NEW YORK (AP) – Target Corp. reported a loss in its fourth quarter, dragged down by costs to end its money-losing foray in Canada. But the discount retailer recorded strong sales as shoppers bought more clothing and other items over the holiday period.
The results, which included the second consecutive increase in a key sales measure in a year, come a little more than a month after the discounter announced it was giving up on Canada and focusing on revving up its U.S. business.
The decision to close the Canadian business is the first major move by CEO Brian Cornell, who took over the helm last August and who is charged with reclaiming the retailer’s image as a purveyor of cheap chic fashions.
The results also show how the Minneapolis-based company is successfully moving past a massive data breach disclosed a week before Christmas 2014 that compromised millions of credit and debit cards. That caused shoppers to flee for months and hurt sales and profits. That was one of the major reasons behind the abrupt departure of CEO Gregg Steinhafel, who resigned last May.
Target is also grappling with industrywide issues. Like other retailers catering to middle income shopper, Target’s customers have not benefited much from the country’s economic recovery because wages remain stagnant. Target also has seen a rapid shift among its shoppers to buy and research on their mobile devices. The discounter has been playing catch-up and revamping its apps and just lowered the threshold for free shipping.