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Target (TGT) posted fiscal fourth-quarter earnings results before the market open on Tuesday that beat estimates as consumer spending shifts away from discretionary categories.The Minneapolis-based retailer saw same-store sales increase by 0.7%, higher than Wall Street estimates of -1.74%. Similar to Walmart’s (WMT) latest quarterly results, consumer spending at Target seemed to shift to essentials like food and away from categories like electronics, home, and apparel.Target shares jumped by more than 3.5% in pre-market trading after the report’s release.Target CEO Brian Cornell said the team was pleased with the sales growth in what continues to be a “very challenging environment.”Here’s what Target reported, compared to Wall Street estimates, based on Bloomberg consensus data:Revenue: $31.40 billion versus $30.46 billion expectedAdjusted earnings per share: $1.89 versus $1.48 expectedSame-store sales: 0.7% versus -1.74% expectedCornell said having multiple category offerings, including food & beverage, in addition to beauty and household items served the retailer well this past quarter, Cornell said.”Strength in Food & Beverage, Beauty and Household Essentials offset ongoing softness in discretionary categories. This performance highlights the benefit of our multi-category merchandise assortment, which drives relevance with our guests in any environment, and is a key reason we grew traffic every quarter last year.”Same-store sales beat estimates, up 0.7% compared to expectations of a decline of 1.74%. Same-store sales at physical locations also got a boost, up 1.9%, while digital sales dropped 3.6% in Q4.At the end of Q4, inventory was 3% lower than 2021. Meanwhile, in discretionary categories like electronics, home and apparel, inventory was nearly 13% lower than 2021, “partially offset by higher inventory in frequency categories.”Story continuesFor full-year fiscal 2022 results, revenue grew by $3 billion, to $109 billion. Compared to 2019, revenue is up more than $30 billion. In the full-year, same-store sales increased 2.2%, while traffic was up 2.1%.’Planning our business cautiously’Looking ahead to fiscal 2023, Cornell said the retailer is focused on it’s long-term strategy and “continued differentiation through affordability, assortment, ease and convenience” as it competes with other retailers for consumers trading down.”At the same time, we’re planning our business cautiously in the near term to ensure we remain agile and responsive to the current operating environment…as we plan for the year ahead, we will continue to make robust capital investments and pursue efficiency opportunities in support of our long-term growth.”For the first-quarter of 2023, the company expects a wide range for same-store sales, from a low-single digit decline to a low-single increase, and an operating income margin rate of 4-5%. Adjusted EPS is expected to be between $1.50 to $1.90. For fiscal-year 2023, the company expects same-store sales to be the same, from low-single digit to a low-single increase, along with an operating income of more than $1 billion and adjusted EPS to range from $7.75 to $8.75.In the next 3 years, the company aims to move beyond its pre-pandemic operating income margin rate of 6%, and says it could possibly reach that goal as early as fiscal 2024, “depending on the speed of recovery for the economy and consumer demand.”We’re Hiring banner, starting wage $17 per hour, Target Store, Boston, Massachusetts. (Photo by: Lindsey Nicholson/UCG/Universal Images Group via Getty Images)—Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at the latest earnings reports and analysis, earnings whispers and expectations, and company earnings news, click hereRead the latest financial and business news from Yahoo FinanceDownload the Yahoo Finance app for Apple or AndroidFollow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube

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