MINNEAPOLIS -- Target Corp. is optimistic heading into the critical holiday shopping season after a strong third quarter.
The holiday shopping season can make up 40 per cent of a retailer's annual revenue -- and Target expects this year to be "highly competitive and promotional," said Kathryn Tesija, executive vice-president of merchandising.
"For the holiday season, consumers anticipate spending slightly more than last year, but indicate they'll be focused on value, pricing and promotions," she said on a call with analysts.
The big-box retailer, known for its cheap but trendy merchandise, on Thursday reminded investors of the initiatives it's betting on for growth in the coming weeks, including a holiday collection partnership with luxury department store Neiman Marcus and a new online price-matching program.
For the fourth quarter, which ends in January, the company anticipates adjusted earnings of $1.64 to $1.74 per share. Analysts predict $1.50 per share.
For the three months ended Oct. 27, Target earned $637 million, or 96 cents per share. That's up from $555 million, or 82 cents per share, a year earlier.
The current quarter's performance included a 15-cent gain tied to the retailer's sale of its consumer credit-card business to TD Bank Group.
Removing certain items, the chain's earnings were 90 cents per share. Analysts expected 78 cents per share, according to a FactSet poll.
Revenue at stores open at least a year rose 2.9 per cent, slower than last year's 4.3 per cent increase.
-- The Associated Press