Target has lowered its financial expectations for the year after reporting a sharp fall in sales for the three months to May 2025, which it blamed on a “highly challenging environment” caused, at least in part, by the introduction of trade tariffs.
BBC News reports that the U.S. retail giant saw sales slump by 5.7% in the period, at a time when the company also faced a backlash following a previous decision to end diversity, equity and inclusion (DEI) targets.
On a call with reporters on May 21, the company declined to confirm any potential price rises because of higher import taxes, saying raising prices could be a “last resort.” According to CNBC, the company has been struggling to return to growth for years, and created a new office to try to accelerate its turnaround.
Brian Cornell, chief executive of Target, said pricing decisions would depend on the retailer’s efforts to source more products in the U.S. and reduce its reliance on China, adding, “That is going to play a very important role.”
Target sources the majority of such products from China. BBC News reported that Rick Gomez, the company’s chief commercial officer, said Target was looking to negotiate with suppliers and expand the number of its suppliers beyond China, as well as adjusting the timing and quantity of orders.