MINNEAPOLIS - Discount retailer Target Corp. said Thursday a key revenue measure rose 2.4 percent in October, as customers spent more on food and health and beauty items, but the number of people buying items was even with a year ago.
Analysts expected a bigger 3.3 percent increase for the four weeks through Oct. 27, according to Thomson Reuters, but CEO Gregg Steinhafel was optimistic about the all-important upcoming holiday season. Retailers can make up to 40 percent of the year's revenue from holiday shopping.
"As we enter the fourth quarter we feel very good about our holiday season merchandising and marketing plans and our ability to deliver outstanding value for our guests while generating strong financial performance for our shareholders," Steinhafel said in a statement.
To lure shoppers, Target is offering a 5 percent discount for customers that have a Target Redcard and says it will match prices from brick-and-mortar competitors.
The Minneapolis company expects the revenue figure to rise by a low-single-digit percentage in November. Revenue in stores open at least one year is a key gauge of a retailer's health, because it excludes results from stores recently opened or closed, which can skew business trends.
Total October revenue, which includes new stores, rose 3 percent to $4.98 billion.
In the fiscal third quarter, which runs from August through October, revenue in stores open at least one year rose 2.9 percent and total revenue rose 3.4 percent to $16.6 billion. Year-to-date, revenue in stores open at least one year rose 3.7 percent and total revenue rose 4.3 percent to $49.59 billion.
Target still expects profit of 83 to 93 cents per share in the third quarter, excluding one-time items. Analysts are less optimistic. They expect 77 cents per share, according to FactSet.