Total Revenue

-3% YoY (Q4 2025: $30,915M vs Q4 2024: $31,919M)

The decline in total revenue reflects a reversal from the modest Q3 2025 gains—driven earlier by a 1.1% increase from digital strength " " —as consumer demand weakened further in Q4, especially in discretionary segments, resulting in a 3% drop in overall sales. " "

Home Furnishings & Décor

-8% YoY (Q4 2025: $5,087M vs Q4 2024: $5,530M)

This steeper decline builds on previous period trends where cautious consumer spending and supply chain disruptions already dampened performance, worsening in Q4 as consumers further curtailed discretionary spending amid tightened budgets and an environment of rising costs. " "

Credit Card Profit Sharing

-11% YoY (Q4 2025: $142M vs Q4 2024: $159M)

The 11% drop continues the trend observed in previous quarters where weaker consumer spending in discretionary areas led to reduced card usage and profit-sharing revenue, reflecting persistent economic pressures on consumer budgets. " "

Other Revenue

Reversal from +$293M in Q4 2024 to -$304M in Q4 2025

A dramatic reversal in Other Revenue indicates a significant shift in revenue mix—from previously buoyed performance (helped by a robust Roundel ad business in Q3 2025 " " " ) to challenges that likely include further declines in credit card profit sharing and other miscellaneous revenues in Q4. " "

Balance Sheet – Cash & Cash Equivalents

+25% YoY (Q4 2025: $4,762M vs Q4 2024: $3,805M)

The marked improvement in cash balances is largely attributed to strategic financing actions and cost efficiencies that built on prior period operational adjustments (as seen in Q3 improvements " " )—resulting in a 25% increase despite softer operating cash generation in Q4. " "

Balance Sheet – Inventory

+7% YoY (Q4 2025: $12,740M vs Q4 2024: $11,886M)

The inventory increase reflects a cautious supply chain strategy aimed at pre-positioning for Q4 demand amid prior period supply disruptions and volatile receipt timings; building on Q3 trends where elevated inventory levels were observed due to channel and seasonal adjustments. " " " "

Net Sales Growth

FY 2025

no prior guidance

Expected to grow around 1%, with comparable sales expected to be around flat. "

no prior guidance

Operating Margin Rate

FY 2025

no prior guidance

A modest increase is planned, supported by profit tailwinds offsetting continued investments in long-term growth. "

no prior guidance

Effective Tax Rate

FY 2025

no prior guidance

Expected to be in the range of 23% to 24%. "

no prior guidance

Adjusted EPS

FY 2025

$8.30 to $8.90 "

$8.80 to $9.80 "

raised

Capital Expenditures (CapEx)

FY 2025

$4 billion to $5 billion "

$4 billion to $5 billion "

no change

Consumer demand uncertainty and volatility

Q1 described consumer resilience amid elevated prices and uncertainty due to inflation, higher interest rates, and concerns about the economy. " " Q2 highlighted that despite resilient spending, executives maintained a measured and cautious outlook due to macroeconomic variability and consumer behavior shifts. " "

Q4 emphasized a conservative planning approach with explicit mentions of volatile sales (especially in discretionary categories) and added focus on managing tariff uncertainty by diversifying production. " " " "

Consistent caution continues, with Q4 adding new emphasis on tariff uncertainty in managing demand volatility.

Comparable sales performance

Q1 guided comparable sales growth in the 0%–2% range with expectations of a rebound starting in Q2, noting a decline driven by softness in key categories. " " Q2 similarly offered a 0%–2% outlook and noted a 2% comp driven by traffic growth. " "

Q4 provided flat comparable sales guidance for 2025, contrasting with a 1.5% increase achieved in Q4 2024, reflecting an adjustment to ongoing consumer unpredictability. " " "

A shift from anticipating modest rebound growth to maintaining flat guidance due to persistent uncertainty.

Operational efficiencies and inventory management improvements

Q1 outlined enterprise-wide inventory reductions, improved in‐stock positions, and efficiency measures across channels. " " " " Q2 highlighted innovations such as GenAI integration in stores, enhanced sortation center performance, and significant out-of-stock rate improvements. " "

Q4 detailed further advancements with AI-powered inventory tools, reduced lead times in categories like Apparel, and a renewed focus on granular performance metrics and cost savings initiatives. " " "

A consistent and deepening focus on operational and inventory management improvements across all periods.

Discretionary business volatility in non‑essential categories

Q1 noted softness in Home and Hardlines due to normalization of spending post‑pandemic, while pointing out some recuperation in Apparel. " " Q2 recognized ongoing volatility in discretionary comps but also highlighted improvements in on-trend offerings and specific brand successes. "

Q4 reiterated high volatility in discretionary categories such as Apparel and Home, prompting a conservative planning approach to manage rapid shifts and inventory challenges. " " "

Continued volatility remains a headwind, despite targeted efforts in product innovation, keeping executives cautious.

Frequency business performance and tariff impacts

Q1 reported frequency categories experienced low single-digit comparable sales declines with a focus on innovative launches (e.g., new items in Favorite Day and Good & Gather) and seasonal strengths. " " Q2 emphasized strong loyalty growth via Target Circle with solid performance in Food & Beverage and Essentials, but did not mention tariffs. "

Q4 discussed frequency performance success in Food & Beverage and Essentials while introducing mention of tariff uncertainty and diversification to reduce production risk. " "

While frequency performance remains a steady focus, Q4 introduces the new element of tariff uncertainty, adding complexity to the narrative.

Drive Up sales growth and omni‑channel fulfillment initiatives

Q1 highlighted strong Drive Up growth with innovative features (e.g., Starbucks orders, direct returns) and significant contributions from same-day services fulfilled through store models. " " Q2 reported over 14% growth in Drive Up sales with robust digital performance and increased package processing speed via sortation centers. " "

Q4 continued to emphasize Drive Up as a key driver of digital volume (20% of total) with advanced integrations (e.g., Apple CarPlay, streamlined store processes) and strong consumer satisfaction noted through high Net Promoter Scores. " " " "

Consistently robust and growing, with ongoing technological and process innovations reinforcing its importance.

Apparel category innovation and successful brand launches

Q1 focused on improvement in Apparel through innovative partnerships (such as the DVF limited-time collaboration) and robust performance in owned brands like All in Motion, Wild Fable, and A New Day. " " Q2 described further success with All In Motion and new offerings in Women's Apparel and seasonal assortments. " "

Q4 underscored a rapid speed-to-market approach (as exemplified by the viral “Mob Wife's Leopard Print” trend) along with strategic partnerships (e.g., new multiyear partnership with Champion) and reduced product development calendars. " " "

A marked intensification in innovation, with faster response times and deeper strategic partnerships fueling growth.

Price investment strategy and competitive pricing pressures

Q1 detailed significant price cuts (1,500 items initially with plans for 1,000 more) as part of the “Expect More, Pay Less” strategy to address cumulative inflation and soften consumer price sensitivity. " " Q2 continued this narrative with investments on 5,000 frequently purchased items, highlighting consumer approval and efforts to offset a more promotional environment. " "

Q4 did not mention the price investment strategy or competitive pricing pressures at all [document reference].

Topic no longer mentioned in the current period, indicating a potential shift in focus or successful resolution of earlier pricing concerns.

Reliance on promotional events impacting organic sales

Q1 featured concerns raised regarding overreliance on events like Target Circle Week, with leadership expecting organic trends to improve in subsequent quarters. "

Q2 noted high digital traffic and membership growth during Target Circle Week, but Q4 provided no mention of promotional event reliance impacting organic sales. " "

Topic is no longer mentioned in the current period, suggesting either its diminished impact or a strategic move away from heavy reliance on promotions.