Retail giant Target reported its fourth quarter earnings on Thursday, and the results beat Wall Street estimates. However, CEO Brian Cornell struck a cautious tone as consumer spending shifts.

Total sales for the quarter rose 4.3% year-over-year, but profits were impacted by deep discounts, resulting in a 4.5% decrease in profit margins. Cornell warned that the economic recovery is still fragile, and that the company is expecting a slow recovery.

Target’s same-store sales increased by 4.3%, which was slightly lower than the 4.5% increase that analysts were expecting. The company also reported that digital sales grew by a whopping 145%, and that 95% of its stores are now offering same-day delivery.

Despite the positive news, analysts are concerned about the company’s ability to maintain its profit margins in the face of increasing competition. Target’s stock price fell 3.5% following the earnings report.

Overall, the earnings report indicates that Target is cautiously optimistic about the future of the retail industry. With consumer spending shifting, the company is looking to invest in digital initiatives and same-day delivery to remain competitive.