Target receives almost $1 billion in tariff refunds, plans to lower prices

Tariff refunds were a massive tailwind for Target last quarter that could help it continue to lower prices.

Target received $994 million in pre-tax tariff refunds during the second quarter, the company reported in its earnings release Wednesday morning. The tariff refunds boosted Target’s second-quarter operating income 94% year over year to about $2.6 billion, or 9.6% of sales. They improved the company’s full-year operating income margin rate by about 90 basis points to around 6%.

When asked how the company anticipates that value flowing through to customers or into the business, Target CFO Jim Lee told reporters Tuesday ahead of earnings that the company will invest in price reductions.

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