MINNEAPOLIS — Target Corp. is ready to begin its next chapter, one that will be defined by the retailer “playing our own game and making big changes to delight our guests,” said Michael Fiddelke, chief executive officer.
“We’ve been gathering feedback from consumers, from those who love us to those who don’t, in order to gain a deeper understanding of the role Target plays in their lives,” Fiddelke said in a March 3 conference call with analysts to discuss fiscal 2025 results. “We’ve been meeting with founders of small businesses who have grown their brands with Target and want other entrepreneurs to follow in their footsteps. We’ve also been meeting with national brands and design partners to reinforce our commitment to style, design and value. We’ve been talking to our team about what they need in order to serve our guests well. As a result, we’re moving quickly to simplify work, speed up decisions, and empower our merchants and store teams.”
Target’s new direction already is having an impact on its food and beverage business. The company last week announced plans to only offer cereals free of synthetic colors on its shelves by the end of May. The initiative includes both national cereal brands as well as Target owned cereal brands.
Target’s cereal aisle makeover is part of its effort to “lead with merchandising authority,” one of four priorities the retailer has put in place to drive growth. The other three priorities are elevating the guest experience, accelerating technology and strengthening team and communities.
“At its core, merchandising authority is about curation and playing to our strengths,” Fiddelke said.
Fiddelke stressed that going forward Target will not be “an everything store.”
“That’s not what guests want from us,” he said. “They want a strong, trend-forward assortment that they can trust to deliver quality and value, and that’s exactly what we do at Target when we’re at our best. We’re making choices. In assortment, we’re doubling down where we are strongest and where guests tell us our right to win and growth is highest.”
Cara Sylvester, executive vice president and chief merchandising officer, expanded on what’s next for Target’s food and beverage business, noting the retailer will focus on strengthening its unique identity when it comes to food.
Cara Sylvester, chief merchandising officer, said the retailer will focus on strengthening its unique identity when it comes to food.
| Source: Sosland Publishing Co.“We are not trying to be an everything grocer or just another grocer down the street,” she said.
Instead, she said Target seeks to build a distinctive grocery destination where emerging brands, wellness and own brands intersect. She said the retailer is on track to double the number of unique items in its food and beverage assortment over the next three years.
“Forty-percent of our guests tell us they’re looking for something new when they shop food at Target,” Sylvester said. “When we deliver trend-right newness, consumers respond.”
Food and beverage sales at Target in the year ended Jan. 31 were $24.14 billion, up 1.3% from $23.83 billion in fiscal 2024. In the fourth quarter, food and beverage sales were $6.64 billion, up from $6.52 billion.
Sylvester said Target has grown its food business by $9 billion since 2019, and its Good & Gather brand is on track to become Target’s first $4 billion own brand. She attributed the brand’s growth to “leaning into innovation and driving awareness.”
Target Corp. net income in fiscal 2025 was $3.71 billion, equal to $8.16 per share on the common stock, down 9% from $4.09 billion, or $8.89 per share, in fiscal 2024. Sales were $104.78 billion, down 1.7% from $106.6 billion. Fourth-quarter net income was $1.05 billion, or $2.31 per share, down 5% from $1.1 billion, or $2.42 per share, in fiscal 2024. Net sales were $30.45 billion, down 1.5% from $30.92 billion.
In its guidance for 2026, Target said it expects net sales growth of about 2%, a modest improvement in operating margin and earnings per share of $7.50 to $8.50.
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