CEO Brian Cornell responds to price gouging allegations in retail.

• No room for price gouging exists in the competitive retail landscape, according to CEO Brian Cornell.
• Did the tactic increase Target's profits, as Kamala Harris proposed a plan to prevent price gouging?
• He spoke to CNBC after Target beat quarterly earnings expectations.

On Wednesday, CEO Brian Cornell stated that there's no place for price gouging in a highly competitive industry like retail.

On CNBC's "Squawk Box," the retail chief refuted campaign claims that grocers increase prices. He emphasized the importance of retailers being customer-responsive to maintain business.

CNBC's Joe Kernen questioned if Target or its competitors gain from price gouging, referring to Vice President Kamala Harris's recent proposal for a federal ban on price-gouging in the food and grocery industries. Harris stated that some companies are charging excessively and contributing to household inflation.

Cornell remarked that the retail industry has small profit margins, and customers have numerous options for finding lower prices or alternative merchandise, such as visiting stores, using their phones to compare prices, or exploring other retailers.

Target's retail chief made comments after the discounter beat Wall Street's expectations for earnings and revenue on Wednesday, but struck a cautious note with its full-year guidance. Despite expecting comparable sales to be on the lower side of its range of flat to up 2%, Target raised its profit guidance, saying it expects adjusted earnings per share to range from $9 to $9.70, up from the previous outlook of $8.60 and $9.60.

Over the past two weeks, a wide range of retailers, including Target and Walmart, have reported that cautious consumers are being selective about where they're spending due to inflation and high prices.

On "Squawk Box," Cornell stated that the retailer is targeting a consumer who is carefully managing their budget and emphasized that value is a core part of their business.

Target has responded to shoppers' concerns by lowering prices on about 5,000 everyday items, such as diapers and peanut butter, to drive higher traffic and sales. Meanwhile, others, such as , have debuted value meals.

Despite a slight decrease in the average amount spent per customer, Target's customer traffic increased by 3% in the latest quarter.

Last week, CEO Doug McMillon stated that while prices have decreased in various merchandise categories, inflation has been more persistent in the sections that contain dry groceries and processed foods.

He stated on an earnings call with investors that some brands are discussing cost increases, and they are fiercely opposing this viewpoint because they believe prices must decrease.