Target's Data Breach Is Going To Cost The Company Even More Than It Previously Thought
Reuters
Interim president, CEO and CFO of Target John Mulligan listens to a question while testifying at the Senate Judiciary Committee hearing about Privacy in the Digital Age on Capitol Hill.
In a statement, the retailer said its second quarter earnings will include a $148 million charge related to losses regarding the massive data breach which occurred during last year's holiday shopping season. This is more than the company previously estimated.
"Since the data breach last December, we have been focused on providing clarity on the Company's estimated financial exposure to breach-related claims," said John Mulligan, interim president and CEO, CFO of Target. "With the benefit of additional information, we believe that today is an appropriate time to provide greater clarity on this topic."
And in addition to increasing costs stemming from this data breach, Target also cut its second quarter earnings outlook.
The company said it expects adjusted EPS to be around $0.78, lower than then $0.85-$1.00 it previously expected.
Target said this outlook reflects flat sales in the U.S. and softer-than-expected sales in its Canadian segment.
In pre-market trading, shares of Target were down as much as 4%.
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