Target's Sales Grew 5.3% and It Raised Its Forecast. A $994 Million Tariff Refund Padded the Quarter.
Comparable sales rose 3.8% with traffic up 3.6%. Earnings of $4.11 a share included a one-time tariff refund worth about $1.65 of it. The stock fell anyway.
The short answer
- Target reported second-quarter fiscal 2026 results on August 19: net sales up 5.3% to $26.5 billion and comparable sales up 3.8%, with customer traffic up 3.6%.
- Earnings came to $4.11 a share, but roughly $994 million in tariff refunds recognized in the quarter contributed about $1.65 of that figure.
- Digital comparable sales rose 8.7% and same-day delivery grew more than 25%; store comparable sales rose 2.7%.
- The company raised full-year guidance to earnings of $9.90 to $10.90 a share on net sales growth of about 5% — and the stock still fell after the report.
Target grew both sales and profit in its second quarter and lifted its outlook for the year. The results were better than the muted expectations the retailer had set — but a one-time refund of tariffs did a meaningful share of the work, and investors sold the stock anyway.
The headline numbers
Target reported the quarter on August 19. Net sales rose 5.3% to $26.5 billion, comparable sales rose 3.8%, and customer traffic — the number of visits — was up 3.6%. Growth came across all six of the company's core merchandise categories.
- Net sales: $26.5 billion, up 5.3%
- Comparable sales: up 3.8%; traffic up 3.6%
- Store comparable sales: up 2.7%; digital comparable sales: up 8.7%
- Same-day delivery: up more than 25%
- Earnings per share: $4.11
The tariff refund inside the earnings figure
The $4.11 in earnings per share is not a clean measure of the quarter's operations. Target said it recognized about $994 million in tariff refunds in the period — money returned on import duties — worth roughly $1.65 of that per-share figure. Strip the refund out and the underlying result is far smaller, though the company still described earnings as up about 20% year over year excluding the tariff effects.
Guidance up, shares down
Target raised its full-year forecast to earnings of $9.90 to $10.90 a share, with net sales growth of about 5%. That range includes the roughly $1.65 benefit already booked this quarter but assumes no further tariff refunds. Even so, the stock fell after the report. A beat built partly on a non-recurring refund, against a raised bar, gives investors reason to look past the headline and at the slower underlying trend.
Why it matters
Target's quarter lands days after Walmart's, and the pair are read together as a gauge of how U.S. households are spending. Rising traffic and broad category growth suggest customers are still showing up. A profit number leaning on a one-time refund is a reminder to read past the top line.
Sources
- Target Q2 2026 Earnings Highlights — Target Corporation
- Target Q2 2026 earnings beat: sales up 5.3%, guidance raised — Quartz
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