Target Blames Apple for Lower Sales

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iPhone with Target LogoTarget released its 2nd quarter results on Wednesday, including a 1.1% decline in revenue year-over-year. In a conference call with analysts, executives cited a 20% decrease in sales of Apple products as one of the principle reasons for overall performance.

Target

Target CEO Brian Cornell said the Apple slump resulted in an overall decease in traffic to its electronics department. More interestingly, that 20% decrease in Apple sales was responsible for 0.7 percentage points of the total 1.1% revenue decrease for the entire company.

Looked at from the other direction, Apple has an outsized effect on Target’s overall sales. Related, there are apparently a lot of people who buy their Apple devices at Target.

Mr. Cornell also said his company was working with Apple to increase performance of its devices at Target. Neither company announced any new initiatives relating to Target.

Target also saw poor performance in its grocery business, and said the total number of transactions was down 2.2%.

Apple

Apple itself turned in decreased sales year-over-year for the June quarter, Apple’s third fiscal quarter. iPhone sales have particularly struggled when compared to the rip-roaring success of iPhone 6.

CEO Tim Cook has said that his company is working on new products, that the smartphone will continue to be integral to people’s lives for the near and midterm future, and that he believes in Apple’s future.

Shares of $TGT closed lower Wednesday at $70.63, down $4.85 (-6.43%), on heavy volume of 19.6 million shares trading hands.

Shares of $AAPL ended the day at $109.22, down $0.160 (-0.15%), on light volume of 25.3 million shares.

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Brutno
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Brutno

Oops. Edit the second paragraph above to “and a poor business decision.”

Brutno
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Brutno

Whatever side you fall on on the transgender debate, Target decided to take a stand and potentially p!&& off the majority of their customer base. Tails wags dog, for the sake of being PC. Over a million people signed a petition to boycott Target. Could have some effect. It may be clever politics, but’s it’s definitely politics, but a poor business decision. Polarization of the customer base is never a good idea. Now they’re going to spend millions to add single-stall restrooms – another hit to the bottom line. They could have avoided all of this by staying politely above… Read more »

Lee Dronick
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Lee Dronick

“I stopped shopping there due to lack of Apple Pay”

And at least in our neighborhood Target, the men’s clothng department is lacking.

JustCause
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JustCause

I stopped shopping there due to lack of Apple Pay