Target’s second quarter profits fell 90%, missing expectations massively, as customers weighed down by inflation pulled back on spending on non-essential items.

Most retailers have been having a tough run, being forced to cut prices on general merchandise due to an excess inventory of items which saw high demand during the pandemic, but which have seen demand wane as lockdowns ended and consumers returned to normal activities. In addition, consumers have seen their pocketbooks hit hard by high gas and food prices as inflation soared.

Unfortunately for Target, its price cuts failed to stimulate purchasing, as it ended the quarter with inventory up 1.5% from three months earlier, and up 36% from one year ago.

The company noted that it was able to reduce its discretionary inventory, however lowering the prices on those items to move them, “put significant pressure on our near-term profitability.”

Net income dropped to $183 million for the quarter, a significant drop from the $1.8 billion one year prior. Revenue came in at $26 billion, which was up 3.5% from a year prior, and roughly in line with estimates.

This was the second consecutive quarter of falling earnings at Target, a streak which followed seven straight quarters of strong profit growth during the pandemic. This quarter’s decline however was far more than the 40% decline seen in Q1.

Target’s report stood in contrast to Walmart’s much stronger report which showed profits down only slightly from a year ago. Walmart did forecast an 8% to 10% drop in earnings, however that was a slightly smaller drop than it had previously forecast.

Target shares fell 3% in premarket trading on the news.