Target Corporation announced that CEO Brian Cornell will step down from his leadership role after an 11-year tenure marked by recent sales declines and mounting pressure from conservative customers over the company’s diversity policies.
Cornell’s departure comes as the retail giant faces its third consecutive quarter of falling sales and significant stock decline.
The announcement sent Target shares tumbling 10 percent in premarket trading Wednesday.
The company selected Michael Fiddelke, Target’s current chief operating officer, to replace Cornell effective February 1, 2026.
Fiddelke began his career at Target as an intern and has spent two decades with the retailer.
Cornell will transition to executive chairman following the leadership change.
During a Wednesday analyst call, he described Fiddelke as the “right candidate to lead our business back to growth” after evaluating both internal and external candidates.
The outgoing CEO took control of Target in 2014 and initially revitalized the brand through store remodeling and expanded online capabilities to compete with Amazon.
His early leadership earned recognition, including CNN Business’ CEO of the Year award in 2019.
Target experienced significant success under Cornell’s guidance through 2021, particularly during the pandemic when consumers increased purchases of home goods and essentials.
The company reported its strongest results in a decade during 2018. However, Target’s performance began deteriorating in 2022 when the company struggled with excess inventory as inflation pressured consumer spending.
Shoppers shifted away from discretionary items like home goods and clothing that comprise more than half of Target’s merchandise.
The retailer faces intensified competition from Walmart, Amazon and Costco, with analysts noting Target’s vulnerability due to its focus on non-essential items.
Walmart’s grocery-heavy business model provides more stability during economic uncertainty.
Target’s challenges deepened in 2023 when conservative activists launched campaigns against the company’s LGBTQ-themed Pride Month merchandise.
The backlash included threats against Target employees over items such as so-called transgender-friendly bathing suits, forcing the company to remove products from stores.
Social media misinformation falsely claimed the swimwear targeted children, though the products were designed for adults.
The controversy resulted in sales drops and lawsuits from Republican-aligned legal organizations.
Earlier this year, Target ended some of its DEI programs, a decision that angered supporters of diversity and inclusion policies.
CNN reported that Anne and Lucy Dayton, daughters of Target’s co-founder, characterized the company’s actions as “a betrayal.”
The DEI rollback particularly impacted Target because diversity initiatives were more deeply integrated into its business operations compared to competitors.
Target’s customer base also skews more progressive than other major retailers.
Current economic pressures from tariffs and consumer spending slowdowns have further strained Target’s operations.
The company imports approximately half its merchandise, compared to 33 percent at Walmart, making it more vulnerable to tariff impacts.
The new CEO indicated Target would pursue price increases only as a last resort while navigating tariff challenges.
The company has already adjusted merchandise selection to minimize tariff impacts.
Analysts remain divided on Target’s recovery prospects.
Ohmes warned that “Target’s long-term outlook is deteriorating” and the company “is falling behind peers and has tougher challenges.”
