 2024.
- Digital comparable sales grew 4.7 percent reflecting more
than 35 percent growth in same-day delivery powered by Target
Circle 360TM and continued growth in Drive Up.
- Key seasonal moments such as Valentine's Day and Easter
outperformed non-holiday periods throughout the quarter.
- The Company's limited-time partnership with kate spade
was the strongest designer collaboration in the last
decade.
- First quarter SG&A Expense and Operating Income included
$593 million in pre-tax gains from
the settlement of credit card interchange fee litigation.
- First quarter GAAP EPS was $2.27 compared with $2.03 last year. Adjusted EPS1, which
excludes the gains from litigation settlements, was $1.30.
- The Company has established an acceleration office led by
Michael Fiddelke, with the purpose
of enabling faster decisions and execution of its core strategic
initiatives in support of a return to growth.
For additional media materials, please visit:
https://corporate.target.com/news-features/article/2025/05/q1-2025-earnings
Target Corporation (NYSE: TGT) today announced its first quarter
2025 financial results.
The Company reported first quarter GAAP earnings per share (EPS)
of $2.27 and Adjusted earnings per
share1 of $1.30 compared
with GAAP and Adjusted EPS of $2.03
in 2024. The attached tables provide a reconciliation of non-GAAP
to GAAP measures. All earnings per share figures refer to diluted
EPS.
"In the first quarter, our team navigated a highly challenging
environment and focused on delivering the outstanding assortment,
experience and value guests expect from Target," said Brian Cornell, chair and chief executive officer
of Target Corporation. "While our sales fell short of our
expectations, we saw several bright spots in the quarter, including
healthy digital growth, led by a 36 percent increase in same-day
delivery through Target Circle 360, and our strongest designer
collaboration in more than a decade, kate spade for Target. While
these highlights reinforce our confidence in the underlying health
of our business, we're not satisfied with current performance and
know we have opportunities to deliver faster progress on our
roadmap for growth. This morning, we announced the establishment of
a multi-year acceleration office, led by Michael Fiddelke, along with several leadership
changes. These steps forward are intended to build more speed and
agility into how we operate, and position key capabilities to drive
long-term profitable growth. With these changes and the financial
strength to continue investing in our business, I'm confident we
can emerge an even stronger company over time."
Guidance
For fiscal 2025, the Company now expects a low-single digit
decline in sales, and GAAP EPS of $8.00 to $10.00. Adjusted EPS, which excludes the
gains from the litigation settlements in the first quarter, is
expected to be approximately $7.00 to
$9.00.
Operating Results
Comparable sales decreased 3.8 percent in the first quarter,
reflecting a comparable store sales decline of 5.7 percent and
comparable digital sales growth of 4.7 percent. Net Sales of
$23.8 billion in the first quarter
were 2.8 percent lower than last year, reflecting
a merchandise sales decrease of 3.1 percent and a 13.5 percent
increase in other revenue. First quarter operating income of
$1.5 billion was 13.6 percent higher
than last year.
First quarter operating income margin rate, which includes the
one-time benefit of the settlement of credit card interchange fee
litigation, was 6.2 percent in 2025, compared with 5.3 percent in
2024. Excluding the litigation settlement gains,
operating income margin rate was 3.7 percent in 2025. First
quarter gross margin rate was 28.2 percent, compared with 28.8
percent in 2024, reflecting the net impact of merchandising
activities, including higher markdown rates, as well as digital
fulfillment and supply chain costs due to increased digital sales
penetration and new supply chain facilities coming online. These
pressures were partially offset by the benefit of lower inventory
shrink. First quarter SG&A expense rate was 19.3 percent
in 2025, compared with 21.0 percent in 2024, reflecting credit card
interchange fee settlements and disciplined cost management
partially offset by the deleveraging impact of lower sales and
higher costs, including team member pay and benefits. Without the
litigation settlement gains, the SG&A expense rate was 21.7
percent in Q1 2025.
Interest Expense and Taxes
The Company's first quarter 2025 net interest expense was
$116 million, compared with
$106 million last year, reflecting
lower interest income in the current year.
First quarter 2025 effective income tax rate was 25.0 percent,
compared with the prior year rate of 22.7 percent, reflecting the
impact of discrete tax expenses in the current year.
Capital Deployment and Return on Invested Capital
The Company paid dividends of $510
million in the first quarter, compared with $508 million last year, reflecting a 1.8 percent
increase in the dividend per share.
The Company repurchased $251
million of its shares in the first quarter, retiring 2.2
million shares of common stock at an average price of $114.60. As of the end of the quarter, the
Company had approximately $8.4
billion of remaining capacity under the repurchase program
approved by Target's Board of Directors in August 2021.
For the trailing twelve months through first quarter 2025,
after-tax return on invested capital (ROIC) was 15.1 percent,
compared with 15.4 percent for the trailing twelve months through
first quarter 2024. The tables in this release provide additional
information about the Company's ROIC calculation.
Webcast Details
Target will webcast its first quarter earnings conference call
at 7:00 a.m. CT today. Investors and
the media are invited to listen to the meeting at
Corporate.Target.com/Investors (click on "Q1 2025 Target
Corporation Earnings Conference Call" under "Events &
Presentations"). A replay of the webcast will be provided when
available. The replay number is 1-866-360-7721.
Miscellaneous
Statements in this release regarding the Company's future
financial performance, including its fiscal 2025 full-year
guidance, are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements
are subject to risks and uncertainties which could cause the
Company's results to differ materially. The most important risks
and uncertainties are described in Item 1A of the Company's Form
10-K for the fiscal year ended February 1,
2025. Forward-looking statements speak only as of the date
they are made, and the Company does not undertake any obligation to
update any forward-looking statement.
About Target
Minneapolis-based Target
Corporation (NYSE: TGT) serves guests at nearly 2,000 stores and at
Target.com, with the purpose of helping all families discover the
joy of everyday life. Since 1946, Target has given 5% of its profit
to communities, which today equals millions of dollars a week.
Additional company information can be found by visiting the
corporate website (corporate.target.com) and press center.
|
1Adjusted
diluted earnings per share (Adjusted EPS), a non-GAAP financial
measure, excludes the impact of certain discretely managed items.
See the tables of this release for additional
information.
|
|
TARGET
CORPORATION
Consolidated
Statements of Operations
|
|
|
Three Months Ended
|
|
|
|
(millions, except per share data) (unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Change
|
|
Net sales
|
|
$
23,846
|
|
$
24,531
|
|
(2.8)
|
|
Cost of
sales
|
|
17,128
|
|
17,471
|
|
(2.0)
|
|
Selling, general and
administrative expenses
|
|
4,591
|
|
5,146
|
|
(10.8)
|
|
Depreciation and
amortization (exclusive of depreciation included in cost of
sales)
|
|
655
|
|
618
|
|
6.0
|
|
Operating
income
|
|
1,472
|
|
1,296
|
|
13.6
|
|
Net interest
expense
|
|
116
|
|
106
|
|
8.7
|
|
Net other
income
|
|
(26)
|
|
(29)
|
|
(12.8)
|
|
Earnings before income
taxes
|
|
1,382
|
|
1,219
|
|
13.4
|
|
Provision for income
taxes
|
|
346
|
|
277
|
|
25.1
|
|
Net earnings
|
|
$
1,036
|
|
$
942
|
|
10.0 %
|
|
Basic earnings per
share
|
|
$
2.28
|
|
$
2.04
|
|
11.7 %
|
|
Diluted earnings per
share
|
|
$
2.27
|
|
$
2.03
|
|
11.7 %
|
|
Weighted average common
shares outstanding
|
|
|
|
|
|
|
|
Basic
|
|
455.0
|
|
462.2
|
|
(1.6) %
|
|
Diluted
|
|
456.5
|
|
463.9
|
|
(1.6) %
|
|
Antidilutive
shares
|
|
2.4
|
|
1.6
|
|
|
|
Dividends declared per
share
|
|
$
1.12
|
|
$
1.10
|
|
1.8 %
|
|
TARGET
CORPORATION
Consolidated
Statements of Financial Position
|
|
(millions, except
footnotes) (unaudited)
|
|
May 3, 2025
|
|
February 1,
2025
|
|
May 4, 2024
|
|
Assets
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
2,887
|
|
$
4,762
|
|
$
3,604
|
|
Inventory
|
|
13,048
|
|
12,740
|
|
11,730
|
|
Other current
assets
|
|
1,824
|
|
1,952
|
|
1,744
|
|
Total current
assets
|
|
17,759
|
|
19,454
|
|
17,078
|
|
Property and equipment,
net
|
|
33,182
|
|
33,022
|
|
33,114
|
|
Operating lease
assets
|
|
3,739
|
|
3,763
|
|
3,486
|
|
Other noncurrent
assets
|
|
1,505
|
|
1,530
|
|
1,439
|
|
Total
assets
|
|
$
56,185
|
|
$
57,769
|
|
$
55,117
|
|
Liabilities and
shareholders' investment
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
11,823
|
|
$
13,053
|
|
$
11,561
|
|
Accrued and other
current liabilities
|
|
6,029
|
|
6,110
|
|
5,684
|
|
Current portion of
long-term debt and other borrowings
|
|
1,139
|
|
1,636
|
|
2,614
|
|
Total current
liabilities
|
|
18,991
|
|
20,799
|
|
19,859
|
|
Long-term debt and
other borrowings
|
|
14,334
|
|
14,304
|
|
13,487
|
|
Noncurrent operating
lease liabilities
|
|
3,564
|
|
3,582
|
|
3,392
|
|
Deferred income
taxes
|
|
2,338
|
|
2,303
|
|
2,543
|
|
Other noncurrent
liabilities
|
|
2,011
|
|
2,115
|
|
1,996
|
|
Total noncurrent
liabilities
|
|
22,247
|
|
22,304
|
|
21,418
|
|
Shareholders'
investment
|
|
|
|
|
|
|
|
Common
stock
|
|
38
|
|
38
|
|
39
|
|
Additional paid-in
capital
|
|
7,011
|
|
6,996
|
|
6,747
|
|
Retained
earnings
|
|
8,360
|
|
8,090
|
|
7,519
|
|
Accumulated other
comprehensive loss
|
|
(462)
|
|
(458)
|
|
(465)
|
|
Total shareholders'
investment
|
|
14,947
|
|
14,666
|
|
13,840
|
|
Total liabilities
and shareholders' investment
|
|
$
56,185
|
|
$
57,769
|
|
$
55,117
|
|
Common
Stock Authorized 6,000,000,000 shares, $0.0833 par value;
454,364,799, 455,566,995, and 462,635,539 shares issued and
outstanding as of May 3, 2025, February 1, 2025, and
May 4, 2024, respectively.
|
|
|
Preferred
Stock Authorized 5,000,000 shares, $0.01 par value; no
shares were issued or outstanding during any period
presented.
|
|
TARGET
CORPORATION
Consolidated
Statements of Cash Flows
|
|
|
Three Months
Ended
|
|
(millions) (unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Operating
activities
|
|
|
|
|
|
Net earnings
|
|
$
1,036
|
|
$
942
|
|
Adjustments to
reconcile net earnings to cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
|
787
|
|
718
|
|
Share-based
compensation expense
|
|
69
|
|
72
|
|
Deferred income
taxes
|
|
36
|
|
64
|
|
Noncash (gains) /
losses and other, net
|
|
(4)
|
|
(31)
|
|
Changes in operating
accounts:
|
|
|
|
|
|
Inventory
|
|
(308)
|
|
156
|
|
Other
assets
|
|
146
|
|
43
|
|
Accounts
payable
|
|
(1,344)
|
|
(524)
|
|
Accrued and other
liabilities
|
|
(143)
|
|
(339)
|
|
Cash provided by
operating activities
|
|
275
|
|
1,101
|
|
Investing
activities
|
|
|
|
|
|
Expenditures for
property and equipment
|
|
(790)
|
|
(674)
|
|
Other
|
|
3
|
|
3
|
|
Cash required for
investing activities
|
|
(787)
|
|
(671)
|
|
Financing
activities
|
|
|
|
|
|
Additions to long-term
debt
|
|
991
|
|
—
|
|
Reductions of
long-term debt
|
|
(1,534)
|
|
(32)
|
|
Dividends
paid
|
|
(510)
|
|
(508)
|
|
Repurchase of
stock
|
|
(250)
|
|
—
|
|
Shares withheld for
taxes on share-based compensation
|
|
(60)
|
|
(91)
|
|
Cash required for
financing activities
|
|
(1,363)
|
|
(631)
|
|
Net decrease in cash
and cash equivalents
|
|
(1,875)
|
|
(201)
|
|
Cash and cash
equivalents at beginning of period
|
|
4,762
|
|
3,805
|
|
Cash and cash
equivalents at end of period
|
|
$
2,887
|
|
$
3,604
|
|
TARGET
CORPORATION
Operating
Results
|
|
Net
Sales
|
Three Months
Ended
|
|
(millions)
(unaudited)
|
May 3, 2025
|
|
May 4, 2024
|
|
Apparel and
accessories
|
$
3,711
|
|
$
3,897
|
|
Beauty
|
3,101
|
|
3,119
|
|
Food and
beverage
|
5,902
|
|
5,853
|
|
Hardlines
|
3,074
|
|
3,160
|
|
Home furnishings and
décor
|
3,220
|
|
3,519
|
|
Household
essentials
|
4,357
|
|
4,549
|
|
Other merchandise
sales
|
40
|
|
46
|
|
Merchandise
sales
|
23,405
|
|
24,143
|
|
Advertising revenue
(a)
|
163
|
|
130
|
|
Credit card profit
sharing
|
141
|
|
142
|
|
Other
|
137
|
|
116
|
|
Net sales
|
$
23,846
|
|
$
24,531
|
|
(a)
|
Primarily represents
revenue related to advertising services provided via the Company's
Roundel digital advertising business offering. Roundel services are
classified as either Net Sales or as a reduction of Cost of Sales
or Selling, General, and Administrative (SG&A) Expenses,
depending on the nature of the advertising arrangement.
|
|
Rate
Analysis
|
|
Three Months
Ended
|
|
(unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Gross margin rate
(a)
|
|
28.2 %
|
|
28.8 %
|
|
SG&A expense rate
(a)(b)
|
|
19.3
|
|
21.0
|
|
Depreciation and
amortization expense rate (exclusive of depreciation included in
cost of sales)
|
|
2.7
|
|
2.5
|
|
Operating income margin
rate (b)
|
|
6.2
|
|
5.3
|
|
Note: Gross margin is
calculated as Net Sales less Cost of Sales. All rates are
calculated by dividing the applicable amount by Net
Sales.
|
|
(a)
|
Reflects the impact of
a reclassification of prior year amounts, which were not material,
to conform with current year presentation. The reclassifications
increased Cost of Sales with equal and offsetting decreases to
SG&A Expenses.
|
|
(b)
|
SG&A Expenses and
Operating Income for the three months ended May 3, 2025, includes
gains, net of legal fees, related to settlements of credit card
interchange fee litigation matters in which we were a
plaintiff.
|
Sales Metrics
Comparable sales include all Merchandise Sales, except sales
from stores open less than 13 months or that have been
closed. Digitally originated sales include all Merchandise
Sales initiated through mobile applications and the Company's
websites.
|
Comparable
Sales
|
|
Three Months Ended
|
|
(unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Comparable sales
change
|
|
(3.8) %
|
|
(3.7) %
|
|
Drivers of change in
comparable sales
|
|
|
|
|
|
Number of transactions
(traffic)
|
|
(2.4)
|
|
(1.9)
|
|
Average transaction
amount
|
|
(1.4)
|
|
(1.9)
|
|
|
Comparable Sales by
Channel
|
|
Three Months Ended
|
|
(unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Stores originated
comparable sales change
|
|
(5.7) %
|
|
(4.8) %
|
|
Digitally originated
comparable sales change
|
|
4.7
|
|
1.4
|
|
|
Sales by
Channel
|
|
Three Months Ended
|
|
(unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Stores
originated
|
|
80.2 %
|
|
81.7 %
|
|
Digitally
originated
|
|
19.8
|
|
18.3
|
|
Total
|
|
100 %
|
|
100 %
|
|
|
Sales by
Fulfillment Channel
|
|
Three Months Ended
|
|
(unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Stores
|
|
97.6 %
|
|
97.7 %
|
|
Other
|
|
2.4
|
|
2.3
|
|
Total
|
|
100 %
|
|
100 %
|
|
Note: Sales fulfilled
by stores include in-store purchases and digitally originated sales
fulfilled by shipping merchandise from stores to guests, Order
Pickup, Drive Up, and Same Day Delivery.
|
|
Target Circle Card
Penetration
|
|
Three Months
Ended
|
|
(unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Total Target Circle
Card Penetration
|
|
17.4 %
|
|
18.0 %
|
|
Number of Stores and
Retail Square Feet
|
|
Number of
Stores
|
|
Retail Square Feet
(a)
|
|
(unaudited)
|
|
May 3,
2025
|
|
February 1,
2025
|
|
May 4,
2024
|
|
May 3,
2025
|
|
February 1,
2025
|
|
May 4,
2024
|
|
170,000 or more sq.
ft.
|
|
273
|
|
273
|
|
273
|
|
48,824
|
|
48,824
|
|
48,824
|
|
50,000 to 169,999 sq.
ft.
|
|
1,562
|
|
1,559
|
|
1,547
|
|
195,436
|
|
195,050
|
|
193,529
|
|
49,999 or less sq.
ft.
|
|
146
|
|
146
|
|
143
|
|
4,404
|
|
4,404
|
|
4,301
|
|
Total
|
|
1,981
|
|
1,978
|
|
1,963
|
|
248,664
|
|
248,278
|
|
246,654
|
|
(a)
|
In thousands; reflects
total square feet less office, supply chain facility, and vacant
space.
|
TARGET CORPORATION
Reconciliation of Non-GAAP Financial Measures
To provide additional transparency, we disclose non-GAAP
adjusted diluted earnings per share (Adjusted EPS). This metric
excludes certain items presented below. We believe this information
is useful in providing period-to-period comparisons of the results
of our operations. This measure is not in accordance with, or an
alternative to, generally accepted accounting principles in the
U.S. (GAAP). The most comparable GAAP measure is diluted earnings
per share. Adjusted EPS should not be considered in isolation or as
a substitution for analysis of our results as reported in
accordance with GAAP. Other companies may calculate Adjusted EPS
differently, limiting the usefulness of the measure for comparisons
with other companies.
|
Reconciliation of
Non-GAAP
Adjusted
EPS
|
|
Three Months
Ended
|
|
|
|
May 3, 2025
|
|
May 4, 2024
|
|
|
|
(millions, except
per share data) (unaudited)
|
|
Pretax
|
|
Net of Tax
|
|
Per Share
|
|
Pretax
|
|
Net of Tax
|
|
Per Share
|
|
Change
|
|
GAAP diluted
EPS
|
|
|
|
|
|
$ 2.27
|
|
|
|
|
|
$ 2.03
|
|
11.7 %
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interchange fee
settlements (a)
|
|
$
(593)
|
|
$ (441)
|
|
$
(0.97)
|
|
$
—
|
|
$
—
|
|
$
—
|
|
|
|
Adjusted EPS
|
|
|
|
|
|
$ 1.30
|
|
|
|
|
|
$ 2.03
|
|
(35.9) %
|
|
(a)
|
Note (b) to the Rate
Analysis table provides additional information.
|
|
Reconciliation of
Non-GAAP
Adjusted EPS
Guidance
|
|
|
(per share)
(unaudited)
|
|
Full Year
2025
|
|
GAAP diluted earnings
per share guidance
|
|
~$8.00 -
$10.00
|
|
Estimated
adjustments
|
|
|
|
Interchange fee
settlements
|
|
($0.97)
|
|
Other
(a)
|
|
—
|
|
Adjusted diluted
earnings per share guidance
|
|
$7.00 -
$9.00
|
|
(a)
|
Full-year 2025 GAAP EPS
may include the impact of additional discrete items, which will be
excluded in calculating Adjusted EPS. The guidance does not
currently reflect any such additional discrete items. In the past,
these items have included losses on the early retirement of debt
and certain other items that are discretely managed.
|
Earnings before interest expense and income taxes (EBIT) and
earnings before interest expense, income taxes, depreciation and
amortization (EBITDA) are non-GAAP financial measures. We believe
these measures provide meaningful information about our operational
efficiency compared with our competitors by excluding the impact of
differences in tax jurisdictions and structures, debt levels, and,
for EBITDA, capital investment. These measures are not in
accordance with, or an alternative to, GAAP. The most comparable
GAAP measure is net earnings. EBIT and EBITDA should not be
considered in isolation or as a substitution for analysis of our
results as reported in accordance with GAAP. Other companies may
calculate EBIT and EBITDA differently, limiting the usefulness of
the measures for comparisons with other companies.
|
EBIT and
EBITDA
|
|
Three Months Ended
|
|
|
|
(dollars in
millions) (unaudited)
|
|
May 3, 2025
|
|
May 4, 2024
|
|
Change
|
|
Net earnings
|
|
$
1,036
|
|
$
942
|
|
10.0 %
|
|
+ Provision for
income taxes
|
|
346
|
|
277
|
|
25.1
|
|
+ Net interest
expense
|
|
116
|
|
106
|
|
8.7
|
|
EBIT
|
|
$
1,498
|
|
$
1,325
|
|
13.0 %
|
|
+ Total
depreciation and amortization (a)
|
|
787
|
|
718
|
|
9.7
|
|
EBITDA
|
|
$
2,285
|
|
$
2,043
|
|
11.9 %
|
|
(a)
|
Represents total
depreciation and amortization, including amounts classified within
Depreciation and Amortization and within Cost of Sales.
|
We have also disclosed after-tax ROIC, which is a ratio based on
GAAP information, with the exception of the add-back of operating
lease interest to operating income. We believe this metric is
useful in assessing the effectiveness of our capital allocation
over time. Other companies may calculate ROIC differently, limiting
the usefulness of the measure for comparisons with other
companies.
|
After-Tax Return on
Invested Capital
|
|
|
|
(dollars in
millions) (unaudited)
|
|
|
|
|
|
|
Trailing Twelve
Months
|
|
|
|
Numerator
|
|
May 3, 2025
|
|
May 4, 2024
(a)
|
|
|
|
Operating
income
|
|
$
5,742
|
|
$
5,675
|
|
|
|
+ Net other
income
|
|
102
|
|
99
|
|
|
|
EBIT
|
|
5,844
|
|
5,774
|
|
|
|
+ Operating lease
interest (b)
|
|
165
|
|
133
|
|
|
|
- Income
taxes (c)
|
|
1,373
|
|
1,314
|
|
|
|
Net operating profit
after taxes
|
|
$
4,636
|
|
$
4,593
|
|
|
|
Denominator
|
|
May 3, 2025
|
|
May 4, 2024
|
|
April 29,
2023
|
|
Current portion of
long-term debt and other borrowings
|
|
$
1,139
|
|
$
2,614
|
|
$
200
|
|
+ Noncurrent
portion of long-term debt
|
|
14,334
|
|
13,487
|
|
16,010
|
|
+ Shareholders'
investment
|
|
14,947
|
|
13,840
|
|
11,605
|
|
+ Operating lease
liabilities (d)
|
|
3,922
|
|
3,723
|
|
2,921
|
|
- Cash
and cash equivalents
|
|
2,887
|
|
3,604
|
|
1,321
|
|
Invested
capital
|
|
$
31,455
|
|
$
30,060
|
|
$
29,415
|
|
Average invested
capital (e)
|
|
$
30,757
|
|
$
29,737
|
|
|
|
After-tax return on
invested capital (f)
|
|
15.1 %
|
|
15.4 %
|
|
|
|
(a)
|
The trailing twelve
months ended May 4, 2024, consisted of 53 weeks compared with
52 weeks in the current-year period.
|
|
(b)
|
Represents the add-back
to operating income driven by the hypothetical interest expense we
would incur if the property under our operating leases was owned or
accounted for under finance leases. Calculated using the discount
rate for each lease and recorded as a component of rent expense
within Operating Income. Operating lease interest is added back to
Operating Income in the ROIC calculation to control for differences
in capital structure between us and our competitors.
|
|
(c)
|
Calculated using the
effective tax rates, which were 22.8 percent and 22.2 percent for
the trailing twelve months ended May 3, 2025, and May 4,
2024, respectively. For the twelve months ended May 3, 2025,
and May 4, 2024, includes tax effect of $1.3 billion
related to EBIT, and $38 million and $30 million,
respectively, related to operating lease interest.
|
|
(d)
|
Total short-term and
long-term operating lease liabilities included within Accrued and
Other Current Liabilities and Noncurrent Operating Lease
Liabilities, respectively.
|
|
(e)
|
Average based on the
invested capital at the end of the current period and the invested
capital at the end of the comparable prior period.
|
|
(f)
|
For the trailing twelve
months ended May 3, 2025, includes the impact of after-tax net
gains on interchange fee settlements, which increased after-tax
ROIC by 1.4 percentage points. Note (b) to the Rate Analysis table
provides additional information.
|
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SOURCE Target Corporation
