Target sees profit boost on fewer discounts

US retailer Target cut its full-year sales and profit expectations even as its quarterly profit exceeded Wall Street estimates last week, benefiting from fewer discounts and better stocked store shelves, reports Reuters.
The retailer's second-quarter sales, however, dropped 5 per cent, partly due to the fallout of a backlash against its Pride merchandise in May.
Target was forced to remove some items from transgender designer Erik Carnell's Abprallen brand, citing an increase in customer-employee confrontations and incidents of Pride merchandise being thrown on the floor.
"As we navigate an ever-changing operating and social environment, we are applying what we learned," CEO Brian Cornell said.
Target did not provide the exact financial impact of the backlash, saying the incident cannot be separated from the rest of the macroeconomic pressure.
Company executives said sales were much softer in June as consumer spending remained strained, but improved through July.
"We are seeing food and beverage and household essentials absorbing a larger portion of the US consumers wallet," Cornell said.
The company, which largely sells non-essential items like electronics and home decor, has been trying to balance its merchandise by adding more daily-use products as consumers limit their spending to necessary items amid rising prices.