What: retailer’s growth is driven by holiday sales performance

Why is it important: Target's sales growth in 2020 outpaces past 11 years

Target capped off the fiscal year on 2 March with strong fourth-quarter results driven by its blockbuster holiday sales performance. The retailer recorded USD 15 billion of sales growth in 2020, higher than the company's total sales growth over the past 11 years, according to a company press release.

Total net sales in 2020 reached USD 92.4 billion, while comparable sales rose 19.3%. For the fourth quarter, comparable sales grew 20.5%, with traffic growth of 6.5% and average ticket up 13.1%. The company's revenue for Q4 rose 21.1% year over year to USD 28.3 billion from USD 23.4 billion.

Target also said it would annually invest about USD 4 billion to launch more stores, update existing ones and improve online fulfilment. The company intends to continue this investment over the next couple of years.

Digital comp sales rose 102% in November and December, while store comps rose 4.2%. Digital was a big winner for Target for the whole year: Sales through that channel grew by nearly USD 10 billion in 2020, thanks to a 235% increase in Target's same-day services. In the fourth quarter alone, digital comps were up 118%, led by 500% growth in Drive Up.

While Target declined to provide sales estimates for the future, competitor Walmart said it expects sales to slow in 2022 after pandemic-driven sales begin to dial down.

Target Corporation Reports Q4 and 2020 Earnings

Target's sales growth in 2020 outpaces past 11 years