Target Sales Surged at Year-End, Capping Strong Holiday Season

By Sarah Nassauer

Holiday sales rose at Target Corp. and Costco Wholesale Corp., an early sign that many retailers benefited from what was expected to be one of the strongest holiday shopping seasons in years.

Target sales rose 5.7% between Nov. 4 and Jan. 5 in stores and through company websites operating for at least 12 months, the company said Thursday. Sales rose 3.4% during the same period last year. The results put Target on track to have its best full year of sales growth in 13 years, the company said.

At Costco, sales rose 7%, excluding gasoline and currency fluctuations, during the five weeks ended Jan. 6, the company said Wednesday. Each retailer said more shoppers visiting stores drove sales growth over the holidays.

Both Target and Costco have reported a string of strong sales figures in recent quarters. Those and other chains' results suggest retailers that have worked to attract more shoppers online or invest in store operations benefited from robust consumer spending over the holidays, despite worries of an economic slowdown.

Target said online sales grew 29% over the holidays, driven largely by its use of stores to ready packages for home delivery and as pickup hubs. Costco has worked to keep prices for its bulk goods low and added a wider product selection online.

But some retailers have continued to struggle, as shopping shifts online and away from department stores. J.C. Penney Co. said sales fell 3.5% during the nine-week period ended Jan. 5 and that it planned to close more stores this year, continuing a stretch of weak sales figures.

As in recent years, while online sales surged, traffic to overall physical stores fell 3% between Nov. 18 and Dec. 29, according to ShopperTrak, which uses cameras to track shoppers in stores.

On Thursday Target also said its chief financial officer, Cathy Smith, will retire. "Target is conducting a comprehensive internal and external search for its next CFO and a search firm has been retained to assist in the process," the company said. Ms. Smith, who joined as CFO in 2015, will stay in her role until a successor is named and act as an adviser until May of next year, the company said.

Target still expects fourth quarter 2018 comparable sales to grow around 5% and full-year earnings to be between $5.30 and $5.50 per share.

Write to Sarah Nassauer at sarah.nassauer@wsj.com

(END) Dow Jones Newswires

January 10, 2019 06:45 ET (11:45 GMT)

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