Target Corp., a major southwest Ohio retailer, reported a 29 percent drop in first-quarter profit as unusually cool spring weather and financial pressures chilled customers’ appetite for spending.
The company, based in Minneapolis, also on Wednesday cut its annual profit outlook, sending its stock down.
Target is the latest in a string of companies including rival Wal-Mart Stores Inc. that say bad weather and financial pressures like the higher payroll tax have squeezed business in the first couple months of the year.
Meanwhile, Lowe’s said Wednesday that its first-quarter net income rose nearly 3 percent, but results fell short of expectations as rainy weather hurt spring gardening sales. Lowe’s also has stores throughout southwest Ohio.
The No. 2 home improvement retailer said its results were hurt more by the rainy and cool spring.
While chilly weather was a big factor in depressing sales of spring clothing and other seasonal goods at Target, the company said that a yo-yo economic recovery has continued to make shoppers stick to shopping lists and plan their spending.
Target said it earned $498 million, or 77 cents per share, for the three months ended May 4. That compares with $697 million, or $1.04 per share, a year earlier.
Excluding items related to its Canadian expansion and retirement of certain debt, the company earned $1.05 per share. Sales rose 1 percent to $16.71 billion. Analysts had expected earnings of 95 cents per share on revenue of $16.82 billion.
As for Lowe’s, revenue in stores open at least one year rose 3 percent for indoor products such as paint but declined 7 percent for outdoor products. Results were weaker in March but improved in April, Niblock said. Revenue in stores open at least one year have been positive in May as well, he said.
For the period ended May 3, Lowe’s Cos. earned $540 million, or 49 cents per share. That compares with $527 million, or 43 cents per share, a year ago. Analysts polled by FactSet expected higher earnings of 51 cents per share for Lowe’s.
Revenue dipped to $13.09 billion from $13.15 billion. Wall Street expected a rise to $13.45 billion.