Target lowered its comparable store sales and earnings forecasts for the fourth quarter, citing "softer-than-expected" holiday sales due to, what the retailer called, disappointing traffic and sales trends.
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The company said comparable sales declined 1.3 percent in the November-December period, while total sales decreased 4.9 percent, reflecting the impact of the sale of its pharmacy and clinic business to CVS Health Corp in 2015.
Target said transactions were flat compared with last year, as digital transaction growth of more than 30 percent was offset by a 1.7 percent decline in comparable store transactions.
The company said sales growth in its signature categories, including toys, was also more than offset by declines in sales of electronics, entertainment, food and essential products.
Target said it now expects fourth-quarter comparable sales to fall between 1.0 percent and 1.5 percent, compared with its prior view of sales ranging between a decline of 1 percent to an increase of 1 percent.
The company said it expects to earn $1.45-$1.55 per share in the quarter, lower than its prior forecast of $1.55-$1.75.
Target also lowered its full-year adjusted profit forecast to $5.00-$5.10 per share from $5.10-$5.30.
The company's shares were down 3.9 percent at $68.19 in premarket trading on Wednesday.
(Reporting by Aravind K in Bengaluru; Editing by Savio D'Souza)