Target’s Quarterly Profits Down 90% From Last Year

Trouble for America’s favorite everything store bodes ill for small businesses.

Photo by Daniel ODonnell on Unsplash.

“Target on Wednesday said its quarterly profit fell nearly 90% from a year ago, as the retailer followed through on its warning that steep markdowns on unwanted merchandise would weigh on its bottom line,” reported CNBC Wednesday morning.

“The big-box retailer missed Wall Street’s expectations by a wide margin, even after the company itself lowered guidance twice,” wrote Melissa Repko for CNBC, referring to the fact that Target cut its own profit outlook twice already this year, in May and June.

“If we hadn’t dealt with our excess inventory head on, we could have avoided some short-term pain on the profit line, but that would have hampered our longer-term potential,” Target Chief Financial Officer Michael Fiddelke told reporters on an earning call. “While our quarterly profit took a meaningful step down, our future path is brighter.”

While market-watchers and certainly Target stockholders hope Fiddelke is correct, this latest dark cloud on the U.S. economic horizon doesn’t bode at all well for small business retailers further downstream from a mega-retailer giant like Target.

“As inflation continues to dominate business decisions, small business owners’ expectations for better…