Target Corporation (NYSE:TGT) plans to eliminate 475 jobs particularly in its offices in Minnesota, according to a spokesperson of the company on Wednesday.
The retailer currently has 361,000 employees worldwide and approximately 14,000 people are working at its headquarters in Minnesota. Target Corporation (NYSE:TGT) has 1,700 stores in the United States.
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Difficult but right decision to transform business
Molly Snyder, spokesperson of Target Corporation (NYSE:TGT) said, “We believe these decisions, while difficult, are the right actions as we continue to focus on transforming our business. We will continue to invest in key business areas to strengthen our ability to compete and thrive well into the future.”
Fourth quarter and full year 2013 guidance reduced
The planned workforce reduction came after the company warned that the payment data breach hit its sales performance and lowered its earnings outlook for the fourth quarter and full-year 2013.
Target Corporation (NYSE:TGT) stated that its sales became “meaningfully weaker-than-expected” since the announcement of the data breach last December 9. The retailer estimated that earnings of its U.S. segment will be in the range of $1.20 to $1.30 per share, lower than its previous forecast of $1.50 to $1.60. The estimate was based on the anticipated 2.5% comparable sales decline in the fourth quarter.
The company revealed the hackers accessed the e-mail addresses, mailing addresses, and phone numbers of 70 million people; and it is offering free credit monitoring and identity theft protection for all customers who shopped at its stores in the United States. The number is separate from the 40 million people whose debit and credit card accounts were compromised.
Target Corporation (NYSE:TGT) also stated that it might include charges related to the payment data breach in its financial results. However, the company it was “not able to estimate the costs or range of costs related to the data breach.” The retailer expected that the problem will have material adverse effects on the results of its operation in the fourth quarter and in the future.