As an internal memo led to widespread media reports about Target laying off 1,000 corporate staffers and eliminating 800 unfilled positions, the company has initiated a corporate restructure that has generated rumors of significant executive departures, including in merchandising.
Target initially remained mum about its actions despite the media outburst. The company did not respond to an inquiry from HomePage News.
As Michael Fiddelke, currently executive vice president and COO and a long-time Target leader, prepares to take over the CEO position from Brian Cornell on February 1, 2026, observers expect operational change to occur, particularly given the drop in share price that has hit the company recently. Morningstar analyst Brett Husslein, writing the day before the news of layoffs made news, pointed out that, despite sluggish performance, Target’s stock is undervalued, which suggests investors have lost some faith in the brand and the strategies supporting it.
As Fiddelke (pictured above) prepares to take the reins, Target is attempting to steady its position in the retail marketplace by differentiating the store base with trendy merchandise, Husslein observed, but execution missteps and lost market share in recent years demonstrate that the company faces a rough road ahead. That said, Target could resume generating some sales growth after three consecutive years of declines, Husslein indicated, due to what it has recently done to update its assortment and enhance the in-store and online shopping experience.
However, Husslein added, it seems as if Wall Street remains reluctant to believe Target will realize substantive benefits from its initiatives, given contracting operating margins.
Target has seemed to stumble even as it tries to adjust to a marketplace where competition has become more diverse, with companies such as Primark and Temu gaining traction with its core middle-class consumer. Some challenges have arisen from outside sources, including pressure exerted as it got entangled in wider social disputes that preceded a pullback of its DEI initiatives.
Internally, Target’s expansion and contraction in food and everyday essentials during the past 15 years created dilemmas as the company had to confront the higher demand on store labor those products demand even just to keep the shelves neat. When Cornell took the helm a decade ago, he led a drawback on edibles and everyday essentials in a drive to refocus Target on core categories, including home, made up of mostly discretionary assortments that offered better ROI prospects. Then the COVID-19 pandemic and inflation struck the economy, favoring established retail competitors such as Walmart and Costco that could more readily shift focus to necessities.
Although the specifics of what Target might do to improve its prospects were unknown, observers have expected change for months, given changes in focus and leadership. Fiddelke’s emergence after leading what the company named its Enterprise Acceleration Office, which focused on how to reinvigorate the operation, certainly foreshadowed the current developments in the company’s second-quarter conference call when he said that he understands how Target can perform when the company is at its best and where it has clear opportunities to improve performance. “We must improve, Fiddlele added. “I know we’re not realizing our full potential right now. And so I’m stepping into the role with a clear and urgent commitment to build new momentum in the business and get back to profitable growth.”
He said the entire leadership is taking a clear-eyed approach to determining where it has to work harder and accelerate change. Fiddelke noted:
My work over the past few months leading the Enterprise Acceleration Office has also provided a fresh opportunity to broadly assess where we’re at and where we need to go across the enterprise. But even as this work is ongoing, I’ve established three key priorities to help us reinforce what will continue to set us apart for years to come. I strongly believe in our differentiated place in retail. At our core, we are a style and design-led company. We’re merchants at heart who love product and win through offering a unique assortment. So first, we must reestablish our merchandising authority in a way that is distinctly Target. Second, we’re a retailer that believes that an elevated experience is every bit as important as product. We want guests to find a sense of joy from every trip to Target, and we must do that more consistently and frequently. And third, we must more fully use technology to improve our speed, guest experience and efficiency throughout the business.
