Target shares tumbled on Wednesday after the US retailer said rising costs would hit its annual profits, echoing a warning from rival Walmart and sparking a wider equity market sell-off on fears that companies are struggling to pass higher prices on to consumers.
Shares in Target fell 25 per cent — the biggest one-day decline since 1987 — as it revealed first-quarter profits plunged by a half to $1bn. The retailer blamed a combination of higher freight, fuel and labour costs, as well as supply chain disruptions that began with the pandemic.
Shares in Walmart, the world’s largest bricks-and-mortar retailer, fell a further 6.8 per cent on Wednesday after losing 11 per cent the previous day when it cut its earnings guidance.
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