10-KPeriod: FY2026

TARGET CORP Annual Report, Year Ended Jan 31, 2026

Filed March 11, 2026For Securities:TGT

Summary

Target Corporation's 2025 Form 10-K reports on a fiscal year marked by a dynamic and uncertain environment, primarily influenced by cautious consumer spending and significant tariff volatility. The company continued its strategic focus on merchandising, guest experience, technology acceleration, and strengthening its team and communities. Despite a 1.7% decrease in Net Sales to $104.8 billion, driven by a 2.6% decline in comparable sales, Target made progress on its business transformation initiatives, including organizational simplification and advancements in its Hardlines business. Key financial highlights include GAAP diluted earnings per share of $8.13 and Adjusted EPS of $7.57. Operating income saw a decline of 8.1% to $5.1 billion, with Adjusted operating income down 14.2%. The company also reported significant improvements in inventory shrink, returning to pre-pandemic levels, and continued innovation in its owned brands and retail media network. The report highlights a notable $593 million gain from credit card interchange fee litigation settlements and $250 million in business transformation costs. Management remains focused on liquidity and capital allocation, with plans for continued investment in stores, supply chain, and technology.

Financial Highlights

28 data points
Beta

Revenue

$104.78B

27.9% Gross Margin

Net Income

$3.71B

3.5% Net Margin

EPS (Diluted)

$8.13

Free Cash Flow

$2.83B

Financial Statements
Beta
Revenue$104.78B
Cost of Revenue$75.51B
Gross Profit$29.27B
SG&A Expenses$21.54B
Operating Income$5.12B
Net Income$3.71B
EPS (Basic)$8.16
EPS (Diluted)$8.13
Shares Outstanding (Basic)454.10M
Shares Outstanding (Diluted)455.60M

Key Highlights

  • 1Net Sales decreased by 1.7% to $104.8 billion for the fiscal year ended January 31, 2026.
  • 2Comparable sales decreased by 2.6%, with traffic down 2.2% and average transaction amount down 0.4%.
  • 3GAAP diluted earnings per share were $8.13, while Adjusted diluted earnings per share were $7.57.
  • 4Operating income decreased by 8.1% to $5.1 billion, and Adjusted operating income decreased by 14.2% to $4.8 billion.
  • 5The company reported $593 million in net gains from credit card interchange fee litigation settlements.
  • 6Business transformation initiatives incurred $250 million in costs, with potential for future costs.
  • 7Inventory shrink significantly improved, reaching pre-pandemic levels.

Frequently Asked Questions

Target's Net Sales decreased by 1.7% to $104.8 billion. This was primarily due to a 2.6% decrease in comparable sales, which was driven by a 2.2% decrease in traffic and a 0.4% decrease in the average transaction amount. Consumers remained value-focused and selective in discretionary spending amidst a dynamic and uncertain economic environment.

The company reported significant improvements in inventory shrink, bringing shrink rates back to pre-pandemic levels. This indicates better inventory management and loss prevention efforts. Additionally, Target leveraged its extensive store network to fulfill the vast majority of sales, with two-thirds of digital sales fulfilled through same-day options, supporting speed and cost efficiency.

For the fiscal year ended January 31, 2026, GAAP diluted earnings per share were $8.13, while Adjusted EPS (excluding certain items) was $7.57. Operating income was $5.1 billion, down 8.1% from the prior year. Notable items include a $593 million gain from credit card interchange fee settlements and $250 million in costs related to business transformation initiatives.

Target expects capital expenditures of approximately $5 billion in fiscal year 2026. These investments will support store experience and remodels, supply chain and technology projects, and new store openings (approximately 30 new stores expected). The company's strategy remains focused on merchandising authority, guest experience elevation, technology acceleration, and strengthening its team and communities.