The supermarket chain is facing a major loss in sales for the first time in two years as the recession continues to bite hard.
Target said on Monday that its first-quarter profit fell 25.3 percent to $1.6 billion, a far cry from the $3.7 billion in the same period last year.
Its net income fell to $6.4 billion, or $4.3 per share.
It also reported a $847 million loss on its book value, a measure of net assets that includes assets like inventory and equipment.
“This is not a good sign for the company,” said David Goldfarb, chief investment officer at JGB Capital.
Target is now in a position where it can either sell assets or wait for the market to return to normal.
Goldfarb said Target’s stock will continue to rise but will likely have to be sold.
The stock lost about 2.5 percent in after-hours trading.
Last year, Target reported a net loss of $3 billion.
Target also reported another big loss on a book value for the fourth consecutive quarter, falling 18.6 percent.
While Target’s losses are not as big as some analysts had expected, it still has a long way to go to reach its full potential.
For its full year, the company reported a loss of about $1 billion, including a loss in the first quarter on a decline in spending.
At its peak in 2014, Target had more than 50 million square feet of store space in the U.S. and sold more than $20 billion worth of products in the past decade.
With a few months of the year remaining, the retailer is struggling to stay afloat, even though sales at its retail stores are growing.
This story was updated on May 8 to include additional information.