Target Corp 10-K for FY2026
Target Corp (TGT)
10-K
2026-03-11
For: 2026-01-31
View Original
Added on
April 02, 2026
About this 10-K
Target Corp filed this 10-K on March 11, 2026, covering the fiscal year ended January 31, 2026 (FY2026).
Headline figures
Fiscal year ended January 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $104.78B
- down 1.7% from $106.57B a year earlier
- Net income
- $3.71B
- down 9.4% from net income of $4.09B a year earlier
- Diluted EPS
- $8.13
- down 8.2% from $8.86 a year earlier
| UNITED STATES SECURITIES AND EXCHANGE COMMISSION | ||||||||
Washington, D.C. 20549
FORM 10-K
(Mark One)
For the fiscal year ended January 31 , 2026
OR
For the transition period from ____ to ____
Commission File Number 1-6049
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization)
(Address of principal executive offices)
(I.R.S. Employer Identification No.)
(Zip Code)
Registrant’s telephone number, including area code: (612 ) 304-6073
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
x | Accelerated filer | o | |||||||||||||||
Non-accelerated filer | o | Smaller reporting company | |||||||||||||||
Emerging growth company | |||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of the voting stock held by non-affiliates of the registrant as of August 1, 2025, was $45,284,343,058 based on the closing price of $99.77 per share of common stock as reported on the New York Stock Exchange.
Total shares of common stock, par value $0.0833, outstanding as of March 4, 2026, were 452,855,589 .
DOCUMENTS INCORPORATED BY REFERENCE
TABLE OF CONTENTS
| TARGET CORPORATION |  | 2025 Form 10-K | 1 | ||||||||
PART I
Item 1. Business
General
Target Corporation was incorporated in Minnesota in 1902. Our corporate purpose is to help all families discover the joy of everyday life. We offer our customers, referred to as "guests," fashionable, differentiated merchandise and everyday essentials at discounted prices. We operate as a single segment designed to enable guests to purchase products seamlessly in stores or through our digital channels. Since 1946, we have given 5 percent of our profit to communities.
When used in this report, the terms "we," "our," "us," "Target," and the "Corporation" mean Target Corporation and its subsidiaries, collectively, unless the context otherwise requires or indicates.
Strategy
Target’s strategy is grounded in our purpose to help all families discover the joy of everyday life and our ambition to be the most delightful experience in retail. We differentiate through design, style, and value, and a curated multi-category assortment delivered across stores and digital channels.
Our strategy is centered on four priorities.
Lead with Merchandising Authority. Curating design-led, trend-right assortments that combine quality, newness, and value. We focus on categories and brands where we can offer a distinctive and relevant experience for our guests.
Elevate the Guest Experience. Elevating the guest experience by making shopping easy, inspiring, and friendly. Our stores remain central to this strategy as destination-worthy environments and fulfillment hubs, complemented by digital channels that support discovery, inspiration, and flexibility.
Accelerate Technology to Enable Our Team and Delight Our Guests. Advancing technology, data and operational capabilities that enable personalization, improve execution, and support scalable growth.
Strengthen Our Team and Communities. Developing a future-ready workforce through skills, leadership, and tools that amplify human performance. We are also dedicated to working with communities and partners to make life better everywhere we do business, including continuation of our long history of financial giving and volunteering.
Through this strategy, we seek to strengthen relevance, deepen engagement, and deliver strong long-term financial performance.
| TARGET CORPORATION | | 2025 Form 10-K | 2 | ||||||||
The vast majority of our Net Sales are generated by the sale of merchandise to customers. Our strategy continues to leverage stores as fulfillment hubs, with stores fulfilling more than 97 percent of total Merchandise Sales in each of the last three years, which provides convenience for our guests at a reduced fulfillment cost. In addition to Merchandise Sales, we generate revenue from other sources, most notably advertising revenue and credit card profit-sharing income. Note 2 to the Financial Statements provides more information.
Net Sales
(in billions)
2023 (53 weeks) | 2024 (52 weeks) | 2025 (52 weeks) | |||||||||||||||
| $107.4 | $106.6 | $104.8 | |||||||||||||||
(a) 2023 consisted of 53 weeks. The extra week in 2023 contributed $1.7 billion of Net Sales.
| TARGET CORPORATION | | 2025 Form 10-K | 3 | ||||||||
Merchandise Sales by Fulfillment Channel
Financial Highlights
For information on key financial highlights, see Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A).
Seasonality
A larger share of annual net sales are traditionally earned during the fourth quarter because it includes the November and December holiday sales period.
Merchandise
The majority of our stores offer a wide assortment of general merchandise and groceries. Most of our stores larger than 170,000 square feet offer a variety of general merchandise and a full line of groceries comparable to traditional supermarkets. Our digital channels include a wide merchandise assortment, including many items found in our stores, along with a complementary assortment sold by Target and third parties through our Target Plus digital marketplace. We manage our business across the six core merchandise categories shown below. Within categories, gross margins vary depending on the type of merchandise.
Merchandise Sales by Category
| TARGET CORPORATION | | 2025 Form 10-K | 4 | ||||||||
A significant portion of our Merchandise Sales are from national brand merchandise. Approximately thirty percent of our Merchandise Sales come from our owned and exclusive brands, including, but not limited to, the brands listed below.
| Owned Brands | ||||||||
| A New Day™ | Favorite Day™ | Original Use™ | ||||||
| All in Motion™ | Figmint™ | Pillowfort™ | ||||||
| Art Class™ | Future Collective™ | Room Essentials™ | ||||||
| Auden™ | Gigglescape™ | Shade & Shore™ | ||||||
| Ava & Viv™ | Good & Gather™ | Sonia Kashuk™ | ||||||
| Boots & Barkley™ | Good Little Garden™ | Spritz™ | ||||||
| Brightroom™ | Goodfellow & Co™ | Sun Squad™ | ||||||
| Bullseye's Playground™ | Hearth & Hand™ with Magnolia | Threshold™ | ||||||
| Casaluna™ | Heyday™ | Universal Thread™ | ||||||
| Cat & Jack™ | Hyde & EEK! Boutique™ | up & up™ | ||||||
| Cloud Island™ | JoyLab™ | Wild Fable™ | ||||||
| Colsie™ | Kindfull™ | Wondershop™ | ||||||
dealworthy™ | Market Pantry™ | |||||||
| Embark™ | Mondo Llama™ | |||||||
| Everspring™ | Open Story™ | |||||||
| Exclusive Adult Beverage Brands | ||||||||
| California Roots™ | SunPop™ | Wine Cube™ | ||||||
| Jingle & Mingle™ | The Collection™ | |||||||
We also sell merchandise through periodic exclusive design and creative partnerships, and shop-in-shop experiences, with partners such as Apple, Levi's, and Ulta Beauty, and generate revenue from in-store amenities such as Starbucks and Target Optical. CVS Pharmacy, Inc. (CVS) operates pharmacies and clinics in our stores under a perpetual operating agreement from which we generate annual occupancy income. In 2025, we reached a mutual agreement with Ulta Beauty to terminate our commercial shop-in-shop operating agreement when it expires in August 2026.
Global Sourcing, Import Operations, and Tariffs
Our global sourcing operations operate from offices in 13 countries and support the design, development, and manufacturing of merchandise sold across our stores and digital channels, with a particular focus on owned brands. These operations play critical roles in product quality and safety, cost management, and responsible sourcing practices.
Approximately one-half of the merchandise we offer is sourced from outside the United States, with China representing the largest country of origin for imported goods. We serve as the importer of record for most owned and exclusive, and certain national brand merchandise. As importer of record, we are responsible for customs compliance, including but not limited to, classification, import valuation, and payment of all applicable duties and fees.
We employ a range of tariff mitigation strategies, including supplier negotiations, sourcing diversification, and ongoing evaluation of assortment and pricing decisions. We also utilize permitted customs valuation methods, including the first sale methodology, for certain qualifying direct imports. We generally pay duties based on the price Target pays its vendors for the goods, and later seek refunds for qualifying transactions by filing first sale claims, a significant portion of which have processing and payment cycles that extend beyond one year.
| TARGET CORPORATION | | 2025 Form 10-K | 5 | ||||||||
Other Capabilities
We generate revenue through a variety of other sources, including Roundel, which provides advertising services to vendors and other third parties, including marketplace sellers; credit card profit sharing related to our Target Circle Card program; our third-party digital marketplace, Target Plus; membership fees; and others.
Customer Loyalty Program
We seek to drive customer loyalty and trip frequency through our Target Circle™ program, which provides benefits to guests that vary depending on their engagement with the program through one or more of the following offerings:
•a free membership providing deals and bonuses including instant discounts and Target Circle Rewards offerings redeemable on future purchases;
•Target Circle Card1 offerings that provide a 5 percent discount on nearly all purchases, free standard and 2-day shipping on eligible items purchased through our digital channels, and extended returns; and/or
•a paid Target Circle 360™ membership that provides access to unlimited same-day delivery on eligible orders over $35 from Target and other retailers, in addition to free shipping and extended returns benefits generally consistent with our Target Circle Card offering, and exclusive member deals.
1Target Circle Card offerings include Target Debit Card, Target Credit Card, and Target MasterCard (collectively, Target Circle Cards).
Distribution
Most merchandise is distributed to our stores through our network of distribution centers. Common carriers ship merchandise to and from our distribution centers. Vendors or third-party distributors ship certain food and beverage items and other merchandise directly to our stores. Merchandise sold through our digital channels is distributed to our guests through guest pick-up at our stores, via common carriers (from stores, supply chain facilities, vendors, and third-party distributors), and same-day delivery. Our stores fulfill the majority of digitally originated sales, which allows improved product availability, faster fulfillment times, reduced shipping costs, and allows us to offer guests a suite of same-day fulfillment options such as Order Pickup, Drive Up, and Same-Day Delivery.
| TARGET CORPORATION | | 2025 Form 10-K | 6 | ||||||||
Human Capital Management
In support of our purpose—to help all families discover the joy of everyday life—we invest in our team, our most important asset, by offering a rewarding experience grounded in growth, well-being, and a culture of care. As one of the largest private employers in the United States (U.S.), our workforce reflects a wide range of goals and expectations, from team members building long-term careers to students, retirees and others seeking flexible work in a supportive environment. We seek to be an employer of choice by attracting, engaging and retaining top talent who live our values and contribute to an inclusive and purpose-driven culture. To that end, we strive to foster a highly engaged team where all employees, referred to as “team members,” have fair access to opportunities, feel supported by their teams and communities, and are positioned to contribute to positive experiences for our guests and to overall business results.
As of January 31, 2026, we employed approximately 415,000 full-time, part-time, and seasonal team members. Because of the seasonal nature of the retail business, employment levels peak in the holiday season. We also engage independent contractors, most notably in our Shipt subsidiary.
Our Board of Directors, through the Compensation and Human Capital Management Committee, oversees human capital management matters.
Talent Development and Engagement
We offer a compelling work environment with meaningful experiences and abundant growth and career-development opportunities. This starts with the opportunity to do challenging work and learn on the job and is supplemented by programs and continuous learning that help our team build skills at all levels, including offerings focused on specialized skill development, leadership opportunities, coaching, and mentoring. Our talent and succession planning process supports the development of a strong talent pipeline for leadership and other critical roles. We monitor our team members’ perceptions of these development and engagement programs through a number of surveys and use those insights to guide areas of focus and improvement. We are focused on making Target a destination for talent by fostering a culture grounded in inclusivity, connection and drive, where team members feel supported and engaged. We believe inclusion and belonging for all is an essential part of our team and culture, reinforcing our values and helping fuel the growth of our business.
Compensation and Benefits
Our compensation and benefits are designed to support the financial, mental, and physical well-being of our team members and their families. We believe in paying team members fairly and regularly conduct a pay audit to confirm we are doing so. We also share pay ranges and benefit offerings on all US job postings and continue to expand visibility into these offerings. Our compensation packages include a starting wage range of $15 to $24 per hour for U.S. hourly team members in our stores and supply chain facilities (who comprise the vast majority of our team), a 401(k) plan with dollar-for-dollar matching contributions up to five percent of eligible earnings, paid vacation and holidays, family leave, sick pay, merchandise and other discounts, disability insurance, life insurance, healthcare and dependent care flexible spending accounts, tuition-free education assistance, free mental health services, an annual short-term incentive program, long-term equity awards, and health insurance benefits, including free virtual health care visits. Eligibility for, and the level of, benefits vary depending on team members’ full-time or part-time status, work location, compensation level, and tenure.
Workplace Health and Safety
We strive to maintain a safe and secure work environment and have specific safety programs. This includes administering a comprehensive occupational injury- and illness-prevention program and training for team members.
Working Capital
Effective inventory management is key to our ongoing success, and we use various techniques including demand forecasting and planning and various forms of replenishment management. We achieve effective inventory management by staying in-stock in core product offerings, maintaining positive vendor relationships, and carefully planning inventory levels for seasonal and apparel items to minimize markdowns.
| TARGET CORPORATION | | 2025 Form 10-K | 7 | ||||||||
Competition
We compete with omnichannel retailers, including department stores, off-price general merchandise retailers, wholesale clubs, category-specific retailers, drug stores, supermarkets, direct-to-consumer brands, online marketplaces, and other forms of retail commerce. Our ability to positively differentiate ourselves from other retailers and provide compelling value to our guests largely determines our competitive position within the retail industry.
Intellectual Property
Our brand image is a critical element of our business strategy. Our principal trademarks, including Target, our "Expect More. Pay Less." brand promise, and our "Bullseye Design," have been registered with the U.S. Patent and Trademark Office. We also seek to obtain and preserve intellectual property protection for our brands.
Geographic Information
Nearly all of our sales are generated within the U.S. The vast majority of our property and equipment is located within the U.S. In addition to our administrative operations headquartered in the U.S., we perform additional administrative functions in Bangalore, India, and perform global sourcing operations from offices in 13 countries, predominantly in Asia and Central America.
Available Information
Our corporate internet website is corporate.target.com. Our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements, and amendments to those documents filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (Exchange Act), are available free of charge on the Investors section of our website (corporate.target.com/investors) as soon as reasonably practicable after we file such material with, or furnish it to, the U.S. Securities and Exchange Commission (SEC). In addition, the SEC maintains a website (sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Investors should note that we currently announce material information to our investors and others using filings with the SEC, press releases, public conference calls, webcasts, or our corporate website (corporate.target.com). Information that we post on our corporate website could be deemed material to investors. We encourage investors, the media, and others interested in us to review the information we post on these channels. The information on our website is not, and shall not be deemed to be, a part hereof or incorporated into this or any of our other filings with the SEC.
| TARGET CORPORATION | | 2025 Form 10-K | 8 | ||||||||
Information About Our Executive Officers
Executive officers are elected by, and serve at the pleasure of, the Board of Directors. There are no family relationships between any of the officers named and any other executive officer or member of the Board of Directors, or any arrangement or understanding pursuant to which any person was selected as an officer.
| Name | Title and Recent Business Experience | Age | ||||||
| Michael J. Fiddelke | Chief Executive Officer since February 2026. Executive Vice President and Chief Operating Officer from February 2024 to January 2026. Executive Vice President and Chief Financial Officer from November 2019 to October 2024. | 49 | ||||||
Lisa R. Roath | Executive Vice President and Chief Operating Officer since February 2026. Executive Vice President and Chief Merchandising Officer, Food, Essentials & Beauty from January 2025 to February 2026. Executive Vice President and Chief Marketing Officer from July 2023 to January 2025. Senior Vice President, Merchandising - Food & Beverage from July 2020 to July 2023. | 48 | ||||||
| Melissa K. Kremer | Executive Vice President and Chief Human Resources Officer since January 2019. | 48 | ||||||
| Jim Lee | Executive Vice President and Chief Financial Officer since September 2024. Prior to joining Target, Mr. Lee held various leadership positions with PepsiCo, Inc., including as Deputy Chief Financial Officer from November 2023 to September 2024, Senior Vice President, Corporate Finance from October 2022 to November 2023, and Chief Strategy and Transformation Officer and Senior Vice President, PepsiCo Beverages North America, from February 2019 to October 2022. | 51 | ||||||
| Cara A. Sylvester | Executive Vice President and Chief Merchandising Officer since February 2026. Executive Vice President and Chief Guest Experience Officer from May 2022 to February 2026. Executive Vice President and Chief Marketing & Digital Officer from February 2021 to May 2022. Senior Vice President, Home from March 2019 to February 2021. | 48 | ||||||
Prat Vemana | Executive Vice President and Chief Information and Product Officer since February 2025. Executive Vice President and Chief Digital and Product Officer from October 2022 to February 2025. Prior to joining Target, Mr. Vemana held various leadership positions with Kaiser Permanente, including as Senior Vice President and Chief Digital Officer from July 2019 to October 2022. | 54 | ||||||
| Brian C. Cornell | Executive Chair since February 2026. Chair of the Board and Chief Executive Officer from August 2014 to January 2026. | 67 | ||||||
Item 1A. Risk Factors
Our business is subject to many risks. The following risks, some of which have occurred and any of which may occur in the future, could materially and adversely affect our business and financial performance. These are not the only risks we face and there may be other risks that could materially and adversely affect our business and financial performance. Although the risks are organized by headings, and each risk is discussed separately, many are interrelated.
Competitive and Reputational Risks
If we are unable to positively differentiate ourselves from our competitors, our results of operations and financial condition could be adversely affected.
We attempt to differentiate our guest experience through a careful combination of price, merchandise assortment, store environment, digital experiences, convenience, guest service, loyalty programs, advertising, and marketing. Our ability to successfully differentiate ourselves depends on many competitive factors, including guest perceptions regarding our shopping experience, the safety and cleanliness of our stores, our ability to offer products at affordable prices, the desirability and exclusivity of our offerings, our in-stock levels, the effectiveness of our digital channels and fulfillment options, our ability to responsibly source merchandise, and our ability to create a personalized guest experience. If we fail to differentiate our guest experience from our competitors, our results of operations and financial condition could be adversely affected.
| TARGET CORPORATION | | 2025 Form 10-K | 9 | ||||||||
| RISK FACTORS | ||||||||
Consumers continue to migrate to digital channels and seek out multiple fulfillment options, which has affected the ways we attempt to differentiate ourselves. Since consumers can quickly comparison shop using digital tools, they may make decisions based solely on price or convenience, which could limit our ability to differentiate from our competitors. In addition, providing multiple fulfillment options, expanding our digital channels, expanding our digital assortment through third-party sellers on our Target Plus marketplace, and implementing new technology is complex, costly, and may not meet our guests’ expectations. If we are unable to offset our investments in these or other initiatives with improved performance or efficiencies, our results of operations could be adversely affected. In addition, if we do not anticipate and adapt to consumer behavior or developments and offerings by our competitors, we may not be able to compete effectively. For example, we may be unable to match or surpass the advances in technologies and capabilities (including artificial intelligence) that our competitors implement for consumer-facing platforms or for internal operations, which could adversely affect our competitive position. As technology (including artificial intelligence) in the digital retail market continues to evolve, new competitors may emerge due to lowered barriers of entry, which could negatively impact our ability to compete. Furthermore, generative artificial intelligence presents emerging ethical issues and could negatively impact our guests and team members. If our use of generative or agentic artificial intelligence becomes controversial or is ineffective, or if the outputs generated are inaccurate or controversial, our reputation and competitive position could be adversely affected. Consumers may also use third-party channels, devices, technologies, and capabilities (including artificial intelligence) to initiate shopping searches and place orders, which could make us dependent on the capabilities and search algorithms of those third parties to reach those consumers. Any failures or difficulties in executing our differentiation efforts or adapting to offerings by our competitors could adversely affect our results of operations and financial condition.
If we do not anticipate consumer demand accurately and respond quickly to changing consumer preferences, our results of operations and financial condition could be adversely affected.
A large part of our business is dependent on our ability to make trend-right decisions in a broad range of merchandise categories and offer those products at affordable prices. If we do not accurately predict consumer demand and quickly respond to changing consumer preferences and spending patterns, we may experience lower sales, spoilage, and increased inventory markdowns, which could adversely affect our results of operations. Our ability to accurately predict consumer demand and adapt to changing consumer preferences depends on many factors, including obtaining accurate and relevant data on guest preferences, successfully implementing new technologies and capabilities (including artificial intelligence), emphasizing relevant merchandise categories, effectively managing our inventory levels, and implementing competitive and effective pricing and promotion strategies. We have not always been able to accurately forecast consumer demand or react to rapid changes in consumer preferences and spending patterns, which has previously resulted in insufficient or excess inventory, increased inventory markdowns, higher costs (including for storage, transportation, labor, and other expenses), and adverse impacts on our results of operations. If we are unable to do so again in the future, our results of operations and financial condition could be adversely affected.
Our continued success is dependent on positive perceptions of Target which, if eroded, could adversely affect our business and our relationships, including with our guests, team members, and vendors.
We believe that one of the reasons our shareholders, guests, team members, vendors and business collaborators choose Target is the positive reputation we have built over many years for serving those constituencies and the communities in which we operate. To be successful in the future, we must continue to preserve Target's reputation. Our reputation is largely based on perceptions. It may be difficult to address negative publicity or sensationalism across media channels, regardless of its accuracy or the reputability of its source, including as a result of fictitious media content (such as content produced by generative artificial intelligence or bad actors). Negative incidents (including those based on differing perspectives or opinions) involving us, our workforce, or others with whom we do business could quickly erode trust and confidence and result in changes in consumer behavior including consumer boycotts, workforce unrest or walkouts, government investigations, and litigation. Negative reputational incidents or negative perceptions of us could adversely affect our business and results of operations, including through lower sales, the termination of existing business relationships, challenges in obtaining new vendors, third-party sellers or business collaborators, loss of new store and development opportunities, higher costs, and team member engagement, retention, and recruiting difficulties. We have previously experienced negative perceptions of our business, which have adversely affected consumer behavior and our results of operations, and we could experience similar occurrences in the future. Any of these outcomes could negatively impact our reputation, results of operations, and financial condition.
| TARGET CORPORATION | | 2025 Form 10-K | 10 | ||||||||
| RISK FACTORS | ||||||||
We previously established, and may continue to establish, various goals and initiatives regarding environmental, political, social, and governance matters, including with respect to sustainability and human capital management. We have modified and concluded, and may continue to modify and conclude, certain of these goals and initiatives from time to time. For example, in 2025, we announced that we modified and concluded certain of our initiatives related to diversity, equity, and inclusion, which resulted in adverse reactions from some of our shareholders, guests, team members, and others, as well as consumer boycotts organized throughout 2025. Our establishment and continuation of any goals or initiatives regarding environmental, political, social, and governance matters, any modification or termination of such goals or initiatives, or any failure or perceived failure by us to achieve them, could result in negative reactions from our shareholders, guests, team members, vendors, and other third parties (including governmental entities and officials and non-governmental organizations) and lead to adverse perceptions of our business, consumer boycotts, litigation, investigations, and regulatory proceedings. In particular, certain federal and state officials and agencies have asserted that corporate initiatives regarding environmental, social, and governance matters, including with respect to sustainability, belonging, and diversity, equity, and inclusion, violate various federal and state laws. Although we believe that all of our corporate initiatives have complied with applicable laws, we could still become subject to litigation, investigations, and regulatory proceedings, including as it relates to corporate initiatives that have concluded. Any of these outcomes could negatively impact our reputation, results of operations, and financial condition.
Our shareholders, guests, team members, vendors and business collaborators, and other third parties (including governmental entities and officials and non-governmental organizations) have evolving, varied, and sometimes conflicting expectations regarding many aspects of our business, including our operations, product and service offerings, and environmental, political, social, and governance matters. Some of these individuals and organizations have expectations that Target offer or not offer certain products and services or pursue or not pursue particular environmental, political, social, and governance initiatives, including with respect to belonging and diversity, equity, and inclusion. We have previously been unable to meet some of those conflicting expectations, which has led to negative publicity and adversely affected our reputation. For example, we experienced adverse reactions from some of our shareholders, guests, team members, and others related to our assortment of Pride Month products in 2023 and other positions we have taken with respect to social issues, including LGBTQIA+ matters, which resulted in consumer boycotts and litigation. We may in the future take actions, or be perceived to take actions, that do not meet the conflicting expectations of some or all of our shareholders, guests, team members, vendors, business collaborators, and other third parties (including governmental entities and officials and non-governmental organizations) regarding various aspects of our business, including our operations, product and service offerings, and environmental, political, social, and governance matters. As a result, we may experience adverse perceptions of our business, consumer boycotts, litigation, investigations, and regulatory proceedings. Any of these outcomes could negatively impact our reputation, results of operations, and financial condition.
Reputational harm can also occur indirectly through companies and others with whom we do business or whose products we sell. We have consumer-facing relationships with a variety of other companies, including Apple, CVS, Disney, Levi’s, Starbucks, and Ulta Beauty. In addition, we have relationships with third-party companies that sell and ship items directly to guests through our digital channels. We also have relationships with designers, celebrities, influencers, and other individuals, including for advertising campaigns, product collaborations, and marketing programs. If consumers have negative experiences with, or view unfavorably, any of the companies or individuals with whom we have relationships, it could cause them to not shop with us and negatively impact our results of operations.
Our business transformation initiatives may not achieve their intended objectives, which could adversely affect our competitive position, results of operations, and financial condition.
Beginning in 2025, we began a company-wide business transformation effort to increase speed and agility across the organization in support of our strategic priorities. This initiative is intended to simplify cross-functional ways of working, increase role clarity, leverage technology (including artificial intelligence) and data to enhance decision-making, and reduce costs. These efforts have required, and may continue to require, significant changes to the day-to-day ways of working of our team members.
The success of this initiative is subject to the related risks discussed throughout this Item 1A, Risk Factors, as it is interconnected with our broader strategy and further depends on, among other things, effective execution and change management. If our execution is ineffective, if adoption by our team members is slower or more limited than expected, or if the initiative otherwise fails to adequately support our strategy, our competitive position, results of
| TARGET CORPORATION | | 2025 Form 10-K | 11 | ||||||||
| RISK FACTORS | ||||||||
operations, and financial condition could be adversely affected. We cannot assure that we will achieve all of the intended benefits of this initiative, including anticipated efficiencies, cost savings, or operational improvements, or that such benefits will be realized within expected timeframes.
In addition, the execution of our business transformation efforts has resulted, and may continue to result, in additional costs, including impairment of long-lived assets and costs associated with exiting certain activities or terminating commercial relationships. For example, in 2025, we recognized costs and charges related to reductions in our workforce, facility exits, and the termination of a commercial partnership. Such costs and charges could adversely affect our results of operations and financial condition.
If we are unable to successfully develop, source, and market our owned and exclusive brand products, our results of operations could be adversely affected.
Our owned and exclusive brand products represent approximately thirty percent of our overall merchandise sales and generally carry higher margins than equivalent national brand products. Our ability to source, develop, and market our owned and exclusive brands depends on many factors, including our ability to anticipate consumer demand and preferences and make trend-right decisions, our relationships with both established and new vendors, the availability and price of raw materials, product quality, and our ability to offer products at affordable prices. If we are unable to successfully develop, source, and market our owned and exclusive brands, or if we are unable to successfully protect our related intellectual property rights, our results of operations could be adversely affected. In addition, our reliance on owned and exclusive brand products may also amplify other risks discussed in this Item 1A, Risk Factors, because many of these products are imported and we are more involved in the development and sourcing of those products. For example, any failure of our owned brands to meet applicable safety standards or Target's or our guests' expectations regarding safety, quality, supply chain transparency, and responsible sourcing could expose us to government enforcement actions and private litigation, result in costly product recalls and other liabilities, and exacerbate our reputational risks. In addition, owned brand products generally need longer lead times between order placement and product delivery and require us to take ownership of those products earlier in the supply chain. This requires accurate longer-term forecasting of consumer demand to effectively manage our operations, including for categories where consumer preferences may change rapidly, and exposes us to enhanced risks of supply chain disruptions and trade policy or tariff impacts. We have previously been, and may in the future be, unable to accurately predict consumer demand for our owned brand products. This has resulted, and may in the future result, in insufficient or excess inventory, increased inventory markdowns, and higher costs. Any of these outcomes could adversely affect our results of operations and financial condition.
If we are unable to protect against inventory shrink, our results of operations and financial condition could be adversely affected.
Our business depends on our ability to effectively manage our inventory. We have historically experienced loss of inventory (also called shrink) due to damage, theft (including from organized retail crime), and other causes. To protect against rising inventory shrink, we have taken, and may continue to take, certain operational and strategic actions that could adversely affect our reputation, guest experience, and results of operations. In addition, sustained high rates of inventory shrink at certain stores have contributed, and may continue to contribute, to the closure of certain stores and the impairment of long-term assets.
We depend on seasonal moments and higher-margin merchandise to drive sales and net earnings growth.
Our business experiences some seasonality, with a larger portion of our sales traditionally occurring in the fourth quarter because it includes the November and December holiday sales period. In addition to the November and December holiday sales period, we also see increased sales activity during the back-to-school and back-to-college period and other seasonal moments throughout the year. As a result, any factors negatively impacting us during any of these periods, including weather conditions, natural disasters, macroeconomic conditions, consumer preferences, technological disruptions, and political or economic uncertainty or instability, could adversely affect our results of operations and financial condition to a greater degree.
We offer our guests a multi-category assortment of everyday essentials and differentiated merchandise. However, we depend on sales of our higher-margin merchandise to drive net earnings growth. As a result, flat sales and sales declines of our higher-margin merchandise have previously limited, and may in the future limit, our ability to drive net earnings growth or result in a decline in our gross margin rate. Furthermore, we are subject to cyclical trends in
| TARGET CORPORATION | | 2025 Form 10-K | 12 | ||||||||
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consumer spending, which may disproportionately impact sales of certain merchandise and result in lower sales for our higher-margin merchandise. Such trends have previously adversely affected, and could in the future adversely affect, our results of operations.
Our Roundel retail media network may not maintain or grow advertising revenue, which could adversely affect our results of operations.
Roundel, our in-house retail media network, offers advertising services on a variety of digital platforms primarily to our merchandise vendors, either directly or via advertising agencies, and Target Plus third-party sellers to promote their products and services. The digital advertising environment is highly competitive, and our advertisers do not have long-term commitments with us.
The performance of Roundel depends on a number of factors, including the size and composition of our merchandise vendor and seller base, levels of consumer engagement with Target-branded digital platforms, and our ability to maintain effective relationships with key search and social media platforms and third-party technology providers. If our vendor or seller base shrinks, consumer traffic to our digital platforms decreases, or we are unable maintain key relationships, our advertising revenue may fail to meet expectations or may decline.
In addition, changes in data privacy laws and regulations (as discussed elsewhere in this Item 1A, Risk Factors), as well as new or modified policies of third-party platforms through which Roundel’s offerings are delivered, could negatively affect Roundel’s business model. Increased competition, including from new or enhanced technology offerings such as artificial intelligence-enabled advertising solutions, may further pressure demand for our services. If advertisers reduce or discontinue their use of Roundel’s offerings, our competitive position and results of operations could be adversely affected.
Investment and Infrastructure Risks
If our capital investments do not achieve appropriate returns or our efficiency efforts are not successful, our competitive position, results of operations, and financial condition could be adversely affected.
Our business depends, in part, on our ability to remodel existing stores and build new stores in a manner that achieves appropriate returns on our capital investment. When building new stores, we compete with other retailers and businesses for suitable locations for our stores and available labor and materials. Pursuing the wrong remodel or new store opportunities and any delays, cost increases, or other difficulties related to those projects could adversely affect our results of operations and financial condition. Furthermore, remodels and new store projects have previously been, and may in the future be, delayed or cancelled based on changes in macroeconomic conditions, changes in expected project benefits, the timing for required permit issuances or other regulatory clearances, and other factors, which could result in the inefficient deployment of our capital and adversely affect our results of operations and financial condition.
We have made, and expect to continue to make, significant investments in our technology infrastructure, digital platforms, and supply chain infrastructure. The effectiveness of these investments can be less predictable than remodeling or building new stores, and might not provide the anticipated benefits, which could adversely affect our results of operations and financial condition. For example, our stores-as-hubs strategy depends on adequate replenishment facilities to receive, store, and move inventory to stores on a timely basis. Underestimating our replenishment capacity needs could result in lower in-stock levels or increased costs for temporary storage. Conversely, overestimating replenishment capacity needs, changes in macroeconomic conditions, changes in expected project benefits, and other factors have resulted, and could in the future result, in delays or cancellations of supply chain infrastructure projects. Such delays or cancellations have resulted, and may in the future result, in the inefficient deployment of our capital relative to our expectations, including as a result of carrying costs for facilities that are not being utilized. Any of these outcomes could adversely affect our results of operations and financial condition.
A significant disruption to our technology systems and our failure to adequately maintain and update those systems could adversely affect our operations and negatively affect our guests.
We rely extensively on technology systems throughout our business, including systems that we develop internally. We also rely on continued and unimpeded access to the Internet to use our technology systems. These systems are
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subject to possible damage or interruption from many events, including power and other outages, telecommunications failures, third-party failures, malicious attacks, security breaches, unplanned downtime, program transitions, and implementation errors. Any damage or disruption to our technology systems could severely interrupt our business operations, including our ability to process guest transactions and manage inventories, which could adversely affect our reputation, results of operations, and financial condition. For example, in the past, we have experienced disruptions to the order fulfillment capabilities on our digital platforms and in our point-of-sale system that prevented our ability to process debit or credit transactions, which negatively impacted some guests’ experiences and generated negative publicity. We have invested, and expect to continue to invest, in maintaining and updating our technology systems, but implementing significant changes increases the risk of system disruption. Furthermore, the technology systems that we develop internally may become outdated or ineffective and may be unable to match or surpass third-party systems. Problems and interruptions associated with implementing technology initiatives could adversely affect our operational efficiency and negatively impact our guests and their confidence in us. Any of these outcomes could adversely affect our results of operations and financial condition.
Information Security, Cybersecurity, and Data Privacy Risks
If our efforts to maintain information security, cybersecurity, and data privacy are unsuccessful or if we are unable to meet increasingly demanding regulatory requirements, our reputation, results of operations, and financial condition could be adversely affected.
As part of our business, we receive and store information about our guests, team members, vendors, and other third parties. We also rely extensively on information systems throughout our business. We have programs in place to detect, contain, and respond to information security, cybersecurity, and data privacy incidents. However, we may be unable to anticipate security incidents, detect attacks, or implement adequate preventive measures as cyber threats continue to evolve and cyberattacks become more sophisticated and frequent, including through the introduction of viruses and malware (such as ransomware) and the use of enhanced and rapidly advancing technologies and capabilities (including artificial intelligence) by threat actors. Cyberattacks are being carried out by groups and individuals with a wide range of expertise and motives. In addition, hardware or software that we develop or obtain from third parties may contain defects that could compromise information security, cybersecurity, or data privacy. Unauthorized parties may also attempt to gain access to our information systems or facilities, or those of third parties with whom we do business, through fraud, deception, social engineering, or other bad acts. Errors or malicious actions by our team members or contractors, faulty password management, and other vulnerabilities or irregularities could also overcome our security measures or those of third parties with whom we do business and result in a compromise or breach of our or their information systems. The utilization of hybrid and remote work by our team members, vendors, independent contractors, and other third parties has amplified our already extensive reliance on computing and information systems and unimpeded Internet access. Furthermore, the training we conduct as part of our information security, cybersecurity, and data privacy efforts may not be effective in preventing or limiting successful attacks.
We and our vendors face attempts by others to gain unauthorized access to, sabotage, take control of, and corrupt, our information systems and data. As a result of these types of attempts, both we and our vendors have experienced information security, cybersecurity, and data privacy incidents. None of these incidents has recently had a material impact on our business strategy, results of operations, or financial condition. But as we previously experienced a prominent data breach, additional information security, cybersecurity, or data privacy incidents could draw greater scrutiny. If we, our vendors, or other third parties with whom we do business experience additional significant information security, cybersecurity, or data privacy incidents or fail to detect and appropriately respond to significant incidents, our business operations could be severely disrupted and we could be exposed to costly government enforcement actions and private litigation. In addition, our guests could lose confidence in our ability to protect their information, stop using our Target-branded payment cards or loyalty programs, or stop shopping with us altogether. Any of these outcomes could adversely affect our reputation, results of operations, and financial condition.
The legal and regulatory environment regarding information security, cybersecurity, and data privacy is dynamic and has strict requirements, including for the use and treatment of personal information. Complying with current or contemplated information security, cybersecurity, data privacy, data protection, and data processing laws and regulations (including reporting and disclosure regimes), or any actual or alleged failure to comply, could cause us to incur substantial costs, require changes to our business practices, and expose us to litigation and regulatory risks, each of which could adversely affect our reputation, results of operations, and financial condition.
| TARGET CORPORATION | | 2025 Form 10-K | 14 | ||||||||
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Supply Chain and Third-Party Risks
Changes in our relationships with our vendors or other companies, changes in tax or trade policy, interruptions in our operations or supply chain, and increased commodity or supply chain costs could adversely affect our reputation and results of operations.
We are dependent on our vendors, independent contractors, and other third parties (including common carriers) to supply merchandise to our distribution centers, stores, and guests. If our replenishment and fulfillment network does not operate properly, if we are unable to timely import certain merchandise, if a vendor fails to deliver on its commitments, or if common carriers have difficulty providing capacity to meet demands for their services as has happened in the past, we could experience merchandise out-of-stocks, delays in shipping and receiving merchandise, and increased costs, which could adversely affect our reputation and results of operations. In addition, we have consumer-facing relationships with a variety of other companies, including Apple, CVS, Disney, Levi’s, Starbucks, and Ulta Beauty. Any termination of, or adverse change in, our relationship with any of these companies could decrease our sales, increase our costs, and negatively impact our reputation and results of operations.
U.S. trade policy is changing rapidly and remains subject to uncertainty. In February 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were not authorized by the statute. The U.S. government then imposed additional, non-IEEPA global Section 122 tariffs. Any trade disputes or further changes in tax or trade policy, including the imposition of additional tariffs or duties on imported products or changes in tariff levels, between the U.S. and countries from which we source merchandise directly or indirectly through vendors could require us to take certain actions, including raising prices on products we sell and seeking alternative sources of supply from vendors in other countries. Approximately one-half of the merchandise that we offer is sourced, directly or indirectly, from outside the U.S., with China as our single largest source of merchandise we import. In particular, U.S. tariffs imposed or threatened to be imposed on several countries in 2025, including China, India, Vietnam and Bangladesh, and any retaliatory actions taken by such countries have resulted, and could continue to result, in us incurring substantial additional costs to procure a large portion of the merchandise we offer and impact the margin rate for certain products, raising prices on certain products, and starting new vendor relationships in other countries. Many of these tariffs were imposed under IEEPA and were subsequently impacted by the February 2026 ruling, though the process, timing, and amount of any potential refund recovery for such tariffs remain uncertain. We continue to closely monitor these developments and their ultimate impact on our business, results of operations, and financial condition, all of which may be adversely impacted. In addition, if our competitors do not keep pace with any such price increases or are able to offset the impact of tariffs through other actions, such as diversification in their mix of vendors, our competitive position may be adversely affected.
We also utilize a first sale declaration program, which is subject to rigorous requirements, to pay duties and tariffs to U.S. Customs for merchandise on the basis of the price paid by our vendors rather than the price paid by the importer of record. Our program may be subject to inquiries, investigations, or regulatory proceedings by U.S. Customs. The amount of duties and tariffs that we pay to import merchandise could rise substantially if the U.S. government eliminates the availability of the first sale declaration methodology, if the requirements to utilize this methodology change, or if our ability to rely on this methodology is limited or eliminated. Any of these outcomes could adversely affect our reputation, results of operations, and financial condition.
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Political or economic uncertainty or instability, trade policies, disputes, or sanctions, currency fluctuations, the outbreak of pandemics or other illnesses, labor shortages, labor unrest or strikes, transport capacity and costs, inflation, port security, weather conditions, natural disasters, geopolitical conflicts, social unrest, terrorist attacks, armed conflicts, or other events that have affected, and could in the future affect, foreign trade are beyond our control. These types of events have impacted us, and could impact us in the future, including by disrupting our supply of merchandise, increasing the price and limiting the availability of raw materials, increasing our costs, and adversely affecting our results of operations. For example, there have been periodic closings and ship diversions, armed conflicts, unrest, labor disputes, and congestion disrupting railways, trucking, waterways, and ports around the world, including at major U.S. ports where we receive a significant portion of the products we source from outside the U.S. We have from time to time made alternative arrangements to continue the flow of inventory as a result of supply chain disruptions in the U.S. and other countries. If these types of events recur and impact any of the locations or modes of transportation that we depend on, it could increase our costs and adversely affect our supply of inventory. In addition, prices of fuel and other commodities on which our supply chain depends are historically volatile and subject to fluctuations based on a variety of international and domestic factors. Rapid and significant changes in commodity prices, as have occurred in recent years, could further increase our costs and adversely affect our results of operations.
If services we obtain from third parties are unavailable, fail to meet our standards, or increase in cost, our reputation, results of operations, and financial condition could be adversely affected.
We rely on third parties to support our business operations, including portions of our technology infrastructure (including certain generative artificial intelligence services), digital platforms, replenishment and fulfillment operations, store and supply chain infrastructure, delivery services (including by independent contractors via our Shipt subsidiary), guest contact centers, payment processing, digital advertising offerings, and extensions of credit for our Target-branded payment card program. If we are unable to contract with third parties having the specialized skills needed to support our operations (including as a result of any labor disputes or labor unavailability at such third parties), if any third-party services are interrupted, or if they fail to meet our performance standards, then our reputation and results of operations could be adversely affected.
In addition, we incur significant expenses related to our reliance on services from third parties. If we are unable to effectively manage these costs or if we face significant increases in any of these costs, our results of operations and financial condition could be adversely affected. In particular, for certain payment methods, including credit and debit cards, we generally pay interchange fees and other processing fees. Given the continued adoption of credit and debit cards by consumers, we have incurred, and expect to continue to incur, significant costs as a result of these fees. Any increase in these fees over time could significantly increase our expenses and adversely affect our results of operations and financial condition.
Legal, Regulatory, Global, and Other External Risks
Our earnings depend on the state of macroeconomic conditions and consumer confidence and spending in the U.S.
Nearly all of our sales are in the U.S., making our results highly dependent on the health of the U.S. economy and U.S. consumer behavior, confidence, and spending, which can be affected by a variety of factors, including inflation, interest rates, housing prices, unemployment rates, legal and regulatory actions, immigration policies and trends, household debt and wage levels, credit usage, and crime rates. In addition, the interconnected nature of the global economy means that events occurring domestically or internationally, such as geopolitical conflicts, social unrest, terrorist attacks, armed conflicts, public health crises, legal and regulatory actions, immigration policies and trends, energy availability, trade policies, disputes, or sanctions, and market volatility can all affect macroeconomic conditions in the U.S. A deterioration in U.S. macroeconomic conditions or consumer confidence or spending could adversely affect our business in many ways, such as negatively impacting consumer demand (which may disproportionately affect demand for certain merchandise), reducing sales (including our credit card profit-sharing revenue), reducing gross margins, and increasing our expenses, each of which could adversely affect our results of operations and financial condition.
| TARGET CORPORATION | | 2025 Form 10-K | 16 | ||||||||
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Uncharacteristic or significant weather conditions or natural disasters, the impacts of a changing climate, and other catastrophic events could adversely affect our results of operations and financial condition.
Uncharacteristic or significant weather conditions, including the physical impacts of a changing climate, and other catastrophic events can affect consumer shopping patterns, particularly in apparel and seasonal items, which could lead to lower sales or greater than expected markdowns and adversely affect our results of operations. In addition, we have significant operations in certain states where natural disasters (including hurricanes, tropical storms, floods, fires, and earthquakes) are more prevalent. Natural disasters in those states or in other areas where we operate has previously resulted, and could in the future result, in significant physical damage to, or closure of, one or more of our stores, distribution centers, facilities, or key vendors. Furthermore, weather conditions, natural disasters, and other catastrophic events in areas where we or our vendors operate, or depend upon for continued operations, have adversely affected, and could in the future adversely affect, the availability and cost of certain products within our supply chain, consumer purchasing power, and consumer demand. Additionally, acts of violence and other crimes, including active shooter situations, at or around our stores, distribution centers, or other facilities have, and may in the future, negatively impact the safety and security of our workforce and guests, damage our facilities, or harm our reputation. Any of these events could adversely affect our results of operations and financial condition.
The potential impacts of a changing climate may be widespread and unpredictable and present a variety of risks in the short-term and long-term. The physical effects of a changing climate, such as natural disasters, extreme weather conditions, drought or water scarcity, and rising sea levels, could adversely affect our results of operations, including by increasing our energy costs, disrupting our supply chain, negatively impacting our workforce, damaging our stores, distribution centers, and inventory, and threatening the habitability of the locations in which we operate. In addition to physical risks, the potential impacts of a changing climate also present transition risks, including regulatory and reputational risks. For example, we use commodities and energy inputs in our operations that may face increased regulation due to a changing climate or other environmental concerns, which could increase our costs. Furthermore, our establishment and continuation of our goals and initiatives to create a more resilient business, or any modification, conclusion, failure, or perceived failure by us to achieve them, or to otherwise meet evolving, varied, and sometimes conflicting expectations from our shareholders, guests, team members, vendors, and other third parties (including governmental entities and officials and non-governmental organizations) regarding the environment and our goals and initiatives to create a more resilient business, could lead to adverse perceptions of our business, consumer boycotts, litigation, investigations, and regulatory proceedings. Any of these outcomes could adversely affect our reputation, results of operations, and financial condition.
| TARGET CORPORATION | | 2025 Form 10-K | 17 | ||||||||
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We rely on a large, global, and changing workforce of team members, contractors, and temporary staffing. If we do not effectively manage our workforce, our labor costs and results of operations could be adversely affected.
With over 400,000 team members, our workforce costs represent our largest operating expense, and our business is dependent on our ability to attract, train, and retain the appropriate mix of qualified team members, contractors, and temporary staffing. Many team members are in entry-level or part-time positions with high turnover rates historically. In addition, the continuous advancements in automation and artificial intelligence capabilities will continue to impact the skills required in our workforce, and our recruiting and training needs must evolve to maintain pace. Our ability to meet our changing labor needs while controlling our costs is subject to external factors such as labor laws and regulations, labor availability, unemployment levels, prevailing wage rates, benefit costs, changing demographics, immigration laws and regulations, and our reputation within the labor market. If we are unable to attract, train and retain a workforce meeting our needs (including for specialized roles with significant competition for talent) or are unable to successfully execute on succession planning at all levels of the organization, our operations, strategy, guest service levels, support functions, and competitiveness could suffer. Any of these outcomes could adversely affect our reputation, results of operations, and financial condition. We are periodically subject to labor organizing efforts and activism, which could negatively impact how we are perceived by team members and our overall reputation. If we become subject to one or more collective bargaining agreements in the future, it could adversely affect our labor costs, how we operate our business, and our results of operations. In addition to our U.S. operations, we perform additional administrative functions in Bangalore, India, and perform global sourcing operations from offices in 12 countries, predominantly in Asia and Central America, and any extended disruption of our operations in our different locations, whether due to labor difficulties or otherwise, could adversely affect our results of operations. In particular, we rely on our administrative functions in India for various business operations and any events that negatively impact the availability or effectiveness of our administrative functions in India, including political or economic uncertainty or instability, the outbreak of pandemics or other illnesses, labor shortages, labor unrest or strikes, weather conditions, natural disasters, geopolitical conflicts, social unrest, terrorist attacks, and armed conflicts, could adversely affect our results of operations and financial condition.
Shareholder activism could adversely affect our business, strategic execution, and stock price.
We regularly engage with shareholders with a goal of strengthening our business. From time to time, shareholders may pursue public or private campaigns to influence our corporate strategy, capital allocation, or environmental, political, social, and governance matters. Any such activist campaigns, including rumors of such campaigns, could result in increased costs, including legal expenses, and diversion of management and board attention. Public activism campaigns may also create actual or perceived uncertainty regarding our strategic direction, which could impair relationships with guests, suppliers, team members, and others, or cause volatility in our stock price that is not reflective of our underlying business fundamentals. These risks could adversely impact our reputation, ability to execute on strategic objectives, results of operations, and financial condition.
Failure to address product safety and sourcing concerns could adversely affect our results of operations.
If any of our merchandise offerings do not meet applicable safety standards or Target’s or our guests’ expectations regarding safety, supply chain transparency, and responsible sourcing, we could be exposed to legal and reputational risks and our results of operations could be adversely affected. Our vendors and third-party sellers must comply with applicable product safety laws, and we are dependent on them to ensure that the products we buy or offer, respectively, comply with all safety standards. Events that give rise to actual or perceived product safety concerns, including food or drug contamination and product defects, could expose us to government enforcement actions and private litigation and result in costly product recalls and other liabilities. Our sourcing vendors, including any third parties selling through our digital channels, must also meet our expectations and comply with applicable laws and regulations across multiple areas of social compliance, including supply chain transparency and responsible sourcing. We have a social compliance audit process that performs audits regularly, but we cannot continuously monitor every vendor and third-party seller, so we are also dependent on them to ensure that the products we buy or offer comply with applicable standards. If we need to seek alternative sources of supply from vendors with whom we have less familiarity, including to diversify the geographic locations of our vendors to mitigate the impacts of tariffs or other trade policies, the risk of these standards not being met may increase. Negative guest perceptions regarding the safety and sourcing of the products we sell could harm our reputation and adversely affect our results of operations.
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Our failure to comply with applicable laws, or changes in these laws, could adversely affect our reputation, results of operations, and financial condition.
Our business is subject to a wide variety of complex foreign, national, state, and local laws and regulations.
Our expenses could increase and our operations could be adversely affected by changes in law or adverse judicial developments involving our workforce, including an employer’s obligation to recognize collective bargaining units, minimum wage requirements, advance scheduling notice requirements, health care or other mandates, the classification of exempt and non-exempt employees, and the classification of workers as either employees or independent contractors. The classification of workers as employees or independent contractors, in particular, is an area that has experienced legal challenges and legislative changes. Our Shipt subsidiary, which facilitates delivery services (including same-day delivery to our guests), has faced, and continues to face, legal challenges to its worker classification. If, as a result of judicial decisions or legislation, Shipt is required to treat its network of independent contractors as employees, we may experience higher digital fulfillment costs, which could adversely affect our results of operations and financial condition.
There have been, and may continue to be, changes in the legal or regulatory environment (including as a result of executive orders) affecting many areas related to our business, including merchandise costs and availability, customs and trade policy (including the impacts of our first sale declaration program), workforce availability, transport costs and capacity, information security, cybersecurity, and data privacy, supply chain requirements, product safety, product quality, payment methods, environmental, social, and governance matters (including sustainability, belonging, and diversity, equity, and inclusion), and climate and emissions disclosure. Changes in the environment may occur rapidly. The ultimate impact of any changes in the legal or regulatory environment is not possible to predict and could negatively affect our results of operations and financial condition, including by increasing our expenses, reducing consumer demand for our products and services, limiting workforce availability for us and our vendors, and resulting in litigation, investigations, and regulatory proceedings against us. In addition, if we are unable or perceived to be unable to comply with any changes in the legal or regulatory environment, our reputation, results of operations, and financial condition could be adversely affected. Furthermore, if we fail to comply with other applicable laws and regulations, including the Foreign Corrupt Practices Act and other anti-bribery laws, anti-money laundering laws, import restrictions, responsible sourcing laws, and sanctions programs, we could be subject to legal and reputational risks, including government enforcement actions and private litigation, which could adversely affect our results of operations and financial condition.
Litigation and other legal proceedings may adversely affect our reputation, results of operations, and financial condition.
We are regularly involved in a variety of legal proceedings, including litigation, arbitration, claims, investigations, and inquiries. The frequency of any such proceedings could increase in the future. These proceedings relate to a wide range of matters, including commercial disputes, employment, environmental, social, and governance matters, intellectual property rights, personal injury, shareholder actions, securities claims, and matters relating to our compliance with applicable laws and regulations. These matters are inherently uncertain, and we may not be successful in defending ourselves. Determining applicable reserves and possible losses related to such matters involves judgment and may not reflect the full range of uncertainties and unpredictable outcomes. In addition, our assessment of the materiality and likely outcome of these matters may not be consistent with the ultimate outcome of such matters. Responding to these matters has required, and may in the future require, us to devote significant resources and incur significant expenses, even for those that are non-meritorious, which could adversely affect our results of operations and financial condition. Any of these proceedings could also generate negative publicity that adversely affects our reputation.
| TARGET CORPORATION | | 2025 Form 10-K | 19 | ||||||||
RISK FACTORS & UNRESOLVED STAFF COMMENTS | ||||||||
Financial Risks
Increases in our effective income tax rate could adversely affect our results of operations.
Several factors influence our effective income tax rate, including domestic and international tax laws and regulations, the related interpretations, the continued availability of purchased tax credits, and our ability to sustain our reporting positions on examination. Changes in any of those factors could change our effective tax rate, which could adversely affect our net earnings. In addition, changes in our operations both in and outside of the U.S. may cause greater volatility in our effective tax rate. Furthermore, we are subject to regular reviews and ongoing audits by both domestic and international tax authorities. For example, the IRS is auditing certain aspects of our intercompany transfer pricing for fiscal years 2021 and 2022. Although we believe our tax positions and estimates are reasonable and we review and maintain adequate reserves, the ultimate tax outcome could differ significantly from our recorded tax amounts and could adversely affect our results of operations and financial condition.
If we are unable to access the capital markets or obtain bank credit, our financial condition and results of operations could suffer.
We are dependent on a stable, liquid, and well-functioning financial system to fund our operations and capital investments. Our continued access to financial markets depends on multiple factors including the condition of debt capital markets, the condition of the banking sector, our operating performance, and our credit ratings. If rating agencies lower our credit ratings, it could adversely affect our ability to access the debt markets, our cost of funds, and other terms for new debt issuances and borrowings. Each of the credit rating agencies reviews its rating periodically, and there is no guarantee that our current credit ratings will remain the same. In addition, we use a variety of derivative products to manage our exposure to market risk, principally interest rate fluctuations. Disruptions or turmoil in the financial markets could reduce our ability to fund our operations and capital investments and lead to losses on derivative positions from counterparty failures, which could adversely affect our financial condition and results of operations.
If we fail to achieve our projected results or otherwise fail to meet market expectations regarding our financial performance, the price of our stock could be volatile or adversely affected.
Our results of operations have previously fluctuated from quarter to quarter, sometimes significantly, and may do so again in the future. If we fail to achieve our projected results, if our guidance is not aligned with market expectations, if we modify our guidance, if we modify our share repurchase program or our approach to dividend distributions, or if we fail to meet the expectations of investors or securities analysts, our stock price may decline (as it has at times in recent years), and the decrease in the stock price may be disproportionate to any shortfall in our financial performance. Additionally, factors such as performance results for our competitors and news or announcements by us, our competitors, and other third parties (including governmental entities and officials and non-governmental organizations) may result in a decline and volatility in our stock price.
Item 1B. Unresolved Staff Comments
Not applicable.
| TARGET CORPORATION | | 2025 Form 10-K | 20 | ||||||||
| CYBERSECURITY | ||||||||
Item 1C. Cybersecurity.
Set forth below is information regarding our cybersecurity risk management, strategy, and governance, along with a related description of our information security and data privacy practices.
Securing company systems, business information, and personal information of our guests, team members, vendors, and other third parties is important to us. We have systems in place to:
•safely receive, protect, and store that information;
•collect, use, and share that information appropriately; and
•detect, contain, and respond to information security, cybersecurity, and data privacy incidents.
While everyone at Target plays a part in information security, cybersecurity, and data privacy, oversight responsibility is shared by our Board of Directors, its committees, and management.
| Responsible party | Oversight of information security, cybersecurity, and data privacy | ||||
| Board of Directors | Oversight of these topics within Target’s overall risks | ||||
| Audit & Risk Committee | Primary oversight responsibility for information security, cybersecurity, and data privacy, including internal controls designed to identify, assess, and manage risks related to these topics | ||||
| Management | |||||
Our program and practices regarding information security, cybersecurity, and data privacy include the following:
•Audit & Risk Committee and Board of Directors updates. To inform and educate the Audit & Risk Committee in its primary oversight responsibility for information security, cybersecurity, and data privacy, management provides updates on these topics. For example, the Chief Information Security Officer addresses information security risks and controls, cyber threats, and other program updates, and senior members of the risk team provide enterprise risk management program updates. In addition, the Board of Directors receives updates from management regarding Target’s overall risks, which include risks related to these topics.
•Integration into enterprise risk management program. By aligning the identification, assessment, and management of risks related to information security, cybersecurity, and data privacy with our overall approach to risk oversight by the Board of Directors, its committees, and management, we have integrated these practices into our enterprise risk management program.
•Management expertise. Our Chief Information and Product Officer leads the strategic direction and management of Target’s product and engineering teams. He is responsible for Target’s enterprise technology systems and oversees Target’s cybersecurity, data platforms, data science, infrastructure, product engineering, and enterprise product teams. He previously served as Target's Chief Digital and Product Officer and held a variety of leadership roles in enterprise technology and product management prior to joining Target. He has developed significant knowledge and skills regarding enterprise technology systems, including cybersecurity. Our Chief Information Security Officer has a strong background in technology, information security, cybersecurity, threat intelligence, incident response, data protection, compliance, and risk management. She champions a strong security culture both internally and externally and contributes to the broader cybersecurity community by serving in several advisory roles and promoting industry collaboration, best-practice sharing, and talent development.
| TARGET CORPORATION | | 2025 Form 10-K | 21 | ||||||||
| CYBERSECURITY | ||||||||
•Systems and processes. We use a combination of industry-leading tools and in-house technologies to protect Target and our guests, operate a proactive threat intelligence program to identify and assess risks, including from threats associated with our use of third-party service providers, and we run a cyber fusion center to investigate and respond to threats. Our program is based on recognized industry security standards and control frameworks, which we seek to validate through internal and independent assessments. Our cybersecurity team regularly tests our controls through penetration testing, vulnerability scanning, and attack simulation. In addition, we have an incident response program to address potential security and privacy incidents. As part of this incident response program, members of management are informed about and monitor the prevention, detection, mitigation, and remediation of potential security and privacy incidents. The program uses a coordinated escalation model to provide information to, and engage with, relevant members of management and the Board of Directors, as needed, throughout the incident response process.
•Understanding evolving threats in the industry and with our suppliers. Our cybersecurity and data privacy teams work to understand evolving threats, developing issues, and industry trends, and our vendor teams monitor and assess risks with our suppliers.
•Collaboration with organizations across different industries. We share threat intelligence and collaborate with organizations across different industries to share best practices, fight cybercrime, enhance privacy, discuss new technologies, better understand the evolving regulatory environment, and advance capabilities in these areas.
•Investment, training, and development of our cybersecurity and data privacy teams. We invest in building and developing cybersecurity talent and engineering expertise, using both in-house and external resources rather than relying solely on third-party providers. Our training model combines internal subject matter expertise with curated external resources. Our cybersecurity and data privacy team members hold industry certifications, stay current on emerging technologies, and regularly participate in training and conferences.
•Regular training and compliance activities for our team members. Our team members receive annual mandatory training on information security, cybersecurity, and data privacy topics to understand the behaviors and technical requirements necessary to protect company and guest information, and appropriately collect, use, and share personal information. We also offer ongoing practice and education for team members to recognize and report suspicious activity.
•Use of third parties. Beyond our in-house capabilities we engage with leading security and technology vendors to assess our information security and cybersecurity program and test our technical capabilities.
•Insurance coverage. We maintain insurance coverage intended to limit our exposure to certain network security and privacy matters.
See “Information Security, Cybersecurity, and Data Privacy Risks” in Part I, Item 1A, Risk Factors for additional information regarding risks from cybersecurity threats.
| TARGET CORPORATION | | 2025 Form 10-K | 22 | ||||||||
Item 2. Properties
| Stores as of January 31, 2026 | Stores | Retail Square Feet (in thousands) | Stores as of January 31, 2026 | Stores | Retail Square Feet (in thousands) | |||||||||||||||
| Alabama | 23 | 3,153 | Montana | 7 | 777 | |||||||||||||||
| Alaska | 3 | 504 | Nebraska | 15 | 2,163 | |||||||||||||||
| Arizona | 48 | 6,377 | Nevada | 18 | 2,262 | |||||||||||||||
| Arkansas | 9 | 1,165 | New Hampshire | 10 | 1,236 | |||||||||||||||
| California | 321 | 38,067 | New Jersey | 53 | 6,542 | |||||||||||||||
| Colorado | 45 | 6,361 | New Mexico | 10 | 1,185 | |||||||||||||||
| Connecticut | 24 | 3,067 | New York | 108 | 11,285 | |||||||||||||||
| Delaware | 5 | 699 | North Carolina | 54 | 6,945 | |||||||||||||||
| District of Columbia | 4 | 317 | North Dakota | 4 | 594 | |||||||||||||||
| Florida | 135 | 18,129 | Ohio | 65 | 7,865 | |||||||||||||||
| Georgia | 51 | 6,827 | Oklahoma | 15 | 2,167 | |||||||||||||||
| Hawaii | 10 | 1,446 | Oregon | 19 | 2,240 | |||||||||||||||
| Idaho | 7 | 725 | Pennsylvania | 79 | 9,438 | |||||||||||||||
| Illinois | 102 | 12,328 | Rhode Island | 4 | 517 | |||||||||||||||
| Indiana | 32 | 4,186 | South Carolina | 22 | 2,686 | |||||||||||||||
| Iowa | 22 | 3,008 | South Dakota | 5 | 580 | |||||||||||||||
| Kansas | 17 | 2,385 | Tennessee | 31 | 3,963 | |||||||||||||||
| Kentucky | 14 | 1,575 | Texas | 159 | 21,875 | |||||||||||||||
| Louisiana | 16 | 2,195 | Utah | 17 | 2,216 | |||||||||||||||
| Maine | 6 | 741 | Vermont | 1 | 60 | |||||||||||||||
| Maryland | 40 | 5,055 | Virginia | 61 | 7,912 | |||||||||||||||
| Massachusetts | 50 | 5,559 | Washington | 38 | 4,376 | |||||||||||||||
| Michigan | 54 | 6,300 | West Virginia | 7 | 851 | |||||||||||||||
| Minnesota | 72 | 10,310 | Wisconsin | 38 | 4,614 | |||||||||||||||
| Mississippi | 6 | 743 | Wyoming | 3 | 257 | |||||||||||||||
| Missouri | 36 | 4,690 | ||||||||||||||||||
| Total | 1,995 | 250,518 | ||||||||||||||||||
| Stores and Supply Chain Facilities as of January 31, 2026 | Stores | Supply Chain Facilities (a) | ||||||
| Owned | 1,546 | 41 | ||||||
| Leased | 288 | 27 | ||||||
| Owned buildings on leased land | 161 | 2 | ||||||
| Total | 1,995 | 70 | ||||||
(a)Supply Chain Facilities includes distribution centers, sortation centers, and other facilities with a total of 72.9 million square feet.
We own and lease our corporate headquarters buildings and other office spaces in the Minneapolis, Minnesota, area and elsewhere in the U.S. We also lease office space in other countries. Our properties are in good condition, well maintained, and suitable to carry on our business.
For additional information on our properties, see the Capital Expenditures section in MD&A and Notes 12 and 19 to the Consolidated Financial Statements.
| TARGET CORPORATION | | 2025 Form 10-K | 23 | ||||||||
| LEGAL PROCEEDINGS & MINE SAFETY DISCLOSURES | ||||||||
Item 3. Legal Proceedings
On January 31, 2025, and February 20, 2025, Target Corporation and members of its Board of Directors were named as defendants in two purported federal securities law class actions filed in the United States District Court for the Middle District of Florida. The complaints allege violations of Sections 10(b), 14(a), and 20(a) of the Securities Exchange Act of 1934, as amended, and Rules 10b-5 and 14a-9 relating to certain prior disclosures of Target about risks related to its environmental, social, and governance initiatives (including with respect to diversity, equity, and inclusion) and oversight of those risks. One plaintiff is seeking to represent a class of shareholders who purchased or otherwise acquired Target common stock between August 26, 2022, and November 19, 2024, and the other plaintiff is seeking to represent a class of shareholders who purchased or otherwise acquired Target common stock between March 9, 2022, and August 16, 2023. Both plaintiffs have marked the class actions as related to a previously filed individual federal securities action in which the court denied a motion to dismiss. The plaintiffs seek damages and other relief, including attorneys’ fees, based on allegations that the defendants misled investors, including about the risks associated with Target’s environmental, social, and governance initiatives (including with respect to diversity, equity, and inclusion) and its 2023 Pride Month merchandise collection, and oversight of those risks. The plaintiffs allege that such conduct affected the value of Target common stock. These proceedings were consolidated on July 24, 2025. On November 14, 2025, the United States District Court for the Middle District of Florida transferred these proceedings to the United States District Court for the District of Minnesota. Target intends to vigorously defend these lawsuits.
Item 4. Mine Safety Disclosures
Not applicable.
| TARGET CORPORATION | | 2025 Form 10-K | 24 | ||||||||
| OTHER INFORMATION | ||||||||
PART II
Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Our common stock is listed on the New York Stock Exchange under the symbol "TGT." We are authorized to issue up to 6,000,000,000 shares of common stock, par value $0.0833, and up to 5,000,000 shares of preferred stock, par value $0.01. As of March 4, 2026, there were 11,675 shareholders of record. Dividends declared per share for 2025, 2024, and 2023, are disclosed in our Consolidated Statements of Shareholders' Investment.
On August 11, 2021, our Board of Directors authorized a $15 billion share repurchase program with no stated expiration. Under the program, we have repurchased 34.8 million shares of common stock for a total investment of $6.7 billion. As of January 31, 2026, the dollar value of shares that may yet be purchased under the program is $8.3 billion. There were no Target common stock purchases made during the three months ended January 31, 2026, by Target or any "affiliated purchaser" of Target, as defined in Rule 10b-18(a)(3) under the Exchange Act.
| TARGET CORPORATION | | 2025 Form 10-K | 25 | ||||||||
| OTHER INFORMATION | ||||||||
| Fiscal Years Ended | ||||||||||||||||||||
| January 30, 2021 | January 29, 2022 | January 28, 2023 | February 3, 2024 | February 1, 2025 | January 31, 2026 | |||||||||||||||
| Target | $ | 100.00 | $ | 121.80 | $ | 96.28 | $ | 85.82 | $ | 83.76 | $ | 66.89 | ||||||||
| S&P 500 Index | 100.00 | 121.00 | 112.98 | 139.92 | 172.78 | 201.03 | ||||||||||||||
| Current Peer Group | 100.00 | 104.93 | 89.38 | 122.82 | 167.53 | 176.65 | ||||||||||||||
| Previous Peer Group | 100.00 | 104.84 | 89.19 | 121.71 | 165.42 | 174.45 | ||||||||||||||
The graph above compares the cumulative total shareholder return on our common stock for the last five fiscal years with (i) the cumulative total return on the S&P 500 Index and (ii) the peer group consisting of 19 online, general merchandise, department stores, food, and specialty retailers (Albertsons Companies, Inc., Amazon.com, Inc., Best Buy Co., Inc., BJ's Wholesale Club Holdings, Inc., Costco Wholesale Corporation, CVS Health Corporation, Dollar General Corporation, Dollar Tree, Inc., The Gap, Inc., The Home Depot, Inc., Kohl's Corporation, The Kroger Co., Lowe's Companies, Inc., Macy's, Inc., Nordstrom, Inc., Ross Stores, Inc., The TJX Companies, Inc., Walgreens Boots Alliance, Inc., and Walmart Inc.) (Previous Peer Group), and (iii) a new peer group consisting of the companies in the Previous Peer Group, but excluding Nordstrom, Inc. and Walgreens Boots Alliance, Inc., which are no longer publicly traded (Current Peer Group). The Current Peer Group is consistent with the retail peer group described in our definitive Proxy Statement for the 2026 Annual Meeting of Shareholders, excluding Publix Super Markets, Inc., which is not quoted on a public stock exchange.
The peer group is weighted by the market capitalization of each component company. The graph assumes the investment of $100 in Target common stock, the S&P 500 Index, and each Peer Group on January 30, 2021, and reinvestment of all dividends.
Item 6. [Reserved]
| TARGET CORPORATION | | 2025 Form 10-K | 26 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| EXECUTIVE OVERVIEW & FINANCIAL SUMMARY | ||||||||
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Executive Overview
In 2025, we operated in a dynamic and uncertain environment characterized by cautious consumers who remained value-focused and selective in discretionary spending along with unprecedented tariff volatility.
Against this backdrop, we took decisive actions to strengthen our business and position Target for long-term growth with a clear strategic focus around four priorities: leading with merchandising authority; elevating the guest experience; accelerating technology; and strengthening team and communities. During 2025, we:
•Took action on our initiative to transform various aspects of our business, including organizational simplification to streamline decision-making, reduce complexity, and drive efficiency;
•Advanced the multi-year transformation of our Hardlines business into "Fun 101", an evolution in bringing greater cultural relevance and style authority to the assortment;
•Continued innovation within our owned brands portfolio, including design partnerships and collaborations across multiple categories, such as our new fresh floral owned brand, Good Little Garden, the kate spade new york x Target collection, and partnerships with celebrities including Taylor Swift and Tom Holland;
•Launched Precision Plus by Roundel™, a retail media capability that improves advertising outcomes by leveraging data and AI-learning, and expanded our Target Plus third-party digital marketplace;
•Leveraged our nearly 2,000-store network (including 18 new stores opened in 2025) to fulfill the vast majority of sales through stores, supporting speed and cost efficiency, with two-thirds of digital sales fulfilled through our same-day fulfillment options;
•Realized significant improvements in inventory shrink throughout the year, with shrink rates reaching pre-pandemic levels;
•Enhanced artificial intelligence capabilities across merchandising, planning, inventory management, and personalization, and expanded the use of AI-powered tools to simplify work for store and headquarters teams; and
•Continued our longstanding commitment to community engagement and giving, including giving 5 percent of profit to communities, as well as over 1 million team member volunteer hours annually.
Business Environment
Beginning in 2025, the U.S. imposed a variety of additional tariffs on a wide range of imported products using various legal authorities, including IEEPA. Those additional tariffs were subsequently modified through incremental increases, decreases, pauses, and limited exemptions. Approximately one-half of the merchandise we offer is sourced from outside the U.S., either directly or through our vendors, with China as the single largest source of merchandise we import.
On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under IEEPA were not authorized by the statute. The ruling does not establish a refund process, and significant uncertainty remains regarding how and when any amounts may be recovered. We are evaluating the ruling and potential actions available to us. Because the process, timing, and amount of any recovery are uncertain, we are unable to estimate the financial effects, if any, at this time. The ultimate resolution of this matter could materially affect our consolidated financial position, results of operations, and cash flows.
We are closely monitoring the evolving consumer and regulatory landscape, including new tariffs announced in February 2026 in response to the U.S. Supreme Court ruling on IEEPA tariffs, and adjusting plans as needed. The collective interaction of tariffs, sourcing strategies, pricing actions, consumer response and behaviors, and other factors, could materially impact our sales and results of operations in future periods.
| TARGET CORPORATION | | 2025 Form 10-K | 27 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| EXECUTIVE OVERVIEW & FINANCIAL SUMMARY | ||||||||
Business Transformation Initiatives
In 2025, we announced a multi-year initiative to transform various aspects of our business—including our organizational structure, processes, and technology—to enable greater agility and optimize the use of the Company's assets. We incurred costs and charges related to our business transformation initiatives in 2025, including a reduction in our headquarters workforce. Note 7 to the Financial Statements provides additional information.
We may incur additional business transformation costs and charges in future periods, which may adversely affect our results of operations and financial condition; however, we cannot reasonably estimate the amount of such costs and charges at this time.
Financial Summary
Fiscal 2025 included the following notable items:
•GAAP diluted earnings per share were $8.13 and Adjusted EPS1 were $7.57.
•Net Sales were $104.8 billion, a decrease of $1.8 billion, or 1.7 percent, from the prior year.
•Comparable sales decreased 2.6 percent, driven by a 2.2 percent decrease in traffic and a 0.4 percent decrease in average transaction amount.
•Operating income of $5.1 billion and Adjusted operating income1 of $4.8 billion were 8.1 percent and 14.2 percent lower, respectively, than the prior-year.
•We recognized $593 million of net gains related to settlements of credit card interchange fee litigation matters.
•We incurred $250 million of costs related to business transformation initiatives.
Earnings Per Share | Percent Change | ||||||||||||||||
| 2025 | 2024 | 2023 (a) | 2025/2024 | 2024/2023 | |||||||||||||
| GAAP diluted earnings per share | $ | 8.13 | $ | 8.86 | $ | 8.94 | (8.2) | % | (0.9) | % | |||||||
Total adjustments | (0.56) | — | — | ||||||||||||||
Adjusted diluted earnings per share 1 | $ | 7.57 | $ | 8.86 | $ | 8.94 | (14.5) | % | (0.9) | % | |||||||
Note: Amounts may not foot due to rounding.
1Adjusted diluted earnings per share (Adjusted EPS) and Adjusted operating income, non-GAAP metrics, exclude the impact of certain items. Management believes that Adjusted EPS and Adjusted operating income are useful in providing period-to-period comparisons of the results of our operations. A reconciliation of non-GAAP financial measures to GAAP measures is provided on page 32.
(a)2023 consisted of 53 weeks compared with 52 weeks in 2025 and 2024.
We report after-tax return on invested capital (ROIC) because we believe ROIC provides a meaningful measure of our capital allocation effectiveness over time. For the trailing twelve months ended January 31, 2026, after-tax ROIC was 13.8 percent, compared to 15.4 percent for the trailing twelve months ended February 1, 2025. The calculation of ROIC is provided on page 34.
| TARGET CORPORATION | | 2025 Form 10-K | 28 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF OPERATIONS | ||||||||
Analysis of Results of Operations
| Summary of Operating Income | Percent Change | ||||||||||||||||
| (dollars in millions) | 2025 | 2024 | 2023(a) | 2025/2024 | 2024/2023 | ||||||||||||
Net sales | $ | 104,780 | $ | 106,566 | $ | 107,412 | (1.7) | % | (0.8) | % | |||||||
Cost of sales | 75,511 | 76,502 | 77,828 | (1.3) | (1.7) | ||||||||||||
SG&A expenses | 21,535 | 21,969 | 21,462 | (2.0) | 2.4 | ||||||||||||
Depreciation and amortization (exclusive of depreciation included in cost of sales) | 2,617 | 2,529 | 2,415 | 3.5 | 4.7 | ||||||||||||
| Operating income | $ | 5,117 | $ | 5,566 | $ | 5,707 | (8.1) | % | (2.5) | % | |||||||
Adjusted SG&A expenses (b) | $ | 21,877 | $ | 21,969 | $ | 21,462 | (0.4) | % | 2.4 | % | |||||||
Adjusted operating income (b) | 4,775 | 5,566 | 5,707 | (14.2) | (2.5) | ||||||||||||
| Rate Analysis | 2025 | 2024 | 2023(a) | ||||||||
Gross margin rate | 27.9 | % | 28.2 | % | 27.5 | % | |||||
SG&A expense rate | 20.6 | 20.6 | 20.0 | ||||||||
Adjusted SG&A expense rate (b) | 20.9 | 20.6 | 20.0 | ||||||||
Depreciation and amortization (exclusive of depreciation included in cost of sales) expense rate | 2.5 | 2.4 | 2.2 | ||||||||
| Operating income margin rate | 4.9 | 5.2 | 5.3 | ||||||||
Adjusted operating income margin rate (b) | 4.6 | 5.2 | 5.3 | ||||||||
Note: Gross margin is calculated as Net Sales less Cost of Sales. All rates are calculated by dividing the applicable amount by Net Sales.
(a)2023 consisted of 53 weeks compared with 52 weeks in 2025 and 2024.
(b)Adjusted SG&A expenses, Adjusted SG&A expense rate, Adjusted operating income, and Adjusted operating income margin rate, which are non-GAAP measures, exclude the impact of certain items. Management believes that these measures are useful in providing period-to-period comparisons of the results of our operations. A reconciliation of non-GAAP financial measures to GAAP measures is provided on page 32.
A discussion regarding Analysis of Results of Operations and Analysis of Financial Condition for 2024, as compared to 2023, is included in Part II, Item 7, MD&A to our Annual Report on Form 10-K for the year ended February 1, 2025.
| TARGET CORPORATION | | 2025 Form 10-K | 29 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF OPERATIONS | ||||||||
Net Sales
Net Sales includes Merchandise Sales and revenues from other sources, most notably advertising revenue and credit card profit-sharing income. Note 2 to the Financial Statements provides more information.
Merchandise Sales are net of expected returns, and our estimate of gift card breakage. Note 2 to the Financial Statements defines gift card "breakage." We use comparable sales to evaluate the performance of our stores and digital channels by measuring the change in sales for a period over the comparable, prior-year period of equivalent length. Comparable sales include all Merchandise Sales, except sales from stores open less than 13 months or that have been closed. Comparable sales measures vary across the retail industry. As a result, our comparable sales calculation is not necessarily comparable to similarly titled measures reported by other companies. Digitally originated sales include all Merchandise Sales initiated through mobile/computer applications and our websites. Our stores fulfill the majority of digitally originated sales, including shipment from stores to guests, store Order Pickup or Drive Up, and Same-Day Delivery. Digitally originated sales may also be fulfilled through our distribution centers, our vendors, or other third parties.
Merchandise Sales growth – from both comparable sales and new stores – represents an important driver of our long-term profitability. We expect that comparable sales growth will drive a significant portion of our total sales growth. We believe that our ability to successfully differentiate our guests’ shopping experience through a careful combination of merchandise assortment, price, convenience, guest experience, and other factors will over the long-term drive both increasing shopping frequency (number of transactions, or "traffic") and the amount spent each visit (average transaction amount).
The extra week in 2023 contributed $1.7 billion to Net Sales.
| Comparable Sales | 2025 | 2024 | 2023 | ||||||||
| Comparable sales change | (2.6) | % | 0.1 | % | (3.7) | % | |||||
| Drivers of change in comparable sales | |||||||||||
| Number of transactions (traffic) | (2.2) | 1.4 | (2.4) | ||||||||
| Average transaction amount | (0.4) | (1.3) | (1.4) | ||||||||
| Comparable Sales by Channel | 2025 | 2024 | 2023 | ||||||||
| Stores originated comparable sales change | (4.0) | % | (1.6) | % | (3.5) | % | |||||
| Digitally originated comparable sales change | 3.1 | 7.5 | (4.8) | ||||||||
Merchandise Sales by Channel | 2025 | 2024 | 2023 | ||||||||
| Stores originated | 79.4 | % | 80.4 | % | 81.7 | % | |||||
| Digitally originated | 20.6 | 19.6 | 18.3 | ||||||||
| Total | 100 | % | 100 | % | 100 | % | |||||
Merchandise Sales by Fulfillment Channel | 2025 | 2024 | 2023 | ||||||||
| Stores | 97.6 | % | 97.6 | % | 97.4 | % | |||||
| Other | 2.4 | 2.4 | 2.6 | ||||||||
| Total | 100 | % | 100 | % | 100 | % | |||||
Note: Merchandise Sales fulfilled by stores include in-store purchases and digitally originated sales fulfilled by shipping merchandise from stores to guests, Order Pickup, Drive Up, and Same-Day Delivery.
Part I, Item 1, Business of this Form 10-K and Note 2 to the Financial Statements provides additional product category sales information. The collective interaction of a broad array of macroeconomic, competitive, and consumer behavioral factors, as well as sales mix, and transfer of sales between stores and within different channels makes further analysis of sales metrics infeasible.
| TARGET CORPORATION | | 2025 Form 10-K | 30 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF OPERATIONS & OTHER PERFORMANCE FACTORS | ||||||||
Store Data
| Change in Number of Stores | 2025 | 2024 | ||||||
| Beginning store count | 1,978 | 1,956 | ||||||
| Opened | 18 | 23 | ||||||
| Closed | (1) | (1) | ||||||
| Ending store count | 1,995 | 1,978 | ||||||
| Number of Stores and Retail Square Feet | Number of Stores | Retail Square Feet (a) | |||||||||||||||
| January 31, 2026 | February 1, 2025 | January 31, 2026 | February 1, 2025 | ||||||||||||||
| 170,000 or more sq. ft. | 273 | 273 | 48,824 | 48,824 | |||||||||||||
| 50,000 to 169,999 sq. ft. | 1,576 | 1,559 | 197,274 | 195,050 | |||||||||||||
| 49,999 or less sq. ft. | 146 | 146 | 4,420 | 4,404 | |||||||||||||
| Total | 1,995 | 1,978 | 250,518 | 248,278 | |||||||||||||
(a)In thousands; reflects total square feet less office, distribution center, and vacant space.
Gross Margin (GM) Rate
Our gross margin rate was 27.9 percent in 2025 and 28.2 percent in 2024. The decrease reflected the net impact of:
•merchandising activities, including higher markdown rates and purchase order cancellation costs, partially offset by growth in advertising and other revenues;
•changes in category sales mix; and
•lower inventory shrink.
Selling, General and Administrative (SG&A) Expense Rate
Our SG&A expense rate was 20.6 percent in 2025, consistent with 2024. The 2025 rate included a 0.6 percentage point benefit from interchange fee settlements, partially offset by 0.2 percentage points of business transformation costs. Excluding these items, our Adjusted SG&A expense rate was 20.9 percent in 2025, compared with 20.6 percent in 2024, reflecting the deleveraging impact of lower Net Sales and the net impact of other costs.
| TARGET CORPORATION | | 2025 Form 10-K | 31 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF OPERATIONS & OTHER PERFORMANCE FACTORS | ||||||||
Other Performance Factors
Net Interest Expense
Net interest expense was $445 million for 2025, compared with $411 million for 2024. The increase in net interest expense was primarily due to higher average debt levels.
Provision for Income Taxes
Our 2025 effective income tax rate was 22.3 percent compared with 22.2 percent in 2024. The increase reflects global minimum taxes and discrete tax expense in the current year related to share-based compensation, primarily offset by benefits from tax credits.
Reconciliation of Non-GAAP Financial Measures to GAAP Measures
To provide additional transparency, we have disclosed non-GAAP adjusted diluted earnings per share (Adjusted EPS), adjusted SG&A expenses, adjusted SG&A expense rate, adjusted operating income, and adjusted operating income margin rate. These measures exclude certain items presented below. We believe this information is useful in providing period-to-period comparisons of the results of our operations. These measures are not in accordance with, or an alternative to, generally accepted accounting principles in the U.S. (GAAP). The most comparable GAAP measures are diluted earnings per share, SG&A expenses, SG&A expense rate, operating income, and operating income margin rate. Adjusted EPS, adjusted SG&A expenses, adjusted SG&A expense rate, adjusted operating income, and adjusted operating income margin rate should not be considered in isolation or as a substitution for analysis of our results as reported in accordance with GAAP. Other companies may calculate these measures differently, or not provide similar measures, limiting the usefulness of the measures for comparisons with other companies.
| Reconciliation of Non-GAAP Adjusted EPS | 2025 | 2024 | 2023 (a) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (millions, except per share data) | Pretax | Net of Tax | Per Share Amounts | Pretax | Net of Tax | Per Share Amounts | Pretax | Net of Tax | Per Share Amounts | |||||||||||||||||||||||||||||||||||||||||||||||
GAAP diluted earnings per share | $ | 8.13 | $ | 8.86 | $ | 8.94 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business transformation costs (b) | $ | 250 | $ | 187 | $ | 0.41 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||||||||||
Interchange fee settlements (c) | (593) | (441) | (0.97) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Adjusted diluted earnings per share | $ | 7.57 | $ | 8.86 | $ | 8.94 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Note: Amounts may not foot due to rounding.
(a)2023 consisted of 53 weeks compared with 52 weeks in 2025 and 2024.
| TARGET CORPORATION | | 2025 Form 10-K | 32 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||
Adjustments Affecting Comparability
| 2025 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||
| SG&A Expenses | Operating Income | SG&A Expenses | Operating Income | SG&A Expenses | Operating Income | |||||||||||||||||||||||||||||||||||||||
| (dollars in millions) | Dollars | Rate (a) | Dollars | Rate (a) | Dollars | Rate (a) | Dollars | Rate (a) | Dollars | Rate (a) | Dollars | Rate (a) | ||||||||||||||||||||||||||||||||
| Reported, GAAP measure | $ | 21,535 | 20.6 | % | $ | 5,117 | 4.9 | % | $21,969 | 20.6 | % | $5,566 | 5.2 | % | $21,462 | 20.0 | % | $5,707 | 5.3 | % | ||||||||||||||||||||||||
Adjustments affecting comparability | ||||||||||||||||||||||||||||||||||||||||||||
Business transformation costs (b) | $ | (250) | (0.2) | % | $ | 250 | 0.2 | % | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | — | — | % | ||||||||||||||||||||
Interchange fee settlements (c) | 593 | 0.6 | (593) | (0.6) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
| Adjusted, Non-GAAP measure | $ | 21,877 | 20.9 | % | $ | 4,775 | 4.6 | % | $21,969 | 20.6 | % | $5,566 | 5.2 | % | $21,462 | 20.0 | % | $5,707 | 5.3 | % | ||||||||||||||||||||||||
Note: Amounts may not foot due to rounding.
(a)Rates are calculated by dividing the applicable amount by Net Sales.
| TARGET CORPORATION | | 2025 Form 10-K | 33 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||||||
We have also disclosed after-tax ROIC, which is a ratio based on GAAP information, with the exception of the add-back of operating lease interest to operating income. We believe this metric is useful in assessing the effectiveness of our capital allocation over time. Other companies may calculate ROIC differently, limiting the usefulness of the measure for comparisons with other companies.
| After-Tax Return on Invested Capital | ||||||||||||||||||||
| (dollars in millions) | ||||||||||||||||||||
| Trailing Twelve Months | ||||||||||||||||||||
Numerator | January 31, 2026 | February 1, 2025 | ||||||||||||||||||
Operating income | $ | 5,117 | $ | 5,566 | ||||||||||||||||
| + Net other income | 95 | 106 | ||||||||||||||||||
| EBIT | 5,212 | 5,672 | ||||||||||||||||||
+ Operating lease interest (a) | 172 | 159 | ||||||||||||||||||
- Income taxes (b) | 1,199 | 1,297 | ||||||||||||||||||
| Net operating profit after taxes | $ | 4,185 | $ | 4,534 | ||||||||||||||||
Denominator | January 31, 2026 | February 1, 2025 | February 3, 2024 | |||||||||||||||||
| Current portion of long-term debt and other borrowings | $ | 2,130 | $ | 1,636 | $ | 1,116 | ||||||||||||||
| + Noncurrent portion of long-term debt | 14,326 | 14,304 | 14,922 | |||||||||||||||||
| + Shareholders' investment | 16,165 | 14,666 | 13,432 | |||||||||||||||||
+ Operating lease liabilities (c) | 3,834 | 3,935 | 3,608 | |||||||||||||||||
| - Cash and cash equivalents | 5,488 | 4,762 | 3,805 | |||||||||||||||||
| Invested capital | $ | 30,967 | $ | 29,779 | $ | 29,273 | ||||||||||||||
Average invested capital (d) | $ | 30,373 | $ | 29,526 | ||||||||||||||||
After-tax return on invested capital (e) | 13.8 | % | 15.4 | % | ||||||||||||||||
(a)Represents the add-back to operating income driven by the hypothetical interest expense we would incur if the property under our operating leases were owned or accounted for as finance leases. Calculated using the discount rate for each lease and recorded as a component of rent expense within Operating Income. Operating lease interest is added back to Operating Income in the ROIC calculation to control for differences in capital structure between us and our competitors.
(b)Calculated using the effective tax rates, which were 22.3 percent and 22.2 percent for the trailing twelve months ended January 31, 2026, and February 1, 2025, respectively. For the trailing twelve months ended January 31, 2026, and February 1, 2025, includes tax effect of $1.2 billion and $1.3 billion, respectively, related to EBIT, and $38 million and $35 million, respectively, related to operating lease interest.
(c)Total short-term and long-term operating lease liabilities included within Accrued and Other Current Liabilities and Noncurrent Operating Lease Liabilities.
(d)Average based on the invested capital at the end of the current period and the invested capital at the end of the comparable prior period.
(e)For the trailing twelve months ended January 31, 2026, includes the impact of after-tax net gains on interchange fee settlements and business transformation costs, which had a net favorable impact on after-tax ROIC of 0.8 percentage points. Notes 6 and 7 to the Financial Statements provide additional information.
| TARGET CORPORATION | | 2025 Form 10-K | 34 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF FINANCIAL CONDITION | ||||||||
Analysis of Financial Condition
Liquidity and Capital Resources
Capital Allocation
We follow a disciplined and balanced approach to capital allocation based on the following priorities, ranked in order of importance: first, we fully invest in opportunities to profitably grow our business, create sustainable long-term value, and maintain our current operations and assets; second, we maintain a competitive quarterly dividend and seek to grow it annually; and finally, we return any excess cash to shareholders by repurchasing shares within the limits of our credit rating goals.
Our year-end cash and cash equivalents balance increased to $5.5 billion from $4.8 billion in 2024. Our cash and cash equivalents balance includes short-term investments of $4.6 billion and $3.9 billion as of January 31, 2026, and February 1, 2025, respectively. Our investment policy is designed to preserve principal and liquidity of our short-term investments. This policy allows investments in large money market funds or in highly rated direct short-term instruments that mature in 60 days or less. We also place dollar limits on our investments in individual funds or instruments.
Operating Cash Flows
Cash flows provided by operating activities were $6.6 billion in 2025 compared with $7.4 billion in 2024. The operating cash flow decrease reflects lower net earnings, as well as the net impact of lower accounts payable leverage and inventory purchases in the current year.
Inventory
Year-end inventory was $12.3 billion in 2025, compared with $12.7 billion in 2024. The decrease reflects the combined impact of timing of receipts and alignment of inventory with sales trends, partially offset by higher merchandise costs in 2025.
| TARGET CORPORATION | | 2025 Form 10-K | 35 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF FINANCIAL CONDITION | ||||||||
Capital Expenditures
Note: Amounts may not foot due to rounding.
Capital expenditures in 2025 reflect continued investment in our strategic initiatives, including investments in both stores and in our supply chain, enhancing our capabilities and guest experience across stores and digital channels. The increase in capital expenditures in 2025 compared with 2024 primarily reflects an increased investment in both new stores and remodels.
We expect capital expenditures in 2026 of approximately $5 billion to support our store experience and remodel program, continued investment in supply chain and technology projects, and investment in new stores. We expect to open about 30 new stores during 2026.
Dividends
We paid dividends totaling $2.1 billion ($4.52 per share) in 2025 and $2.0 billion ($4.44 per share) in 2024, a per share increase of 1.8 percent. We declared dividends totaling $2.1 billion ($4.54 per share) in 2025 and $2.1 billion ($4.46 per share) in 2024, a per share increase of 1.8 percent. We have paid dividends every quarter since our 1967 initial public offering, and it is our intent to continue to do so in the future.
Share Repurchases
During 2025 and 2024, we deployed $0.4 billion and $1.0 billion to repurchase shares. See Part II, Item 5, Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities of this Annual Report on Form 10-K and Note 22 to the Financial Statements for more information.
| TARGET CORPORATION | | 2025 Form 10-K | 36 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF FINANCIAL CONDITION | ||||||||
Financing
Our financing strategy is to ensure liquidity and access to capital markets, to maintain a balanced spectrum of debt maturities, and to manage our net exposure to floating interest rate volatility. Within these parameters, we seek to minimize our borrowing costs. Our ability to access the long-term debt and commercial paper markets has provided us with ample sources of liquidity. Our continued access to these markets depends on multiple factors, including the condition of debt capital markets, our operating performance, and maintaining strong credit ratings. As of January 31, 2026, our credit ratings were as follows:
| Credit Ratings | Moody's | S&P | Fitch | ||||||||
| Long-term debt | A2 | A | A | ||||||||
| Commercial paper | P-1 | A-1 | F1 | ||||||||
If our credit ratings were lowered, our ability to access the debt markets, our cost of funds, and other terms for new debt issuances could be adversely impacted. Each of the credit rating agencies reviews its rating periodically, and there is no guarantee our current credit ratings will remain the same as described above.
We issued $1.0 billion of unsecured debt in both March and June 2025, and repaid $1.5 billion of unsecured debt in April 2025. Note 17 to the Financial Statements provides additional information.
We have the ability to obtain short-term financing from time to time under our commercial paper program and credit facilities. In October 2025, we obtained a new committed $1.0 billion 364-day unsecured revolving credit facility that will expire in October 2026 and terminated our prior 364-day credit facility. This credit facility and our $3.0 billion unsecured revolving credit facility that will expire in October 2028 provide a liquidity backstop to our commercial paper program. No balances were outstanding under either credit facility or our commercial paper program at any time during 2025 or 2024.
Most of our long-term debt obligations contain covenants related to secured debt levels. In addition to a secured debt level covenant, our credit facilities also contain a debt leverage covenant. We are, and expect to remain, in compliance with these covenants. Additionally, as of January 31, 2026, no notes or debentures contained provisions requiring acceleration of payment upon a credit rating downgrade, except that certain outstanding notes allow the note holders to put the notes to us if within a matter of months of each other we experience both (i) a change in control and (ii) our long-term credit ratings are either reduced and the resulting rating is non-investment grade, or our long-term credit ratings are placed on watch for possible reduction and those ratings are subsequently reduced and the resulting rating is non-investment grade.
Note 17 to the Financial Statements provides additional information.
Future Cash Requirements
We enter into contractual obligations in the ordinary course of business that may require future cash payments. Such obligations include, but are not limited to, purchase commitments, debt service, leasing arrangements, and liabilities related to deferred compensation and pensions. The Notes to the Consolidated Financial Statements provide additional information.
We believe our sources of liquidity, namely operating cash flows, credit facility capacity, and access to capital markets, will continue to be adequate to meet our contractual obligations, working capital and capital expenditure requirements, finance anticipated expansion and strategic initiatives, fund debt maturities, pay dividends, and execute purchases under our share repurchase program for the foreseeable future.
| TARGET CORPORATION | | 2025 Form 10-K | 37 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF FINANCIAL CONDITION | ||||||||
Critical Accounting Estimates
Our consolidated financial statements are prepared in accordance with GAAP, which requires us to make estimates and apply judgments that affect the reported amounts. In the Notes to the Consolidated Financial Statements, we describe the significant accounting policies used in preparing the consolidated financial statements. Our management has discussed the development, selection, and disclosure of our critical accounting estimates with the Audit & Risk Committee of our Board of Directors. The following items require significant estimation or judgment:
Inventory and cost of sales: The vast majority of our inventory is accounted for under the retail inventory accounting method using the last-in, first-out method (LIFO). Our inventory is valued at the lower of LIFO cost or market. We reduce inventory for estimated losses related to shrink and markdowns. Our shrink estimate is based on historical losses and is adjusted to reflect results of actual physical inventory counts. We generally perform counts at each location annually, with counts taking place throughout the year. A 10 percent increase or decrease in our 2025 year-end inventory shrink reserve would impact our cost of sales by approximately $110 million. Historically, our actual physical inventory count results have shown our estimates to be reasonably accurate. Market adjustments for markdowns are recorded when the salability of the merchandise has diminished. Salability can be impacted by consumer preferences and seasonality, among other factors. We believe the risk of inventory obsolescence is largely mitigated because our inventory typically turns in less than three months. Inventory was $12.3 billion and $12.7 billion as of January 31, 2026, and February 1, 2025, respectively, and is further described in Note 10 to the Financial Statements.
Vendor income: We receive various forms of consideration from our vendors (vendor income), principally earned as a result of volume rebates, promotions, certain advertising activities, and markdown allowances. Vendor income is recorded as a reduction of cost of sales except in arrangements where the payment is a reimbursement of specific, incremental, and identifiable costs and recorded as an offset to those costs. Vendor income earned can vary based on a number of factors, including purchase volumes, sales volumes, and our pricing and promotion strategies.
We establish a receivable for vendor income that is earned but not yet received. Based on historical trending and data, this receivable is computed by forecasting vendor income collections and estimating the amount earned. The majority of the year-end vendor income receivables are collected within the following fiscal quarter, and we do not believe there is a reasonable likelihood that the assumptions used in our estimate will change significantly. Historically, adjustments to our vendor income receivable have not been material. Vendor income receivable was $542 million and $543 million as of January 31, 2026, and February 1, 2025, respectively. Vendor income is described further in Note 4 to the Financial Statements.
Long-lived assets: Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The evaluation is performed primarily at the store level. An impairment loss is recognized when estimated undiscounted future cash flows from the operation and/or eventual disposition of the asset or asset group are less than its carrying amount, and is measured as the excess of its carrying amount over fair value. We estimate fair value by obtaining market appraisals, obtaining valuations from third-party brokers, or using other valuation techniques. We recorded impairments of $69 million, $68 million, and $102 million in 2025, 2024, and 2023, respectively, which are described further in Note 12 to the Financial Statements.
Insurance/self-insurance: We retain a substantial portion of the risk related to certain general liability, workers' compensation, property loss, and team member medical and dental claims. However, we maintain stop-loss coverage to limit the exposure related to certain risks. Liabilities associated with these losses include estimates of both claims filed and losses incurred but not yet reported. We use actuarial methods which consider a number of factors to estimate our ultimate cost of losses. General liability and workers' compensation liabilities are recorded based on our estimate of their net present value; other liabilities referred to above are not discounted. Our workers' compensation and general liability accrual was $881 million and $772 million as of January 31, 2026, and February 1, 2025, respectively. We believe that the amounts accrued are appropriate; however, our liabilities could be significantly affected if future occurrences or loss developments differ from our assumptions. For example, a 10 percent increase or decrease in average claim costs would have impacted our self-insurance expense by $87 million in 2025. Historically, adjustments to our estimates have not been material. Refer to Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, for further disclosure of the market risks associated
| TARGET CORPORATION | | 2025 Form 10-K | 38 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| ANALYSIS OF FINANCIAL CONDITION & NEW ACCOUNTING PRONOUNCEMENTS | ||||||||
with these exposures. We maintain insurance coverage to limit our exposure to certain events, including network security matters.
Income taxes: We pay income taxes based on the tax statutes, regulations, and case law of the various jurisdictions in which we operate. Significant judgment is required in determining the timing and amounts of deductible and taxable items, and in evaluating the ultimate resolution of tax matters in dispute with tax authorities. The benefits of uncertain tax positions are recorded in our financial statements only after determining it is more likely than not the uncertain tax positions would withstand challenge by taxing authorities. We periodically reassess these probabilities and record any changes in the financial statements as appropriate. Gross uncertain tax positions, including interest and penalties, were $468 million and $454 million as of January 31, 2026, and February 1, 2025, respectively. Although we believe our tax positions are reasonable, the resolution of these matters could be materially different from our assumptions, which would affect our consolidated results of operations and/or operating cash flows. Income taxes are described further in Note 20 to the Financial Statements.
Pension accounting: We maintain a funded qualified defined benefit pension plan, as well as nonqualified and international pension plans that are generally unfunded, for certain current and former team members. The costs for these plans are determined based on actuarial calculations using the assumptions described in the following paragraphs. Eligibility and the level of benefits vary depending on each team member's full-time or part-time status, date of hire, age, length of service, and/or compensation. The benefit obligation and related expense for these plans are determined based on actuarial calculations using assumptions about the expected long-term rate of return, the discount rate, compensation growth rates, mortality, and retirement age. These assumptions, with adjustments made for any significant plan or participant changes, are used to determine the period-end benefit obligation and establish expense for the next year.
Our 2025 expected long-term rate of return on plan assets of 7.20 percent was determined by the portfolio composition, historical long-term investment performance, and current market conditions. A 1 percentage point decrease in our expected long-term rate of return would increase annual expense by $38 million.
The discount rate used to determine benefit obligations is adjusted annually based on the interest rate for long-term high-quality corporate bonds, using yields for maturities that are in line with the duration of our pension liabilities. Our benefit obligation and related expense will fluctuate with changes in interest rates. A 1 percentage point decrease in the discount rate assumption for our qualified defined benefit pension plan would increase our year-end projected benefit obligation and annual expense by $360 million and $38 million, respectively.
Based on our experience, we use a graduated compensation growth schedule that assumes higher compensation growth for younger, shorter-service pension-eligible team members than it does for older, longer-service pension-eligible team members.
Legal and other contingencies: We believe the accruals recorded in our consolidated financial statements properly reflect loss exposures that are both probable and reasonably estimable. We do not believe any of the currently identified claims or litigation will materially affect our results of operations, cash flows, or financial condition. However, litigation is subject to inherent uncertainties, and unfavorable rulings could occur. If an unfavorable ruling were to occur, it may cause a material adverse impact on the results of operations, cash flows, or financial condition for the period in which the ruling occurs, or future periods. Refer to Note 16 to the Financial Statements for further information on contingencies.
New Accounting Pronouncements
We do not expect that any recently issued accounting pronouncements will have a material effect on our financial statements.
| TARGET CORPORATION | | 2025 Form 10-K | 39 | ||||||||
| MANAGEMENT'S DISCUSSION AND ANALYSIS | ||||||||
| FORWARD LOOKING STATEMENTS & QUANTITATIVE AND QUALITATIVE DISCLOSURES | ||||||||
Forward-Looking Statements
This report contains forward-looking statements, which are based on our current assumptions and expectations. These statements are typically accompanied by the words "aim," "anticipate," "believe," "could," "expect," "may," "might," "seek," "will," "would," or similar words. The principal forward-looking statements in this report include statements regarding: our future financial and operational performance, our strategy for growth, changes in the consumer landscape, evolution in tariffs and global trade policy, the impacts of business transformation efforts, the adequacy of and costs associated with our sources of liquidity, the funding of debt maturities, the execution of our share repurchase program, our expected capital expenditures and new lease commitments, the expected compliance with debt covenants, the expected impact of new accounting pronouncements, our intentions regarding future dividends, the expected contributions and payments related to our pension plan, the expected return on plan assets, the expected timing and recognition of compensation expenses, the adequacy of our reserves for general liability, workers' compensation, and property loss, the expected outcome of, and adequacy of our reserves for, claims, litigation, and the resolution of tax matters, our expectations regarding our contractual obligations, liabilities, and vendor income, the expected ability to recognize deferred tax assets and liabilities and the timing of such recognition, our expectations regarding arrangements with our partners, and changes in our assumptions and expectations.
All such forward-looking statements are intended to enjoy the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, as amended. Although we believe there is a reasonable basis for the forward-looking statements, our actual results could be materially different. The most important factors which could cause our actual results to differ from our forward-looking statements are set forth in our description of risk factors included in Part I, Item 1A, Risk Factors to this Form 10-K, which should be read in conjunction with the forward-looking statements in this report. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update any forward-looking statement.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
As of January 31, 2026, our exposure to market risk was primarily from interest rate changes on our debt obligations and short-term investments. Our interest rate exposure is primarily due to differences between our floating rate debt obligations, including fixed rate debt hedged using floating rate interest rate swaps, compared to our floating rate short-term investments. As of January 31, 2026, our floating rate short-term investments exceeded our floating rate debt obligations by approximately $2.4 billion. Based on our financial position as of January 31, 2026, the annualized effect of a 1 percentage point increase in floating interest rates on our floating rate short-term investments, net of our floating rate debt obligations, would increase our earnings before income taxes by $24 million. In general, we expect our floating rate debt obligations to be in line with our floating rate short-term investments over time, but that may vary in different interest rate and economic environments. See further description of our debt and derivative instruments in Notes 17 and 18 to the Financial Statements.
We record our general liability and workers' compensation liabilities at net present value; therefore, these liabilities fluctuate with changes in interest rates. Based on our balance sheet position as of January 31, 2026, the annualized effect of a 1 percentage point increase/(decrease) in interest rates would increase/(decrease) earnings before income taxes by $20 million.
In addition, we are exposed to market return fluctuations on our qualified defined benefit pension plan. The value of our pension liabilities is inversely related to changes in interest rates. A 1 percentage point decrease in the weighted average discount rate would increase annual expense by $38 million. To protect against declines in interest rates, we hold high-quality, long-duration bonds and derivative instruments in our pension plan trust. As of January 31, 2026, we had hedged 75 percent of the interest rate exposure of our plan liabilities.
As more fully described in Note 24 to the Financial Statements, we are exposed to market returns on accumulated team member balances in our nonqualified, unfunded deferred compensation plans. We control the risk of offering the nonqualified plans by making investments in life insurance contracts and prepaid forward contracts on our own common stock that substantially offset our economic exposure to the returns on these plans.
There have been no other material changes in our primary risk exposures or management of market risks since the prior year.
| TARGET CORPORATION | | 2025 Form 10-K | 40 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| INDEX | ||||||||
Item 8. Financial Statements and Supplementary Data
| INDEX TO CONSOLIDATED FINANCIAL STATEMENTS | |||||||||||
| TARGET CORPORATION | | 2025 Form 10-K | 41 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| REPORTS | ||||||||
Report of Management on the Consolidated Financial Statements
Management is responsible for the consistency, integrity, and presentation of the information in the Annual Report. The consolidated financial statements and other information presented in this Annual Report have been prepared in accordance with accounting principles generally accepted in the United States and include necessary judgments and estimates by management.
To fulfill our responsibility, we maintain comprehensive systems of internal control designed to provide reasonable assurance that assets are safeguarded and transactions are executed in accordance with established procedures. The concept of reasonable assurance is based upon recognition that the cost of the controls should not exceed the benefit derived. We believe our systems of internal control provide this reasonable assurance.
The Board of Directors exercised its oversight role with respect to the Corporation's systems of internal control primarily through its Audit & Risk Committee, which is comprised of independent directors. The Committee oversees the Corporation's systems of internal control, accounting practices, financial reporting and audits to assess whether their quality, integrity, and objectivity are sufficient to protect shareholders' investments.
In addition, our consolidated financial statements have been audited by Ernst & Young LLP, independent registered public accounting firm, whose report also appears on this page.
/s/ Michael J. Fiddelke | /s/ Jim Lee | |||||||
Michael J. Fiddelke Chief Executive Officer March 11, 2026 | Jim Lee Executive Vice President and Chief Financial Officer | |||||||
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Target Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of Target Corporation (the Corporation) as of January 31, 2026 and February 1, 2025, the related consolidated statements of operations, comprehensive income, shareholders' investment and cash flows for each of the three years in the period ended January 31, 2026, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Corporation at January 31, 2026 and February 1, 2025, and the results of its operations and its cash flows for each of the three years in the period ended January 31, 2026, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Corporation's internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated March 11, 2026 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Corporation's management. Our responsibility is to express an opinion on the Corporation’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Corporation in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
| TARGET CORPORATION | | 2025 Form 10-K | 42 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| REPORTS | ||||||||
| Valuation of Vendor Income Receivable | |||||
| Description of the Matter | At January 31, 2026, the Corporation’s vendor income receivable totaled $542 million. As discussed in Note 4 of the consolidated financial statements, the Corporation receives consideration for a variety of vendor-sponsored programs, which are primarily recorded as a reduction of cost of sales when earned. The Corporation records a receivable for amounts earned but not yet received. | ||||
| Auditing the Corporation's calculation of vendor income receivable was especially challenging due to the inputs required in the vendor receivable model, which include, among others, forecasted vendor income collections and the time period over which the collections have been earned. As a result of the high volume of transactions processed by the Corporation and used in estimating these inputs, auditing the vendor income receivable requires extensive audit effort to address the completeness and accuracy of the information used in the receivable model. | |||||
| How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Corporation’s vendor income receivable process, including controls over the inputs described above. | ||||
| To test the estimated vendor income receivable, we performed audit procedures that included, among others, testing the completeness and accuracy of inputs used in the receivable model by verifying for a sample of the vendor-sponsored programs, the nature and source of the inputs used and the terms of the contractual agreements. We recalculated the amount of the vendor income earned based on the inputs and the terms of the contractual agreements. In addition, we recalculated the time period over which the vendor income collections had been earned to assess the accuracy of management’s inputs used in the model. We also performed sensitivity analyses of inputs to evaluate the significance of changes in the receivable that would result from changes to the inputs. Finally, we performed audit procedures over the vendor income collections subsequent to the balance sheet date to support the vendor income receivable at year end. | |||||
/s/ Ernst & Young LLP
We have served as the Corporation's auditor since 1931.
Minneapolis, Minnesota
March 11, 2026
| TARGET CORPORATION | | 2025 Form 10-K | 43 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| REPORTS | ||||||||
Report of Management on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f). Under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, we assessed the effectiveness of our internal control over financial reporting as of January 31, 2026, based on the framework in Internal Control—Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on our assessment, we conclude that the Corporation's internal control over financial reporting is effective based on those criteria.
Our internal control over financial reporting as of January 31, 2026, has been audited by Ernst & Young LLP, the independent registered public accounting firm who has also audited our consolidated financial statements, as stated in their report which appears on this page.
/s/ Michael J. Fiddelke | /s/ Jim Lee | |||||||
Michael J. Fiddelke Chief Executive Officer March 11, 2026 | Jim Lee Executive Vice President and Chief Financial Officer | |||||||
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Target Corporation
Opinion on Internal Control Over Financial Reporting
We have audited Target Corporation’s internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Target Corporation (the Corporation) maintained, in all material respects, effective internal control over financial reporting as of January 31, 2026, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial position of the Corporation as of January 31, 2026 and February 1, 2025, the related consolidated statements of operations, comprehensive income, shareholders' investment and cash flows for each of the three years in the period ended January 31, 2026, and the related notes and our report dated March 11, 2026 expressed an unqualified opinion thereon.
Basis for Opinion
The Corporation’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report of Management on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Corporation's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Corporation in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
March 11, 2026
| TARGET CORPORATION | | 2025 Form 10-K | 44 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
Consolidated Statements of Operations
| (millions, except per share data) | 2025 | 2024 | 2023 | ||||||||
| Net sales | $ | $ | $ | ||||||||
| Cost of sales | |||||||||||
| Selling, general, and administrative expenses | |||||||||||
Depreciation and amortization (exclusive of depreciation included in cost of sales) | |||||||||||
Operating income | |||||||||||
| Net interest expense | |||||||||||
| Net other income | ( | ( | ( | ||||||||
| Earnings before income taxes | |||||||||||
| Provision for income taxes | |||||||||||
| Net earnings | $ | $ | $ | ||||||||
| Basic earnings per share | $ | $ | $ | ||||||||
| Diluted earnings per share | $ | $ | $ | ||||||||
| Weighted average common shares outstanding | |||||||||||
| Basic | |||||||||||
| Diluted | |||||||||||
| Antidilutive shares | |||||||||||
Note: 2023 consisted of 53 weeks compared with 52 weeks in 2025 and 2024.
| TARGET CORPORATION | | 2025 Form 10-K | 45 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
Consolidated Statements of Comprehensive Income
| (millions) | 2025 | 2024 | 2023 | ||||||||
| Net earnings | $ | $ | $ | ||||||||
Other comprehensive income / (loss), net of tax | |||||||||||
Pension benefit liabilities | ( | ||||||||||
Currency translation adjustment and cash flow hedges | ( | ( | ( | ||||||||
Other comprehensive income / (loss) | ( | ||||||||||
Comprehensive income | $ | $ | $ | ||||||||
Note: 2023 consisted of 53 weeks compared with 52 weeks in 2025 and 2024.
| TARGET CORPORATION | | 2025 Form 10-K | 46 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
Consolidated Statements of Financial Position
| (millions, except footnotes) | January 31, 2026 | February 1, 2025 | ||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Inventory | ||||||||
| Other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Operating lease assets | ||||||||
| Other noncurrent assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and shareholders' investment | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued and other current liabilities | ||||||||
| Current portion of long-term debt and other borrowings | ||||||||
Total current liabilities | ||||||||
| Long-term debt and other borrowings | ||||||||
| Noncurrent operating lease liabilities | ||||||||
| Deferred income taxes | ||||||||
| Other noncurrent liabilities | ||||||||
| Total noncurrent liabilities | ||||||||
| Shareholders' investment | ||||||||
| Common stock | ||||||||
| Additional paid-in capital | ||||||||
| Retained earnings | ||||||||
| Accumulated other comprehensive loss | ( | ( | ||||||
| Total shareholders' investment | ||||||||
| Total liabilities and shareholders' investment | $ | $ | ||||||
Common Stock Authorized 6,000,000,000 0.0833 452,840,187 455,566,995
Preferred Stock Authorized 5,000,000 0.01 no
| TARGET CORPORATION | | 2025 Form 10-K | 47 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
Consolidated Statements of Cash Flows
| (millions) | 2025 | 2024 | 2023 | ||||||||
| Operating activities | |||||||||||
Net earnings | $ | $ | $ | ||||||||
| Adjustments to reconcile net earnings to cash provided by operations: | |||||||||||
| Depreciation and amortization | |||||||||||
| Share-based compensation expense | |||||||||||
| Deferred income taxes | ( | ( | |||||||||
Noncash (gains) / losses and other, net | ( | ||||||||||
| Changes in operating accounts: | |||||||||||
| Inventory | ( | ||||||||||
| Other assets | ( | ( | ( | ||||||||
| Accounts payable | ( | ( | |||||||||
| Accrued and other liabilities | |||||||||||
| Cash provided by operating activities | |||||||||||
| Investing activities | |||||||||||
| Expenditures for property and equipment | ( | ( | ( | ||||||||
Other | |||||||||||
Cash used in investing activities | ( | ( | ( | ||||||||
| Financing activities | |||||||||||
| Additions to long-term debt | |||||||||||
| Reductions of long-term debt | ( | ( | ( | ||||||||
| Dividends paid | ( | ( | ( | ||||||||
| Repurchase of stock | ( | ( | |||||||||
Shares withheld for taxes on share-based compensation | ( | ( | ( | ||||||||
Cash used in financing activities | ( | ( | ( | ||||||||
Net increase in cash and cash equivalents | |||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | $ | ||||||||
| Supplemental information | |||||||||||
| Interest paid, net of capitalized interest | $ | $ | $ | ||||||||
| Leased assets obtained in exchange for new finance lease liabilities | |||||||||||
| Leased assets obtained in exchange for new operating lease liabilities | |||||||||||
Note: 2023 consisted of 53 weeks compared with 52 weeks in 2025 and 2024.
| TARGET CORPORATION | | 2025 Form 10-K | 48 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
Consolidated Statements of Shareholders' Investment
| (millions) | Common Stock Shares | Stock Par Value | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total | ||||||||||||||
| January 28, 2023 | $ | $ | $ | $ | ( | $ | ||||||||||||||
| Net earnings | — | — | — | — | ||||||||||||||||
Other comprehensive loss | — | — | — | — | ( | ( | ||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | ||||||||||||||
Share-based compensation | — | — | — | |||||||||||||||||
| February 3, 2024 | $ | $ | $ | $ | ( | $ | ||||||||||||||
| Net earnings | — | — | — | — | ||||||||||||||||
Other comprehensive income | — | — | — | — | ||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | ||||||||||||||
| Repurchase of stock | ( | ( | — | ( | — | ( | ||||||||||||||
Share-based compensation | — | — | ||||||||||||||||||
| February 1, 2025 | $ | $ | $ | $ | ( | $ | ||||||||||||||
| Net earnings | — | — | — | — | ||||||||||||||||
Other comprehensive income | — | — | — | — | ||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | ||||||||||||||
| Repurchase of stock | ( | — | — | ( | — | ( | ||||||||||||||
Share-based compensation | — | — | — | |||||||||||||||||
| January 31, 2026 | $ | $ | $ | $ | ( | $ | ||||||||||||||
| TARGET CORPORATION | | 2025 Form 10-K | 49 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Notes to Consolidated Financial Statements
1. Summary of Accounting Policies
Organization - We are a general merchandise retailer selling products to our guests through our stores and digital channels.
We operate as a single segment that includes all of our operations, which are designed to enable guests to purchase products seamlessly in stores or through our digital channels. Nearly all of our revenues are generated in the United States (U.S.). The vast majority of our long-lived assets are located within the U.S.
Use of estimates - The preparation of our consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions affecting reported amounts in the consolidated financial statements and accompanying notes. Actual results may differ significantly from those estimates.
Fiscal year - Our fiscal year ends on the Saturday nearest January 31. Unless otherwise stated, references to years in this report relate to fiscal years, rather than to calendar years. Fiscal 2025 ended January 31, 2026, and consisted of 52 weeks. Fiscal 2024 ended February 1, 2025, and consisted of 52 weeks. Fiscal 2023 ended February 3, 2024, and consisted of 53 weeks. Fiscal 2026 will end January 30, 2027, and will consist of 52 weeks.
| TARGET CORPORATION | | 2025 Form 10-K | 50 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
2. Net Sales
Merchandise sales represent the vast majority of our revenues. We also earn revenues from a variety of other sources, most notably advertising revenue and credit card profit-sharing income.
Net Sales (millions) | 2025 | 2024 | 2023 | ||||||||
Apparel & accessories (a) | $ | $ | $ | ||||||||
Beauty (b) | |||||||||||
Food & beverage (c) | |||||||||||
Hardlines (d) | |||||||||||
Home furnishings & décor (e) | |||||||||||
Household essentials (f) | |||||||||||
| Other merchandise sales | |||||||||||
| Merchandise sales | |||||||||||
| Advertising revenue | |||||||||||
| Credit card profit sharing | |||||||||||
| Other | |||||||||||
| Net sales | $ | $ | $ | ||||||||
(a)Includes apparel for women, men, young adults, kids, toddlers, and babies, as well as jewelry, accessories, and shoes.
(b)Includes skin and bath care, cosmetics, hair care, oral care, deodorant, and shaving products.
(c)Includes dry and perishable grocery, including snacks, candy, beverages, deli, bakery, meat, produce, and food service (primarily Starbucks) in our stores.
(d)Includes electronics, including video games and consoles, toys, sporting goods, entertainment, and luggage.
(e)Includes bed and bath, home décor, school/office supplies, storage, small appliances, kitchenware, greeting cards, party supplies, furniture, lighting, home improvement, and seasonal merchandise.
(f)Includes household cleaning, paper products, over-the-counter healthcare, vitamins and supplements, baby gear, and pet supplies.
Merchandise sales – We record almost all retail store revenues at the point of sale. Digitally originated sales may include shipping revenue and are recorded upon delivery to the guest or upon guest pickup at the store. Merchandise sales do not include sales tax because we are a pass-through conduit for collecting and remitting sales taxes. Generally, guests may return national brand merchandise within 90 days of purchase and owned and exclusive brand merchandise within one year of purchase. Sales are recognized net of expected returns, which we estimate using historical return patterns and our expectation of future returns. As of January 31, 2026, and February 1, 2025, the liability for estimated returns was $155 million and $172 million, respectively.
We routinely enter into arrangements with vendors whereby we do not purchase or pay for merchandise until the merchandise is ultimately sold to a guest. Under the vast majority of these arrangements, which represent less than 5 percent of consolidated sales, we record revenue and related costs gross. We concluded that we are the principal in these transactions for a number of reasons, most notably because we 1) control the overall economics of the transactions, including setting the sales price and realizing the majority of cash flows from the sale, 2) control the relationship with the customer, and 3) are responsible for fulfilling the promise to provide goods to the customer. Merchandise received under these arrangements is not included in Inventory because the purchase and sale of this inventory are virtually simultaneous.
Revenue from Target gift card sales is recognized upon gift card redemption, which is typically within one year of issuance. Our gift cards do not expire. Based on historical redemption rates, a small and relatively stable percentage of gift cards will never be redeemed, referred to as "breakage." Estimated breakage revenue is recognized over time in proportion to actual gift card redemptions.
| TARGET CORPORATION | | 2025 Form 10-K | 51 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Gift Card Liability Activity (millions) | February 1, 2025 | Gift Cards Issued During Current Period But Not Redeemed (b) | Revenue Recognized From Beginning Liability | January 31, 2026 | |||||||||||||||||||
Gift card liability (a) | $ | $ | $ | ( | $ | ||||||||||||||||||
(a)Included in Accrued and Other Current Liabilities.
(b)Net of estimated breakage.
Advertising revenue – Primarily represents revenue related to advertising services provided via our Roundel digital advertising business offering. Roundel services are classified as either Net Sales or as a reduction of Cost of Sales or Selling, General, and Administrative (SG&A) Expenses, depending on the nature of the advertising arrangement. Notes 3 and 5 provide additional information about items included in Cost of Sales and SG&A Expenses.
Credit card profit sharing – We receive payments under a credit card program agreement with TD Bank Group (TD). Under the agreement, we receive a percentage of the profits generated by the Target Circle credit card receivables in exchange for performing account servicing and primary marketing functions. TD underwrites, funds, and owns Target Circle credit card receivables, controls risk management policies, and oversees regulatory compliance.
Other – Includes commissions earned on third-party sales through our Target Plus third-party digital marketplace, Target Circle 360 membership revenue, Shipt membership and service revenues, rental income, and other miscellaneous revenues.
3. Cost of Sales and Selling, General, and Administrative Expenses
The following table illustrates the primary items classified in each major expense category:
Selling, General, and Administrative Expenses | |||||
Merchandising cost of sales, including • Merchandise costs • Payment term cash discounts • Tariffs/duties • Other import costs • Freight expenses associated with moving merchandise from our vendors to and between our distribution centers and our retail stores • Vendor income that is not reimbursement of specific, incremental, and identifiable costs • Markdowns • Inventory shrink Supply chain and digital fulfillment costs, including • Compensation and benefits costs associated with operating our supply chain facilities • Outbound shipping expenses associated with sales to our guests • Compensation and benefit costs associated with shipment of merchandise from stores • Depreciation associated with supply chain facilities | Compensation and benefit costs for stores and headquarters, except ship from store costs classified as cost of sales Occupancy and operating costs of retail and headquarters facilities Advertising, offset by vendor income that is a reimbursement of specific, incremental, and identifiable costs Pre-opening and exit costs of stores and other facilities Credit cards servicing expenses Costs associated with accepting third-party bank issued payment cards Litigation and defense costs and related insurance recoveries Other administrative costs | ||||
Note: The classification of these expenses varies across the retail industry.
| TARGET CORPORATION | | 2025 Form 10-K | 52 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
4. Consideration Received from Vendors
We receive consideration for a variety of vendor-sponsored programs—such as volume rebates, promotions, certain advertising activities, markdown allowances, and for our compliance programs—referred to as "vendor income." Additionally, under our compliance programs, vendors are charged for merchandise shipments that do not meet our requirements (violations), such as late or incomplete shipments. Vendor income is recorded as a reduction of Cost of Sales except in arrangements where the payment is a reimbursement of specific, incremental, and identifiable costs and recorded as an offset to those costs within SG&A Expenses.
5. Advertising Costs
6. Interchange Fee Settlements
In March 2025, we entered into settlement agreements to resolve credit card interchange fee litigation matters in which we were a plaintiff. As a result of these lump-sum settlements, we recorded gains within SG&A Expenses of $593 million, net of legal fees.
7. Business Transformation Costs
In May 2025, we announced a multi-year initiative to transform various aspects of our business—including our organizational structure, processes, and technology—to enable greater agility and optimize the use of the Company's assets. Costs incurred in connection with our business transformation initiative include the following:
•Severance and Related Costs — During 2025, we recognized $129 million of severance and related costs within SG&A, primarily related to our headquarters workforce reduction. The majority has been paid as of January 31, 2026.
•Asset-Related Charges and Other Costs — During 2025, we recognized $57 million of lease termination costs associated with vacant office space, and $64 million of impairment charges and other costs associated with the termination of a commercial partnership and certain other contract terminations within SG&A. Note 12 provides additional information regarding impairment charges.
| TARGET CORPORATION | | 2025 Form 10-K | 53 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
8. Fair Value Measurements
Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).
Financial Instruments Measured on a Recurring Basis | Fair Value as of | |||||||||||||||||||
| (millions) | Classification | Measurement Level | January 31, 2026 | February 1, 2025 | ||||||||||||||||
| Assets | ||||||||||||||||||||
Short-term investments (a) | Cash and Cash Equivalents | Level 1 | $ | $ | ||||||||||||||||
Prepaid forward contracts (b) | Other Current Assets | Level 1 | ||||||||||||||||||
| Liabilities | ||||||||||||||||||||
Interest rate swaps (c) | Other Current Liabilities | Level 2 | ||||||||||||||||||
Interest rate swaps (c) | Other Noncurrent Liabilities | Level 2 | ||||||||||||||||||
(a)Carrying value approximates fair value because maturities are less than three months.
(b)Initially valued at transaction price. Subsequently valued by reference to the market price of Target common stock.
(c)Valuations are based on observable inputs to the valuation model (e.g., interest rates and credit spreads). See Note 18 for additional information on interest rate swaps.
Significant Financial Instruments Not Measured at Fair Value (a) | As of January 31, 2026 | As of February 1, 2025 | |||||||||||||||
| (millions) | Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
Long-term debt, including current portion (b) | $ | $ | $ | $ | |||||||||||||
(a)The carrying amounts of certain other current assets, commercial paper, accounts payable, and certain accrued and other current liabilities approximate fair value due to their short-term nature.
(b)The fair value of long-term debt is estimated using Level 2 inputs based on quoted prices for the instruments. Where quoted prices are not available, fair value is estimated using discounted cash flows and market-based expectations for interest rates. These amounts exclude commercial paper, fair value hedge adjustments, and lease liabilities.
9. Cash and Cash Equivalents
Cash equivalents include highly liquid investments with an original maturity of three months or less from the time of purchase. Cash equivalents also include amounts due from third-party financial institutions for credit and debit card transactions. These receivables typically settle in five days or less.
Cash and Cash Equivalents (millions) | January 31, 2026 | February 1, 2025 | ||||||
| Cash | $ | $ | ||||||
Receivables from third-party financial institutions for credit and debit card transactions | ||||||||
| Short-term investments | ||||||||
Cash and Cash Equivalents (a) | $ | $ | ||||||
(a)We have access to these funds without any significant restrictions, taxes, or penalties.
As of January 31, 2026, and February 1, 2025, we included book overdrafts of $221 million and $157 million, respectively, in Accounts Payable and $7 million and $8 million, respectively, in Accrued and Other Current Liabilities.
| TARGET CORPORATION | | 2025 Form 10-K | 54 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
10. Inventory
The vast majority of our inventory is accounted for under the retail inventory accounting method (RIM) using the last-in, first-out (LIFO) method. Inventory is stated at the lower of LIFO cost or market. Inventory cost includes the amount we pay to our suppliers to acquire inventory, freight costs incurred to deliver product to our distribution centers and stores, and import costs, reduced by vendor income and cash discounts. Supply chain operating costs, including compensation and benefits, are expensed in the period incurred. Inventory is also reduced for estimated losses related to shrink and markdowns. The LIFO provision is calculated based on inventory levels, markup rates, and internally measured retail price indices, and was $201 million and $183 million as of January 31, 2026, and February 1, 2025, respectively.
Under RIM, inventory cost and the resulting gross margins are calculated by applying a cost-to-retail ratio to the inventory retail value. RIM is an averaging method that has been widely used in the retail industry due to its practicality. The use of RIM will result in inventory being valued at the lower of cost or market because permanent markdowns are taken as a reduction of the retail value of inventory.
11. Other Current Assets
Other Current Assets (millions) | January 31, 2026 | February 1, 2025 | ||||||
| Accounts and other receivables | $ | $ | ||||||
| Vendor income receivable | ||||||||
| Prepaid expenses | ||||||||
| Other | ||||||||
| Other Current Assets | $ | $ | ||||||
12. Property and Equipment
Property and equipment, including assets acquired under finance leases, is depreciated using the straight-line method over estimated useful lives or lease terms if shorter. We amortize leasehold improvements purchased after the beginning of the initial lease term over the shorter of the assets' useful lives or a term that includes the remaining initial lease term, plus any renewals that are reasonably certain at the date the leasehold improvements are acquired. Total depreciation expense, including depreciation expense included in Cost of Sales, was $3.1 billion, $3.0 billion, and $2.8 billion for 2025, 2024, and 2023, respectively. For income tax purposes, accelerated depreciation methods are generally used. Repair and maintenance costs are expensed as incurred. Facility pre-opening costs, including supplies and payroll, are expensed as incurred.
Property and Equipment, Net (millions) | January 31, 2026 | February 1, 2025 | ||||||
Land | $ | $ | ||||||
| Buildings and improvements | ||||||||
| Fixtures and equipment | ||||||||
| Computer hardware and software | ||||||||
| Construction-in-progress | ||||||||
Accumulated depreciation | ( | ( | ||||||
Property and equipment, net | $ | $ | ||||||
| Estimated Useful Lives | Life (Years) | ||||
| Buildings and improvements | |||||
| Fixtures and equipment | |||||
| Computer hardware and software | |||||
| TARGET CORPORATION | | 2025 Form 10-K | 55 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
We review long-lived assets for impairment when performance expectations, events, or changes in circumstances—such as a decision to relocate or close a store, office, or supply chain facility, discontinue a project, or make significant software changes—indicate that the asset's carrying value may not be recoverable. We recognized impairment losses of $69 million, $68 million, and $102 million during 2025, 2024, and 2023, respectively. For asset groups classified as held for sale, measurement of an impairment loss is based on the excess of the carrying amount of the asset group over its fair value. We estimate fair value by obtaining market appraisals, obtaining valuations from third-party brokers, or using other valuation techniques. Impairments are recorded in SG&A Expenses.
13. Other Noncurrent Assets
Other Noncurrent Assets (millions) | January 31, 2026 | February 1, 2025 | ||||||
Goodwill (a) | $ | $ | ||||||
Company-owned life insurance investments, net of loans (b) | ||||||||
| Pension asset | ||||||||
| Other | ||||||||
| Other Noncurrent Assets | $ | $ | ||||||
(a)No
14. Supplier Finance Programs
We have arrangements with several financial institutions to act as our paying agents to certain vendors. The arrangements also permit the financial institutions to provide vendors with an option, at our vendors' sole discretion, to elect to receive early payment of our payment obligations from the financial institutions at a discounted amount. A vendor’s election to receive early payment does not change the amount that we must remit to the financial institutions or our payment date, which is up to 120 days from the invoice date.
We do not pay any fees or pledge any security to these financial institutions under these arrangements. The arrangements can be terminated by either party with notice ranging up to 120 days.
Our outstanding vendor obligations eligible for early payment, which are included within Accounts Payable on our Consolidated Statements of Financial Position, do not represent actual early payments made under supplier finance programs, which have historically been lower.
Confirmed Obligations Outstanding (millions) | February 1, 2025 | Invoices Confirmed During the Year | Confirmed Invoices Paid During the Year | January 31, 2026 | |||||||||||||||||||
| $ | $ | $ | ( | $ | |||||||||||||||||||
| TARGET CORPORATION | | 2025 Form 10-K | 56 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
15. Accrued and Other Current Liabilities
Accrued and Other Current Liabilities (millions) | January 31, 2026 | February 1, 2025 | ||||||
| Wages and benefits | $ | $ | ||||||
Gift card liability, net of estimated breakage | ||||||||
Real estate, sales, and other taxes payable | ||||||||
| Dividends payable | ||||||||
| Income tax payable | ||||||||
| Current portion of operating lease liabilities | ||||||||
Workers' compensation and general liability (a) | ||||||||
| Interest payable | ||||||||
| Other | ||||||||
| Accrued and Other Current Liabilities | $ | $ | ||||||
(a)We retain a substantial portion of the risk related to general liability and workers' compensation claims. We estimate our ultimate cost based on analysis of historical data and actuarial estimates. General liability and workers' compensation liabilities are recorded at our estimate of their net present value. Note 21 provides the noncurrent balance of these liabilities.
16. Commitments and Contingencies
Contingencies
We are exposed to claims and litigation arising in the ordinary course of business and use various methods to resolve these matters in a manner that we believe serves the best interest of our shareholders and other constituents. When a loss is probable, we record an accrual based on the reasonably estimable loss or range of loss. When no point of loss is more likely than another, we record the lowest amount in the estimated range of loss and, if material, disclose the estimated range of loss. We do not record liabilities for reasonably possible loss contingencies, but do disclose a range of reasonably possible losses if they are material and we are able to estimate such a range. If we cannot provide a range of reasonably possible losses, we explain the factors that prevent us from determining such a range. Historically, adjustments to our estimates have not been material. We believe the recorded reserves in our consolidated financial statements are adequate in light of the probable and estimable liabilities. We do not believe that any of these identified claims or litigation will be material to our results of operations, cash flows, or financial condition.
Commitments
Purchase obligations, which include all legally binding contracts such as merchandise royalties, equipment purchases, marketing-related contracts, software acquisition/license commitments, firm minimum commitments for inventory purchases, and service contracts, were $1.2 billion as of January 31, 2026. These purchase obligations are primarily due within three years and recorded as liabilities when goods are received or services are rendered. Real estate obligations, which include legally binding minimum lease payments for leases signed but not yet commenced, and commitments for the purchase, construction, or remodeling of real estate and facilities, were $1.7 billion as of January 31, 2026. These real estate obligations are primarily due within one year , a portion of which are recorded as liabilities.
We issue inventory purchase orders in the ordinary course of business, which represent authorizations to purchase that are cancellable by their terms. We do not consider purchase orders to be firm inventory commitments. If we choose to cancel a purchase order, we may be obligated to reimburse the vendor for unrecoverable outlays incurred prior to cancellation.
| TARGET CORPORATION | | 2025 Form 10-K | 57 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
17. Commercial Paper and Long-Term Debt
| Debt Maturities | |||||||||||||||||
| (dollars in millions) | Weighted-Average Interest Rate at January 31, 2026 | January 31, 2026 | February 1, 2025 | ||||||||||||||
| Due 2025 | % | $ | $ | ||||||||||||||
| Due 2026-2030 | |||||||||||||||||
| Due 2031-2035 | |||||||||||||||||
| Due 2036-2040 | |||||||||||||||||
| Due 2041-2045 | |||||||||||||||||
| Due 2046-2050 | |||||||||||||||||
| Due 2051-2052 | |||||||||||||||||
| Total notes and debentures | |||||||||||||||||
| Swap valuation adjustments | ( | ( | |||||||||||||||
| Finance lease liabilities | |||||||||||||||||
| Less: Amounts due within one year | ( | ( | |||||||||||||||
| Long-term debt and other borrowings | $ | $ | |||||||||||||||
Required Principal Payments (millions) | 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter | ||||||||||||||
| Total required principal payments | $ | $ | $ | $ | $ | $ | ||||||||||||||
Our unsecured long-term debt issuances during the year ended January 31, 2026 were as follows:
Debt Issuances (dollars in millions) | ||||||||||||||||||||
| Issuance Date | Maturity Date | Principal Amount | Interest Rate (Fixed) | |||||||||||||||||
| March 2025 | April 2035 | $ | % | |||||||||||||||||
| June 2025 | June 2028 | |||||||||||||||||||
| June 2025 | February 2036 | |||||||||||||||||||
We obtain short-term financing from time to time under our commercial paper program. There was no
In October 2025, we obtained a new committed $1.0 billion 364-day unsecured revolving credit facility that will expire in October 2026 and terminated our prior 364-day facility. We also have a committed $3.0 billion unsecured revolving credit facility that will expire in October 2028. No
Substantially all of our outstanding borrowings are senior, unsecured obligations. Most of our long-term debt obligations contain covenants related to secured debt levels. In addition to a secured debt level covenant, our credit facilities also contain a debt leverage covenant. We are, and expect to remain, in compliance with these covenants, which have no practical effect on our ability to pay dividends.
18. Derivative Financial Instruments
Our derivative instruments consist of interest rate swaps used to mitigate interest rate risk. As a result, we have counterparty credit exposure to large global financial institutions, which we monitor on an ongoing basis. Note 8 provides the fair value and classification of these instruments.
| TARGET CORPORATION | | 2025 Form 10-K | 58 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Under our swap agreements, we pay a floating rate equal to the daily Secured Overnight Financing Rate (SOFR) compounded over six months and receive a weighted average fixed rate of 2.8 percent. The agreements have a weighted average remaining maturity of 3.5 years. As of January 31, 2026, and February 1, 2025, interest rate swaps with notional amounts totaling $2.20
Effect of Hedges on Debt (millions) | January 31, 2026 | February 1, 2025 | ||||||
| Long-term debt and other borrowings | ||||||||
| $ | $ | |||||||
| Cumulative hedging adjustments, included in carrying amount | ( | ( | ||||||
Effect of Hedges on Net Interest Expense (millions) | 2025 | 2024 | 2023 | ||||||||
| Gain (loss) on fair value hedges recognized in Net Interest Expense | |||||||||||
Interest rate swaps designated as fair value hedges | $ | $ | $ | ( | |||||||
| Hedged debt | ( | ( | |||||||||
| Gain on cash flow hedges recognized in Net Interest Expense | |||||||||||
| $ | $ | $ | |||||||||
19. Leases
We lease certain retail stores, supply chain facilities, office space, land, and equipment. Leases with an initial term of 12 months or less are not recorded on the Consolidated Statements of Financial Position; we recognize lease expense for these leases on a straight-line basis over the lease term. We combine lease and nonlease components for new and reassessed leases.
Most leases include one or more options to renew, with renewal terms that can extend the lease term from to 50
Certain of our lease agreements require reimbursement of real estate taxes, common area maintenance, and insurance, as well as rental payments based on a percentage of retail sales over contractual levels, and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
We rent or sublease certain real estate to third parties. Our lease and sublease portfolio consists mainly of operating leases with CVS Pharmacy Inc. (CVS) for space within our stores.
| TARGET CORPORATION | | 2025 Form 10-K | 59 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Leases (millions) | Classification | January 31, 2026 | February 1, 2025 | ||||||||
| Assets | |||||||||||
| Operating | Operating Lease Assets | $ | $ | ||||||||
| Finance | |||||||||||
| Total leased assets | $ | $ | |||||||||
| Liabilities | |||||||||||
| Current | |||||||||||
Operating | $ | $ | |||||||||
Finance | |||||||||||
| Noncurrent | |||||||||||
Operating | Noncurrent Operating Lease Liabilities | ||||||||||
Finance | |||||||||||
| Total lease liabilities | $ | $ | |||||||||
(a)Finance lease assets are recorded net of accumulated amortization of $963 million and $857 million as of January 31, 2026, and February 1, 2025, respectively.
Lease Cost (millions) | Classification | 2025 | 2024 | 2023 | ||||||||||
Operating lease cost (a) | SG&A Expenses or Cost of Sales (b) | $ | $ | $ | ||||||||||
| Finance lease cost | ||||||||||||||
Amortization of leased assets | Depreciation and Amortization (b) | |||||||||||||
Interest on lease liabilities | Net Interest Expense | |||||||||||||
Sublease income (c) | Net Sales | ( | ( | ( | ||||||||||
| Net lease cost | $ | $ | $ | |||||||||||
(a)2025, 2024, and 2023 include $143 million, $132 million, and $115 million, respectively, of short-term and variable lease costs.
(b)Supply chain-related amounts are included in Cost of Sales.
(c)Sublease income excludes rental income from owned properties of $54 million, $48 million, and $49 million for 2025, 2024, and 2023, respectively, which is also included in Net Sales.
| TARGET CORPORATION | | 2025 Form 10-K | 60 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Maturity of Lease Liabilities | Operating | Finance | |||||||||
(millions) | Leases (a) | Leases (b) | Total | ||||||||
| 2026 | $ | $ | $ | ||||||||
| 2027 | |||||||||||
| 2028 | |||||||||||
| 2029 | |||||||||||
| 2030 | |||||||||||
| Thereafter | |||||||||||
| Total lease payments | $ | $ | $ | ||||||||
| Less: Interest | |||||||||||
Present value of lease liabilities | $ | $ | |||||||||
(a)Operating lease payments include $719 million related to options to extend lease terms that are reasonably certain of being exercised and exclude $39 million of legally binding minimum lease payments for leases signed but not yet commenced.
| Lease Term and Discount Rate | January 31, 2026 | February 1, 2025 | ||||||
| Weighted average remaining lease term (years) | ||||||||
Operating leases | ||||||||
Finance leases | ||||||||
| Weighted average discount rate | ||||||||
Operating leases | % | % | ||||||
Finance leases | % | % | ||||||
Other Information (millions) | 2025 | 2024 | 2023 | ||||||||
| Cash paid for amounts included in the measurement of lease liabilities | |||||||||||
Operating cash flows from operating leases | $ | $ | $ | ||||||||
Operating cash flows from finance leases | |||||||||||
Financing cash flows from finance leases | |||||||||||
| TARGET CORPORATION | | 2025 Form 10-K | 61 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
20. Income Taxes
Earnings before income taxes were $4.8 billion, $5.3 billion, and $5.3 billion during 2025, 2024, and 2023, respectively, including $0.8 billion, $1.1 billion, and $1.2 billion earned by our foreign entities subject to tax outside of the U.S.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), which expands income tax disclosure requirements, primarily related to the effective tax rate reconciliation and income taxes paid. We adopted the standard prospectively in fiscal 2025.
| Tax Rate Reconciliation | 2025 | |||||||
(dollars in millions) | Amount | Percent | ||||||
| U.S. federal statutory rate | $ | % | ||||||
State and local income taxes, net of federal income tax effects (a) | ||||||||
| Foreign tax effects | ||||||||
| Hong Kong | ( | ( | ||||||
| Other foreign jurisdictions | ||||||||
| Effect of cross-border tax laws | ||||||||
| Tax credits | ( | ( | ||||||
Nontaxable or nondeductible Items (b) | ( | ( | ||||||
| Changes in unrecognized tax benefits | ||||||||
| Other adjustments | ( | |||||||
| Effective tax rate | $ | % | ||||||
(a) State taxes in California, New York, Illinois, and Minnesota contributed to the majority of the tax effect in this category.
(b) The tax effects of share based compensation are classified within nontaxable or nondeductible items in the effective tax rate reconciliation for 2025.
Tax Rate Reconciliation for years prior to the adoption of ASU 2023-09 | 2024 | 2023 | ||||||
Percent | Percent | |||||||
U.S. federal statutory rate | % | % | ||||||
State and local income taxes, net of federal income tax effects | ||||||||
| International | ( | ( | ||||||
| Excess tax benefit related to share-based payments | ( | ( | ||||||
| Federal tax credits | ( | ( | ||||||
| Other | ( | ( | ||||||
| Effective tax rate | % | % | ||||||
| TARGET CORPORATION | | 2025 Form 10-K | 62 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Provision for Income Taxes (millions) | 2025 | 2024 | 2023 | ||||||||
| Current: | |||||||||||
| Federal | $ | $ | $ | ||||||||
| State | |||||||||||
| International | |||||||||||
| Total current | |||||||||||
| Deferred: | |||||||||||
| Federal | ( | ( | |||||||||
| State | |||||||||||
| International | ( | ||||||||||
| Total deferred | ( | ( | |||||||||
| Total provision | $ | $ | $ | ||||||||
Income Taxes Paid, Net of Refunds (millions) | 2025 | ||||||||||
Federal taxes (a) | $ | ||||||||||
| State taxes | |||||||||||
| California | |||||||||||
| Other | |||||||||||
| International taxes | |||||||||||
| Total income taxes paid | $ | ||||||||||
(a) Includes amounts paid for the purchase of federal transferable tax credits.
We made cash payments of $1,055 million and $374 million for income taxes, net of refunds, during 2024 and 2023, respectively. Due to deferred tax effects and other payment and refund timing differences, income tax payments are not necessarily indicative of our current tax expense or future cash obligations.
Net Deferred Tax Asset / (Liability) (millions) | January 31, 2026 | February 1, 2025 | ||||||
| Gross deferred tax assets: | ||||||||
| Accrued and deferred compensation | $ | $ | ||||||
| Accruals and reserves not currently deductible | ||||||||
| Self-insured benefits | ||||||||
| Lease liabilities | ||||||||
| Other | ||||||||
| Total gross deferred tax assets | ||||||||
| Gross deferred tax liabilities: | ||||||||
| Property and equipment | ( | ( | ||||||
| Leased assets | ( | ( | ||||||
| Inventory | ( | ( | ||||||
| Other | ( | ( | ||||||
| Total gross deferred tax liabilities | ( | ( | ||||||
Total net deferred tax liability (a) | $ | ( | $ | ( | ||||
(a)$13 million and $10 million of the balances as of January 31, 2026, and February 1, 2025, respectively, is included in Other Noncurrent Assets.
| TARGET CORPORATION | | 2025 Form 10-K | 63 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
As of January 31, 2026, we had gross tax loss carryforwards of $1.2 billion in Canada and $0.2 billion in Luxembourg. The losses are deemed to have a remote possibility of realization; therefore, a deferred tax asset and valuation allowance are not established.
We file a U.S. federal income tax return and income tax returns in various states and foreign jurisdictions. The U.S. Internal Revenue Service (IRS) is currently auditing certain aspects of our U.S. federal income tax returns for 2021-2024, including transfer pricing matters. The IRS has completed examinations of years 2020 and prior. With few exceptions, we are no longer subject to state and local or non-U.S. income tax examinations by tax authorities for years before 2019.
Reconciliation of Gross Unrecognized Tax Benefits (millions) | 2025 | 2024 | 2023 | ||||||||
| Balance at beginning of period | $ | $ | $ | ||||||||
| Additions based on tax positions related to the current year | |||||||||||
| Additions for tax positions of prior years | |||||||||||
| Reductions for tax positions of prior years | ( | ( | ( | ||||||||
| Settlements | ( | ( | ( | ||||||||
| Balance at end of period | $ | $ | $ | ||||||||
If we were to prevail on all unrecognized tax benefits recorded, the amount that would benefit the effective tax rate was $226 million, $206 million, and $161 million as of January 31, 2026, February 1, 2025, and February 3, 2024, respectively. In addition, the reversal of accrued interest and penalties would also benefit the effective tax rate. Interest and penalties associated with unrecognized tax benefits are recorded within income tax expense. During 2025, 2024, and 2023, we recorded expense from accrued interest and penalties of $12 million, $13 million, and $6 million, respectively. As of January 31, 2026, February 1, 2025, and February 3, 2024, total accrued interest and penalties were $32 million, $21 million, and $14 million, respectively.
| TARGET CORPORATION | | 2025 Form 10-K | 64 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
21. Other Noncurrent Liabilities
Other Noncurrent Liabilities (millions) | January 31, 2026 | February 1, 2025 | ||||||
| Deferred compensation | $ | $ | ||||||
| Workers' compensation and general liability | ||||||||
Deferred occupancy income (a) | ||||||||
| Income and other taxes payable | ||||||||
| Other | ||||||||
| Other Noncurrent Liabilities | $ | $ | ||||||
(a)To be amortized evenly through 2038.
22. Share Repurchase
We periodically repurchase shares of our common stock under a board-authorized repurchase program through a combination of open market transactions, accelerated share repurchase arrangements, and other privately negotiated transactions with financial institutions.
Share Repurchase Activity (millions, except per share data) | 2025 | 2024 | 2023 | ||||||||
| Total number of shares purchased | |||||||||||
Average price paid per share (a) | $ | $ | $ | ||||||||
Total investment (a) | $ | $ | $ | ||||||||
(a)Amounts include applicable excise tax and commissions.
23. Share-Based Compensation
We maintain a long-term incentive plan for key team members and non-employee members of our Board of Directors. This plan allows us to grant equity-based compensation awards, including stock options, stock appreciation rights, performance share units, restricted stock units, restricted stock awards, or a combination of awards (collectively, share-based awards). The number of unissued common shares reserved for future grants under this plan was 15.3 million as of January 31, 2026.
Compensation expense associated with share-based awards is recognized on a straight-line basis over the required service period and reflects estimated forfeitures. Share-based compensation expense recognized in SG&A Expenses was $282 million, $307 million, and $255 million, and the related income tax benefit was $62 million, $66 million, and $56 million, in 2025, 2024, and 2023, respectively.
| TARGET CORPORATION | | 2025 Form 10-K | 65 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Restricted Stock Units
We issue restricted stock units and performance-based restricted stock units generally with 3 -year cliff or 4 -year graduated vesting from the grant date (collectively restricted stock units) to certain team members. The final number of shares issued under performance-based restricted stock units is based on our total shareholder return relative to a retail peer group over a 3-year performance period. We also regularly issue restricted stock units to our Board of Directors, which vest quarterly in the year they are granted and are settled in shares of Target common stock upon departure from the Board. The fair value for restricted stock units is calculated based on our stock price on the date of grant, incorporating an analysis of the total shareholder return performance measure where applicable. The weighted average grant date fair value of restricted stock units was $107.95 , $165.21 , and $160.91 in 2025, 2024, and 2023, respectively.
| Restricted Stock Unit Activity | Total Nonvested Units | |||||||
Restricted Stock (a) | Grant Date Fair Value (b) | |||||||
| February 1, 2025 | $ | |||||||
| Granted | ||||||||
| Forfeited | ( | |||||||
| Vested | ( | |||||||
| January 31, 2026 | $ | |||||||
(a)Represents the number of shares of restricted stock units, in thousands. For performance-based restricted stock units, assumes attainment of maximum payout rates as set forth in the performance criteria. Applying actual or expected payout rates, the number of outstanding restricted stock units and performance-based restricted stock units as of January 31, 2026, was 5.98 million.
(b)Weighted average per unit.
Performance Share Units
We issue performance share units to certain team members that represent shares potentially issuable in the future. Issuance is based upon our performance, generally relative to a retail peer group, over a 3-year performance period on certain measures primarily including sales growth, after-tax return on invested capital, and earnings per share growth. The fair value of performance share units is calculated based on our stock price on the date of grant. The weighted average grant date fair value of performance share units was $108.32 , $164.92 , and $162.54 in 2025, 2024, and 2023, respectively.
| Performance Share Unit Activity | Total Nonvested Units | |||||||
Performance Share Units (a) | Grant Date Fair Value (b) | |||||||
| February 1, 2025 | $ | |||||||
| Granted | ||||||||
| Forfeited | ( | |||||||
| Vested | ( | |||||||
| January 31, 2026 | $ | |||||||
(a)Represents the number of performance share units, in thousands. Assumes attainment of maximum payout rates as set forth in the performance criteria. Applying actual or expected payout rates, the number of outstanding performance share units as of January 31, 2026, was 1.11 million.
(b)Weighted average per unit.
| TARGET CORPORATION | | 2025 Form 10-K | 66 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
The expense recognized each period is partially dependent upon our estimate of the number of shares that will ultimately be issued. Future compensation expense for unvested awards could reach a maximum of $265 million assuming payout of all unvested awards. The unrecognized expense is expected to be recognized over a weighted average period of 1.6 years. The fair value of performance share units vested and converted to shares of Target common stock was $13 million, $46 million, and $127 million in 2025, 2024, and 2023, respectively.
24. Defined Contribution Plans
Team members who meet eligibility requirements can participate in a defined contribution 401(k) plan by investing up to 80 percent of their eligible earnings, as limited by statute or regulation. We match 100 percent of each team member's contribution up to 5 percent of eligible earnings. Company match contributions are made to funds designated by the participant, none of which are based on Target common stock.
In addition, we maintain an unfunded, nonqualified deferred compensation plan for a broad management group whose participation in our 401(k) plan is limited by statute or regulation. These team members choose from a menu of crediting rate alternatives that are generally the same as the investment choices in our 401(k) plan, but also includes a fund based on Target common stock. We credit an additional 2 percent per year to the accounts of all active participants, excluding executive officers, in part to recognize the risks inherent to their participation in this plan. We also maintain a frozen, unfunded, nonqualified deferred compensation plan covering less than 50 participants. Our total liability under these plans was $717 million and $684 million as of January 31, 2026, and February 1, 2025, respectively.
We mitigate our risk of offering the nonqualified plans through investing in company-owned life insurance and prepaid forward contracts that substantially offset our economic exposure to the returns of these plans. These investments are general corporate assets and are marked to market with the related gains and losses recognized in the Consolidated Statements of Operations in the period they occur.
| Plan Expenses | |||||||||||
| (millions) | 2025 | 2024 | 2023 | ||||||||
| 401(k) plan matching contributions expense | $ | $ | $ | ||||||||
| Nonqualified deferred compensation plans | |||||||||||
Benefits expense | $ | $ | $ | ||||||||
Related investment income | ( | ( | ( | ||||||||
| Nonqualified plans net expense | $ | $ | $ | ||||||||
25. Pension Plans
We have a U.S. qualified defined benefit pension plan covering team members who meet eligibility requirements. This plan is closed to new participants. Active participants accrue benefits under a final average pay feature or a cash balance feature. We also have unfunded, nonqualified pension plans for team members with qualified plan compensation restrictions, as well as international plans. Eligibility and the level of benefits under all plans vary depending on each team member's full-time or part-time status, date of hire, age, length of service, and/or compensation.
| Funded Status | Qualified Plan | Nonqualified and International Plans | |||||||||||||||
| (millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Projected benefit obligations | $ | $ | $ | $ | |||||||||||||
| Fair value of plan assets | |||||||||||||||||
Funded / (underfunded) status | $ | $ | $ | ( | $ | ( | |||||||||||
| TARGET CORPORATION | | 2025 Form 10-K | 67 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Contributions and Estimated Future Benefit Payments
Our pension obligations can be met over time through a combination of company contributions to these plans and earnings on plan assets. In 2025 and 2024, we made no
Estimated Future Benefit Payments (millions) | Pension Benefits | ||||
| 2026 | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| 2031 - 2035 | |||||
Cost of Plans
Net Pension Benefits (Income) / Expense | ||||||||||||||
| (millions) | Classification | 2025 | 2024 | 2023 | ||||||||||
| Service cost benefits earned | Cost of Sales and SG&A Expenses | $ | $ | $ | ||||||||||
Net Other Income | ||||||||||||||
Net Other Income | ( | ( | ( | |||||||||||
Net Other Income | ||||||||||||||
Prior service cost | Net Other Income | |||||||||||||
| Total | $ | ( | $ | ( | $ | ( | ||||||||
Assumptions
| Benefit Obligation Weighted Average Assumptions | 2025 | 2024 | |||||||||
| Discount rate | % | % | |||||||||
| Average assumed rate of compensation increase | |||||||||||
| Cash balance plan interest crediting rate | |||||||||||
| Net Periodic Benefit Expense Weighted Average Assumptions | 2025 | 2024 | 2023 | ||||||||
| Discount rate | % | % | % | ||||||||
| Expected long-term rate of return on plan assets | |||||||||||
| Average assumed rate of compensation increase | |||||||||||
| Cash balance plan interest crediting rate | |||||||||||
The weighted average assumptions used to measure net periodic benefit expense each year are the rates as of the beginning of the year (i.e., the prior measurement date). Our most recent compound annual rate of return on qualified plan assets was 0.8 percent, 5.4 percent, 6.2 percent, and 5.9 percent for the 5-year , 10-year , 15-year , and 20-year time periods, respectively.
| TARGET CORPORATION | | 2025 Form 10-K | 68 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
We review the expected long-term rate of return annually and revise it as appropriate. Additionally, we monitor the mix of investments in our portfolio to ensure alignment with our long-term strategy to manage pension cost and reduce volatility in our assets. Our 2025 expected annualized long-term rate of return assumptions were 7.0 percent for domestic equity securities, 7.0 percent for international equity securities, 6.0 percent for long-duration debt securities, 9.0 percent for balanced funds, and 8.0 percent for other investments. These estimates are a judgmental matter in which we consider the composition of our asset portfolio, our historical long-term investment performance, and current market conditions.
Benefit Obligation
| Change in Projected Benefit Obligation | Qualified Plan | Nonqualified and International Plans | |||||||||||||||
| (millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Benefit obligation at beginning of period | $ | $ | $ | $ | |||||||||||||
| Service cost | |||||||||||||||||
| Interest cost | |||||||||||||||||
Plan amendments | |||||||||||||||||
Actuarial loss / (gain) (a) | ( | ( | |||||||||||||||
| Participant contributions | |||||||||||||||||
| Benefits paid | ( | ( | ( | ( | |||||||||||||
Benefit obligation at end of period (b) | $ | $ | $ | $ | |||||||||||||
(a)The actuarial loss / (gain) was primarily driven by changes in the weighted average discount rate.
(b)Accumulated benefit obligation—the present value of benefits earned to date assuming no future salary growth—is materially consistent with the projected benefit obligation in each period presented.
| TARGET CORPORATION | | 2025 Form 10-K | 69 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
Plan Assets
| Change in Plan Assets | Qualified Plan | Nonqualified and International Plans | |||||||||||||||
| (millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||
Fair value of plan assets at beginning of period | $ | $ | $ | $ | |||||||||||||
| Actual return on plan assets | |||||||||||||||||
| Employer contributions | |||||||||||||||||
| Participant contributions | |||||||||||||||||
| Benefits paid | ( | ( | ( | ( | |||||||||||||
Fair value of plan assets at end of period | $ | $ | $ | $ | |||||||||||||
Our asset allocation policy is designed to reduce the long-term cost of funding our pension obligations. The plan invests with both passive and active investment managers depending on the investment. The plan also seeks to reduce the risk associated with adverse movements in interest rates by employing an interest rate hedging program, which includes the use of derivative instruments.
| Asset Category | Current Targeted Allocation | Actual Allocation | |||||||||
| 2025 | 2024 | ||||||||||
Domestic equity securities (a) | % | % | % | ||||||||
| International equity securities | |||||||||||
| Debt securities | |||||||||||
Balanced funds | |||||||||||
Other (b) | |||||||||||
| Total | % | % | % | ||||||||
(a)Equity securities include our common stock in amounts substantially less than 1
| TARGET CORPORATION | | 2025 Form 10-K | 70 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
| Fair Value Measurements | Fair Value as of | |||||||||||||
| (millions) | Measurement Level | January 31, 2026 | January 31, 2025 | |||||||||||
| Cash and cash equivalents | Level 1 | $ | $ | |||||||||||
Government securities (a) | Level 2 | |||||||||||||
Fixed income (b) | Level 2 | |||||||||||||
Investments valued using NAV per share (c) | ||||||||||||||
| Fixed income | ||||||||||||||
| Private equity funds | ||||||||||||||
| Cash and cash equivalents | ||||||||||||||
| Common collective trusts | ||||||||||||||
Balanced funds | ||||||||||||||
| Other | ||||||||||||||
| Total plan assets | $ | $ | ||||||||||||
(a)Investments in government securities and long-term government bonds.
(b)Investments in corporate and municipal bonds.
(c)Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position.
| Position | Valuation Technique | |||||||
| Cash and cash equivalents | Carrying value approximates fair value. | |||||||
Government securities and fixed income | Valued using matrix pricing models and quoted prices of securities with similar characteristics. | |||||||
Amounts Included in Shareholders' Investment
26. Accumulated Other Comprehensive Loss
Change in Accumulated Other Comprehensive Loss (millions) | Cash Flow Hedges | Currency Translation Adjustment | Pension | Total | |||||||||||||||||||
| February 1, 2025 | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
Other comprehensive (loss) / income before reclassifications | ( | ( | |||||||||||||||||||||
Amounts reclassified | ( | (a) | ( | ||||||||||||||||||||
| January 31, 2026 | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
Note: Amounts are net of tax.
(a)Represents amortization of gains and losses on cash flow hedges, net of $6 million of taxes, which is recorded in Net Interest Expense.
| TARGET CORPORATION | | 2025 Form 10-K | 71 | ||||||||
| FINANCIAL STATEMENTS | ||||||||
| NOTES | ||||||||
27. Segment Reporting
Our Chief Operating Decision Maker (CODM)—our Chief Executive Officer—monitors our consolidated net earnings and operating income to evaluate performance and make operating decisions including whether to invest profits into capital projects, make equity or other investments, or return capital to shareholders. Consolidated assets as presented on our Consolidated Statements of Financial Position is the only view of assets regularly reviewed by our CODM. We operate as a single segment that includes all of our operations, which are designed to enable guests to purchase products seamlessly in stores or through our digital channels. Virtually all of our consolidated revenues are generated in the United States. The vast majority of our properties and equipment are located within the United States.
| Business Segment Results | |||||||||||
(millions) | 2025 | 2024 | 2023 | ||||||||
Net sales | $ | $ | $ | ||||||||
| Cost of sales | |||||||||||
Merchandising cost of sales (a) | |||||||||||
Supply chain and digital fulfillment costs (a) | |||||||||||
| Total cost of sales | |||||||||||
SG&A expenses (b) | |||||||||||
Depreciation and amortization (exclusive of depreciation included in cost of sales) | |||||||||||
Operating income | |||||||||||
| Net interest expense | |||||||||||
| Net other income | ( | ( | ( | ||||||||
| Earnings before income taxes | |||||||||||
| Provision for income taxes | |||||||||||
| Net earnings | $ | $ | $ | ||||||||
(a)Note 3 provides a description of Merchandising Cost of Sales and Supply Chain and Digital Fulfillment Costs.
28. Subsequent Event
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Not applicable.
Item 9A. Controls and Procedures
Changes in Internal Control Over Financial Reporting
During the most recently completed fiscal quarter, there were no changes which materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| TARGET CORPORATION | | 2025 Form 10-K | 72 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this Annual Report, we conducted an evaluation, under supervision and with the participation of management, including the chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934, as amended (Exchange Act). Based upon that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective at a reasonable assurance level. Disclosure controls and procedures are defined by Rules 13a-15(e) and 15d-15(e) of the Exchange Act as controls and other procedures that are designed to ensure that information required to be disclosed by us in reports filed with the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in reports filed under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.
For the Report of Management on Internal Control and the Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting, see Part II, Item 8, Financial Statements and Supplementary Data.
Item 9B. Other Information
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
| TARGET CORPORATION | | 2025 Form 10-K | 73 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
PART III
Certain information required by Part III is incorporated by reference from Target's definitive Proxy Statement for the 2026 Annual Meeting of Shareholders (our Proxy Statement). Except for those portions specifically incorporated in this Form 10-K by reference to the Proxy Statement, no other portions of the Proxy Statement are deemed to be filed as part of this Form 10-K.
Item 10. Directors, Executive Officers and Corporate Governance
The following sections of the Proxy Statement are incorporated herein by reference:
•Item one—Election of directors
•General information about corporate governance and the Board—
◦Committees
◦Business ethics and conduct
•Compensation Discussion and Analysis—Compensation policies and risk—Securities trading policy
•Questions and answers about the 2026 Annual Meeting—Access to information—Question 16
•Questions and answers about the 2026 Annual Meeting—Communications—Question 19
Item 11. Executive Compensation
The following sections of the Proxy Statement are incorporated herein by reference:
•Item one—Election of directors—Non-employee director compensation
•Compensation Discussion and Analysis
•Compensation tables (exclusive of Compensation tables—Pay versus performance disclosure)
•Compensation & Human Capital Management Committee Report
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following sections of the Proxy Statement are incorporated herein by reference:
•Stock ownership information—
◦Beneficial ownership of directors and executive officers
◦Beneficial ownership of Target’s largest shareholders
•Compensation tables—Equity compensation plan information
Item 13. Certain Relationships and Related Transactions, and Director Independence
The following sections of the Proxy Statement are incorporated herein by reference:
•General information about corporate governance and the Board—
◦Committees
◦Director independence
◦Policy on transactions with related persons
Item 14. Principal Accountant Fees and Services
The following section of the Proxy Statement is incorporated herein by reference:
•Item two—Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm—Audit and non-audit fees
| TARGET CORPORATION | | 2025 Form 10-K | 74 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
PART IV
Item 15. Exhibits, Financial Statement Schedules
The following information required under this item is filed as part of this report:
a) (1) Financial Statements
•Consolidated Statements of Operations for the Years Ended January 31, 2026, February 1, 2025, and February 3, 2024
•Consolidated Statements of Comprehensive Income for the Years Ended January 31, 2026, February 1, 2025, and February 3, 2024
•Consolidated Statements of Cash Flows for the Years Ended January 31, 2026, February 1, 2025, and February 3, 2024
•Consolidated Statements of Shareholders' Investment for the Years Ended January 31, 2026, February 1, 2025, and February 3, 2024
•Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements (PCAOB ID: 42 )
(2) Financial Statement Schedules | ||
| None. | ||
| Other schedules have not been included either because they are not applicable or because the information is included elsewhere in this Report. | ||
(3) Exhibits
See exhibits listed under part (b) below.
| TARGET CORPORATION | | 2025 Form 10-K | 75 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
b) Exhibits (1)
| 3.1 | ||||||||
| 3.2 | ||||||||
| 4.1 | ||||||||
| 4.1.1 | ||||||||
| 4.2 | ||||||||
| 10.1 | * | |||||||
| 10.2 | * | |||||||
| 10.3 | * | |||||||
| 10.4 | * | |||||||
| 10.4.1 | * | |||||||
| 10.4.2 | * | |||||||
| 10.4.3 | * | |||||||
| 10.4.4 | * | |||||||
10.4.5 | * | |||||||
10.4.6 | * | |||||||
| 10.5 | * | |||||||
| 10.6 | * | |||||||
| 10.7 | * | |||||||
| 10.7.1 | * | |||||||
| 10.8 | * | |||||||
| 10.9 | * | |||||||
| TARGET CORPORATION | | 2025 Form 10-K | 76 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
| 10.10 | * | |||||||
| 10.11 | * | |||||||
| 10.12 | * | |||||||
| 10.13 | * | |||||||
| 10.14 | * | |||||||
| 10.15 | * | |||||||
| 10.15.1 | * | |||||||
| 10.15.2 | * | |||||||
| 10.15.3 | * | |||||||
| 10.16 | * | |||||||
| 10.17 | * ‡ | |||||||
10.18 | * ** | |||||||
10.19 | * ** | |||||||
10.20 | * | |||||||
10.21 | * | |||||||
10.22 | * ** | |||||||
10.23 | ||||||||
10.23.1 | ‡ | |||||||
10.23.2 | ||||||||
10.24 | ‡ | 364-Day Credit Agreement, dated as of October 9, 2025, among Target Corporation, the Banks listed therein, the Co-Documentation Agents and Syndication Agent listed therein, and Bank of America, N.A., as Administrative Agent (filed as Exhibit 10.20 to Target's Quarterly Report on Form 10-Q for the quarter ended November 1, 2025, and incorporated herein by reference). | ||||||
| TARGET CORPORATION | | 2025 Form 10-K | 77 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
10.25 | + ‡ | |||||||
10.25.1 | + | |||||||
10.25.2 | + | |||||||
10.25.3 | + | |||||||
10.25.4 | + | |||||||
10.26 | + | |||||||
10.26.1 | + | |||||||
10.26.2 | ||||||||
19.1 | ** | |||||||
| 21.1 | ** | |||||||
| 23.1 | ** | |||||||
| 24.1 | ** | |||||||
| 31.1 | ** | |||||||
| 31.2 | ** | |||||||
| 32.1 | *** | |||||||
| 32.2 | *** | |||||||
97.1 | ||||||||
| 101.INS | ** | Inline XBRL Instance Document | ||||||
| 101.SCH | ** | Inline XBRL Taxonomy Extension Schema | ||||||
| 101.CAL | ** | Inline XBRL Taxonomy Extension Calculation Linkbase | ||||||
| 101.DEF | ** | Inline XBRL Taxonomy Extension Definition Linkbase | ||||||
| 101.LAB | ** | Inline XBRL Taxonomy Extension Label Linkbase | ||||||
| 101.PRE | ** | Inline XBRL Taxonomy Extension Presentation Linkbase | ||||||
| 104 | ** | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | ||||||
____________________________________________________________________
* Management contract or compensatory plan or arrangement.
** Filed herewith.
*** Furnished herewith.
+ Certain portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Corporation agrees to furnish supplementally an unredacted copy of the exhibit to the Securities and Exchange Commission upon its request.
‡ Certain schedules and attachments have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Corporation agrees to furnish a copy of such schedules and attachments to the Securities and Exchange Commission upon its request.
| TARGET CORPORATION | | 2025 Form 10-K | 78 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
(1) Certain instruments defining the rights of holders of long-term debt securities of the Corporation have been omitted pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K. The Corporation agrees to furnish copies of any such instruments to the Securities and Exchange Commission upon its request.
Item 16. Form 10-K Summary
Not applicable.
| TARGET CORPORATION | | 2025 Form 10-K | 79 | ||||||||
| SUPPLEMENTAL INFORMATION | ||||||||
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| TARGET CORPORATION | ||||||||
| By: | /s/ Jim Lee | |||||||
| Date: March 11, 2026 | Jim Lee Executive Vice President and Chief Financial Officer | |||||||
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
/s/ Michael J. Fiddelke | |||||
| Date: March 11, 2026 | Michael J. Fiddelke Chief Executive Officer (Principal Executive Officer) | ||||
/s/ Jim Lee | |||||
| Date: March 11, 2026 | Jim Lee Executive Vice President and Chief Financial Officer (Principal Financial Officer) | ||||
/s/ Matthew A. Liegel | |||||
| Date: March 11, 2026 | Matthew A. Liegel Senior Vice President, Chief Accounting Officer and Controller (Principal Accounting Officer) | ||||
DAVID P. ABNEY DOUGLAS M. BAKER, JR. GEORGE S. BARRETT GAIL K. BOUDREAUX BRIAN C. CORNELL ROBERT L. EDWARDS | DONALD R. KNAUSS CHRISTINE A. LEAHY MONICA C. LOZANO GRACE PUMA DERICA W. RICE DMITRI L. STOCKTON | Constituting a majority of the Board of Directors | ||||||||||||
Jim Lee, by signing his name hereto, does hereby sign this document pursuant to powers of attorney duly executed by the Directors named, filed with the Securities and Exchange Commission on behalf of such Directors, all in the capacities and on the date stated.
| By: | /s/ Jim Lee | |||||||
| Date: March 11, 2026 | Jim Lee Attorney-in-fact | |||||||
| TARGET CORPORATION | | 2025 Form 10-K | 80 | ||||||||
EXHIBIT 10.18January 2026
Brian C. Cornell
Dear Brian:
On behalf of Target Corporation (the “Company”) and its Board of Directors (the “Board”), I want to thank you for your vision, leadership and dedication to the Company during your many years serving as Chief Executive Officer. We also appreciate your willingness to provide the Company continued support as Executive Chair of the Board (“Executive Chair”). Your term as Executive Chair will begin on February 1, 2026 (the “Effective Date”).
1. Position and Duties. On the Effective Date, you will assume the position of Executive Chair and your service as Chief Executive Officer will cease. The anticipated term of your employment (the “Term”) will extend through March 13, 2027. If you cease serving as Executive Chair during the Term, we anticipate that you will continue to provide services to the Company as a Special Advisor until March 13, 2027.
In the positions of Executive Chair and Special Advisor, you will have the duties and responsibilities assigned to you by the Board and consistent with other policies of the Company. You and the Company reasonably anticipate that due to your expected level of service as Executive Chair and Special Advisor, you will not experience a “separation from service” for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) during the Term.
2. Work Location. We anticipate that your principal place of employment will be your home office. Your travel to, and time spent working at, Company headquarters in Minnesota will be subject to such reasonable guidelines as the Board may establish from time to time.
3. Base Salary. During the Term, your annual base salary will be $1,120,000. The Company will pay your base salary in accordance with its normal payroll practices as in effect from time to time.
4. Annual Bonus. For fiscal year 2026, you will be eligible for an annual cash bonus with an at-goal opportunity equal to 200% of your annual base salary (“Annual Bonus”). The Annual Bonus will be determined in accordance with the Company’s Short-term Incentive program in effect for senior executives of the Company. You will not be eligible for an Annual Bonus for the period you are employed during fiscal year 2027.
5. Equity Awards. The equity awards granted to you by the Company prior to the Effective Date will continue to vest during the Term. In addition, on March 11, 2026, you will receive a grant of Restricted Stock Units with a present value of $6,000,000. Fifty percent of these Restricted Stock Units will vest and pay out on each anniversary of the grant date. This grant, which is eligible for retirement vesting, will be described in a Restricted Stock Unit agreement.
6. Benefits & Perquisites. During the Term, you will be entitled to participate in the Company’s employee benefit plans and perquisite programs on the same terms as senior
executives of the Company. You will be eligible for reimbursement of security expenses of up to $20,000 annually. Company-owned aircraft will not be available for your personal travel.
7. Termination
a. Termination Generally. You or the Company may terminate your employment for any reason or no reason at any time. Upon any termination of your employment that is not for-Cause, you will be entitled to: (i) any earned but unpaid base salary, (ii) any earned but unpaid Annual Bonus, (iii) any other amounts or benefits to which you are entitled under the terms of any plan, program, policy, practice or contract of the Company, specifically including the vested portion of the Restricted Stock Unit grant described in Section 5 (collectively, the “Earned Amounts”), and (iv) and the post-termination benefits set forth in Section 9. As of the Effective Date, you will no longer be a participant in the Company’s Income Continuation Plan and you hereby waive any rights you may have under such plan.
b. Resignation upon Termination. Upon termination of your employment for any reason, you will promptly tender to the Board your resignation as a director, in accordance with the Company’s Corporate Governance Guidelines, as in effect from time to time.
c. Termination for Cause. In the event that the Company terminates your employment for Cause, you will not be entitled to any further payments or benefits from the Company following the Term, other than the Earned Amounts. For purposes of this Section 7(c), “Earned Amounts” does not include Annual Bonus or Long-Term Incentives.
8. Restrictive Covenants. You acknowledge and agree that your Restrictive Covenant Agreement, dated March 3, 2021 (as amended by this Section 8, the “RCA”), remains in full force and effect. You agree that the RCA is hereby amended to change the restricted period for the non-solicitation, non-disparagement, and confidentiality covenants to 24 months.
9. Post-Termination Benefits. For a period of 12 months following the Term, you will have access to your Company email address and Company-provided technology support.
10. Miscellaneous
a. Governing Law. This Letter Agreement will be governed by the laws of the State of Minnesota, without regard to choice of law provisions.
b. Entire Agreement. This Letter Agreement, together with the RCA and any Company equity award agreements to which you are party, contain the entire agreement between you and the Company with respect to your service as Executive Chair and Special Advisor, and supersede all prior oral or written understandings or agreements, specifically including any pay summaries or statements.
c. Amendments. No provision of this Letter Agreement will be modified or amended except by an instrument in writing duly executed by you and the Company.
d. Successors. This Letter Agreement is personal to you and will not be assignable by you other than by will or the laws of descent and distribution.
e. Invalidity. If any term or provision of this Letter Agreement or the application thereof to any person or circumstance will to any extent be invalid or unenforceable, the remainder of this Letter Agreement or the application of such term to circumstances other than those that make it invalid will not be affected.
f. Survivability. The provisions of this Letter Agreement that by their terms call for performance subsequent to the termination of either your employment or this Letter Agreement will survive such termination.
g. Section 409A. It is intended that payments and benefits made or provided under this Letter Agreement will not result in penalty taxes or accelerated taxation pursuant to Section 409A.
h. Clawbacks. Certain compensation addressed in this Letter Agreement is subject to recovery in accordance with the terms of the Company’s Clawback Policy and/or Recoupment Policy (the “Policies”), in the event such Policies are triggered.
To confirm these terms are acceptable to you, please sign and return this Letter Agreement.
Very truly yours,
Target Corporation
By: /s/ Melissa Kremer
Melissa Kremer
EVP & Chief Human Resources Officer
Feb 2, 2026
By: /s/ Christine A. Leahy
Christine A. Leahy
Lead Independent Director, Target Corporation Board of Directors
Feb 2, 2026
Acknowledged and agreed:
/s/ BC
Brian C. Cornell
Feb 2, 2026
EXHIBIT 10.19
Target Corporation 2020 Long-Term Incentive Plan
RESTRICTED STOCK UNIT AGREEMENT
(Officer)
THIS RESTRICTED STOCK UNIT AGREEMENT (the “Agreement”) is made in Minneapolis, Minnesota as of the date of grant (the “Grant Date”) set forth in the award letter (the “Award Letter”) by and between the Company and the person (the “Team Member”) identified in the Award Letter. This award (the “Award”) of Restricted Stock Units (“RSUs”), provided to you as a Service Provider, is being issued under the Target Corporation 2020 Long-Term Incentive Plan (the “Plan”), subject to the following terms and conditions.
1. Definitions. Except as otherwise provided in this Agreement, the defined terms used in this Agreement shall have the same meaning as in the Plan. The term “Committee” shall also include those persons to whom authority has been delegated under the Plan.
2. Grant of RSUs. Subject to the relevant terms of the Plan and this Agreement, as of the Grant Date, the Company has granted the Team Member the number of RSUs set forth in the Award Letter.
3. Vesting Schedule.
(a) Subject to Section 3(b), one-half (1/2) of the Shares issuable under the RSUs shall vest on the first anniversary of the Grant Date and the remaining one-half (1/2) shall vest on the second anniversary of the Grant Date.
(b) Notwithstanding Section 3(a), the Shares issuable under the applicable number of RSUs shall vest on the earlier of: (i) the date that the conditions for an Accelerated Vesting Event set forth in Section 4 are satisfied; or (ii) as specified in Section 5.
(c) Each date of vesting is referred to as a “Vesting Date”. All vested RSUs shall be paid out as provided in Section 10, in accordance with and subject to any restrictions set forth in this Agreement, the Plan or any Release Agreement that the Team Member may be required to enter pursuant to Sections 4 or 5. “Release Agreement” means an agreement containing a release of claims and other provisions deemed appropriate by the Committee in its sole discretion.
4. Accelerated Vesting Events. Upon the occurrence of one of the following events (each, an “Accelerated Vesting Event”), the outstanding unvested RSUs subject to this Agreement shall vest as provided below. The Committee, in its sole discretion, makes all determinations required under this Section 4.
(a) Retirement. The applicable number of outstanding unvested RSUs shall vest as of the date the last of the Retirement Conditions is satisfied. The “Retirement Conditions” are: (i) the Team Member attaining age 55 and completing at least 5 years of Service (which 5 years need not be continuous) on or prior to the Team Member’s (1) voluntary termination of Service, or (2) termination of Service resulting from the Company’s elimination of the Team Member’s position (“Position Elimination”); (ii) the Company receiving a valid unrevoked Release Agreement from the Team Member; and (iii) the Team Member commencing discussions with the Company’s Chief Executive Officer or most senior human resources executive regarding the Team Member’s consideration of termination at least six months prior to the Team Member’s voluntary termination of Service. If the Team Member’s termination of Service described in Section 4(a)(i) occurs during the 12 month period immediately following the Grant Date, the Team Member shall vest in a portion of the outstanding unvested RSUs subject to this Agreement. Such vested portion will be determined by multiplying the number of outstanding unvested RSUs in the grant by a fraction, the numerator of which is the number of days from the Grant Date through the date of termination of Service and the denominator of which is the number of days from the Grant Date to the second anniversary of the Grant Date. All remaining RSUs shall be cancelled, and the Team Member shall have no rights to such cancelled RSUs. If the Team Member’s termination of Service described in Section 4(a)(i) occurs more than 12 months after the Grant Date but before the second anniversary of the Grant Date, the applicable number of outstanding unvested RSUs to vest shall be 100% of the RSUs subject to this Agreement.
(b) Death. In the case of the Team Member’s death prior to the Team Member’s termination of Service, the Team Member shall vest in all outstanding unvested RSUs as of the date of the Team Member’s death.
(c) Disability. In the case of the Team Member’s Disability prior to the Team Member’s termination of Service, the Team Member shall vest in all outstanding unvested RSUs as of the date of the Team Member’s Disability.
5. Change in Control. If a Change in Control occurs and the Award is assumed or replaced pursuant to Section 11(b)(1) of the Plan, the Award will continue to be subject to the Vesting Schedule provided in Section 3. Notwithstanding the foregoing and any other contrary provision of this Agreement, if within two years after a Change in Control and prior to the second anniversary of the Grant Date, the Team Member’s Service terminates voluntarily by the Team Member for Good Reason or involuntarily without Cause, and provided that the Company has received a valid unrevoked Release Agreement from the Team Member, the Team Member shall vest in all outstanding unvested RSUs as of the date of the Team Member’s termination of Service.
6. Cause. Notwithstanding any other provisions of this Agreement to the contrary, if the Committee concludes, in its sole discretion, that the Team Member’s Service was terminated in whole or in part for Cause, all of the RSUs subject to the Award that have not previously been converted to Shares shall terminate immediately and the Team Member shall have no rights hereunder.
2.
7. Other Termination; Changes of Service. If at any time prior to the second anniversary of the Grant Date the Team Member’s Service is terminated involuntarily under circumstances not covered in Section 4(a)(i)(2), for Cause, or for any reason not meeting all applicable conditions in Sections 4 or 5, all outstanding unvested RSUs subject to the Award shall terminate effective as of the date of termination of Service and the Team Member shall have no rights hereunder. Service shall not be deemed terminated in the case of (a) any approved leave of absence, or (b) transfers among the Company and any Subsidiaries in the same Service Provider capacity; however, a termination of Service shall occur if (i) the relationship the Team Member had with the Company or a Subsidiary at the Grant Date terminates, even if the Team Member continues in another Service Provider capacity with the Company or a Subsidiary, or (ii) the Team Member experiences a “separation from service” within the meaning of Code Section 409A.
8. Restrictive Covenant. By accepting the Award, the Team Member specifically agrees to the restrictive covenant contained in this Section 8 (the “Restrictive Covenant”) and the Team Member agrees that the Restrictive Covenant and the remedies described herein are reasonable and necessary to protect the legitimate interests of the Company.
(a) Non-Solicitation. The Team Member agrees that for the period beginning on the Grant Date and ending on the date that is one year following the Team Member’s termination of Service, the Team Member will not recruit for employment directly or indirectly, any employee of the Company with whom the Team Member worked, or about whom the Team Member possesses any Company personnel information.
(b) Remedies. The Team Member agrees that immediate irreparable damage will result to Company if the Team Member breaches the Restrictive Covenant set forth in this Agreement. Therefore, in the event the Team Member breaches this Agreement, whether directly or indirectly, the Team Member consents to specific enforcement of this Agreement through an injunction or restraining order. Injunctive relief shall be awarded in addition to any other remedies or damages available at law or in equity. The Team Member specifically agrees that the Company is entitled to the attorneys’ fees and expenses the Company incurs to enforce this Agreement, and that the Team Member is responsible for paying the Company’s costs and attorneys’ fees incurred as a result of enforcing any provisions of this Agreement.
(c) Recovery. Notwithstanding any other provisions of this Agreement to the contrary, if the Committee concludes, in its sole discretion, that the Team Member has breached the Restrictive Covenant, the Company may take one or more of the following actions with respect to the Award:
(i) immediately terminate all of the RSUs subject to the Award that have not previously been converted to Shares, and the Team Member shall have no rights hereunder; and
(ii) require repayment of all or any portion of the amounts realized or received by the Team Member resulting from the conversion of RSUs to Shares or the sale of Shares related to the Award.
3.
9. Dividend Equivalents. The Team Member shall have the right to receive additional RSUs with a value equal to the regular cash dividend paid on one Share for each RSU held pursuant to this Agreement prior to the conversion of RSUs and issuance of Shares pursuant to Section 10. The number of additional RSUs to be received as dividend equivalents for each RSU held shall be determined by dividing the cash dividend per share by the Fair Market Value of one Share on the dividend payment date; provided, however, that for purposes of avoiding the issuance of fractional RSUs, on each dividend payment date the additional RSUs issued as dividend equivalents shall be rounded up to the nearest whole number. All such additional RSUs received as dividend equivalents shall be subject to forfeiture in the same manner and to the same extent as the original RSUs granted hereby, and shall be converted into Shares on the basis and at the time set forth in Section 10 hereof.
10. Conversion of RSUs and Issuance of Shares.
(a) Timing. Fifty percent of the vested RSUs shall be converted to Shares and shall be issued within 90 days of each of the following: (i) March 13, 2027, and (ii) the second anniversary of the Grant Date. Notwithstanding the foregoing, in the event that the Team Member’s death or the Team Member’s Disability (as determined by the Committee in its sole discretion, provided such determination complies with the definition of disability under Code Section 409A) occurs before one or both of the anniversaries described in this Section, the conversion to Shares and issuance of all vested RSUs shall occur within 90 days of the Team Member’s death or the Team Member’s Disability, as applicable. For avoidance of doubt, neither the Team Member’s termination of Service nor any vesting acceleration under Section 4(a) will accelerate Share conversion or issuance.
(b) Limitation for Specified Employees. If any Shares shall be issuable with respect to the RSUs as a result of the Team Member’s “separation from service” at such time as the Team Member is a “specified employee” within the meaning of Code Section 409A, then no Shares shall be issued, except as permitted under Code Section 409A, prior to the first business day after the earlier of (i) the date that is six months after the Team Member’s “separation from service”, or (ii) the Team Member’s death.
(c) Unvested RSUs. All of the RSUs subject to the Award that are unvested as of the time the vested RSUs are converted and Shares are issued under Section 10(a)(ii) shall terminate immediately and the Team Member shall have no rights hereunder with respect to those unvested RSUs.
(d) Code Section 409A. The Committee in its sole discretion may accelerate or delay the distribution of any payment under this Agreement to the extent allowed or required under Code Section 409A. Payment of amounts under this Agreement are intended to comply with the requirements of Code Section 409A and this Agreement shall in all respects be administered and construed to give effect to such intent.
11. Taxes. The Team Member acknowledges that (a) the ultimate liability for any and all income tax, social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”) legally due by him or her is and remains the Team Member’s responsibility and may exceed the amount actually withheld by the Company and/or a
4.
Subsidiary to which the Team Member is providing Service (the “Service Recipient”) and (b) the Company and/or the Service Recipient or a former Service Recipient, as applicable, (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the RSUs, including, but not limited to, the grant, vesting and/or conversion of the RSUs and issuance of Shares; (ii) do not commit and are under no obligation to structure the terms of the grant or any aspect of the RSUs to reduce or eliminate the Team Member’s liability for Tax-Related Items; (iii) may be required to withhold or account for Tax-Related Items in more than one jurisdiction if the Team Member has become subject to tax in more than one jurisdiction between the Grant Date and the date of any relevant taxable event; and (iv) may refuse to deliver the Shares to the Team Member if he or she fails to comply with his or her obligations in connection with the Tax-Related Items as provided in this Section.
The Team Member authorizes and consents to the Company and/or the Service Recipient, or their respective agents, satisfying all applicable Tax-Related Items which the Company reasonably determines are legally payable by him or her by withholding from the Shares that would otherwise be delivered to the Team Member the highest number of whole Shares that the Company determines has a value less than or equal to the aggregate applicable Tax-Related Items. In lieu thereof, the Team Member may elect at the time of conversion of the RSUs such other then-permitted method or combination of methods established by the Company and/or the Service Recipient to satisfy the Team Member’s Tax-Related Items.
12. Limitations on Transfer. The Award shall not be sold, assigned, transferred, exchanged or encumbered by the Team Member other than pursuant to the terms of the Plan.
13. Recovery Provisions. Notwithstanding any other provision of this Agreement to the contrary, the Award (and any compensation paid or shares issued under the Award) is subject to recovery in accordance with the terms of: (a) the Company’s Recoupment Policy, and (b) the Company’s Clawback Policy (each, the “Policy” and collectively, the “Policies”), in each case to the extent the Policy applies to the Award and the Team Member as the Policies may be in effect from time to time. In addition, this Award may be unilaterally amended by the Committee to comply with any other compensation recovery policy adopted by the Board or the Committee at any time and any listing rules or other rules and regulations implementing the Policies, or as otherwise required by law. The Team Member agrees and consents to the Company’s application, implementation and enforcement of the Policies or any other policy established by the Company or applicable law that may apply to this Award and the Team Member and any provision of applicable law relating to cancellation, rescission, or recoupment of compensation, and expressly agrees that the Company may take such actions as are necessary to effectuate the Policies, any other policies or applicable law without further consent or action being required by the Team Member.
14. No Employment Rights. Nothing in this Agreement, the Plan or the Award Letter shall confer upon the Team Member any right to continued Service with the Company or any Subsidiary, as applicable, nor shall it interfere with or limit in any way any right of the Company or any Subsidiary, as applicable, to terminate the Team Member’s Service at any time with or without Cause or change the Team Member’s compensation, other benefits, job responsibilities or title
5.
provided in compliance with applicable local laws and permitted under the terms of the Team Member’s service contract, if any.
(a) The Team Member’s rights to vest in the RSUs or receive Shares after termination of Service shall be determined pursuant to Sections 3 through 10. Those rights and the Team Member’s date of termination of Service will not be extended by any notice period mandated under local law (e.g., active service would not include a period of “garden leave” or similar notice period pursuant to local law).
(b) This Agreement, the Plan and the Award Letter are separate from, and shall not form, any part of the contract of Service of the Team Member, or affect any of the rights and obligations arising from the Service relationship between the Team Member and the Company and/or the Service Recipient.
(c) No Service Provider has a right to participate in the Plan. All decisions with respect to future grants, if any, shall be at the sole discretion of the Company and/or the Service Recipient.
(d) The Team Member will have no claim or right of action in respect of any decision, omission or discretion which may operate to the disadvantage of the Team Member.
15. Nature of Grant. In accepting the grant, the Team Member acknowledges, understands, and agrees that:
(a) the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement, and any such modification, amendment, suspension or termination will not constitute a constructive or wrongful dismissal;
(b) the RSUs are extraordinary items and are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or welfare or retirement benefits or similar payments;
(c) in no event should the RSUs be considered as compensation for, or relating in any way to, past services for the Company or the Service Recipient, nor are the RSUs or the underlying Shares intended to replace any pension rights or compensation;
(d) the future value of the underlying Shares is unknown and cannot be predicted with certainty;
(e) the Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Team Member’s participation in the Plan or the RSUs;
(f) no claim or entitlement to compensation or damages shall arise from forfeiture or recovery of the RSUs or underlying Shares resulting from termination of the Team
6.
Member’s Service (for any reason whatsoever and whether or not in breach of local labor laws) or application of the Policies, and in consideration of the grant of the RSUs to which the Team Member is otherwise not entitled, the Team Member (i) agrees not to institute any such claim against the Company or the Service Recipient, (ii) waives the Team Member’s ability, if any, to bring any such claim, and (iii) releases the Company and the Service Recipient from any such claim. If, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Team Member shall be deemed irrevocably to have agreed not to pursue such claim and agrees to execute any and all documents necessary to request dismissal or withdrawal of such claims;
(g) this Agreement is not a condition of the Team Member’s employment or continued employment; and
(h) the Team Member is hereby advised to consult with personal tax, legal and financial advisors regarding participation in the Plan before taking any action related to the RSUs or the Plan.
16. Governing Law; Venue; Jurisdiction; Severability. To the extent that federal laws do not otherwise control, this Agreement, the Award Letter, the Plan and all determinations made and actions taken pursuant to the Plan shall be governed by the laws of the State of Minnesota without regard to its conflicts-of-law principles and shall be construed accordingly. The exclusive forum and venue for any legal action arising out of or related to this Agreement shall be the United States District Court for the District of Minnesota, and the parties submit to the personal jurisdiction of that court. If neither subject matter nor diversity jurisdiction exists in the United States District Court for the District of Minnesota, then the exclusive forum and venue for any such action shall be the courts of the State of Minnesota located in Hennepin County, and the Team Member, as a condition of this Agreement, consents to the personal jurisdiction of that court. If any provision of this Agreement, the Award Letter or the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Agreement, the Award Letter or the Plan, and the Agreement, the Award Letter and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included.
17. Currencies and Dates. Unless otherwise stated, all dollars specified in this Agreement and the Award Letter shall be in U.S. dollars and all dates specified in this Agreement shall be U.S. dates.
18. Survival. The Team Member agrees that the terms of Sections 8 and 13 shall survive the Team Member’s termination of Service and any conversion of the Award into Shares.
19. Imposition of Other Requirements. The Company reserves the right to impose other requirements on the Team Member’s participation in the Plan, on the RSUs and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require the Team Member to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
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20. Plan and Award Letter Incorporated by Reference; Electronic Delivery. The Plan, as hereafter amended from time to time, and the Award Letter shall be deemed to be incorporated into this Agreement and are integral parts hereof. In the event there is any inconsistency between the provisions of this Agreement and the Plan, the provisions of the Plan shall govern. This Agreement, the Plan and the Award Letter embody the entire agreement and understanding between the Company and the Team Member pertaining to this grant of RSUs and supersede all prior agreements and understandings (oral or written) between them relating to the subject matter hereof. The Company or a third party designated by the Company may deliver to the Team Member by electronic means any documents related to his or her participation in the Plan. The Team Member acknowledges receipt of a copy of the Plan and the Award Letter.
[End of Agreement]
8.
EXHIBIT 10.22
TRANSITION AGREEMENT
THIS TRANSITION AGREEMENT (the “Agreement”) is made and entered into effective as of the last date of signature set forth below, by and among Target Corporation, a Minnesota corporation (“Target”), Target Enterprise, Inc. (“Target Enterprise”), a subsidiary of Target (Target and Target Enterprise, collectively, the “Company”), and Richard H. Gomez (“Executive”).
RECITALS
WHEREAS, Executive is employed as the Company’s Executive Vice President & Chief Commercial Officer;
WHEREAS, Executive’s service as Executive Vice President & Chief Commercial Officer will end on February 15, 2026, at which time Executive will begin serving as a strategic advisor employed by the Company for an established period (“Strategic Advisory Period”);
WHEREAS, At the conclusion of the Strategic Advisory Period, the employment relationship between the Company and Executive will be ended by the Company without cause, entitling Executive to benefits under the Company’s Income Continuation Plan;
WHEREAS, The following terms, together with any documents referenced herein, constitute the entire terms of Executive’s employment during this transition period and settlement of all Executive’s rights, remedies, and obligations flowing from Executive’s employment with the Company and the termination of that employment relationship.
AGREEMENT
NOW, THEREFORE, In consideration of the promises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Executive, intending to be legally bound, acknowledge and agree as follows:
1. Strategic Advisory Period. On February 15, 2026, Executive will step down as the Company’s Executive Vice President & Chief Commercial Officer and begin serving as a strategic advisor to the Company. During the Strategic Advisory Period, Executive will assist with the transition of his responsibilities and perform such other duties as may be assigned by the Chief Executive Officer (“CEO”) or the CEO’s delegate. Executive will devote such time, effort and attention to the business of the Company during the Strategic Advisory Period as requested by the Company. To ensure compliance with applicable legal requirements throughout the Strategic Advisory Period, the parties agree that the level of services Executive regularly provides will exceed twenty percent (20%) of a full-time schedule. Executive will fully comply with the standard policies, procedures, and practices of the Company that are in effect during the Strategic Advisory Period. Upon the commencement of the Strategic Advisory Period, Executive will cease to be a Section 16 “officer” of the Company within the meaning of Section 16a-1(f) of the Securities Exchange Act of 1934. Unless terminated earlier pursuant to Section 7, the Strategic Advisory Period will end on April 17, 2026. At the end of the Strategic Advisory Period, the employer-employee relationship of Executive and the Company will terminate (such date is referred to as the “Separation Date”).
2. Base Salary. Throughout the Strategic Advisory Period, the Company will pay to Executive the rate of base salary in effect immediately prior to the start of the Strategic Advisory Period. Such salary shall be payable in accordance with the Company’s customary payroll practices applicable to executives.
3. Short-Term Incentive Plan. Throughout the Strategic Advisory Period, Executive will continue to participate in the Company’s Short-Term Incentive Plan for Leadership Team members. Executive’s benefit will continue to be governed by all terms of the Short-Term Incentive Plan.
4. Long-Term Incentive Plan. Executive’s outstanding Performance Share Units and Performance Based Restricted Stock Units will continue to be governed by all terms of the applicable award agreements and the Long-Term Incentive Plan. Executive’s vested percentage, if any, of each Long-Term Incentive award will be determined as of Executive’s Separation Date.
5. Benefits.
(a) Executive will be entitled to participate in all employee benefit plans and programs of the Company in effect until the Separation Date, specifically including the Company’s medical plan and executive physical program, to the extent that Executive meets the eligibility requirements for each individual plan or program. The Company provides no assurance as to the adoption or continuance of any particular plan or program, and Executive’s participation in any such plan or program will be pursuant to the provisions, rules and regulations applicable thereto. Executive’s participation as an active employee in such plans and programs will end on or about the Separation Date. Except as specified above, Executive’s rights under such plans, including any rights to continue benefits, will be determined as of the Separation Date; and
(b) Provided Executive signs and does not revoke this Agreement and the Release addressed in Section 13, the Company shall pay up to $30,000 for Executive’s reasonable outplacement services through April 17, 2027. Such outplacement fees shall be paid by the Company directly to the outplacement firm engaged by Executive after submission of its invoices to the Company.
6. Income Continuation Payments. As of the Separation Date, Executive shall be entitled to the equivalent of twenty-four (24) months of income continuation payments as further described in Exhibit A, provided Executive signs and does not revoke this Agreement and the Release addressed in Section 13. Such income continuation payments are subject and pursuant to the terms and conditions of the Income Continuation Plan and this Agreement.
7. Termination During Strategic Advisory Period.
(a) Voluntarily by Executive. During the Strategic Advisory Period, Executive may terminate his employment voluntarily at any time. Upon such a voluntary termination by Executive, each of the Company and Executive will be released from any and all further obligations under this Agreement except: (i) as described in Section 7(d), and (ii) the Company will pay to Executive the base salary and Annual Bonus earned by Executive as of the Separation Date, the Long-Term Incentives described in Section 4, and the income continuation payments described in Section 6; and
(b) By Company without Cause. During the Strategic Advisory Period, the Company may terminate this Agreement for any reason. Upon any termination without Cause, each of the Company and Executive will be released from any and all further obligations under this Agreement except: (i) as described in Section 7(d), and (ii) the Company will pay to Executive the base salary and Annual Bonus that would have been earned by Executive if he had remained employed through April 17, 2026, the Long-Term Incentives described in Section 4, and the income continuation payments described in Section 6; and
(c) By Company with Cause. During the Strategic Advisory Period, the Company may terminate this Agreement for “Cause” as defined in the 2020 Target Corporation Long-Term Incentive Plan. Upon any termination for Cause, each of the Company and Executive will be released from any and all further obligations under this Agreement except: (i) that the Company will pay to Executive the base salary
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earned by Executive as of the Separation Date; and (ii) as described in Section 7(d); and
(d) Continuing Obligations. Regardless of the reason for termination the parties’ respective obligations under Sections 4, 6, 8, 9, 10, 11, and 13 hereof shall survive any termination of this Agreement and Executive’s employment and be binding on the parties.
8. Cooperation. Following the Separation Date, the Company may request that Executive consult or cooperate with the Company (including, without limitation, providing truthful information to the Company or serving as a witness or testifying at the Company’s request without subpoena). Executive agrees to be available at mutually agreeable times to perform such duties and provide such cooperation in connection with the various business and legal matters in which Executive was involved or of which Executive has knowledge as a result of Executive’s employment with the Company. In so consulting or cooperating, Executive shall be reimbursed his reasonable out-of-pocket expenses. In addition, Executive agrees to return all Company property, including any copies or duplicates, in Executive’s possession on or before the Separation Date.
9. Prohibited Activities. In exchange for the income continuation payments and, where applicable, vesting of certain Long-Term Incentive awards, Executive agrees to comply with the Company’s standard post-employment covenants as set forth below. Specifically, during his employment and until twenty-four months after the Separation Date, Executive agrees to refrain from doing any of the following:
(a) accepting employment with, becoming a director of, or directly or indirectly becoming a consultant or advisor to, or performing any services for, a member of the Company’s retail peer group listed on page 50 of the Company’s 2025 Proxy Statement filed with the U.S. Securities and Exchange Commission, or any parent, subsidiary, division or affiliate of any such retail peer (examples of affiliates include entities under common control, joint venture partners and e-commerce affiliates);
(b) during his employment and thereafter, using or disclosing Confidential Information, as defined in this Section 9, for or to any person or organization not expressly authorized by the Company to receive or use such information, subject to those permitted communications outlined in this Section 9;
(c) directly or indirectly inducing, soliciting, or requesting any Company employee to accept employment or a consulting relationship with, or perform services for, anyone other than the Company, or to otherwise take any action detrimental to the relationships between the Company and its employees;
(d) disparaging the Company or any of its directors, officers, or employees in a manner that causes, or is intended to cause, significant harm to the Company; and
(e) directly or indirectly: (i) effecting, offering or proposing or in any way assisting any other person to effect, offer or propose: (A) any acquisition of any securities or rights or options to acquire any securities of the Company (other than ownership of less than 0.1% of the Company’s outstanding shares and investments in publicly available mutual funds or exchange traded funds), (B) any tender or exchange offer, merger or other business combination involving the Company, (C) any recapitalization, restructuring, sale of assets, liquidation, dissolution or other extraordinary transaction with respect to the Company, or (D) any “solicitation” of “proxies” (as such terms are used in the proxy rules of the Securities and Exchange Commission); (ii) forming, joining or in any way participating in a “group” (as defined under Securities Exchange Act of 1934, as amended) with respect to the Company or otherwise act in concert with any person in respect of any securities of the Company; (iii) otherwise acting, alone or in concert with others, to seek representation on or to control or influence the management, the Board of
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Directors or policies of the Company or to obtain representation on the Board of Directors; or (iv) entering into any discussions or arrangements with any third party with respect to any of the foregoing.
Notwithstanding any other provision of this Agreement to the contrary, nothing herein shall prohibit Executive from: (i) communicating, without notice to the Company, with any government agency or regulator concerning any possible violations of federal or state law or regulation; or (ii) receiving any applicable award for information provided to any such government agency or regulator concerning any possible violations of federal or state law or regulation. The Company nonetheless asserts and does not waive its attorney-client privilege over any information appropriately protected by the privilege.
“Confidential Information” includes, without limitation, employee data and information obtained pursuant to Executive’s duties and responsibilities (including, but not limited to, personnel decisions relating to employees and applicants), present, past and future strategies, research, plans, and proposals (including but not limited to, customer, marketing, merchandising, sourcing, store operations, technology, assets protection, logistics, pricing, distribution, benefits and compensation strategies, plans and proposals), financial information, and present, past and future personnel, labor relations, vendor, contractor, and partner strategies, plans, practices, policies, training programs and goals. Confidential Information of the Company and any of its affiliates is a valuable, special and unique asset.
10. Termination. Pursuant to Income Continuation Plan Sections 3.6 and 3.8, and in addition to any other remedies available to the Company, in the event Executive breaches any of Executive’s obligations under the Income Continuation Plan or this Agreement, then in the Company’s sole discretion: (a) the Company may be relieved of all liability and obligations to make payments under the Income Continuation Plan or this Agreement, (b) Executive’s outstanding Long-Term Incentive Plan awards may be terminated immediately, and/or (c) the Company may demand and Executive shall return any Long-Term Incentive Plan payouts or income continuation payments provided under this Agreement. Notwithstanding the foregoing, for any breach of Executive’s obligations under Subsection 9(a), the Company’s sole and exclusive remedy shall be relief from any further liability or obligation to make payments under the Income Continuation Plan or this Agreement. Even if payments and benefits are terminated pursuant to this Section 10 or Section 11, Executive’s obligations under Sections 9, 10, 11 and 12, as well as the release addressed in Section 13, shall remain in full force and effect.
11. Enforcement. In the event of a breach or threatened breach by Executive of any of the post-employment covenants in Subsections 9 (b)-(e) of this Agreement, the Company shall be entitled to an injunction restraining Executive from breaching, in whole or in part, any of his duties, obligations, or covenants in that Section. Executive acknowledges that such remedy is appropriate. For purposes of a court issuing injunctive relief, Executive waives any argument relating to irreparable injury, success on the merits of the Company’s claims, or the underlying enforceability of this Agreement. Executive agrees that an appropriate court may issue injunctive relief without addressing these issues, and that a temporary or preliminary injunctive order should be issued without prejudice to any final decision that may later be reached affecting the parties’ rights or obligations under this Agreement. Except for the limitation described in Section 10 applicable to breaches of Subsection 9(a), nothing in this Agreement shall be construed as prohibiting the Company from pursuing any additional or other remedy or remedies available to it for such breach or threatened breach, including, but not limited to, the other remedies specifically provided for in this Agreement and the recovery of damages.
12. Acceptance Period. Executive understands that the terms of this Agreement shall be open for acceptance through February 6, 2026, which is sixteen (16) days from the date a draft of this Agreement was shared with Executive. A signed copy of this Agreement must be delivered to joseph.morales@target.com on or before that date. During this time, Executive may consider whether or not to accept this Agreement or seek counsel to advise him regarding the same. Executive agrees that changes to this Agreement, whether material or immaterial, will not restart this acceptance period.
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13. Release of Executive Claims. Executive agrees to sign, deliver and not revoke a release of substantially similar content to the release in Exhibit B within the applicable consideration period. The Company will provide Executive with such release on or around the Separation Date.
14. Miscellaneous.
(a) Counsel. The Company advises Executive to seek counsel regarding this Agreement.
(b) Clawbacks. Notwithstanding any other provision of this Agreement to the contrary, certain compensation addressed in this Agreement is subject to recovery in accordance with the terms of the Company’s Clawback Policy and/or Recoupment Policy (the “Policies”), in the event such Policies are triggered. This Agreement may be unilaterally amended to comply with the Policies. Executive agrees and consents to the Company’s application, implementation and enforcement of: (i) the Policies or any similar policy established by the Company that may apply to Executive, and (ii) any provision of applicable law relating to cancellation, rescission, or recoupment of compensation, and expressly agrees that the Company may take such actions as are necessary to effectuate the Policies or applicable law without further consent or action being required by Executive.
(c) Notification. For twenty-four months beginning on the Separation Date, Executive shall notify the Company’s Chief Human Resources Officer in writing as soon as practicable after Executive becomes an employee, officer or director of, or consultant for, any entity.
(d) Complete Agreement; Governing Documents. This Agreement, together with the separately executed release, and the plans and Long-Term Incentive Plan agreements referred to herein, shall constitute the entire agreement and understanding of the Company’s obligation to provide compensation and benefits to Executive. This Agreement shall supersede all prior and contemporaneous written or verbal agreements and understandings between Executive and the Company relating to such subject matter. To the extent the terms of this Agreement conflict with the terms of the Income Continuation Plan, the terms of this Agreement will control. To the extent the terms of this Agreement conflict with the terms of the Long-Term Incentive Plan or the Long-Term Incentive Plan agreements, the terms of Long-Term Incentive Plan or the Long-Term Incentive Plan agreements will control. This Agreement may only be amended by written instrument signed by Executive and a duly authorized employee of the Company.
(e) Successors and Assigns. This Agreement and all rights hereunder are personal to Executive and may not be transferred or assigned by Executive at any time. The Company may assign its rights, together with its obligations hereunder, to any parent, subsidiary, affiliate or successor, or in connection with any sale, transfer or other disposition of all or substantially all of its business and assets, provided, however, that any such assignee assumes the Company’s obligations hereunder.
(f) Construction and Governing Law. The Income Continuation Plan and its implementation pursuant to this Agreement are intended to be a welfare benefit plan subject to the applicable requirements of the Employee Retirement Income Security Act. The Income Continuation Plan and this Agreement shall be administered and construed consistently with that intent and with the applicable provisions of the Internal Revenue Code. If any provision of this Agreement as applied to any party or to any circumstance should be adjudged by a court of competent jurisdiction to be void or unenforceable for any reason, the invalidity of that provision shall in no way affect (to the maximum extent permissible by law) the application of such provision under circumstances different from those
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adjudicated by the court, the application of any other provision of this Agreement, or the enforceability or invalidity of this Agreement as a whole.
(g) Jurisdiction and Venue. Executive and the Company consent to jurisdiction of the courts of the State of Minnesota and/or the federal courts, District of Minnesota, for the purpose of resolving all issues of law, equity, or fact, arising out of or in connection with this Agreement that are not subject to the ICP’s claims procedure. Any action involving claims of a breach of this Agreement must be brought in such courts. Each party consents to personal jurisdiction over such party in the state and/or federal courts of Minnesota and hereby waives any defense of lack of personal jurisdiction. Venue, for the purpose of all such suits, will be in Hennepin County, State of Minnesota.
(h) Section 409A. The income continuation payments described in Section 6 and the Long-Term Incentive Plan awards described in Section 4 of this Agreement are intended to comply with the requirements of section 409A of the Internal Revenue Code.
(i) Counterparts. This Agreement may be executed in more than one counterpart, each of which shall be deemed an original, but all of which together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date set forth below.
Target Corporation: By: /s/ Melissa Kremer Name: Melissa Kremer Title: Executive Vice President & Chief Human Resources Officer February 6, 2026 | Target Enterprise, Inc.: By: /s/ Melissa Kremer Name: Melissa Kremer Title: Executive Vice President & Chief Human Resources Officer February 6, 2026 | ||||
Richard H. Gomez /s/ Richard H. Gomez February 6, 2026 | |||||
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Exhibit A
Income Continuation Payments
Subject and pursuant to the terms and conditions of the Income Continuation Plan and this Agreement and provided Executive signs and does not revoke this Agreement and the release addressed in Section 13, Executive shall be entitled to the equivalent of twenty-four (24) months of income continuation payments. Such income continuation payments shall have a total value of $2,770,456, and are calculated using the Executive’s current base salary and the average of the annual bonuses paid to Executive for fiscal years 2024, 2023, and 2022. The initial payment of $692,614 shall be made on November 20, 2026, and will represent twelve (12) suspended bi-weekly payments and one regularly scheduled bi-weekly payment. Each of the remaining thirty-nine (39) bi-weekly payments, each in the amount of $53,278, shall be made on consecutive Company payroll dates beginning on December 4, 2026. The payments shall be reduced for taxes and other amounts the Company reasonably determines are required to be withheld by the Company.
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Exhibit B
Model Release
1. Definitions. The definitions below are intended solely for the purpose of this release. All words used in this release are intended to have their plain meanings in ordinary English, except that capitalized words not defined in this Exhibit shall have the same meaning as in that certain Transition Agreement (the “Agreement”). Specific terms in this release have the following meanings:
(a) “Executive” includes Executive and anyone who has or obtains any legal rights or claims through Executive.
(b) “Target” means Target Corporation and any company related to Target Corporation in the present or past (including without limitation, its predecessors, parents, subsidiaries, affiliates and divisions) and any successor of Target Corporation.
(c) “Corporation” means Target and any company providing insurance to Target in the present or past, any employee benefit plan sponsored or maintained by Target in the present or past and the present and past fiduciaries of any such plans, Target’s present and past officers, directors, employees, committees and agents and any person who acted on behalf of Target or on instructions from Target.
(d) “Executive Claims” means all of the rights Executive has now to any relief of any kind from the Corporation, including without limitation:
(i) all claims arising out of or relating to Executive’s service with Target and Executive’s service termination; and
(ii) all claims arising out of or relating to statements, actions, or omissions of the Corporation; and
(iii) all claims for any alleged unlawful discrimination, harassment, retaliation or reprisal, or other alleged unlawful practices arising under any federal, state, or local statute, ordinance, or regulations, including without limitation, claims under the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, 42 U.S.C § 1981, the Employee Retirement Income Security Act, the Equal Pay Act, the Worker Adjustment and Retraining Notification Act, the Family and Medical Leave Act, the Fair Credit Reporting Act, the Minnesota Human Rights Act, and workers’ compensation non-interference or non-retaliation statutes; and
(iv) all claims for alleged wrongful discharge; breach of contract; breach of implied contract; failure to keep any promise; breach of a covenant of good faith and fair dealing; breach of fiduciary duty; estoppel; defamation; infliction of emotional distress; fraud; misrepresentation; negligence; harassment; retaliation or reprisal; constructive discharge; assault; battery; false imprisonment; invasion of privacy; interference with contractual or business relationships; any other wrongful employment practices; and violation of any other principle of common law; and
(v) all claims for compensation of any kind, including without limitation, bonuses, commissions, stock, stock options or other equity interests, vacation pay, perquisites, and expense reimbursements; and
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(vi) all claims for back pay, front pay, severance pay or income continuation under any Company plan, program, or agreement, reinstatement, equitable relief, compensatory damages, damages for alleged personal injury, liquidated damages, and punitive damages; and
(vii) all claims for attorney’s fees, costs, and interest.
However, Executive Claims do not include any claims related to post-termination benefits accrued before the Separation Date under the generally-applicable terms of benefit plans or programs maintained by the Corporation (including without limitation, Executive’s rights under the Company’s Short-Term Incentive Plan and Long-Term Incentive Plan and related agreements), claims relating to Executive’s rights as a shareholder of the Company, claims that the law does not allow to be waived, claims that may arise after the date on which Executive signs this release, claims relating to the enforcement of the Agreement, or claims for defense, indemnification or contribution to the maximum extent permitted under the laws of the State of Minnesota, including without limitation Minn. Stat. § 302A.521, or otherwise for claims brought against Executive in his capacity as an officer, attorney, employee or agent of the Corporation. This paragraph does not preclude Executive from bringing a charge of discrimination with the EEOC however, Executive hereby agrees to give up any right to receive compensation or damages as a result of such a charge.
2. Agreement to Execute Release of Executive Claims. In exchange for all consideration provided by the Agreement, Executive gives up and releases all Executive Claims. Executive will not make any demands or claims against the Corporation for compensation or damages relating to Executive Claims.
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Exhibit 21.1
Target Corporation
(A Minnesota Corporation)
List of Significant Subsidiaries
(As of January 31, 2026)
Target Brands, Inc. (MN)
Target Enterprise, Inc. (MN)
Target General Merchandise, Inc. (MN)
Pursuant to Item 601(b)(21)(ii) of Regulation S-K, the names of other subsidiaries are omitted because, considered in the aggregate as a single subsidiary, they would not constitute a significant subsidiary as of the end of the year covered by this report.
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the following Registration Statements:
•Registration Statement (Form S-3 ASR No. 333-275713) of Target Corporation,
•Registration Statement (Form S-8 No. 333-274222) pertaining to the Target Corporation DDCP (2022 Plan Statement), the Target Corporation EDCP (2022 Plan Statement), and the Target Corporation Officer EDCP (2023 Plan Statement),
•Registration Statement (Form S-8 No. 333-30311) pertaining to the Dayton Hudson Corporation Executive Deferred Compensation Plan, the Dayton Hudson Corporation Highly Compensated Capital Accumulation Plan, the Dayton Hudson Corporation SMG Executive Deferred Compensation Plan, and the Dayton Hudson Corporation Director Deferred Compensation Plan,
•Registration Statement (Form S-8 No. 333-86373) pertaining to the Dayton Hudson Corporation Long-Term Incentive Plan of 1999,
•Registration Statement (Form S-8 Nos. 333-112260 and 333-75782) pertaining to the Dayton Hudson Corporation Highly Compensated Capital Accumulation Plan, the Target Corporation Director Deferred Compensation Plan, the Target Corporation Executive Deferred Compensation Plan, and the Target Corporation SMG Executive Deferred Compensation Plan,
•Registration Statement (Form S-8 No. 333-116096) pertaining to the Target Corporation Long-Term Incentive Plan,
•Registration Statement (Form S-8 No. 333-131082) pertaining to the Target Corporation Director Deferred Compensation Plan, the Target Corporation Executive Deferred Compensation Plan, and the Target Corporation SMG Executive Deferred Compensation Plan,
•Registration Statement (Form S-8 No. 333-174921) pertaining to the Target Corporation 2011 Long-Term Incentive Plan,
•Registration Statement (Form S-8 No. 333-205027) pertaining to the Amended and Restated Target Corporation 2011 Long-Term Incentive Plan,
•Registration Statement (Form S-8 No. 333-239155) pertaining to the Target Corporation DDCP (2013 Plan Statement), the Target Corporation EDCP (2017 Plan Statement), and Target Corporation Officer EDCP (2017 Plan Statement), and
•Registration Statement (Form S-8 No. 333-239154) pertaining to the Target Corporation 2020 Long-Term Incentive Plan;
of our reports dated March 11, 2026, with respect to the consolidated financial statements of Target Corporation and the effectiveness of internal control over financial reporting of Target Corporation included in this Annual Report (Form 10-K) of Target Corporation for the year ended January 31, 2026.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
March 11, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ David P. Abney
David P. Abney
Jan 23, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Douglas M. Baker, Jr
Douglas M. Baker, Jr.
Jan 23, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ George S. Barrett
George S. Barrett
Jan 26, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Gail K. Boudreaux
Gail K. Boudreaux
Jan 23, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Brian C. Cornell
Brian C. Cornell
Jan 23, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Robert L. Edwards
Robert L. Edwards
Jan 24, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Donald R. Knauss
Donald R. Knauss
Feb 2, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Christine A. Leahy
Christine A. Leahy
Jan 28, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Monica C. Lozano
Monica C. Lozano
Jan 23, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Grace Puma Whiteford
Grace Puma Whiteford
Jan 24, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Derica W. Rice
Derica W. Rice
Jan 25, 2026
Exhibit 24.1
TARGET CORPORATION
Power of Attorney
of Director and/or Officer
The undersigned director and/or officer of TARGET CORPORATION, a Minnesota corporation (the “Corporation”), does hereby make, constitute and appoint MICHAEL J. FIDDELKE, JIM LEE, DAVID L. DONLIN, MINETTE M. LOULA, MIRANDA S. HIRNER, JAYNA M. PAQUIN, and MARY B. STANLEY, and each or any one of them, the undersigned’s true and lawful attorneys-in-fact, with power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as director and/or officer of the Corporation to (1) a Form 10-K, Annual Report, or other applicable form, pursuant to the Securities Exchange Act of 1934, as amended (the “1934 Act”), including any and all exhibits, schedules, supplements, certifications and supporting documents thereto, including, but not limited to, the Form 11-K Annual Reports of the Corporation’s 401(k) Plan and similar plans pursuant to the 1934 Act, and all amendments, supplementations and corrections thereto, to be filed by the Corporation with the Securities and Exchange Commission (the “SEC”), as required in connection with its registration under the 1934 Act; (2) one or more Forms 3, 4, or 5 pursuant to the 1934 Act, Forms 144 pursuant to the Securities Act of 1933, as amended (the “1933 Act”), or applications (including Form ID) to obtain codes and passwords to enable the undersigned to submit electronic filings with the SEC, via the Electronic Data Gathering and Retrieval (“EDGAR”) system, and all related documents, amendments, supplementations and corrections thereto; and (3) one or more Registration Statements, on Form S-3, Form S-8, or other applicable forms, and all amendments, including post-effective amendments thereto, to be filed by the Corporation with the SEC in connection with the registration under the 1933 Act, as amended, of debt, equity and other securities of the Corporation, and to file the same, with all exhibits thereto and other supporting documents, with the SEC.
The undersigned also grants to said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. This Power of Attorney shall remain in effect until revoked in writing by the undersigned.
The undersigned has executed this Power of Attorney as of the date indicated below.
/s/ Dmitri L. Stockton
Dmitri L. Stockton
Jan 26, 2026
Exhibit 31.1
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
Certifications
I, Michael J. Fiddelke, certify that:
1.I have reviewed this Annual Report on Form 10-K of Target Corporation;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: March 11, 2026 | ||
| /s/ Michael J. Fiddelke | ||
| Michael J. Fiddelke | ||
| Chief Executive Officer | ||
Exhibit 31.2
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
Certifications
I, Jim Lee, certify that:
1.I have reviewed this Annual Report on Form 10-K of Target Corporation;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: March 11, 2026 | ||
| /s/ Jim Lee | ||
| Jim Lee | ||
| Executive Vice President and Chief Financial Officer | ||
Exhibit 32.1
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K of Target Corporation, a Minnesota corporation (“the Company”), for the year ended January 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (“the Report”), the undersigned officer of the Company certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the officer's knowledge:
1.the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: March 11, 2026 | ||
| /s/ Michael J. Fiddelke | ||
| Michael J. Fiddelke | ||
| Chief Executive Officer | ||
Exhibit 32.2
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K of Target Corporation, a Minnesota corporation (“the Company”), for the year ended January 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (“the Report”), the undersigned officer of the Company certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the officer's knowledge:
1.the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: March 11, 2026 | ||
| /s/ Jim Lee | ||
| Jim Lee | ||
| Executive Vice President and Chief Financial Officer | ||