US retailer Target reported net earnings of $1.87bn for the second quarter (Q2) ended 1 August 2026, up 100.8% year-on-year (YoY), and raised its full-year guidance.
Net sales for the quarter reached $26.53bn, an increase of 5.3%, driven by a 3.8% rise in comparable sales.
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Comparable sales growth reflected a 2.7% increase in store sales and an 8.7% increase in digital sales, with digital growth led by same-day delivery, which rose more than 25%.
The quarter’s results included a $994m pretax benefit from tariff refunds, recorded within gross margin and operating income.
The refunds contributed $752m to net earnings and $1.65 to earnings per share (EPS).
Operating income rose 94.4% to $2.56bn.
Excluding the refunds, adjusted EPS rose 20% YoY. Diluted EPS for the quarter climbed to $4.11 from $2.05, an increase of 100.3%.
For the first six months of the year, net sales totalled $51.98bn, up 6%, with net earnings rising 34.9% to $2.65bn and diluted EPS increasing to $5.83 from $4.32.
Operating income for the six-month period increased 32.5% to $3.69bn.
As of 1 August 2026, Target operated 2,019 stores, compared with 1,995 stores as at 31 January 2026, and 1,982 stores as of 2 August 2025.
The company raised its full-year 2026 net sales growth forecast to a range around 5%, one percentage point higher than prior guidance.
Full-year operating income margin is expected to be around 6%, including approximately 90 basis points of benefit from the Q2 tariff refunds.
Excluding refunds, the margin rate is expected to be around 50 basis points higher than the prior year’s adjusted operating margin of 4.6%.
Target set an updated adjusted EPS guidance range of $9.90 to $10.90, which includes the $1.65 tariff refund benefit.
Excluding refunds, the midpoint reflects a $0.75 increase versus prior guidance of $7.50 to $8.50.
Target CEO Michael Fiddelke said: “While there is still meaningful work ahead, we are encouraged by the progress we are making and remain focused on executing with discipline, staying agile in a dynamic operating environment, and investing in our team and capabilities to drive sustainable, profitable growth over the long term.”
