Target reports drop in 1st quarter sales, attributes to tariffs, economy, backlash to DEI policies

Target sales dropped in the first quarter, with the retailer warning that the slip will continue for the rest of the year.

The sales drop follows customers pulling back on spending because of concerns over tariffs and boycotts over Target's diversity, equity, and inclusion initiatives, many of which the company scaled back in January, The Associated Press reported.

Target's shares fell 3% before the opening bell Wednesday.

Sales fell 2.8% to $23.85 billion in the quarter, which was short of the $24.23 billion Wall Street expected, per FactSet. During the same period last year, Target reported $24.53 billion in sales.

The company cut its annual sales projections Wednesday, saying it expects a low single-digit decline for 2025, after projecting a 1% increase for sales in March. Target also forecasted annual per-share earnings of $7 to $9, excluding legal settlement gains this year.

Sales from comparable, established stores and online fell 3.8%, after increasing 1.5% in the previous quarter.

"I want to be clear, we’re not satisfied with these results, so we’re moving with urgency to navigate through this period of volatility,"
Target CEO Brian Cornell said on a call with reporters on Tuesday. "We’ve got to drive traffic back into our stores or visits to our site."

Target said it is offering 10,000 new items starting at $1, with the majority under $20, in an effort to entice customers who are nervous about the economy.