A customer signs a credit card statement next to a scanner in a Target store on Dec. 19, 2013, in Miami, Fla.
(Photo: Joe Raedle, Getty Images)
(USA TODAY) -- Tough as the holiday season was for many retailers, Wednesday's
fourth quarter earnings report prove that few had it tougher than
Target, which was bedeviled during the peak shopping season by one of
the largest-ever retail data breaches
The company's long-awaited
fourth quarter results tell a tale of woe: Net income fell 46% to $520
million, or 81 cents a share, from $961 million, or $1.47, a year
earlier, the Minneapolis-based company reported.
At the same time,
the discount retailer said that sales fell 5.3%, it reports, as many
customers were leery about shopping at the discount retailer after the
Even then, there was some relief among investors that the
news wasn't even worse, and Target shares rose slightly in pre-market
trading .4% or about 24-cents.
Target says it earned $520 million,
or 81 cents per share, for the three months that ended Feb. 1. That
compares with a profit of $961 million, or $1.47 per share, a year
earlier. Revenue fell to $21.5 billion from $22.7 billion. Revenue at
stores open at least a year fell 2.5%.
Eyes of the nation's
retailers remain fixated on Target, with a clear recognition that the
potential for massive data breaches are hardly in the rear view mirror.
Shortly after the breach, Target tried to quickly lure back holiday
shoppers with a weekend of 10% discounts in December. It then offered
all affected customers a year of free credit monitoring. Target
executives were even called in to testify before Congress on the data
breach earlier this year.
It isn't clear when Target will fully
recover from the breach, but Avivah Litan, a security analyst at Gartner
Inc., a technology firm, puts the costs of the breach from the $400
million to $450 million. That would include the bills associated with
fines from credit card companies and services for its customers like
free credit card report monitoring.
On Wednesday, Chief Executive
Officer Gregg Steinhafel said, in a statement, that the company's
efforts to lure back shoppers are starting to pay off. But it hasn't
"Results softened meaningfully following our December
announcement of a data breach," he said, in a statement. "We will
continue to work tirelessly to win back the confidence of our guests and
deliver irresistible merchandise and offers, and we are encouraged that
sales trends have improved in recent weeks."
The Associated Press contributed to this report.
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