Target cuts forecast, pegs data breach costs at nearly $150 million
Target Corp. lowered its second-quarter earnings forecast Tuesday and said expenses from its massive data breach probably would be close to $150 million.
Promotional discounts in U.S. stores and weaker-than-expected sales in Canada led to the lower forecast, Target said.
FOR THE RECORD
12 p.m.: An earlier version of this post said Brian Cornell recently served as an executive at PepsiCom. Cornell worked at PepsiCo.
The Minneapolis-based retailer now expects adjusted earnings per share to be around 78 cents, down from its previous guidance of 85 cents to $1 per share.
Target also said it expected expenses stemming from a massive data breach to hit $148 million in its second quarter. Hackers last year stole credit and debit card information from tens of millions of customers in the breach, which the company disclosed in December.
Target has struggled to cope with the fallout. Sales fell during the holiday season as the company sought to regain customer trust.
In May, longtime Chief Executive Gregg Steinhafel resigned. Last month, Target named Brian Cornell, an outsider who most recently served as an executive at PepsiCo, to fill the post.
Target said its second-quarter data breach costs will be partially offset by $38 million in insurance.
In late-morning trading, Target shares were down $1.46, or 2.41%, to $59.24.
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