Target on Wednesday reported that online sales for the first quarter more than doubled, but said that coronavirus-related costs sent profits plunging 64 percent.

Target's quarterly online sales surged 141 percent, due to panic buying in the coronavirus crisis, but the company set aside nearly $500 million for hazard pay and safety standards at stores.

Net income of $284 million was down from $795 million for the same period last year, but still beat analyst expectations, and Target's stock jumped more than 1 percent in pre-market trading.

'Last quarter was unlike anything I've ever seen,' Chief Executive Officer Brian Cornell told reporters. 'It was intense, it was volatile, it was stressful for our guests and the country.' 






A customer wearing a mask carries his purchases as he leaves a Target store during the coronavirus pandemic, in Brooklyn last month. The company reported earnings on Wednesday








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The Minneapolis company reported Wednesday that comparable-store sales, which include online purchases, rose 10.8 percent for the three-month period that ended May 2.

That was fueled by a 12.5 percent jump in the number of items customers bought with each trip to the store as families made major restocking runs, berita saham indonesia but fewer of them.

The pandemic has widened an already growing rift between companies that deftly followed consumers online, and those that have struggled.

J.Crew, Stage Stores, Neiman Marcus, and J.C. Penney have all sought bankruptcy protection in recent weeks.

A years-long campaign by Walmart and Target to challenge Amazon online was, as it turns out, a dry run for the pandemic.

Target had already transformed its 1,800 stores into distribution hubs, putting it in a better position than even Amazon to keep supplies flowing.






To protect from the coronavirus a social distancing spot is painted on the floor while shoppers wait in line at a Target store in the Van Nuys section of Los Angeles last month


Target's stores were directly involved in supplying goods for 80 percent of online sales. Same-day services, such as curbside pickup at stores for things ordered online, nearly tripled. 

The company has 5 million new users on its website, and 2 million have begun relying on Target's services like curbside pickup for things ordered online.

However, with online orders come higher costs, as Target had to select and pack items for shipping or pickup. 

Target picked up market share in all five of its merchandise categories, Cornell said. Sales of items like furniture and electronics surged 20 percent. It was the same for groceries.

Clothing sales, a high-margin category for retailers, slipped during the quarter, but that business began to rebound at the tail end of the quarter. Cornell cites government stimulus checks for that late bump in discretionary spending.

It is unclear if other retailers, particularly those that are still closed, saw the same uptick with the arrival of those checks.

As with other retail companies operating in a pandemic, costs soared as well. Target spent and additional $500 million on things directly related to the outbreak. 






An employee in a face mask and latex gloves cleans the doors to a bank of freezers in a Target store on May 17 in Brighton, Colorado. Costs associated with cleaning jumped for the company


The company has bumped up hourly pay for workers by $2, hazard pay that will be extended to July 4. Target also spent money to sanitize stores and warehouses, new protections for workers and signage for customers to ensure social distancing.

Cornell said those costs will be the new reality going forward.

'There is going to be a premium on creating a safe sanitized shopping environment,' he said. Shopping while minimizing human contact is the new normal, he said, referring to drive-up and curbside pickup.

Target reported an 11.3 percent increase in revenue, which hit $19.62 billion for the quarter. Analysts surveyed by FactSet expected $19.02 billion. 

Net earnings slid 64 percent to $284 million, or 56 cents, or 59 cents when adjusted for non-recurring events. That's far better than the per-share profit of 44 cents that Wall Street was expecting, according to a survey of analysts by FactSet.