Target Corp on Wednesday missed its own expectations for 2019 holiday season sales, blaming weakness in toys and electronics sales for growth of just 1.4 percent that sent shares in the retailer sharply lower.
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"While we knew this season was going be challenging, it was even more challenging than we expected,'' Chief Executive Officer Brian Cornell said.
Digital sales grew 19 percent compared with 2018's 29 percent rise, Cornell said, calling the reported numbers a "tough miss."
Target's numbers come just a week after several U.S. retailers including Kohl's, J.C. Penney and Macy's reported lower sales for the key shopping period, raising doubts about the broader health of the retail sector.
The holiday season, which marks the busiest time for retailers and records the most sales during the year, was also six days shorter in 2019 as Thanksgiving came later than usual.
Target said lower sales in categories such as toys, electronics and home products, which typically account for a higher portion of sales during the holidays, had a larger impact on overall sales growth.
The company now expects its fourth-quarter same-store sales to be in line with its holiday period growth of 1.4 percent, down from its prior range of a 3 percent to 4 percent growth. It maintained its forecast for full-year profit.
(Reporting by Nivedita Balu in Bengaluru; Editing by Shinjini Ganguli)