Target Earnings Show Turnaround Plan, Modest Growth
Target earnings signaled a quarterly sales decline and an investor day unveiled a CEO-led turnaround and guidance that will reshape trader positioning.

KEY TAKEAWAYS
- Target reported quarterly net sales of $30.5 billion, down 1.5% year over year.
- New CEO Michael Fiddelke unveiled a turnaround plan reallocating resources to stores and higher capital spending.
- Fiscal guidance targets roughly 2.0% net-sales growth and an adjusted EPS range of $7.50 to $8.50.
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Target Corporation (TGT) reported a fourth-quarter sales decline and used its March 3, 2026, investor day to unveil a turnaround plan under new CEO Michael Fiddelke. The company projected modest net-sales growth and adjusted earnings for fiscal 2026.
Quarterly and Annual Results
Target’s press release on March 3 reported fourth-quarter 2025 net sales of $30.5 billion, down 1.5% year over year. Comparable sales fell 2.5%, with store sales declining 3.9% and digital sales rising 1.9%. Full-year net sales totaled $104.8 billion, down 1.7% from 2024, while full-year comparable sales dropped 2.6%.
The company posted fourth-quarter GAAP earnings per share (EPS) of $2.30, which included $89 million, or about $0.15 per share, in business-transformation costs. Adjusted EPS was $2.44, slightly above the prior year’s $2.41. For the full year, GAAP EPS was $8.13, down from $8.86, and adjusted EPS was $7.57.
Gross margin improved to 26.6% from 26.2% in the prior year. Fourth-quarter operating income margin was 4.5% on a GAAP basis and 4.8% adjusted. Fiscal 2025 GAAP operating income declined 8.1% year over year to $5.1 billion.
Among categories, Food & Beverage, Beauty, and Toys posted sales growth in the quarter. Essentials and Home strengthened compared with the prior quarter. Non-merchandise revenue rose 25% year over year, driven by membership revenue more than doubling, Roundel advertising revenue growing in double digits, marketplace sales up 30%, and same-day delivery (Target Circle 360) increasing 30%.
Turnaround Plan and Guidance
Michael Fiddelke became CEO on February 1, 2026, and presented his first earnings and turnaround plan at the March 3 investor day in Minneapolis.
Target’s guidance for fiscal 2026 projects net-sales growth around 2% compared with 2025. This reflects a small increase in comparable sales plus more than one percentage point from new stores and non-merchandise revenue. The company expects growth in every quarter of the year.
Fiscal 2026 operating income margin is forecast to be about 20 basis points above the 2025 adjusted rate of 4.6%. GAAP and adjusted EPS guidance ranges from $7.50 to $8.50, with first-quarter adjusted EPS expected to be flat to slightly above the prior $1.30 level.
The turnaround plan includes increasing capital spending to about $5 billion, up from $4 billion in 2025, to fund technology upgrades and store remodels. Management is reshuffling leadership and cutting roughly 500 corporate, regional, and supply-chain roles to reallocate resources toward store staffing. The company tied these changes to its goal of restoring sales momentum under Fiddelke’s leadership.





