Target Hack's Price: 46% Drop in Profit
Q4 sales dropped due to scared customers
By Newser Editors and Wire Services
Posted Feb 26, 2014 8:41 AM CST
In this Dec. 19, 2013, file photo, a passer-by walks near an entrance to a Target retail store in Watertown, Mass.   (AP Photo/Steven Senne, File)

(Newser) – Target's massive data breach wasn't just a PR disaster for the company, it was a financial one, too. Target announced its earnings today, and blamed the breach for knocking its Q4 profit down 46%. It also said that its sales fell 5.3%, as the breach scared off customers. The nation's second-largest discounter said it earned $520 million for the three months that ended Feb. 1, down from a profit of $961 million a year earlier.

The breach resulted in $17 million of net expenses in the fourth quarter, Target said, with $61 million of total expenses partially offset by a $44 million insurance receivable. "We will continue to work tirelessly to win back the confidence of our guests," the company's CEO said. "We are encouraged that sales trends have improved in recent weeks." Still, the company offered a profit outlook below Wall Street expectations: earnings per share of between $3.85 and $4.15 for the full year; analysts had expected $4.21.

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Showing 3 of 8 comments
Lou Bernardo
Mar 3, 2014 9:49 PM CST
Credit card companies like insurance companies don't care about losses. They just raise the rates. Call either about loss or fraud and you just get a ho-hum reply from the dummy on the other end of the phone line.
scum1
Mar 3, 2014 5:39 PM CST
Maybe it's time banks and retailers started caring about credit card theft. All of my wife's credit card numbers were stolen and duplicate cards made(even on a gas card). Not one single bank or store cared. They just wrote it off. Same with the police. The one company that did care mind you was the Valero gas card. They even went as far as to send us photos of some people using the copied card to buy cigs at a Valero store to see if we knew the people. The big banks however just wrote it off.
scum1
Mar 3, 2014 5:36 PM CST
was any actual money lost in the breach? Stupid people just stopped shopping at target I think.