NEW YORK – Target raised its annual profit outlook as the discounter’s efforts to spruce up fashions and other merchandise at U.S. stores are resonating with shoppers.
The rosier forecast, delivered Wednesday, comes as the discount-store chain more than tripled profit in the second quarter as it looks to recover from a series of stumbles in recent years — most notably a costly foray into Canada that ended in the retailer pulling out of the country in April.
The results are the latest evidence that the turnaround spearheaded by CEO Brian Cornell, who has led the company for the past year, is gaining traction.
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Cornell succeeded Gregg Steinhafel whose abrupt departure in May 2014 capped a tumultuous year for the company. On top of the retailer’s botched Canadian expansion, Target was hurt by a massive credit-card breach before Christmas 2013 that sent shoppers temporarily fleeing.
Cornell has been aiming to reinvent Target as a more nimble force amid fierce competition.
The company is investing in e-commerce and expanding Target’s small-format stores. It’s also trying to reclaim its position as the place to go for “cheap chic.”
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Target is placing heavy emphasis on fashion, children’s goods as well as products for the home, and it’s bringing more organic, natural, gluten-free and locally produced food to its grocery aisles.
Cornell is also reshaping his management team. On Monday, Target said it was promoting its Chief Financial Officer John Mulligan to the newly created role of chief operating officer. Mulligan will assume oversight of stores, supply chain and properties. Succeeding Mulligan as chief financial officer is Cathy Smith, a seasoned retail executive. The changes are effective Sept. 1.
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