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Target earnings top expectations as turnaround gains offset tariff refund

Second quarter adjusted EPS doubled to $4.11, but a $994 million pretax tariff refund contributed 3.7 percentage points of the gross margin jump.

Saturday, August 29, 2026 · Written up by our desk · Results

Target Corp. reported second-quarter results that looked strong at first glance, with adjusted earnings per share rising to $4.11, up from the prior year after a turnaround push showed momentum across store traffic and digital sales, according to Yahoo Finance. Net sales reached $26.5 billion, a 5.3% increase year over year.

Digging deeper, Target said comparable sales grew 3.8% in the quarter, supported by foot traffic up 3.6% while average ticket stayed flat, while digital sales accelerated 8.7%. The company also pointed to fast fulfillment gains, including same-day delivery growth of more than 25%, alongside the completion of its largest wave of store resets in more than a decade.

Target reported early performance signs from those changes, including snack sales running more than 15% ahead of last year after the grocery reset, LEGO sales up more than 30% following a toy aisle overhaul, and beauty growth in the high single digits tied to the Target Beauty Studio rollout in more than 600 stores.

Beyond core retail, Yahoo Finance said Target’s higher-margin operations grew as its Roundel ad business rose over 20%, Target Circle 360 membership revenue jumped more than 40%, and the Target+ marketplace grew sales volume by more than 40%. Management raised full-year sales guidance to around 5% growth and lifted its earnings per share outlook to $9.90 to $10.90, but the outlet noted much of the gross margin and adjusted EPS strength traced to a $994 million pretax tariff refund rather than underlying operating performance.

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