Target Corp. said Wednesday that its fourth-quarter profit slumped 46 percent in the wake of the theft of credit card numbers and other information from millions of its customers. It also reported that revenue slipped 5.3 percent as the breach scared off customers. The company said its profits will be affected well into 2014. “We will continue to work tirelessly to win back the confidence of our guests. ... We are encouraged that sales trends have improved in recent weeks,” said Gregg Steinhafel, chairman, president and CEO of Target.
Lowe’s profits rise 6 percent; CEO optimistic
Lowe’s fiscal fourth-quarter net income rose 6 percent, as the home-improvement retailer continued to benefit from the housing market’s recovery. The company also announced a new $5 billion stock repurchase program on Wednesday. Housing market growth is expected to slow in 2014, but CEO Robert Niblock said in a call with investors he thinks consumer spending on home projects will stay strong.
New-home sales surprisingly strong
U.S. sales of new homes rebounded in January to the fastest pace in more than five years, offering hopes that housing could be regaining momentum after a slowdown last year caused by rising interest rates. Sales of new homes increased 9.6 percent in January to a seasonally adjusted annual rate of 468,000, the Commerce Department reported Wednesday. That was the fastest pace since July 2008. The rise came as a surprise to economists who had been forecasting a sales drop in January, in part because of a belief that activity would be held back by bad winter storms in many parts of the country.
Banks’ quarterly earnings shoot up 17 percent
U.S. banks’ earnings rose 17 percent in the October-December quarter from a year earlier, as losses on loans fell to a seven-year low and banks set aside less to cover losses as well as legal costs. The data provide fresh evidence of the banking industry’s sustained recovery more than five years after the financial crisis struck. Still, the government says banks continue to have difficulty increasing revenues and are relying on setting aside less for loan losses to boost earnings. For all of 2013, bank earnings increased 9.6 percent to what the Federal Deposit Insurance Corp. called a record annual level of $154.7 billion.