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Target and TJX Take Diverging Paths Through Tariff Turbulence—Speed vs. Flexibility

Although Target’s 2025 outlook to a hit due to uncertainty surrounding tariffs and consumer spending, the mass merchant is keeping its foot on the gas when it comes to delivery.

The retail giant’s average click-to-deliver speed was nearly 20 percent faster than the year prior, according to Michael Fiddelke, chief operating officer.

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That number doubles the 11 percent faster delivery speeds experienced throughout 2024, in yet another example of national retailers cutting down delivery times on e-commerce orders. Walmart’s U.S. operation nearly doubled the number of deliveries it made within a three-hour window from the year prior, the company revealed this month.

Fiddelke said in a Wednesday earnings call that faster delivery was one of many factors that contributed to the company’s comparable digital sales growth of 4.7 percent.

The company touted its same-day delivery capabilities, with the option seeing 36 percent year-over-year growth in the company’s first quarter. The growth is an acceleration from the 25 percent annual growth Target’s same-day alternative experienced in the prior quarter.

Target also saw “healthy growth” in the Drive Up curbside pickup option, which now accounts for nearly half the retailer’s total digital sales.

“We fulfilled more than 70 percent of all Q1 digital orders within a day,” Fiddelke said, also noting that Shipt’s driver network fulfilled 24 percent more packages year over year.

The talk of same-day services came two days after the company’s announcement that it would remove same-day delivery price markups from more than 100 retailers and grocers through the Target Circle 360 paid membership program.

Previously, Circle 360 customers would have to pay more for same-day deliveries ordered from Target’s network of retailers selling on the Shipt Marketplace, including CVS, PetSmart and Lowe’s.

The successful delivery growth at Target couldn’t save the company from posting largely disappointing first-quarter financial numbers.

Net sales dipped 2.8 percent to $23.8 billion in the quarter, reflecting a merchandise sales decrease of 3.1 percent. Total transactions declined 2.4 percent, with same-store sales dropping 3.8 percent. Net income increased 10 percent to $1 billion.

But the downward adjustment of its full-year guidance tells a bigger story.

Target now expects a low-single-digit decline in sales this fiscal year, compared with a previous forecast of net sales growth of about 1 percent. The retailer said it expects adjusted earnings per share, excluding gains from litigation settlements, to be about $7 to $9, compared with the prior anticipated range of $8.80 to $9.80.