tgt-20230429



UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 29, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission File Number 1-6049

TARGET CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota

(State or other jurisdiction of incorporation or organization)

1000 Nicollet Mall, Minneapolis, Minnesota

(Address of principal executive offices)

41-0215170

(I.R.S. Employer Identification No.)

55403

(Zip Code)

612-304-6073

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.0833 per share

TGT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Total shares of common stock, par value $0.0833, outstanding at May 19, 2023, were 461,559,612.


						Table of Contents
						Index to Notes

TARGET CORPORATION

TABLE OF CONTENTS


PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Consolidated Statements of Operations	1
	Consolidated Statements of Comprehensive Income	2
	Consolidated Statements of Financial Position	3
	Consolidated Statements of Cash Flows	4
	Consolidated Statements of Shareholders’ Investment	5
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	22

PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 3.	Defaults Upon Senior Securities	23
Item 4.	Mine Safety Disclosures	23
Item 5.	Other Information	23
Item 6.	Exhibits	24

Signatures		25


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements


Consolidated Statements of Operations
	Three Months Ended
(millions, except per share data) (unaudited)	April 29, 2023		April 30, 2022
Sales	$	24,948	$	24,830
Other revenue	374		340
Total revenue	25,322		25,170
Cost of sales	18,386		18,461
Selling, general and administrative expenses	5,025		4,762
Depreciation and amortization (exclusive of depreciation included in cost of sales)	583		601
Operating income	1,328		1,346
Net interest expense	147		112
Net other income	(23)		(15)
Earnings before income taxes	1,204		1,249
Provision for income taxes	254		240


Net earnings	$	950	$	1,009



Basic earnings per share	$	2.06	$	2.17



Diluted earnings per share	$	2.05	$	2.16
Weighted average common shares outstanding
Basic	460.9		464.0
Diluted	462.9		467.8
Antidilutive shares	1.2		—

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 2023 Form 10-Q			1


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Comprehensive Income
	Three Months Ended
(millions) (unaudited)	April 29, 2023		April 30, 2022
Net earnings	$	950	$	1,009
Other comprehensive income, net of tax
Pension benefit liabilities	2		11
Cash flow hedges and currency translation adjustment	(5)		190
Other comprehensive income	(3)		201
Comprehensive income	$	947	$	1,210

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 2023 Form 10-Q			2


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Financial Position
(millions, except footnotes) (unaudited)	April 29, 2023		January 28, 2023		April 30, 2022
Assets
Cash and cash equivalents	$	1,321	$	2,229	$	1,112
Inventory	12,616		13,499		15,083
Other current assets	1,836		2,118		1,758
Total current assets	15,773		17,846		17,953
Property and equipment
Land	6,493		6,231		6,164
Buildings and improvements	35,198		34,746		33,300
Fixtures and equipment	7,473		7,439		6,459
Computer hardware and software	3,067		3,039		2,588
Construction-in-progress	2,822		2,688		1,444
Accumulated depreciation	(22,657)		(22,631)		(21,285)
Property and equipment, net	32,396		31,512		28,670
Operating lease assets	2,640		2,657		2,571
Other noncurrent assets	1,341		1,320		1,648
Total assets	$	52,150	$	53,335	$	50,842
Liabilities and shareholders’ investment
Accounts payable	$	11,935	$	13,487	$	14,053
Accrued and other current liabilities	5,732		5,883		5,582
Current portion of long-term debt and other borrowings	200		130		1,089
Total current liabilities	17,867		19,500		20,724
Long-term debt and other borrowings	16,010		16,009		13,379
Noncurrent operating lease liabilities	2,621		2,638		2,581
Deferred income taxes	2,289		2,196		1,752
Other noncurrent liabilities	1,758		1,760		1,632
Total noncurrent liabilities	22,678		22,603		19,344
Shareholders’ investment
Common stock	38		38		39
Additional paid-in capital	6,541		6,608		5,592
Retained earnings	5,448		5,005		5,495
Accumulated other comprehensive loss	(422)		(419)		(352)
Total shareholders’ investment	11,605		11,232		10,774
Total liabilities and shareholders’ investment	$	52,150	$	53,335	$	50,842

Common Stock Authorized 6,000,000,000 shares, $0.0833 par value; 461,552,843, 460,346,947, and 463,683,711 shares issued and outstanding as of April 29, 2023, January 28, 2023, and April 30, 2022, respectively.

Preferred Stock Authorized 5,000,000 shares, $0.01 par value; no shares were issued or outstanding during any period presented.

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 2023 Form 10-Q			3


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Cash Flows
	Three Months Ended
(millions) (unaudited)	April 29, 2023		April 30, 2022
Operating activities
Net earnings	$	950	$	1,009


Adjustments to reconcile net earnings to cash provided by operating activities:
Depreciation and amortization	667		679
Share-based compensation expense	43		83
Deferred income taxes	95		115

Noncash losses / (gains) and other, net	(11)		52
Changes in operating accounts:
Inventory	883		(1,181)
Other assets	34		(86)
Accounts payable	(1,463)		(1,560)
Accrued and other liabilities	67		(505)


Cash provided by (required for) operating activities	1,265		(1,394)
Investing activities
Expenditures for property and equipment	(1,605)		(952)
Proceeds from disposal of property and equipment	2		2
Other investments	1		2
Cash required for investing activities	(1,602)		(948)
Financing activities
Change in commercial paper, net	90		945

Reductions of long-term debt	(46)		(48)
Dividends paid	(497)		(424)
Repurchase of stock	—		(10)
Accelerated share repurchase pending final settlement	—		(2,750)
Shares withheld for taxes on share-based compensation	(118)		(171)
Stock option exercises	—		1
Cash required for financing activities	(571)		(2,457)
Net decrease in cash and cash equivalents	(908)		(4,799)
Cash and cash equivalents at beginning of period	2,229		5,911
Cash and cash equivalents at end of period	$	1,321	$	1,112
Supplemental information
Leased assets obtained in exchange for new finance lease liabilities	$	15	$	62
Leased assets obtained in exchange for new operating lease liabilities	54		59

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 2023 Form 10-Q			4


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Shareholders’ Investment
	Common	Stock		Additional				Accumulated Other
	Stock	Par		Paid-in		Retained		Comprehensive
(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total
January 29, 2022	471.3	$	39	$	6,421	$	6,920	$	(553)	$	12,827
Net earnings	—	—		—		1,009		—		1,009
Other comprehensive income	—	—		—		—		201		201
Dividends declared	—	—		—		(426)		—		(426)
Repurchase of stock	(0.1)	—		—		(10)		—		(10)
Accelerated share repurchase pending final settlement	(8.9)	(1)		(751)		(1,998)		—		(2,750)
Stock options and awards	1.4	1		(78)		—		—		(77)
April 30, 2022	463.7	$	39	$	5,592	$	5,495	$	(352)	$	10,774
Net earnings	—	—		—		183		—		183
Other comprehensive loss	—	—		—		—		(17)		(17)
Dividends declared	—	—		—		(502)		—		(502)
Repurchase of stock	(3.6)	(1)		870		(755)		—		114
Stock options and awards	0.1	—		40		—		—		40
July 30, 2022	460.2	$	38	$	6,502	$	4,421	$	(369)	$	10,592
Net earnings	—	—		—		712		—		712
Other comprehensive income	—	—

SEC Form 10-Q filed by Target Corporation