Toys were a common thread as Kohl’s, Target and Barnes & Noble released earnings today, with all three chains reporting sharp increases in the category as they benefitted from sales freed up by Toys R Us’ liquidation.

Target’s same-store sales of toys – the chain expanded toy departments in 500 stores to 500-sq.-ft. and doubled the number of new and exclusive items to 2,500 – rose 20% in Q3 ended Oct. 28. It has remodeled toy departments in 100 stores. Kohl’s bolstered its toy business by adding Lego and FAO Schwarz products.

Barnes & Noble recorded a double-digit same-store sales increase in toys. “Children’s books are important to us; that is what brings customers into our stores,” Barnes & Noble’s Leonard Riggio told analysts. “It is not uncommon for children to bring their parents to the stores so it (toys) is considered a strategic category for us.” Barnes & Noble’s same-store sales of non-book merchandise, which includes toys, games and collectibles, increased 1.9% in Q2 ended Oct. 27.

Overall, Target’s net income rose 30.7% to $622 million in Q3 as sales increased 5.6% to $17.8 billion on a 5.1% gain in same-store sales. Ecommerce revenue jumped 49% and accounted for 6% of total sales, up from 4.2% a year earlier.

Target’s sales were driven by gains in jewelry, men’s apparel, beauty, toys and private label, which now number 20.

Kohl’s net income grew 38% to $161 million as sales rose 1.2% to $4.6 billion on a 2.5% increase in same-store sales. The gains were partly driven a “high-teens” same-store sales increase in its private label Jumping Beans children’s apparel. Men’s apparel also posted gains in revenue on strong sales of private label Sonoma and Croft & Barrow as well as Izod and Columbia.

In women’s, Kohl’s Vera Wang DTR and Apt. 9 private label drove sales; the business also benefitted from a 120-piece PopSugar apparel collection that is part of a DTR the chain launched with the PopSugar media company in September. PopSugar and the Nine West brand (bags, footwear and apparel under license with Authentic Brands Group) that is due in July 2019 are part of an effort to appeal to younger customers, CEO Michelle Gass said.

Barnes & Noble’s net loss narrowed to $27 million in Q2 ended Oct. 27 from $30 million a year earlier as lower costs offset a 2.5% revenue decline to $771.1 million. Retail sales slipped 2.1% to $753.1 million; the rest of the revenue is from the Nook eBook business. Same-store sales decreased 1.4%.

Barnes & Noble has opened three new small format stores (17,000-20,000 sq. ft.) and will target even smaller locations (14,000 sq. ft.) – about half the size of standard stores — as it opens 10-15 new outlets in 2019, the majority of which will be relocations within existing markets. The prototypes focus on books and include a café and a curated assortment of non-book items such as collectibles. Music and DVDs have been scaled back.

Contacts:

Barnes & Noble, Allen Lindstrom, CFO, 212-633-3300, alindstrom@bn.com

Kohl’s, Bruce Besanko, CFO, 262-703-7000 , bruce.besanko@kohls.com

Target, Cathy Smith, CFO, 612-304-6073; cathy.smith@target.com