Target reports record growth in Q4 and full-year earnings
Target reported its fourth-quarter and full-year 2021 results, capping off a year of record growth for the Minneapolis-based retailer.
Total revenue for 2021 was $106 billion, having grown nearly $28 billion, or more than 35% over the past two years. All five core merchandise categories delivered double digit comparable sales growth in 2021.
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For fourth-quarter 2021, comparable sales grew 8.9%, on top of 20.5% in Q4 2020. Despite the influx of online shopping during the pandemic, 95% of Target’s fourth-quarter sales were fulfilled by its stores.
Target’s fourth-quarter GAAP earnings per share were $3.21, compared with $2.73 in 2020, and $14.10 for full-year 2021, compared with $8.64 in 2020.
“Our strong fourth-quarter performance capped off a year of record growth in 2021, reinforcing the durability of our business model and our confidence in long-term profitable growth,” Brian Cornell, chairman and CEO of Target, said. “As we look ahead, we’ll keep investing and delivering on all that has earned the loyalty and trust of our guests; that starts with our outstanding team and includes continued differentiation through affordability, assortment, ease and convenience.”
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Target’s fourth-quarter operating income margin rate was 6.8% in 2021, compared with 6.5% in 2020. Its fourth-quarter margin rate was 25.7%, compared with 26.8% in 2020. For the decline in gross margin, the company cited an increase in supply chain costs due to increased compensation and headcount in the company’s distribution centers as well as higher freight and merchandising costs.
For fiscal year 2022, Target said it expects low- to mid-single digit revenue growth, an operating margin rate of 8% or higher, low-single digit growth in operating margin dollars, and high-single digit growth in adjusted earnings per share.
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The company also paid dividends of $432 million in the fourth quarter — an increase of 32.4% in the dividend per share, partially offset by a decline in average share count.