Adding some notes from the last earnings call - it’s 2.5 hrs long for some reason lol, so this is only up to 1:30 in. So this is everything before they discussed the Financials and gave guidance. The strategy/growth/results all sounded bullish to me, though.
3/22 Earnings Call Notes:
General:
-Starts off with a speech about how everyone doubted his expansion strategy in 2017 and the stock price suffered…. But of course it was very successful over the years.
-Label themselves as a Growth Company, investing in “Big wins”.
-Affordability is a priority, but they drive to meet it by catering to Proximity, Accessibility, and Assortment Choices in addition to just prices. So they offer convenience and variety to attract customers, and allow them to self select into their price range. They also push their credit card as a way for customers to save.
-Claim to be protecting customers from inflation, not sure how much truth there is to that, but it’s a nice thing to say in these trying times. “Affordable luxury”
-Roundel is their advertising platform/business unit, and is a growing revenue stream for their hub model. This is what they use to drive business to their partners.
-Lots of supply chain improvement to support digital sales, no surprise here. Same day demand is rising fast - more than half of digital sales last year were same day services. Building more sortation centers, etc.
*This should drive cost savings along term
-Investing $300M in employee pay and expanding benefits - $15-$24/hour. Will be a wage leader in every market they operate.
*Turnover is below pre-pandemic levels, despite its historic highs in the market as a whole.
-List of other partnerships/enhancements I missed above that they are planning to add in remodels - drive up shopping, Disney and Apple in-store partnerships, CVS, eye care, ear piercings (it’s just like the Mall after all
)
-Target’s digital experience is evolving around guest behaviors. Data-driven insights around convenience are their focus, along with ad spend and customer retention.
-Convenience and customer experience are a top priority, lots of small enhancements around this
Sales/Growth/Earnings:
-Digital was 19% of sales in 2021, nearly tripled over 2 years. They claim this growth is due to their “hub-store” model. +4% traffic in 2020, +12% in 2021
-Comp salesup 8.9% last Q, 12.7% on the year
-35% sales growth ($27B) since 2019
-EPS +44% from 2020, double 2019
*Stated they covered the cost of their strategic initiatives with earnings
-Target’s owned brands grew 18% in 2021, over $30B in sales