NEW YORK - February 24, 2009 - Target Corp. said Tuesday its fourth-quarter profit fell 41 percent, hurt by the consumer spending slowdown, and said it will expand food offerings and bolster its private-label brands.

Discounters, particularly Target's chief rival, Wal-Mart Stores Inc., have benefited from consumers switching to cheaper stores and focusing on necessities. But at Target, where more than 40 percent of revenue comes from nonessentials such as funky jeans and quilts, the cheap-chic formula has become a drag as shoppers fixate on the lowest prices and forego the extras, no matter how reasonably priced.

Target said it is giving more shelf space in new and remodeled stores to food, household and health care and beauty products and will ensure customers know it offers low prices for these items.

Macy's Inc. reported an almost 59 percent drop in fourth-quarter earnings Tuesday as its results were dragged down by weak sales and one-time costs associated with the consolidations of regional divisions and store closings.

The Cincinnati-based company said Tuesday that in the three months ended January 31; it earned 310 million USD, or 73 cents per share. That compares with 750 million USD, or $1.73 per share, a year earlier.

Sales fell 7.7 percent to 7.93 billion USD from 8.59 billion USD a year ago. Same-store sales, or sales at stores opened at least a year, fell 7 percent. Same-store sales are considered a key indicator of a retailer's health.

Office Depot Inc. said Tuesday it lost 1.54 billion USD in the fourth quarter as hefty charges for a restructuring that included facility closings and job cuts and sharply lower sales weighed on the office supply chain.

The loss was much larger than analysts expected, and Office Depot shares tumbled 20 cents, or 13.8 percent, to an all-time low of $1.25 in morning trading.

Office supply chains have seen sales slump as customers, especially small-business owners, cut spending.

"We are disappointed with the fourth-quarter results," Chief Executive Steve Odland said on a conference call with analysts. "As these times have gotten tough for our customers, they have significantly cut back their spending, including their spending on office products."