NEW YORK – Target has reported solid sales for the fiscal second quarter but its profits plunged nearly 90% because it slashed prices to clear unwanted inventories of clothing, home goods and other discretionary items.
The weaker-than-expected profit came two months after Target warned it was canceling orders from suppliers and aggressively discounting due to a pronounced spending shift by Americans that left the Minneapolis retailer with bloated inventory.
Retailers were blindsided by consumers’ lightening-speed switch from pandemic spending on things like TVs and appliances, in favor of dinners out or travel. Inflation has only intensified that shift.
