

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May ~~2, 2020~~1, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission File Number 1-6049

TARGET CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota

(State or other jurisdiction of incorporation or organization)

1000 Nicollet Mall, Minneapolis, Minnesota

(Address of principal executive offices)

41-0215170

(I.R.S. Employer Identification No.)

55403

(Zip Code)

Registrant’s telephone number, including area code: 612/304-6073

Former name, former address and former fiscal year, if changed since last report: N/A

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.0833 per share

TGT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company (as defined in Rule 12b-2 of the Exchange Act).

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of registrant’s classes of common stock, as of the latest practicable date. Total shares of common stock, par value $0.0833, outstanding at May ~~22, 2020~~21, 2021, were ~~500,015,480.~~494,723,834.


						Table of Contents
						Index to Notes

TARGET CORPORATION

TABLE OF CONTENTS


PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Consolidated Statements of Operations	1
	Consolidated Statements of Comprehensive Income	2
	Consolidated Statements of Financial Position	3
	Consolidated Statements of Cash Flows	4
	Consolidated Statements of Shareholders’ Investment	5
	Notes to Consolidated Financial Statements	87
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2322
Item 4.	Controls and Procedures	2322

PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	24
Item 1A.	Risk Factors	24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2524
Item 3.	Defaults Upon Senior Securities	2524
Item 4.	Mine Safety Disclosures	2524
Item 5.	Other Information	2524
Item 6.	Exhibits	2625

Signature		2726


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements


Consolidated Statements of Operations	Consolidated Statements of Operations					Consolidated Statements of Operations
		Three Months Ended							Three Months Ended
(millions, except per share data) (unaudited)	(millions, except per share data) (unaudited)	May 2, 2020		May 4, 2019		(millions, except per share data) (unaudited)	May 1, 2021		May 2, 2020
Sales	Sales	$	19,371	$	17,401	Sales	$	23,879	$	19,371
Other revenue	Other revenue	244		226		Other revenue	318		244
Total revenue	Total revenue	19,615		17,627		Total revenue	24,197		19,615
Cost of sales	Cost of sales	14,510		12,248		Cost of sales	16,716		14,510
Selling, general and administrative expenses	Selling, general and administrative expenses	4,060		3,663		Selling, general and administrative expenses	4,509		4,060
Depreciation and amortization (exclusive of depreciation included in cost of sales)	Depreciation and amortization (exclusive of depreciation included in cost of sales)	577		581		Depreciation and amortization (exclusive of depreciation included in cost of sales)	598		577
Operating income	Operating income	468		1,135		Operating income	2,374		468
Net interest expense	Net interest expense	117		126		Net interest expense	108		117
Net other (income) / expense	Net other (income) / expense	22		(12)		Net other (income) / expense	(343)		22
Earnings from continuing operations before income taxes		329		1,021
Earnings before income taxes						Earnings before income taxes	2,609		329
Provision for income taxes	Provision for income taxes	45		229		Provision for income taxes	512		45
Net earnings from continuing operations		284		792
Discontinued operations, net of tax		—		3

Net earnings	Net earnings	$	284	$	795	Net earnings	$	2,097	$	284

Basic earnings per share	Basic earnings per share					Basic earnings per share	$	4.20	$	0.57
Continuing operations		$	0.57	$	1.54
Discontinued operations		—		—
Net earnings per share		$	0.57	$	1.54

Diluted earnings per share	Diluted earnings per share					Diluted earnings per share	$	4.17	$	0.56
Continuing operations		$	0.56	$	1.53
Discontinued operations		—		—
Net earnings per share		$	0.56	$	1.53
Weighted average common shares outstanding	Weighted average common shares outstanding					Weighted average common shares outstanding
Basic	Basic	501.0		515.7		Basic	498.6		501.0
Diluted	Diluted	505.8		519.5		Diluted	503.4		505.8
Antidilutive shares	Antidilutive shares	0.2		0.1		Antidilutive shares	0		0.2

Note: Per share amounts may not foot due to rounding.

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			1


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Comprehensive Income	Consolidated Statements of Comprehensive Income								Consolidated Statements of Comprehensive Income
		Three Months Ended								Three Months Ended
(millions) (unaudited)	(millions) (unaudited)	May 2, 2020		May 4, 2019		(millions) (unaudited)	May 1, 2021			May 2, 2020
Net earnings	Net earnings	$	284	$	795	Net earnings	$	2,097		$	284
Other comprehensive income
Pension, net of tax		22		10
Currency translation adjustment and cash flow hedges, net of tax		(8)		3
Other comprehensive income / (loss), net of tax						Other comprehensive income / (loss), net of tax
Pension benefit liabilities						Pension benefit liabilities	22			22
Currency translation adjustment and cash flow hedges						Currency translation adjustment and cash flow hedges	9			(8)
Other comprehensive income	Other comprehensive income	14		13		Other comprehensive income	31			14
Comprehensive income	Comprehensive income	$	298	$	808	Comprehensive income	$	2,128		$	298

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Financial Position	Consolidated Statements of Financial Position							Consolidated Statements of Financial Position
(millions, except footnotes) (unaudited)	(millions, except footnotes) (unaudited)	May 2, 2020		February 1, 2020		May 4, 2019		(millions, except footnotes) (unaudited)	May 1, 2021		January 30, 2021		May 2, 2020
Assets	Assets							Assets
Cash and cash equivalents	Cash and cash equivalents	$	4,566	$	2,577	$	1,173	Cash and cash equivalents	$	7,816	$	8,511	$	4,566
Inventory	Inventory	8,584		8,992		9,060		Inventory	10,539		10,653		8,584
Other current assets	Other current assets	1,465		1,333		1,374		Other current assets	1,576		1,592		1,465
Total current assets	Total current assets	14,615		12,902		11,607		Total current assets	19,931		20,756		14,615
Property and equipment	Property and equipment							Property and equipment
Land	Land	6,034		6,036		6,061		Land	6,146		6,141		6,034
Buildings and improvements	Buildings and improvements	30,756		30,603		29,573		Buildings and improvements	31,710		31,557		30,756
Fixtures and equipment	Fixtures and equipment	5,486		6,083		5,401		Fixtures and equipment	5,496		5,914		5,486
Computer hardware and software	Computer hardware and software	2,597		2,692		2,553		Computer hardware and software	2,256		2,765		2,597
Construction-in-progress	Construction-in-progress	803		533		574		Construction-in-progress	973		780		803
Accumulated depreciation	Accumulated depreciation	(19,087)		(19,664)		(18,456)		Accumulated depreciation	(19,777)		(20,278)		(19,087)
Property and equipment, net	Property and equipment, net	26,589		26,283		25,706		Property and equipment, net	26,804		26,879		26,589
Operating lease assets	Operating lease assets	2,235		2,236		2,019		Operating lease assets	2,362		2,227		2,235
Other noncurrent assets	Other noncurrent assets	1,367		1,358		1,287		Other noncurrent assets	1,374		1,386		1,367
Total assets	Total assets	$	44,806	$	42,779	$	40,619	Total assets	$	50,471	$	51,248	$	44,806
Liabilities and shareholders’ investment	Liabilities and shareholders’ investment							Liabilities and shareholders’ investment
Accounts payable	Accounts payable	$	9,625	$	9,920	$	8,360	Accounts payable	$	11,637	$	12,859	$	9,625
Accrued and other current liabilities	Accrued and other current liabilities	4,619		4,406		3,823		Accrued and other current liabilities	5,788		6,122		4,619
Current portion of long-term debt and other borrowings	Current portion of long-term debt and other borrowings	168		161		1,056		Current portion of long-term debt and other borrowings	1,173		1,144		168
Total current liabilities	Total current liabilities	14,412		14,487		13,239		Total current liabilities	18,598		20,125		14,412
Long-term debt and other borrowings	Long-term debt and other borrowings	14,073		11,338		11,357		Long-term debt and other borrowings	11,509		11,536		14,073
Noncurrent operating lease liabilities	Noncurrent operating lease liabilities	2,249		2,275		2,064		Noncurrent operating lease liabilities	2,337		2,218		2,249
Deferred income taxes	Deferred income taxes	1,122		1,122		1,034		Deferred income taxes	1,169		990		1,122
Other noncurrent liabilities	Other noncurrent liabilities	1,781		1,724		1,808		Other noncurrent liabilities	1,899		1,939		1,781
Total noncurrent liabilities	Total noncurrent liabilities	19,225		16,459		16,263		Total noncurrent liabilities	16,914		16,683		19,225
Shareholders’ investment	Shareholders’ investment							Shareholders’ investment
Common stock	Common stock	42		42		43		Common stock	41		42		42
Additional paid-in capital	Additional paid-in capital	6,206		6,226		5,908		Additional paid-in capital	6,271		6,329		6,206
Retained earnings	Retained earnings	5,775		6,433		5,958		Retained earnings	9,372		8,825		5,775
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(854)		(868)		(792)		Accumulated other comprehensive loss	(725)		(756)		(854)
Total shareholders’ investment	Total shareholders’ investment	11,169		11,833		11,117		Total shareholders’ investment	14,959		14,440		11,169
Total liabilities and shareholders’ investment	Total liabilities and shareholders’ investment	$	44,806	$	42,779	$	40,619	Total liabilities and shareholders’ investment	$	50,471	$	51,248	$	44,806

Common Stock Authorized 6,000,000,000 shares, $0.0833 par value; ~~499,919,691, 504,198,962~~496,093,160, 500,877,129 and ~~512,312,434~~499,919,691 shares issued and outstanding atas of May 1, 2021, January 30, 2021, and May 2, 2020, ~~February 1, 2020, and May 4, 2019,~~ respectively.

Preferred Stock Authorized 5,000,000 shares, $0.01 par value; 0 shares were issued or outstanding during any period presented.

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			3


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Cash Flows	Consolidated Statements of Cash Flows					Consolidated Statements of Cash Flows
		Three Months Ended							Three Months Ended
(millions) (unaudited)	(millions) (unaudited)	May 2, 2020		May 4, 2019		(millions) (unaudited)	May 1, 2021		May 2, 2020
Operating activities	Operating activities					Operating activities
Net earnings	Net earnings	$	284	$	795	Net earnings	$	2,097	$	284
Earnings from discontinued operations, net of tax		—		3
Net earnings from continuing operations		284		792
Adjustments to reconcile net earnings to cash provided by operations

Adjustments to reconcile net earnings to cash provided by operating activities:						Adjustments to reconcile net earnings to cash provided by operating activities:
Depreciation and amortization	Depreciation and amortization	641		644		Depreciation and amortization	667		641
Share-based compensation expense	Share-based compensation expense	49		46		Share-based compensation expense	79		49
Deferred income taxes	Deferred income taxes	(4)		59		Deferred income taxes	170		(4)
Gain on Dermstore sale						Gain on Dermstore sale	(335)		0

Noncash losses / (gains) and other, net	Noncash losses / (gains) and other, net	5		10		Noncash losses / (gains) and other, net	(30)		5
Changes in operating accounts
Changes in operating accounts:						Changes in operating accounts:
Inventory	Inventory	408		438		Inventory	114		408
Other assets	Other assets	11		17		Other assets	(5)		11
Accounts payable	Accounts payable	(280)		(1,402)		Accounts payable	(1,205)		(280)
Accrued and other liabilities	Accrued and other liabilities	170		(281)		Accrued and other liabilities	(413)		170

Cash provided by operations		1,284		323
Cash provided by operating activities						Cash provided by operating activities	1,139		1,284
Investing activities	Investing activities					Investing activities
Expenditures for property and equipment	Expenditures for property and equipment	(751)		(655)		Expenditures for property and equipment	(540)		(751)
Proceeds from disposal of property and equipment	Proceeds from disposal of property and equipment	6		5		Proceeds from disposal of property and equipment	12		6
Proceeds from Dermstore sale						Proceeds from Dermstore sale	356		0
Other investments	Other investments	1		1		Other investments	7		1
Cash required for investing activities	Cash required for investing activities	(744)		(649)		Cash required for investing activities	(165)		(744)
Financing activities	Financing activities					Financing activities
Additions to long-term debt	Additions to long-term debt	2,480		994		Additions to long-term debt	0		2,480
Reductions of long-term debt	Reductions of long-term debt	(17)		(13)		Reductions of long-term debt	(21)		(17)
Dividends paid	Dividends paid	(332)		(330)		Dividends paid	(340)		(332)
Repurchase of stock	Repurchase of stock	(686)		(320)		Repurchase of stock	(1,310)		(686)
Accelerated share repurchase pending final settlement		—		(400)

Stock option exercises	Stock option exercises	4		12		Stock option exercises	2		4
Cash provided by / (required for) financing activities		1,449		(57)
Net increase / (decrease) in cash and cash equivalents		1,989		(383)
Cash (required for) / provided by financing activities						Cash (required for) / provided by financing activities	(1,669)		1,449
Net (decrease) / increase in cash and cash equivalents						Net (decrease) / increase in cash and cash equivalents	(695)		1,989
Cash and cash equivalents at beginning of period	Cash and cash equivalents at beginning of period	2,577		1,556		Cash and cash equivalents at beginning of period	8,511		2,577
Cash and cash equivalents at end of period	Cash and cash equivalents at end of period	$	4,566	$	1,173	Cash and cash equivalents at end of period	$	7,816	$	4,566
Supplemental information	Supplemental information					Supplemental information
Leased assets obtained in exchange for new finance lease liabilities	Leased assets obtained in exchange for new finance lease liabilities	103		126		Leased assets obtained in exchange for new finance lease liabilities	$	69	$	103
Leased assets obtained in exchange for new operating lease liabilities	Leased assets obtained in exchange for new operating lease liabilities	97		107		Leased assets obtained in exchange for new operating lease liabilities	189		97

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			4


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Shareholders’ Investment	Consolidated Statements of Shareholders’ Investment																							Consolidated Statements of Shareholders’ Investment
		Common	Stock		Additional				Accumulated Other					Common	Stock		Additional				Accumulated Other
		Stock	Par		Paid-in		Retained		Comprehensive					Stock	Par		Paid-in		Retained		Comprehensive
(millions) (unaudited)	(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total		(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total
February 2, 2019		517.8	$	43	$	6,042	$	6,017	$	(805)	$	11,297
February 1, 2020													February 1, 2020	504.2	$	42	$	6,226	$	6,433	$	(868)	$	11,833
Net earnings	Net earnings	—	—		—		795		—		795		Net earnings	—	—		—		284		—		284
Other comprehensive income	Other comprehensive income	—	—		—		—		13		13		Other comprehensive income	—	—		—		—		14		14
Dividends declared	Dividends declared	—	—		—		(330)		—		(330)		Dividends declared	—	—		—		(333)		—		(333)
Repurchase of stock	Repurchase of stock	(3.6)	—		—		(277)		—		(277)		Repurchase of stock	(5.7)	—		—		(609)		—		(609)
Accelerated share repurchase pending final settlement		(3.0)	—		(153)		(247)		—		(400)

Stock options and awards	Stock options and awards	1.1	—		19		—		—		19		Stock options and awards	1.4	—		(20)		—		—		(20)
May 4, 2019		512.3	$	43	$	5,908	$	5,958	$	(792)	$	11,117
May 2, 2020													May 2, 2020	499.9	$	42	$	6,206	$	5,775	$	(854)	$	11,169
Net earnings	Net earnings	—	—		—		938		—		938		Net earnings	—	—		—		1,690		—		1,690
Other comprehensive income	Other comprehensive income	—	—		—		—		10		10		Other comprehensive income	—	—		—		—		21		21
Dividends declared	Dividends declared	—	—		—		(341)		—		(341)		Dividends declared	—	—		—		(344)		—		(344)
Repurchase of stock		(1.3)	—		153		(94)		—		59

Stock options and awards	Stock options and awards	0.3	—		53		—		—		53		Stock options and awards	0.4	—		42		—		—		42
August 3, 2019		511.3	$	43	$	6,114	$	6,461	$	(782)	$	11,836
August 1, 2020													August 1, 2020	500.3	$	42	$	6,248	$	7,121	$	(833)	$	12,578
Net earnings	Net earnings	—	—		—		714		—		714		Net earnings	—	—		—		1,014		—		1,014
Other comprehensive income	Other comprehensive income	—	—		—		—		9		9		Other comprehensive income	—	—		—		—		36		36
Dividends declared	Dividends declared	—	—		—		(338)		—		(338)		Dividends declared	—	—		—		(346)		—		(346)
Repurchase of stock		(3.0)	(1)		—		(295)		—		(296)
Accelerated share repurchase pending final settlement		(2.5)	—		(178)		(272)		—		(450)

Stock options and awards	Stock options and awards	0.9	—		70		—		—		70		Stock options and awards	0.5	—		37		—		—		37
November 2, 2019		506.7	$	42	$	6,006	$	6,270	$	(773)	$	11,545
October 31, 2020													October 31, 2020	500.8	$	42	$	6,285	$	7,789	$	(797)	$	13,319
Net earnings	Net earnings	—	—		—		834		—		834		Net earnings	—	—		—		1,380		—		1,380
Other comprehensive loss		—	—		—		—		(95)		(95)
Other comprehensive income													Other comprehensive income	—	—		—		—		41		41
Dividends declared	Dividends declared	—	—		—		(336)		—		(336)		Dividends declared	—	—		—		(344)		—		(344)
Repurchase of stock		(2.6)	—		178		(335)		—		(157)

Stock options and awards	Stock options and awards	0.1	—		42		—		—		42		Stock options and awards	0.1	—		44		—		—		44
February 1, 2020		504.2	$	42	$	6,226	$	6,433	$	(868)	$	11,833
January 30, 2021													January 30, 2021	500.9	$	42	$	6,329	$	8,825	$	(756)	$	14,440


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			5


			FINANCIAL STATEMENTS			Table of Contents
						Index to Notes


Consolidated Statements of Shareholders’ Investment	Consolidated Statements of Shareholders’ Investment																							Consolidated Statements of Shareholders’ Investment
		Common	Stock		Additional				Accumulated Other					Common	Stock		Additional				Accumulated Other
		Stock	Par		Paid-in		Retained		Comprehensive					Stock	Par		Paid-in		Retained		Comprehensive
(millions) (unaudited)	(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total		(millions) (unaudited)	Shares	Value		Capital		Earnings		(Loss) / Income		Total
February 1, 2020		504.2	$	42	$	6,226	$	6,433	$	(868)	$	11,833
January 30, 2021													January 30, 2021	500.9	$	42	$	6,329	$	8,825	$	(756)	$	14,440
Net earnings	Net earnings	—	—		—		284		—		284		Net earnings	—	—		—		2,097		—		2,097
Other comprehensive income	Other comprehensive income	—	—		—		—		14		14		Other comprehensive income	—	—		—		—		31		31
Dividends declared	Dividends declared	—	—		—		(333)		—		(333)		Dividends declared	—	—		—		(343)		—		(343)
Repurchase of stock	Repurchase of stock	(5.7)	—		—		(609)		—		(609)		Repurchase of stock	(6.1)	(1)		—		(1,207)		—		(1,208)
Stock options and awards	Stock options and awards	1.4	—		(20)		—		—		(20)		Stock options and awards	1.3	—		(58)		—		—		(58)
May 2, 2020		499.9	$	42	$	6,206	$	5,775	$	(854)	$	11,169
May 1, 2021													May 1, 2021	496.1	$	41	$	6,271	$	9,372	$	(725)	$	14,959

We declared ~~$0.66~~$0.68 and ~~$0.64~~$0.66 dividends per share for the three months ended May 1, 2021, and May 2, 2020, ~~and May 4, 2019,~~ respectively, and ~~$2.62~~$2.70 per share for the fiscal year ended ~~February 1, 2020.~~January 30, 2021.

See accompanying Notes to Consolidated Financial Statements.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			6


			FINANCIAL STATEMENTS			Table of Contents
			INDEX			Index to Notes


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			7


			FINANCIAL STATEMENTS			Table of Contents
			NOTES			Index to Notes

Notes to Consolidated Financial Statements (unaudited)

1. Accounting Policies

These unaudited condensed consolidated financial statements are prepared in accordance with the rules and regulations of the Securities and Exchange Commission ~~(SEC)~~ applicable to interim financial statements. While these statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by United States ~~(U.S.)~~ generally accepted accounting principles (U.S. GAAP) for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the financial statement disclosures in our ~~2019~~2020 Form 10-K.

We use the same accounting policies in preparing quarterly and annual financial statements. ~~Unless otherwise noted, amounts presented within the Notes to Consolidated Financial Statements refer to our continuing operations.~~.

We operate as a single segment that ~~includes all of our continuing operations, which are~~is designed to enable guests to purchase products seamlessly in stores or through our digital channels. Nearly all of our revenues are generated in the U.S. The vast majority of our long-lived assets are located within the U.S.

Due to the seasonal nature of our business, quarterly revenues, expenses, earnings, and cash flows are not necessarily indicative of the results that may be expected for the full year.

2. ~~Impact of~~ Coronavirus (COVID-19)

~~On March 11, 2020 the World Health Organization declared the~~The novel coronavirus ~~disease~~ (COVID-19) a pandemic ~~and on March 13,~~continues to evolve. In 2020, ~~the United States declared a national emergency. States~~states and cities ~~have taken~~took various measures in response to COVID-19, including mandating the closure of certain businesses and encouraging or requiring citizens to avoid large gatherings. To date, virtually all of our stores, digital channels, and distribution centers ~~remain~~have remained open.

~~Throughout the quarter, guest shopping patterns changed significantly in reaction to~~As the COVID-19 ~~pandemic. Across~~pandemic has evolved, we have experienced significant volatility in our ~~core merchandise categories,~~ sales ~~have grown significantly in Beauty and Household Essentials, Food and Beverage, Hardlines, and Home Furnishings and Décor, while declining significantly in Apparel and Accessories.~~category mix. Note 3 4 ~~provides~~presents sales by category. ~~In response to these changes,~~Since the pandemic started in March 2020, we ~~have taken many~~took various actions, including accelerating purchases of certain merchandise in our core categories and slowing or canceling ~~certain~~ purchase orders, primarily for Apparel and Accessories. As a result, ~~of these actions,~~ during the quarter ended May 2, 2020, we recorded $216 million of purchase order cancellation fees in Cost of Sales.

From March 26, 2020, to April 26, 2020, we did not accept in-store merchandise returns and exchanges to protect our team members. We lengthened the return period for merchandise affected by this change. We continue to recognize sales net of expected returns. Our returns estimate for sales during the suspension period includes significant assumptions that, if actual results are substantially different, could result in material adjustments in future periods.

3. Dermstore Sale

In February 2021, we sold our wholly owned subsidiary Dermstore LLC (Dermstore) for $356 million in cash and recognized a $335 million pretax gain, which is included in Net Other (Income) / Expense. Dermstore has historically represented less than 1 percent of our consolidated revenues, operating income and net assets.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			8


			FINANCIAL STATEMENTS			Table of Contents
			NOTES			Index to Notes

3.4. Revenues

General merchandise sales represent the vast majority of our revenues. We also earn revenues from a variety of other sources, most notably credit card ~~profit sharing~~profit-sharing income from our arrangement with TD Bank Group (TD).

Revenues Three Months Ended
(millions) May 2,
2020 May 4,
2019
Apparel and accessories ^(a)
$ 2,619 $ 3,290
Beauty and household essentials ^(b)
5,911 4,971
Food and beverage ^(c)
4,575 3,722
Hardlines ^(d)
2,974 2,385
Home furnishings and décor ^(e)
3,264 3,001
Other 28 32
Sales 19,371 17,401
Credit card profit sharing 166 160
Other 78 66
Other revenue 244 226
Total revenue $ 19,615 $ 17,627

^{Revenues Three Months Ended
(millions) May 1, 2021 May 2, 2020
Apparel and accessories (a) $ 4,269 $ 2,619
Beauty and household essentials (b) 6,364 5,911
Food and beverage (c) 4,856 4,575
Hardlines (d) 3,946 2,974
Home furnishings and décor (e) 4,410 3,264
Other 34 28
Sales 23,879 19,371
Credit card profit sharing 171 166
Other 147 78
Other revenue 318 244
Total revenue $ 24,197 $ 19,615}

(a)Includes apparel for women, men, boys, girls, toddlers, infants and newborns, as well as jewelry, accessories, and shoes.

^(b)Includes beauty and personal care, baby gear, cleaning, paper products, and pet supplies.

^(c)Includes dry grocery, dairy, frozen food, beverages, candy, snacks, deli, bakery, meat, produce, and food service in our stores.

^(d)Includes electronics (including video game hardware and software), toys, entertainment, sporting goods, and luggage.

^(e)Includes furniture, lighting, storage, kitchenware, small appliances, home décor, bed and bath, home improvement, ~~school/~~school and office supplies, greeting cards and party supplies, and other seasonal merchandise.

Merchandise sales — – We record almost all retail store revenues at the point of sale. Digitally originated sales may include shipping revenue and are recorded upon delivery to the guest or upon guest pickup at the store. Sales are recognized net of expected returns, which we estimate using historical return ~~patterns and our expectation of future returns.~~patterns. As of May ~~2, 2020, February~~ 1, ~~2020,~~2021, January 30, 2021, and May ~~4, 2019,~~2, 2020, the accrual for estimated returns was $196 million, $139 million, and $398 million, ~~$117 million,~~respectively. The accrual as of May 2, 2020, reflects the impact of the suspension of in-store merchandise returns and ~~$124 million, respectively. We have not historically had material adjustments~~exchanges from March 26, 2020, to ~~our returns estimates.~~April 26, 2020, due to the COVID-19 pandemic.

Revenue from Target gift card sales is recognized upon gift card redemption, which is typically within one year of issuance.


Gift Card Liability Activity	Gift Card Liability Activity	February 1, 2020		Gift Cards Issued During Current Period But Not Redeemed ^(b)		Revenue Recognized From Beginning Liability		May 2, 2020		Gift Card Liability Activity	January 30, 2021		Gift Cards Issued During Current Period But Not Redeemed (b)			Revenue Recognized From Beginning Liability		May 1, 2021
(millions)	(millions)														(millions)				Revenue Recognized From Beginning Liability			May 1, 2021
Gift card liability ^(a)	Gift card liability ^(a)	$	935	$	180	$	(335)	$	780	Gift card liability (a)	$	1,035	$	234		$	(374)			$	895

^(a)Included in Accrued and Other Current Liabilities.

^(b)Net of estimated breakage.


TARGET CORPORATION						Q1 2021 Form 10-Q			9


			FINANCIAL STATEMENTS			Table of Contents
			NOTES			Index to Notes

Credit card profit sharing –— We receive payments under a credit card program agreement with TD. Under the agreement, we receive a percentage of the profits generated by the Target Credit Card and Target MasterCard receivables in exchange for performing account servicing and primary marketing functions. TD underwrites, funds, and owns Target Credit Card and Target MasterCard receivables, controls risk management policies, and oversees regulatory compliance.


~~TARGET CORPORATION~~						~~Q1 2020 Form 10-Q~~			9


			~~FINANCIAL STATEMENTS~~			~~Table of Contents~~
			~~NOTES~~			~~Index to Notes~~

4.5. Fair Value Measurements

Fair value measurements are reported in one of three levels reflecting the valuation techniques used to determine fair value.

Fair Value Measurements - Recurring Basis Fair Value at
(millions) Classification Pricing Category May 2,
2020 February 1,
2020 May 4,
2019
Assets
Short-term investments Cash and Cash Equivalents Level 1 $ 3,605 $ 1,810 $ 419
Prepaid forward contracts Other Current Assets Level 1 23 23 21
Equity securities ^(a)
Other Current Assets Level 1 18 39 80
Interest rate swaps Other Noncurrent Assets Level 2 228 137 23
Liabilities
Interest rate swaps Other Current Liabilities Level 2 — — 1
Interest rate swaps Other Noncurrent Liabilities Level 2 10 — —

^(a)~~Represents our investment in Casper Sleep Inc. common stock~~.


Financial Instruments Measured On a Recurring Basis			Fair Value
(millions)	Classification	Pricing Category	May 1, 2021		January 30, 2021		May 2, 2020
Assets
Short-term investments	Cash and Cash Equivalents	Level 1	$	6,895	$	7,644	$	3,605
Prepaid forward contracts	Other Current Assets	Level 1	37		38		23
Equity securities	Other Current Assets	Level 1	0		0		18
Interest rate swaps	Other Noncurrent Assets	Level 2	149		188		228
Liabilities

Interest rate swaps	Other Noncurrent Liabilities	Level 2	0		0		10


Significant Financial Instruments Not Measured at Fair Value ^(a) (millions)	Significant Financial Instruments Not Measured at Fair Value ^(a) (millions)	May 2, 2020							February 1, 2020							May 4, 2019					Significant Financial Instruments Not Measured at Fair Value (a) (millions)		May 1, 2021					January 30, 2021				May 2, 2020
				Carrying Amount		Fair Value			Carrying Amount		Fair Value			Carrying Amount		Fair Value		Significant Financial Instruments Not Measured at Fair Value (a) (millions)	Carrying Amount	Fair Value					Carrying Amount	Fair Value				Carrying Amount	Fair Value
Long-term debt, including current portion ^(b)	Long-term debt, including current portion ^(b)	$	12,474	$	14,781		$	9,992	$	11,864		$	11,243	$	12,015	Long-term debt, including current portion (b)	$		12,335			$	10,643	$	12,787		$	12,474	$	14,781

^(a)The carrying amounts of certain other current assets, commercial paper, accounts payable, and certain accrued and other current liabilities approximate fair value due to their short-term nature.

^(b)The fair value of debt is generally measured using a discounted cash flow analysis based on current market interest rates for the same or similar types of financial instruments and would be classified as Level 2. These amounts exclude commercial paper, unamortized swap valuation adjustments, and lease liabilities.

5.6. Property and Equipment

We review long-lived assets for impairment when store performance expectations, events, or changes in circumstances—such as a decision to relocate or close a store, office, or distribution center, discontinue ~~projects,~~a project, or make significant software changes—indicate that the asset’s carrying value may not be recoverable. We recognized impairment charges of ~~$35~~$41 million and $4$35 million during the three months ended May 1, 2021, and May 2, 2020, ~~and May 4, 2019,~~ respectively. ~~The~~These impairment charges are ~~recorded~~included in Selling, General and Administrative Expenses (SG&A).

~~6. Commercial Paper and Long-Term Debt~~

~~In March 2020, we issued unsecured fixed rate debt of $1.5 billion at 2.250 percent that matures in April 2025 and $1.0 billion at 2.650 percent that matures in September 2030.~~

We obtain short-term financing from time to time under our commercial paper program. NaN balances were outstanding at any time during the three months ended May 2, 2020. For the three months ended May 4, 2019, the maximum amount outstanding was $744 million, and the average daily amount outstanding was $140 million at a weighted average annual interest rate of 2.4 percent, with 0 balance outstanding as of May 4, 2019.

In April 2020, we obtained a committed $900 million 364-day unsecured revolving credit facility that expires in April 2021. This new facility is in addition to our $2.5 billion unsecured revolving credit facility that expires in October 2023. NaN balances were outstanding under either credit facility at any time during 2020 or 2019.

7. Derivative Financial Instruments

Our derivative instruments consist of interest rate swaps used to mitigate interest rate risk. As a result, we have counterparty credit exposure to large global financial institutions, which we monitor on an ongoing basis. Note 45 to the Consolidated Financial Statements provides the fair value and classification of these instruments.

As of May 1, 2021, January 30, 2021, and May 2, 2020, we were party to interest rate swaps with notional amounts totaling $1.5 billion. We pay a floating rate and receive a fixed rate under each of these agreements. All of the agreements are designated as fair value hedges, and all were considered to be perfectly effective under the shortcut method during the three months ended May 1, 2021, and May 2, 2020.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			10


			FINANCIAL STATEMENTS			Table of Contents
			NOTES			Index to Notes

As of May ~~2, 2020,~~1, 2021, January 30, 2021, and May 4, 2019, we were party to interest rate swaps with notional amounts totaling $1.5 billion and$2.5 billion, respectively. We pay a variable rate and receive a fixed rate under each of these agreements. All of the agreements are designated as fair value hedges, and all were perfectly effective during the three months ended May 2, 2020, and May 4, 2019.

~~As of~~ May 2, 2020, we were party to forward-starting interest rate swaps with notional amounts totaling $250 ~~million~~million. We use these derivative financial instruments, which have been designated as cash flow hedges, to hedge the interest rate exposure of anticipated future debt issuances. We designated these derivative financial instruments as cash flow hedges. We assess, both at inception and on an ongoing basis, whether the derivative financial instrument is highly effective in offsetting changes in cash flows of the hedged item and whether it is probable that the hedged forecasted transaction will occur. As of May ~~2, 2020, a $10 million loss was recorded in~~1, 2021, Accumulated Other Comprehensive Loss ~~and~~(AOCI) included $17 million that will be reclassified toand reduce Net Interest Expense when the forecasted transaction affects earnings.


Effect of Hedges on Debt
(millions)		May 2, 2020		February 1, 2020		May 4, 2019
Current portion of long-term debt and other borrowings
Carrying amount of hedged debt		$	—	$	—	$	999
Cumulative hedging adjustments, included in carrying amount		—		—		(1)
Effect of Hedges on Debt (millions)								Effect of Hedges on Debt (millions)	May 1, 2021		January 30, 2021		May 2, 2020

Long-term debt and other borrowings	Long-term debt and other borrowings							Long-term debt and other borrowings
Carrying amount of hedged debt	Carrying amount of hedged debt	1,721		1,630		1,515		Carrying amount of hedged debt	$	1,627	$	1,677	$	1,721
Cumulative hedging adjustments, included in carrying amount	Cumulative hedging adjustments, included in carrying amount	228		137		23		Cumulative hedging adjustments, included in carrying amount	132		183		228


Effect of Hedges on Net Interest Expense	Effect of Hedges on Net Interest Expense	Three Months Ended							Effect of Hedges on Net Interest Expense	Three Months Ended
(millions)	(millions)	May 2, 2020		May 4, 2019		(millions)	May 1, 2021			May 2, 2020

Gain (loss) on fair value hedges recognized in Net Interest Expense	Gain (loss) on fair value hedges recognized in Net Interest Expense					Gain (loss) on fair value hedges recognized in Net Interest Expense
Interest rate swap designated as fair value hedges	Interest rate swap designated as fair value hedges	$	91	$	15	Interest rate swap designated as fair value hedges	$	(51)		$	91
Hedged debt	Hedged debt	(91)		(15)		Hedged debt	51			(91)
Total	Total	$	—	$	—	Total	$	0		$	0

8. Income Taxes

For the three months ended May ~~2, 2020~~,1, 2021, our effective tax rate was ~~13.9~~19.6 percent compared with ~~22.4~~13.9 percent for the three months ended May ~~4, 2019~~,2, 2020, as ~~lower~~higher pretax earnings indiluted the ~~current year period~~tax-rate benefit from fixed and discrete items, such as employee share-based compensation and the sale of Dermstore. Additionally, the favorable resolution of certain income tax matters resulted in a ~~larger tax-rate benefit from~~$44 million discrete ~~items, primarily related to employee share-based compensation.~~tax benefit.

9. Share Repurchase

We periodically repurchase shares of our common stock under a board-authorized repurchase program through a combination of open market transactions, accelerated share repurchase ~~(ASR)~~ arrangements, and other privately negotiated transactions with financial institutions.


Share Repurchase Activity	Share Repurchase Activity	Three Months Ended							Share Repurchase Activity	Three Months Ended
(millions, except per share data)	(millions, except per share data)	May 2, 2020		May 4, 2019		(millions, except per share data)	May 1, 2021			May 2, 2020
Number of shares purchased	Number of shares purchased	5.7		3.6		Number of shares purchased	6.1			5.7
Average price paid per share	Average price paid per share	$	107.58	$	76.98	Average price paid per share	$	190.77		$	107.58
Total investment	Total investment	$	609	$	277	Total investment	$	1,165		$	609

~~Note: This table excludes activity related to the first quarter 2019 ASR arrangement described below because final settlement had not occurred as of May 4, 2019.~~


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			11


			FINANCIAL STATEMENTS			Table of Contents
			NOTES			Index to Notes

During the first quarter of 2019, we entered into an ASR arrangement to repurchase $275 to $400 million of our common stock. Under the agreement, we paid $400 million and received an initial delivery of 3.0 million shares, which were retired, resulting in a $247 million reduction to Retained Earnings. As of May 4, 2019, $153 million was included as a reduction to Additional Paid-in Capital. Upon final settlement in the second quarter of 2019, we received an additional 1.2 million shares, which were retired, and $60 million for the remaining amount not settled in shares. In total, we repurchased 4.2 million shares under the ASR arrangement for a total cash investment of $340 million ($80.21 per share).

~~In March 2020, we suspended share repurchase activity.~~

10. Pension Benefits

We provide pension plan benefits to eligible team members.


Net Pension Benefits Expense	Net Pension Benefits Expense		Three Months Ended							Net Pension Benefits Expense	Three Months Ended
(millions)	(millions)	Classification	May 2, 2020		May 4, 2019		(millions)	Classification	May 1, 2021		May 2, 2020
Service cost benefits earned	Service cost benefits earned	SG&A Expenses	$	26	$	23	Service cost benefits earned	SG&A	$	24	$	26
Interest cost on projected benefit obligation	Interest cost on projected benefit obligation	Net Other (Income) / Expense	30		37		Interest cost on projected benefit obligation	Net Other (Income) / Expense	24		30
Expected return on assets	Expected return on assets	Net Other (Income) / Expense	(61)		(62)		Expected return on assets	Net Other (Income) / Expense	(59)		(61)
Amortization of losses	Amortization of losses	Net Other (Income) / Expense	32		16		Amortization of losses	Net Other (Income) / Expense	29		32
Amortization of prior service cost	Amortization of prior service cost	Net Other (Income) / Expense	(3)		(3)		Amortization of prior service cost	Net Other (Income) / Expense	0		(3)

Total	Total		$	24	$	11	Total		$	18	$	24

11. Accumulated Other Comprehensive Loss


Change in Accumulated Other Comprehensive Loss	Change in Accumulated Other Comprehensive Loss	Cash Flow Hedges		Currency Translation Adjustment		Pension		Total		Change in Accumulated Other Comprehensive Loss	Cash Flow Hedges		Currency Translation Adjustment			Pension		Total
(millions)	(millions)														(millions)					Pension		Total
February 1, 2020		$	(12)	$	(19)	$	(837)	$	(868)
January 30, 2021										January 30, 2021	$	(3)	$	(18)		$	(735)			$	(756)
Other comprehensive income before reclassifications, net of tax	Other comprehensive income before reclassifications, net of tax	(7)		(1)		—		(8)		Other comprehensive income before reclassifications, net of tax	9		0			0		9
Amounts reclassified from AOCI, net of tax	Amounts reclassified from AOCI, net of tax	—		—		22		22		Amounts reclassified from AOCI, net of tax	0		0			22		22
May 2, 2020		$	(19)	$	(20)	$	(815)	$	(854)
May 1, 2021										May 1, 2021	$	6	$	(18)		$	(713)	$	(725)


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			12


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			FINANCIAL SUMMARY			Index to Notes

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Financial Summary

First quarter ~~2020 includes~~2021 included the following notable items:

•GAAP diluted earnings per share ~~from continuing operations were $0.56.~~was $4.17.

•Adjusted diluted earnings per share ~~from continuing operations were $0.59.~~ ~~Adjusted earnings per share reflects the impact of COVID-19 on our business.~~was $3.69.

•Total revenue increased ~~11.3~~23.4 percent, driven by aan increase in comparable ~~sales increase and sales from new stores.~~sales.

•Comparable sales increased ~~10.8~~22.9 percent, driven by a ~~12.5~~17.1 percent increase in ~~average transaction amount.~~traffic.

◦Comparable ~~store~~stores originated sales grew ~~0.9~~18.0 percent.

◦~~Digital channel~~Comparable digitally originated sales increased ~~141 percent, contributing 9.9 percentage points to comparable sales growth.~~50.2 percent.

•Operating income of ~~$468 million~~$2.4 billion was ~~58.7~~407 percent ~~lower~~higher than the comparable prior-year period.

•We recognized a $335 million pretax gain on the sale of Dermstore.

Sales were ~~$19.4~~$23.9 billion for the three months ended May ~~2, 2020,~~1, 2021, an increase of ~~$2.0~~$4.5 billion, or ~~11.3~~23.3 percent, from the ~~same period in the prior year. Operating cash~~comparable prior-year period. Cash flow provided by ~~continuing operations~~operating activities was $1.1 billion for the three months ended May 1, 2021, a decrease of $0.1 billion, or (11.3) percent, from $1.3 billion for the three months ended May 2, ~~2020, an increase of $961 million, or 297.5 percent, from $323 million for the three months ended May 4, 2019.~~2020.


Earnings Per Share from Continuing Operations		Three Months Ended
				May 2, 2020			May 4, 2019			Change
Earnings Per Share										Earnings Per Share	Three Months Ended
											May 1, 2021		May 2, 2020		Change
GAAP diluted earnings per share	GAAP diluted earnings per share	$	0.56		$	1.53		(63.3)	%	GAAP diluted earnings per share	$	4.17	$	0.56	643.2	%
Adjustments	Adjustments	0.03			—					Adjustments	(0.47)		0.03
Adjusted diluted earnings per share	Adjusted diluted earnings per share	$	0.59		$	1.53		(61.3)	%	Adjusted diluted earnings per share	$	3.69	$	0.59	525.0	%

Note: Amounts may not foot due to rounding. Adjusted diluted earnings per share ~~from continuing operations~~ (Adjusted EPS), a non-GAAP metric, excludes the impact of certain items. Management believes that Adjusted EPS is useful in providing period-to-period comparisons of the results of our ~~continuing~~ operations. A reconciliation of non-GAAP financial measures to GAAP measures is ~~provided~~provided on page ~~19.~~18.

We report after-tax return on invested capital (ROIC) ~~from continuing operations~~ because we believe ROIC provides a meaningful measure of our ~~capital-allocation~~capital allocation effectiveness over time. For the trailing twelve months ended May ~~2, 2020,~~1, 2021, after-tax ROIC was ~~13.4~~30.7 percent, compared with ~~14.3~~13.4 percent for the trailing twelve months ended May ~~4, 2019.~~2, 2020. The calculation of ROIC is provided on on page ~~20.~~19.

~~Impact of~~ COVID-19

On March 11, 2020 the World Health Organization declared the novel coronavirus disease (COVID-19) a pandemic, and on March 13, 2020 the United States declared a national emergency. The rapid development and fluidity of this situation limits our ability to predict the ultimate impact of COVID-19 on our business, financial condition and financial performance, which could be material. States and cities have taken various measures in response to COVID-19, including mandating the closure of certain businesses and encouraging or requiring citizens to avoid large gatherings. We have implemented numerous safety measures to protect our guests and team members — such as more rigorous cleaning processes, providing disposable face masks, gloves and thermometers for team members, installing distancing markers, limiting guest levels within our stores, and installing partitions at all stores. ~~We have also reduced store hours to support increased cleaning and replenishment efforts and implemented quantity limits on certain high-demand merchandise. In addition, we have reserved certain store hours for guests with increased vulnerability to COVID-19. To date all of our stores, digital channels, and distribution centers remain open.~~

As the ~~crisis~~COVID-19 pandemic has evolved, we have experienced unusually strong sales, as guests rely on Target for essential items like food, medicine, cleaning products, and household stock-up ~~items.~~items, as well as merchandise associated with guests spending more time at home. Underlying this trend, we ~~saw~~have seen significant volatility in our sales ~~mix, including both~~ category ~~sales~~and channel mix, ~~and the mix of sales in our stores and digital channels,~~ including same-day fulfillment ~~options, and these trends changed within the quarter.~~options.

•~~February 2020~~During the first quarter of 2021, strength in comparable sales ~~increased 3.8 percent with strength~~growth continued across our ~~entire~~ multi-category portfolio, ~~largely reflecting a continuation of 2019 sales trends. Late in the month, we saw an increase in traffic and comparable sales in both our stores and digital channels as well as increased sales~~with significantly higher growth in our ~~Food~~higher-margin Apparel & Accessories and ~~Beverage and Beauty and Household Essential categories as consumers began stock-up shopping.~~


~~TARGET CORPORATION~~						~~Q1 2020 Form 10-Q~~			13


			~~MANAGEMENT'S DISCUSSION AND ANALYSIS~~			~~Table of Contents~~
			~~FINANCIAL SUMMARY~~			~~Index to Notes~~

•March 2020 comparable sales increased 11.7 percent, including an increase of 4.9 percent in stores originated comparable sales and approximately 100 percent in digitally originated comparable sales. Across ourHome Furnishings & Décor core merchandise ~~categories, March comparable~~categories. Comparable sales ~~increased significantly~~growth was strongest in ~~Beauty and Household Essentials, Food and Beverage, and Hardlines. The increases were partially offset by~~Apparel & Accessories, which experienced a significant ~~comparable sales declines in Apparel and Accessories and, to a lesser extent, Home Furnishings and Décor.~~

•~~April 2020 comparable sales increased 16.5 percent. A 4.8 percent~~ decline in stores originated sales was more than offset by a 282 percent increase in digitally originated sales, including those fulfilled by our stores. Comparable sales increased significantly in Beauty and Household Essentials, Food and Beverage, Hardlines, as well as Home Furnishings and Décor. Comparable sales in Apparel and Accessories continued to decline, although at a lower rate than in March. Store originated and Apparel and Accessories sales trends increased notably beginning mid-April.

From March 26, 2020 to April 26, 2020, we did not accept in-store merchandise returns and exchanges. We lengthened the return period for merchandise affected by this change. As a result of this temporary suspension, ~~the accrual for estimated returns was $398 million as of May 2, 2020, compared with $117 million and $124 million as of February 1, 2020, and May 4, 2019, respectively.~~ ~~Our returns estimate for sales~~ during the ~~suspension period includes significant assumptions that, if actual results are substantially different, could result~~first quarter of 2020, Additionally, strength above the chain average continued in ~~material adjustments in future periods.~~

Gross margin has been negatively impacted by changes in both our category and channel sales mix, as well as actions that we have taken to allow us to better fulfill guest demand for essentials. Additionally, gross margin reflects COVID-19-related investments in pay and benefits for our supply chain team members.

Our SG&A expenses have also been significantly impacted by incremental costs related to investments in pay and benefits for store team members, the spikes in merchandise volume in stores and the supply chain, incremental safety and cleaning supplies, and the impact of additional team member hours dedicated to more rigorous cleaning routines in our facilities.

To support our team and minimize potential disruptions in their work to serve our guests, we have modified our plans for some of our strategic initiatives, including our previously announced remodel program. We now anticipate approximately 130 remodels in 2020, down from the previous expectation of approximately 300. Similarly, we now expect to open 15 to 20 new small format stores in 2020, rather than the 36 previously announced.

Hardlines. During the first quarter of 2020, ~~we issued $2.5 billion of 5-year~~comparable sales growth was strongest in our lower-margin Hardlines, Food & Beverage and ~~10-year notes in an effort~~Beauty & Household Essentials categories. Note 4 to increase our cash on hand. Additionally, we entered into a $900 million 364-day credit facility, increasing our total undrawn committed credit facilities to $3.4 billion. Our dividend policy remains unchanged; however, we have temporarily suspended share repurchase activity in the ~~current environment. The~~ Financial Statements presents sales by category.

~~Liquidity and Capital Resources~~ ~~section provides additional information.~~


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			1413


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			ANALYSIS OF OPERATIONS			Index to Notes

Analysis of Results of Operations


Summary of Operating Income	Summary of Operating Income	Three Months Ended									Summary of Operating Income	Three Months Ended
(dollars in millions)	(dollars in millions)	May 2, 2020		May 4, 2019		Change		(dollars in millions)	May 1, 2021			May 2, 2020		Change
Sales	Sales	$	19,371	$	17,401	11.3	%	Sales	$	23,879		$	19,371	23.3	%
Other revenue	Other revenue	244		226		7.7		Other revenue	318			244		30.4
Total revenue	Total revenue	19,615		17,627		11.3		Total revenue	24,197			19,615		23.4
Cost of sales	Cost of sales	14,510		12,248		18.5		Cost of sales	16,716			14,510		15.2
Selling, general and administrative expenses	Selling, general and administrative expenses	4,060		3,663		10.9		Selling, general and administrative expenses	4,509			4,060		11.0
Depreciation and amortization (exclusive of depreciation included in cost of sales)	Depreciation and amortization (exclusive of depreciation included in cost of sales)	577		581		(0.8)		Depreciation and amortization (exclusive of depreciation included in cost of sales)	598			577		3.9
Operating income	Operating income	$	468	$	1,135	(58.7)	%	Operating income	$	2,374		$	468	407.0	%


Rate Analysis	Rate Analysis	Three Months Ended							Rate Analysis	Three Months Ended
		May 2, 2020		May 4, 2019			May 1, 2021			May 2, 2020
Gross margin rate	Gross margin rate	25.1	%	29.6	%	Gross margin rate	30.0	%		25.1	%
SG&A expense rate	SG&A expense rate	20.7		20.8		SG&A expense rate	18.6			20.7
Depreciation and amortization (exclusive of depreciation included in cost of sales) expense rate		2.9		3.3
Depreciation and amortization expense rate (exclusive of depreciation included in cost of sales)						Depreciation and amortization expense rate (exclusive of depreciation included in cost of sales)	2.5			2.9
Operating income margin rate	Operating income margin rate	2.4		6.4		Operating income margin rate	9.8			2.4

Note: Gross margin rate is calculated as gross margin (sales less cost of sales) divided by sales. All other rates are calculated by dividing the applicable amount by total revenue.

Sales

Sales include all merchandise sales, net of expected returns, and our estimate of gift card breakage. We use comparable sales to evaluate the performance of our stores and digital channel sales by measuring the change in sales for a period over the comparable prior-year period of equivalent length. Comparable sales include all sales ~~except~~—except sales from stores open less than 13 months, digital acquisitions we have owned less than 13 months, stores that have been closed, and digital acquisitions that we no longer operate. Comparable sales measures vary across the retail industry. As a result, our comparable sales calculation is not necessarily comparable to similarly titled measures reported by other companies. Digitally originated sales include all sales initiated through mobile applications and our websites. Our stores fulfill the majority of digitally originated sales, including shipment from stores to guests, store Order ~~Pick Up~~Pickup or Drive Up, and delivery via our wholly owned subsidiary, Shipt. Digitally originated sales may also be fulfilled through our distribution centers, our vendors, or other third parties.

Sales growth –— from both comparable sales and new stores –— represents an important driver of our long-term profitability. We expect that comparable sales growth will drive the majority of our total sales growth. We believe that our ability to successfully differentiate our guests’ shopping experience through a careful combination of merchandise assortment, price, convenience, guest experience, and other factors will, over the long-term, drive both increasing shopping frequency (traffic) and the amount spent each visit (average transaction amount).


TARGET CORPORATION						Q1 2021 Form 10-Q			14


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			ANALYSIS OF OPERATIONS			Index to Notes

The increase in sales during the three months ended May ~~2, 2020,~~1, 2021, is due to a comparable sales increase of ~~10.8~~22.9 percent and the contribution from new stores. The COVID-19 pandemic has affected the amount and mix of sales across channels and categories.


Comparable Sales	Comparable Sales	Three Months Ended							Comparable Sales	Three Months Ended
		May 2, 2020		May 4, 2019			May 1, 2021			May 2, 2020
Comparable sales change	Comparable sales change	10.8	%	4.8	%	Comparable sales change	22.9	%		10.8	%
Drivers of change in comparable sales	Drivers of change in comparable sales					Drivers of change in comparable sales
Number of transactions	Number of transactions	(1.5)		4.3		Number of transactions	17.1			(1.5)
Average transaction amount	Average transaction amount	12.5		0.5		Average transaction amount	5.0			12.5


Comparable Sales by Channel	Three Months Ended
	May 1, 2021		May 2, 2020
Stores originated comparable sales change	18.0	%	0.9	%
Digitally originated comparable sales change	50.2		140.6


Sales by Channel	Three Months Ended
	May 1, 2021		May 2, 2020
Stores originated	81.7	%	84.7	%
Digitally originated	18.3		15.3
Total	100	%	100	%


Sales by Fulfillment Channel	Three Months Ended
	May 1, 2021		May 2, 2020
Stores	96.3	%	96.7	%
Other	3.7		3.3
Total	100	%	100	%

Note: ~~Amounts may not foot due~~Sales fulfilled by stores include in-store purchases and digitally originated sales fulfilled by shipping merchandise from stores to ~~rounding.~~guests, Order Pickup, Drive Up, and Shipt.


Sales by Product Category	Three Months Ended
	May 1, 2021		May 2, 2020
Apparel and accessories	18	%	14	%
Beauty and household essentials	27		30
Food and beverage	20		24
Hardlines	17		15
Home furnishings and décor	18		17
Total	100	%	100	%

The collective interaction of a broad array of macroeconomic, competitive, and consumer behavioral factors, as well as sales mix and the transfer of sales to new stores, makes further analysis of sales metrics infeasible.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			15


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			ANALYSIS OF OPERATIONS			Index to Notes

Contribution to Comparable Sales Change Three Months Ended
May 2,
2020 May 4,
2019
Stores originated channel comparable sales change 0.9 % 2.7 %
Contribution from digitally originated sales to comparable sales change 9.9 2.1
Total comparable sales change 10.8 % 4.8 %

~~Note: Amounts may not foot due to rounding.~~

Sales by Channel Three Months Ended
May 2,
2020 May 4,
2019
Stores originated 84.7 % 92.9 %
Digitally originated 15.3 7.1
Total 100 % 100 %

Sales by Product Category Three Months Ended
May 2,
2020 May 4,
2019
Apparel and accessories 14 % 19 %
Beauty and household essentials 30 29
Food and beverage 24 21
Hardlines 15 14
Home furnishings and décor 17 17
Total 100 % 100 %

The collective interaction of a broad array of macroeconomic, competitive, and consumer behavioral factors, as well as sales mix, and transfer of sales to new stores makes further analysis of sales metrics infeasible. As previously discussed, we believe that COVID-19 has had a significant impact on the mix of sales amongst our sales channels and categories.

We monitor the percentage of purchases that are paid for using RedCards (RedCard Penetration) because our internal analysis has indicated that a meaningful portion of the incremental purchases on RedCards are also incremental sales for Target. Guests receive a 5 percent discount on virtually all purchases when they use a RedCard at Target. RedCard sales increased for the three months ended May 1, 2021 and May 2, 2020; however, RedCard penetration declined as total Sales increased at a faster pace.


RedCard Penetration	RedCard Penetration	Three Months Ended							RedCard Penetration	Three Months Ended
		May 2, 2020		May 4, 2019			May 1, 2021			May 2, 2020
Target Debit Card	Target Debit Card	12.7	%	13.1	%	Target Debit Card	12.1	%		12.7	%
Target Credit Cards	Target Credit Cards	9.7		10.4		Target Credit Cards	8.4			9.7
Total RedCard Penetration	Total RedCard Penetration	22.4	%	23.5	%	Total RedCard Penetration	20.5	%		22.4	%

~~Note: Amounts may not foot due to rounding.~~

Gross Margin Rate

For the three months ended May 1, 2021, our gross margin rate was 30.0 percent compared with 25.1 percent in the comparable prior-year period. This increase reflected:

•The benefit of merchandising actions, including exceptionally low promotional and clearance markdown rates, in this year’s results and purchase order cancellation fees and inventory impairments in last year’s results;

•Favorable category mix driven by strength in higher margin categories including Apparel & Accessories and Home Furnishings & Décor; and

•The net impact of other factors, most notably the margin impact of our returns estimate for sales during the temporary returns suspension period in the first quarter of 2020.

Selling, General, and Administrative Expense Rate

For the three months ended May 1, 2021, our SG&A expense rate was 18.6 percent compared with 20.7 percent in the comparable prior-year period. Incremental team member pay and benefits, including higher wages and bonus expense, represented the vast majority of the $449 million increase in SG&A expenses compared with the prior-year period. From a rate perspective, these increased costs were more than offset by leverage resulting from strong revenue growth.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			16


			~~MANAGEMENT'S DISCUSSION AND ANALYSIS~~			~~Table of Contents~~
			~~ANALYSIS OF OPERATIONS~~			~~Index to Notes~~

~~Gross Margin Rate~~

~~For the three months ended May 2, 2020, our gross margin rate was 25.1 percent compared with 29.6 percent in the comparable period last year. This decrease reflected:~~

•The net impact of merchandising actions, including purchase order cancellation fees and inventory impairments related to a rapid slowdown in Apparel and Accessories sales, partially offset by favorability in clearance and promotional markdowns;

•~~Unfavorable category sales mix, as sales growth was strongest in lower-margin categories; and~~

•Digital fulfillment and supply chain costs, driven by unusually strong growth in digital volume combined with the impact of higher pay and benefit costs classified within Cost of Sales, including incremental team member pay and benefits investments due to COVID-19.

~~Selling, General, and Administrative Expense Rate~~

For the three months ended May 2, 2020, our SG&A expense rate was 20.7 percent compared with 20.8 percent in the comparable period last year. For the current quarter, SG&A expenses increased $397 million, including approximately $200 million of incremental team member pay and benefits classified within SG&A Expenses, and investments to protect the health and safety of guests. From a rate perspective, these increased costs were more than offset by leverage resulting from strong revenue growth.

~~Store Data~~

Change in Number of Stores Three Months Ended
May 2,
2020 May 4,
2019
Beginning store count 1,868 1,844
Opened 3 7
Closed — —
Ending store count 1,871 1,851

Number of Stores and
Retail Square Feet Number of Stores
Retail Square Feet ^(a)
May 2,
2020 February 1,
2020 May 4,
2019 May 2,
2020 February 1,
2020 May 4,
2019
170,000 or more sq. ft. 272 272 272 48,613 48,619 48,603
50,000 to 169,999 sq. ft. 1,505 1,505 1,501 189,226 189,227 188,918
49,999 or less sq. ft. 94 91 78 2,745 2,670 2,276
Total 1,871 1,868 1,851 240,584 240,516 239,797

^(a)~~In thousands, reflects total square feet less office, distribution center, and vacant space.~~


~~TARGET CORPORATION~~						~~Q1 2020 Form 10-Q~~			17


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			~~OTHER PERFORMANCE FACTORS~~ANALYSIS OF OPERATIONS			Index to Notes

Store Data


Change in Number of Stores	Three Months Ended
	May 1, 2021	May 2, 2020
Beginning store count	1,897	1,868
Opened	12	3
Closed	—	—

Ending store count	1,909	1,871


Number of Stores and Retail Square Feet	Number of Stores			Retail Square Feet (a)
	May 1, 2021	January 30, 2021	May 2, 2020	May 1, 2021	January 30, 2021	May 2, 2020
170,000 or more sq. ft.	273	273	272	48,798	48,798	48,613
50,000 to 169,999 sq. ft.	1,510	1,509	1,505	189,618	189,508	189,226
49,999 or less sq. ft.	126	115	94	3,690	3,342	2,745
Total	1,909	1,897	1,871	242,106	241,648	240,584

(a)In thousands, reflects total square feet less office, distribution center, and vacant space.

Other Performance Factors

Net Interest Expense

Net interest expense was ~~$117~~$108 million for the three months ended May 1, 2021, and ~~$126~~$117 million for the three months ended May 2, ~~2020 and May 4, 2019, respectively.~~2020. The decrease isin net interest expense was primarily due to ~~the~~a lower ~~floating benchmark~~weighted-average interest rate ~~associated~~on our long-term debt for the three months ended May 1, 2021, compared with ~~our interest rate swaps during~~ the three months ended May 2, 2020.

~~Provision~~Net Other (Income) / Expense

Net Other (Income) / Expense was $(343) million for ~~Income Taxes~~

~~Our effective income tax rate from continuing operations~~the three months ended May 1, 2021, and $22 million for the three months ended May 2, ~~2020,~~2020. The increase was ~~13.9 percent compared with 22.4 percent~~due to the $335 million gain on the February 2021 sale of Dermstore. Note 3 to the Financial Statements provides additional information.

Provision for ~~the comparable periods last year. For~~Income Taxes

Our effective income tax rate for the three months ended May ~~2, 2020, lower pretax~~1, 2021, was 19.6 percent, compared with 13.9 percent in the comparable prior-year period. The increase reflects significantly higher earnings, resulted in a larger rate benefit from discrete items, primarily related to share-based payments, compared with the prior year. Our effective tax rate is generally more volatile at lower amounts of pretax income becausepartially offset by the impact of discrete ~~and nondeductible items is greater.~~tax benefits in the quarter, including a $44 million benefit resulting from the resolution of certain income tax matters.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			1817


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			RECONCILIATION OF NON-GAAP FINANCIAL MEASURES			Index to Notes

Reconciliation of Non-GAAP Financial Measures to GAAP Measures

To provide additional transparency, we have disclosed non-GAAP adjusted diluted earnings per share ~~from continuing operations~~ (Adjusted EPS). This metric excludes certain items presented below. We believe this information is useful in providing period-to-period comparisons of the results of our ~~continuing~~ operations. This measure is not in accordance with, or an alternative to, ~~generally accepted accounting principles in the~~ U.S. ~~(GAAP).~~GAAP. The most comparable GAAP measure is diluted earnings per ~~share from continuing operations.~~share. Adjusted EPS should not be considered in isolation or as a substitution for analysis of our results as reported in accordance with GAAP. Other companies may calculate Adjusted EPS differently, limiting the usefulness of the measure for comparisons with other companies.


Reconciliation of Non-GAAP Adjusted EPS	Reconciliation of Non-GAAP Adjusted EPS	Three Months Ended																						Reconciliation of Non-GAAP Adjusted EPS	Three Months Ended
		May 2, 2020										May 4, 2019											May 1, 2021				May 2, 2020
(millions, except per share data)	(millions, except per share data)	Pretax		Net of Tax		Per Share Amounts		Pretax		Net of Tax		Per Share Amounts		(millions, except per share data)	Pretax		Net of Tax		Per Share Amounts		Pretax		Net of Tax		Per Share Amounts
GAAP diluted earnings per share from continuing operations						$	0.56					$	1.53
GAAP diluted earnings per share														GAAP diluted earnings per share					$	4.17					$	0.56
Adjustments	Adjustments													Adjustments

Gain on Dermstore sale														Gain on Dermstore sale	$	(335)	$	(269)	$	(0.53)	$	—	$	—	$	—
Loss on investment ^(a)	Loss on investment ^(a)	$	21	$	15	$	0.03	$	—	$	—	$	—	Loss on investment (a)	—		—		—		21		15		0.03
Adjusted diluted earnings per share from continuing operations						$	0.59					$	1.53

Other (b)														Other (b)	41		30		0.06		—		—		—
Adjusted diluted earnings per share														Adjusted diluted earnings per share					$	3.69					$	0.59

Note: Amounts may not foot due to rounding.

^(a)~~Includes~~Represented an unrealized loss on our investment in Casper Sleep Inc., which iswas not core to our ~~continuing~~ operations. We sold this investment during the fourth quarter of 2020.

(b)Represents asset impairment charges resulting from the consolidation of our headquarters office space.

Earnings ~~from continuing operations~~ before interest expense and income taxes (EBIT) and earnings ~~from continuing operations~~ before interest expense, income taxes, depreciation, and amortization (EBITDA) are non-GAAP financial measures. We believe these measures provide meaningful information about our operational efficiency compared with our competitors by excluding the impact of differences in tax jurisdictions and structures, debt levels, and for EBITDA, capital investment. These measures are not in accordance with, or an alternative to, GAAP. The most comparable GAAP measure is net ~~earnings from continuing operations.~~earnings. EBIT and EBITDA should not be considered in isolation or as a substitution for analysis of our results as reported in accordance with GAAP. Other companies may calculate EBIT and EBITDA differently, limiting the usefulness of the measures for comparisons with other companies.


EBIT and EBITDA	EBIT and EBITDA	Three Months Ended								EBIT and EBITDA	Three Months Ended
(dollars in millions) (unaudited)		May 2, 2020		May 4, 2019		Change
Net earnings from continuing operations		$	284	$	792	(64.2)	%
(dollars in millions)								(dollars in millions)	May 1, 2021		May 2, 2020		Change
Net earnings								Net earnings	$	2,097	$	284	639.8	%
+ Provision for income taxes	+ Provision for income taxes	45		229		(80.0)		+ Provision for income taxes	512		45		1,017.1
+ Net interest expense	+ Net interest expense	117		126		(6.8)		+ Net interest expense	108		117		(7.6)
EBIT	EBIT	$	446	$	1,147	(61.1)	%	EBIT	$	2,717	$	446	508.7	%
+ Total depreciation and amortization ^(a)	+ Total depreciation and amortization ^(a)	641		644		(0.6)		+ Total depreciation and amortization (a)	667		641		4.1
EBITDA	EBITDA	$	1,087	$	1,791	(39.3)	%	EBITDA	$	3,384	$	1,087	211.3	%

^(a)Represents total depreciation and amortization, including amounts classified within Depreciation and Amortization and within Cost of Sales.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			1918


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			RECONCILIATION OF NON-GAAP FINANCIAL MEASURES			Index to Notes

We have also disclosed after-tax ROIC, which is a ratio based on GAAP information, with the exception of the add-back of operating lease interest to operating income. We believe this metric is useful in assessing the effectiveness of our capital allocation over time. Other companies may calculate ROIC differently, limiting the usefulness of the measure for comparisons with other companies.


After-Tax Return on Invested Capital	After-Tax Return on Invested Capital								After-Tax Return on Invested Capital
(dollars in millions)	(dollars in millions)						(dollars in millions)
		Trailing Twelve Months								Trailing Twelve Months
Numerator	Numerator	May 2, 2020		May 4, 2019		Numerator		May 1, 2021		May 2, 2020
Operating income	Operating income	$	3,992	$	4,204	Operating income		$	8,444	$	3,992
+ Net other income / (expense)	+ Net other income / (expense)	(26)		33		+ Net other income / (expense)		350		(26)
EBIT	EBIT	3,966		4,237		EBIT		8,794		3,966
+ Operating lease interest ^(a)	+ Operating lease interest ^(a)	87		84		+ Operating lease interest (a)		85		87
- Income taxes ^(b)	- Income taxes ^(b)	855		878		- Income taxes (b)		1,864		855
Net operating profit after taxes	Net operating profit after taxes	$	3,198	$	3,443	Net operating profit after taxes		$	7,015	$	3,198


Denominator	Denominator	May 2, 2020			May 4, 2019			May 5, 2018		Denominator	May 1, 2021			May 2, 2020			May 4, 2019
Current portion of long-term debt and other borrowings	Current portion of long-term debt and other borrowings	$	168		$	1,056		$	283	Current portion of long-term debt and other borrowings	$	1,173		$	168		$	1,056
+ Noncurrent portion of long-term debt	+ Noncurrent portion of long-term debt	14,073			11,357			11,107		+ Noncurrent portion of long-term debt	11,509			14,073			11,357
+ Shareholders' investment	+ Shareholders' investment	11,169			11,117			11,158		+ Shareholders' investment	14,959			11,169			11,117
+ Operating lease liabilities ^(c)	+ Operating lease liabilities ^(c)	2,448			2,231			2,157		+ Operating lease liabilities (c)	2,563			2,448			2,231
- Cash and cash equivalents	- Cash and cash equivalents	4,566			1,173			1,060		- Cash and cash equivalents	7,816			4,566			1,173
Invested capital	Invested capital	$	23,292		$	24,588		$	23,645	Invested capital	$	22,388		$	23,292		$	24,588
Average invested capital ^(d)	Average invested capital ^(d)	$	23,940		$	24,116				Average invested capital (d)	$	22,840		$	23,940

After-tax return on invested capital	After-tax return on invested capital	13.4		%	14.3		%			After-tax return on invested capital	30.7		%	13.4		%

^(a)Represents the add-back to operating income driven by the hypothetical interest expense we would incur if the property under our operating leases were owned or accounted for as finance leases. Calculated using the discount rate for each lease and recorded as a component of rent expense within SG~~&A Expenses.~~&A. Operating lease interest is added back to operating income in the ROIC calculation to control for differences in capital structure between us and our competitors.

^(b)Calculated using the effective tax rates, ~~for continuing operations,~~ which were ~~21.1~~21.0 percent and ~~20.3~~21.1 percent for the trailing twelve months ended May ~~2, 2020,~~1, 2021, and May ~~4, 2019,~~2, 2020, respectively. For the trailing twelve months ended May ~~2, 2020,~~1, 2021, and May ~~4, 2019,~~2, 2020, includes tax effect of ~~$837 million~~$1.8 billion and ~~$861~~$837 million, respectively, related to EBIT, and $18 million ~~and $17 million, respectively,~~ related to operating lease interest.

^(c)Total short-term and long-term operating lease liabilities included within Accrued and Other Current Liabilities and Noncurrent Operating Lease ~~Liabilities.~~Liabilities, respectively.

^(d)Average based on the invested capital at the end of the current period and the invested capital at the end of the comparable prior period.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2019


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			ANALYSIS OF FINANCIAL CONDITION			Index to Notes

Analysis of Financial Condition

Liquidity and Capital Resources

Capital Allocation

We follow a disciplined and balanced approach to capital allocation based on the following priorities, ranked in order of importance: first, we fully invest in opportunities to profitably grow our business, create sustainable long-term value, and maintain our current operations and assets; second, we maintain a competitive quarterly dividend and seek to grow it annually; and finally, we return any excess cash to shareholders by repurchasing shares within the limits of our credit rating goals.

We believe our sources of liquidity will continue to be adequate to maintain operations, finance anticipated expansion and strategic initiatives, fund debt maturities, and pay dividends. In response to COVID-19, we have suspended our share repurchase program. We continue to anticipate ample access to commercial paper and long-term financing.

Our cash and cash equivalents balance was $7.8 billion, $8.5 billion, and $4.6 billion ~~$2.6 billion,~~as of May 1, 2021, January 30, 2021, and ~~$1.2 billion at~~ May 2, 2020, ~~February 1, 2020, and May 4, 2019,~~ respectively. Our cash and cash equivalents balance includes short-term investments of ~~$3.6~~$6.9 billion, ~~$1.8~~$7.6 billion, and ~~$419 million~~$3.6 billion as of May ~~2, 2020, February~~ 1, ~~2020,~~2021, January 30, 2021, and May ~~4, 2019,~~2, 2020, respectively. Our investment policy is designed to preserve principal and liquidity of our short-term investments. This policy allows investments in large money market funds or in highly rated direct short-term instruments that mature in 60 days or less. We also place dollar limits on our investments in individual funds or instruments.

Operating Cash Flows

~~Operating cash flow~~Cash flows provided by ~~continuing operations was~~operating activities were $1.1 billion for the three months ended May 1, 2021, compared with $1.3 billion for the three months ended May 2, ~~2020, compared with $323 million for~~2020. For the three months ended May ~~4, 2019. The increase reflects higher payables leverage during the three months ended May 2, 2020, due to increased inventory turnover in high-demand categories, compared with~~1, 2021, operating cash flows reflect stronger operating results, offset by higher net settlement of accounts payable ~~during the three months ended May 4, 2019, driven by elevated inventory~~ and accounts payable levels as of February 2, 2019. The operating cash flow increase is also partially due to the year-over-year increase in the returns reserve resulting from the temporary suspension of in-store merchandise returns duringincentive compensation payments, compared with the three months ended May 2, 2020.

Inventory

Inventory was $10.5 billion as of May 1, 2021, compared with $10.7 billion and $8.6 billion at January 30, 2021, and May 2, 2020, respectively. The increase over the balance as of May 2, 2020, ~~compared~~reflects efforts to align inventory with ~~$9.0 billion and $9.1 billion at February 1,~~sales trends. Additionally, the lower inventory balance as of May 2, 2020, ~~and May 4, 2019, respectively. The decrease reflects~~reflected the impact of elevated sell-through rates in high-demand merchandise categories and efforts to reduce inventory levels in certain discretionary categories to align with evolving sales ~~trends.~~trends early in the pandemic.

Investing Cash Flows

~~Cash flow for investing activities~~Investing cash flows included capital ~~expenditures~~investments of $540 million and $751 million for the three months ended May 1, 2021, and May 2, 2020, ~~compared~~respectively. We continue to expect full-year capital investments of approximately $4 billion, with ~~$655 million for~~ the ~~three months ended~~ ~~May 4, 2019. Capital expenditures increased for~~majority of those investments occurring in the second half of this year. For the three months ended May ~~2, 2020, compared with~~1, 2021, investing cash flows includes $356 million of proceeds from the ~~three months ended~~ ~~May 4, 2019, as we completed new store and remodel projects that were in process as the COVID-19 crisis developed. However, in response to COVID-19, we have modified plans for some~~sale of ~~our strategic initiatives including store remodels and new store openings. We expect full year 2020 capital expenditures to be at a lower level than in 20~~19.Dermstore.

Dividends

We paid dividends totaling $340 million ($0.68 per share) for the three months ended May 1, 2021, and $332 million ($0.66 ~~per share) and $330 million ($0.64~~ per share) for the three months ended May 2, 2020, ~~and May 4, 2019, respectively,~~ a per share increase of ~~3.1~~3.0 percent. We declared dividends totaling $343 million ($0.68 per share) during the first quarter of 2021 and $333 million ($0.66 per share) during the first quarter of 2020, a per share increase of ~~3.1 percent over the $330 million ($0.64 per share) of declared dividends during the first quarter of 2019.~~3.0 percent. We have paid dividends every quarter since our 1967 initial public offering, and it is our intent to continue to do so in the future.

Share Repurchase

We returned ~~$609 million~~$1.2 billion to shareholders through share repurchase during the three months ended May ~~2, 2020.~~1, 2021. See Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds of this Quarterly Report on Form 10-Q and Note 9 to the ~~Consolidated~~ Financial Statements for more information.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2120


			MANAGEMENT'S DISCUSSION AND ANALYSIS			Table of Contents
			ANALYSIS OF FINANCIAL CONDITION			Index to Notes

Financing

Our financing strategy is to ensure liquidity and access to capital markets, to maintain a balanced spectrum of debt maturities, and to manage our net exposure to floating interest rate volatility. Within these parameters, we seek to minimize our borrowing costs. Our ability to access the long-term debt and commercial paper markets has provided us with ample sources of liquidity. Our continued access to these markets depends on multiple factors, including the condition of debt capital markets, our operating performance, and maintaining strong credit ratings. As of May ~~2, 2020,~~1, 2021, our credit ratings were as follows:


Credit Ratings	Moody’s	Standard and Poor’s	Fitch
Long-term debt	A2	A	A-
Commercial paper	P-1	A-1	F1

If our credit ratings were lowered, our ability to access the debt markets, our cost of funds, and other terms for new debt issuances could be adversely impacted. Each of the credit rating agencies reviews its rating periodically and there is no guarantee our current credit ratings will remain the same as described above.

~~In March 2020, we issued $2.5 billion of debt.~~ ~~Notes 6~~We obtain short-term financing from time to time under our commercial paper program. No balances were outstanding at any time during the three months ended May 1, 2021, and 7 ~~to the Consolidated Financial Statements provide additional information.~~

May 2, 2020. We have additional liquidity through a committed ~~$900 million 364-day revolving credit facility obtained through a group of banks in April 2020, which expires in April 2021, and an existing~~ $2.5 billion revolving credit facility ~~obtained through a group of banks, which~~that expires in October 2023. No balances were outstanding ~~under either credit facility~~ at any time during ~~2020~~2021 or ~~2019.~~2020.

Most of our long-term debt obligations contain covenants related to secured debt levels. In addition to a secured debt level covenant, our credit ~~facilities~~facility also ~~contain~~contains a debt leverage covenant. We are, and expect to remain, in compliance with these covenants. Additionally, as of May ~~2, 2020,~~1, 2021, no notes or debentures contained provisions requiring acceleration of payment upon a credit rating downgrade, except that certain outstanding notes allow the note holders to put the notes to us if within a matter of months of each other we experience both (i) a change in control and (ii) our long-term credit ratings are either reduced and the resulting rating is non-investment grade, or our long-term credit ratings are placed on watch for possible reduction and those ratings are subsequently reduced and the resulting rating is non-investment grade.

~~Contractual Obligations~~We believe our sources of liquidity will continue to be adequate to maintain operations, finance anticipated expansion and ~~Commitments~~

~~As of~~strategic initiatives, fund debt maturities, pay dividends, and execute purchases under our share repurchase program for the ~~date of this report, other than the new borrowings discussed in~~ ~~Note 6~~foreseeable future. We continue to ~~the Consolidated Financial Statements, there were no material changes~~anticipate ample access to ~~our contractual obligations~~commercial paper and ~~commitments outside the ordinary course of business since February 1, 2020, as reported in our 2019~~ ~~Form 10-K~~.long-term financing.

New Accounting Pronouncements

We do not expect any recently issued accounting pronouncements to have a material effect on our financial statements.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2221


			MANAGEMENT'S DISCUSSION AND ANALYSIS & SUPPLEMENTAL INFORMATION			Table of Contents
			FORWARD LOOKING STATEMENTS & CONTROLS AND PROCEDURES			Index to Notes

Forward-Looking Statements

This report contains forward-looking statements, which are based on our current assumptions and expectations. These statements are typically accompanied by the words “expect,” “may,” “could,” “believe,” “would,” “might,” “anticipates,” or similar words. The principal forward-looking statements in this report include: our financial performance, statements regarding the adequacy of and costs associated with our sources of liquidity, the funding of debt maturities, the continued execution of our share repurchase program, our expected capital expenditures and new lease commitments, the expected compliance with debt covenants, the expected impact of new accounting pronouncements, our intentions regarding future dividends, the expected return on plan assets, the expected outcome of, and adequacy of our reserves for, claims, litigation and the resolution of tax matters, the expected impact of changes in information technology systems, future responses to and effects of the COVID-19 pandemic, and changes in our assumptions and expectations.

All such forward-looking statements are intended to enjoy the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, as amended. Although we believe there is a reasonable basis for the forward-looking statements, our actual results could be materially different. The most important factors which could cause our actual results to differ from our forward-looking statements are set forth onin our description of risk factors included in ~~Part I, Item 1A, Risk Factors of our Form 10-K for the fiscal year ended February 1, 2020, as updated in~~ Part III, Item 1A, Risk Factors~~, in this report,~~ of our Form 10-K for the fiscal year ended January 30, 2021, which should be read in conjunction with the forward-looking statements in this report. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update any forward-looking statement.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in our primary risk exposures or management of market risks from those disclosed in Part II, Item 7A, Quantitative and Qualitative Disclosures About ~~Marke~~tMarket Risk of our Form 10-K for the fiscal year ended ~~February 1, 2020.~~January 30, 2021.

Item 4. Controls and Procedures

Changes in Internal Control Over Financial Reporting

During the most recently completed fiscal quarter, the following changes materially affected, or are reasonably likely to materially affect, our internal control over financial reporting:

•We are in the process of a broad multi-year migration of many mainframe-based systems and middleware products to a modern platform, including systems and processes supporting inventory, sales, and supply chain-related transactions.

•~~In March 2020, as a result~~During the first quarter of ~~COVID-19,~~2021, we ~~temporarily suspended~~resumed our normal practice of annual physical inventory counts at our ~~stores.~~stores and are no longer using the statistical sampling method implemented during 2020 due to the COVID-19 pandemic. We have ~~continued to record~~recorded estimated losses related to shrink and markdowns based upon ~~historical rates, and we intend to resume physical inventory counts as soon as possible.~~the results of the counts.

During the most recently completed fiscal quarter, no other changes in our internal control over financial reporting materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting.


TARGET CORPORATION						Q1 2021 Form 10-Q			22


			MANAGEMENT'S DISCUSSION AND ANALYSIS & SUPPLEMENTAL INFORMATION			Table of Contents
			FORWARD LOOKING STATEMENTS & CONTROLS AND PROCEDURES			Index to Notes

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this quarterly report, we conducted an evaluation, under supervision and with the participation of management, including the chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934, as amended (Exchange Act). Based upon that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective at a reasonable assurance level. Disclosure controls and procedures are defined by Rules 13a-15(e) and 15d-15(e) of the Exchange Act as controls and other procedures that are designed to ensure that information required to be disclosed by us in reports filed with the SEC under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in reports filed under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			23


			SUPPLEMENTAL INFORMATION			Table of Contents
						Index to Notes

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

~~The following update to a previously reported proceeding~~No response is ~~being reported pursuant to~~required under Item 103 of Regulation ~~S-K:~~

~~On April 10, 2020, the U.S. Court of Appeals~~S-K, nor have there been any material developments for ~~the Eighth Circuit affirmed the prior decision by the United States District Court for the District of Minnesota (the Court) dismissing the two purported federal securities law class actions~~any previously filed in the Court on May 17, 2016 and May 24, 2016, respectively (the Federal Securities Law Class Actions). The Federal Securities Law Class Actions related to prior disclosures by Target about its expansion of retail operations into Canada, and were previously described in Target’s annual report on Form 10-K for the fiscal year ended February 1, 2020.reported legal proceedings.

Item 1A. Risk Factors

~~We are including~~There have been no material changes to the ~~following supplemental risk factor, which should be read in conjunction with our description of~~ risk factors ~~included~~described in Part I, Item 1A, Risk Factors of our Form 10-K for the fiscal year ended ~~February 1, 2020.~~

January 30, 2021.

The COVID-19 pandemic has affected our business in many different ways, and may amplify the risks and uncertainties facing our business and their potential impact on our financial position, results of operations, and cash flows.

The COVID-19 pandemic has significantly affected U.S. consumer shopping patterns and caused the health of the U.S. economy to deteriorate. While our sales have been strong, accompanying shifts in our category sales mix to lower-margin nondiscretionary merchandise and to fulfilling more sales through our digital channels have negatively affected our profitability. While the changes in guest shopping patterns in connection with the COVID-19 pandemic may be temporary, some of those changes could become long-lasting. If the shifts in our category sales mix to lower-margin merchandise and fulfilling a significantly larger percentage of our sales through digital channels become long-lasting and we are unable to offset the lower margin and increased costs of fulfilling orders outside of our traditional in-store channel with efficiencies, cost-savings or expense reductions, our results of operations could be adversely affected.

The shift in shopping patterns has also significantly affected our inventory position and disrupted our supply chain. We have been unable to procure certain merchandise items in the quantities our guests seek, including those most in demand due to COVID-19. We may not be able to re-stock those products for an extended period, which may lead to lost sales and negatively affect our results of operations. For other products for which we are seeing demand below historic levels, many of which are in higher-margin categories such as Apparel and Accessories, we have had to take actions to help manage that inventory, such as slowing or cancelling purchase orders and paying related cancellation fees, asking vendors to store excess inventory on their premises, and accelerating markdowns of inventory. Those increased costs, along with lost sales for those higher-margin products, have negatively affected, and may continue to negatively affect, our profitability. Our vendors have also been affected by the COVID-19 pandemic in differing ways. For example, some financially distressed vendors may be unable to survive the COVID-19 pandemic, which would require us to seek alternative vendors, while others are having difficulty supplying us products in the quantities our guests seek, which could negatively affect our results of operations.

To date, all of our stores, digital channels, and distribution centers remain open. We have incurred significant SG&A expenses related to efforts to protect the health and well-being of our guests and team members. Most of our headquarters operations have transitioned to remote working arrangements, which has amplified our already extensive reliance on computer systems and on our continued and unimpeded access to the Internet to use those systems. We have had to temporarily alter other parts of our operations during the COVID-19 pandemic, including adjusting our in-store returns process, suspending physical inventory counts at our stores, metering guest traffic, reducing store hours, and, in some locations, restricting access to “non-essential” sections of our stores due to emergency state or local operating restrictions. Those temporary alterations to our operations have negatively affected, and may continue to negatively affect, the guest experience, sales, and our results from operations.

A continued and prolonged deterioration in the health in the U.S. economy could lead to a reduction in our sales in the future, which could magnify any negative effects of the COVID-19 pandemic on our results of operations and negatively and materially affect additional areas of our business, such as asset impairment evaluations and the amount of credit card profit-sharing revenue payments we receive from TD Bank Group (TD).


~~TARGET CORPORATION~~						~~Q1 2020 Form 10-Q~~			24


			~~SUPPLEMENTAL INFORMATION~~			~~Table of Contents~~
						~~Index to Notes~~

The full extent of the impact of the COVID-19 pandemic on our business, financial position, and results of operations may not be known for an extended period and will depend on future developments, many of which are outside of our control, including the duration and spread of the COVID-19 pandemic and related actions taken by the U.S., state, local, and international governments, which are uncertain and cannot be predicted. If the COVID-19 pandemic worsens, its negative impacts could be more prolonged and may become more severe. The rapid development and fluidity of this situation limits our ability to predict the ultimate impact of COVID-19 on our business, financial condition, and financial performance, which could be material.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On September ~~20, 2016,~~19, 2019, our Board of Directors authorized a $5 billion share repurchase program ~~(2016 Program). On September 19, 2019, our Board of Directors authorized a new $5 billion share repurchase program (2019 Program).~~with no stated expiration. We began ~~repurchasing~~repurchasing shares under the ~~2019 Program~~authorization during the first quarter of ~~2020 upon completion of the 2016 Program. There is no stated expiration for the share repurchase programs.~~2020. Under the ~~2016 Program,~~program, we have repurchased ~~65.6~~10.7 million shares of common stock at an average price of ~~$76.20,~~$154.39, for a total investment of $5.0 billion. Under the 2019 Program, we had repurchased 4.6 million shares of common stock through May 2, 2020, at an average price of $105.80, for a total investment of $484 million. In March 2020, we suspended share repurchase activity.$1.6 billion. The table below presents information with respect to Target common stock purchases made during the three ~~months~~months ended May ~~2, 2020,~~1, 2021, by Target or any "affiliated purchaser" of Target, as defined in Rule 10b-18(a)(3) under the Exchange Act.


Share Repurchase Activity	Share Repurchase Activity	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs	Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Programs		Share Repurchase Activity	Total Number of Shares Purchased	Average Price Paid per Share				Total Number of Shares Purchased as Part of Publicly Announced Programs				Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Programs
Period	Period												Period				Total Number of Shares Purchased as Part of Publicly Announced Programs			Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Programs
February 2, 2020 through February 29, 2020
January 31, 2021 through February 27, 2021								January 31, 2021 through February 27, 2021
Open market and privately negotiated purchases	Open market and privately negotiated purchases	2,407,239	$	115.82	2,407,239	$	4,845,973,069	Open market and privately negotiated purchases	1,643,873		$	187.16				1,643,873				$	4,208,486,088
March 1, 2020 through April 4, 2020
February 28, 2021 through April 3, 2021								February 28, 2021 through April 3, 2021
Open market and privately negotiated purchases	Open market and privately negotiated purchases	3,249,973	101.48		3,249,973	4,516,156,869		Open market and privately negotiated purchases	2,381,931	180.85					2,381,931				3,777,714,147
April 5, 2020 through May 2, 2020
April 4, 2021 through May 1, 2021								April 4, 2021 through May 1, 2021
Open market and privately negotiated purchases	Open market and privately negotiated purchases	—	—		—	4,516,156,869		Open market and privately negotiated purchases	2,082,677	204.96				2,082,677				3,350,843,436
Total	Total	5,657,212	$	107.58	5,657,212	$	4,516,156,869	Total	6,108,481	$	190.77			6,108,481				$	3,350,843,436

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Not applicable.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2524


			SUPPLEMENTAL INFORMATION			Table of Contents
						Index to Notes

Item 6. Exhibits


(3)A						Amended and Restated Articles of Incorporation (as amended through June 9, 2010) ⁽¹⁾

(3)B						Bylaws (as amended through March 27, 2020) ⁽²⁾

~~(10)LL~~						~~364-Day Credit Agreement dated as of April 10, 2020 among Target Corporation, Bank of America, N.A. as Administrative Agent and the Banks listed therein~~

(31)A						Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(31)B						Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(32)A						Certification of the Chief Executive Officer As Adopted Pursuant to 18 U.S.C. Section 1350 Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(32)B						Certification of the Chief Financial Officer As Adopted Pursuant to 18 U.S.C. Section 1350 Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS						XBRL Instance Document

101.SCH						Inline XBRL Taxonomy Extension Schema Document

101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document

104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

⁽¹⁾ Incorporated by reference to Exhibit (3)A to the Registrant’s Form 8-K Report filed June 10, 2010.

⁽²⁾ Incorporated by reference to Exhibit (3)B to the Registrant’s Form 8-K Report filed April 2, 2020.


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2625


			SUPPLEMENTAL INFORMATION			Table of Contents
						Index to Notes

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

TARGET CORPORATION

Dated: May ~~29, 2020~~28, 2021

By:

/s/ Michael J. Fiddelke

Michael J. Fiddelke

Executive Vice President and

Chief Financial Officer

(Duly Authorized Officer and

Principal Financial Officer)

/s/ Robert M. Harrison

Robert M. Harrison

Senior Vice President, Chief Accounting Officer

and Controller


TARGET CORPORATION						Q1 ~~2020~~2021 Form 10-Q			2726


Revenues	Three Months Ended
(millions)	May 2, 2020		May 4, 2019
Apparel and accessories ^(a)	$	2,619	$	3,290
Beauty and household essentials ^(b)	5,911		4,971
Food and beverage ^(c)	4,575		3,722
Hardlines ^(d)	2,974		2,385
Home furnishings and décor ^(e)	3,264		3,001
Other	28		32
Sales	19,371		17,401

Credit card profit sharing	166		160
Other	78		66
Other revenue	244		226

Total revenue	$	19,615	$	17,627


Fair Value Measurements - Recurring Basis					Fair Value at
(millions)	Classification	Pricing Category	May 2, 2020			February 1, 2020		May 4, 2019
Assets
Short-term investments	Cash and Cash Equivalents	Level 1	$	3,605		$	1,810	$	419
Prepaid forward contracts	Other Current Assets	Level 1	23			23		21
Equity securities ^(a)	Other Current Assets	Level 1	18			39		80
Interest rate swaps	Other Noncurrent Assets	Level 2	228			137		23
Liabilities
Interest rate swaps	Other Current Liabilities	Level 2	—			—		1

Interest rate swaps	Other Noncurrent Liabilities	Level 2	10			—		—


Contribution to Comparable Sales Change	Three Months Ended
	May 2, 2020		May 4, 2019
Stores originated channel comparable sales change	0.9	%	2.7	%
Contribution from digitally originated sales to comparable sales change	9.9		2.1
Total comparable sales change	10.8	%	4.8	%


Number of Stores and Retail Square Feet	Number of Stores						Retail Square Feet ^(a)
		May 2, 2020	February 1, 2020	May 4, 2019		May 2, 2020	February 1, 2020	May 4, 2019
170,000 or more sq. ft.	272	272	272		48,613	48,619	48,603
50,000 to 169,999 sq. ft.	1,505	1,505	1,501		189,226	189,227	188,918
49,999 or less sq. ft.	94	91	78		2,745	2,670	2,276
Total	1,871	1,868	1,851		240,584	240,516	239,797