Target tariff refunds boost profits, lower prices

Target reported about $994 million in pre-tax tariff refunds for the second quarter, which boosted operating income and helped lift its full-year margin outlook. The company said it will use refunds to invest in price reductions to deliver value to shoppers, contributing to recent traffic gains and stronger store performance. It posted its second straight quarter of revenue growth with comparable sales up 3.8% and raised its full-year forecast to about 5% net sales growth, highlighting progress under the new merchandising strategy. Tariff refunds have become a point of focus beyond Target, with Minnesota peers also receiving refunds as tariffs and related relief affect corporate profits. Even excluding refunds, Target’s earnings per share rose, signaling underlying strength amid broader cost pressures. The refunds come after a Supreme Court ruling limited tariff authorities and a government rollout of refunds, reshaping how retailers recover from duties.