MINNEAPOLIS -- Target Corporation (NYSE: TGT) today announced its fourth-quarter and full-year 2025 results. The Company reported fourth-quarter GAAP earnings per share (EPS) of $2.30 and Adjusted EPS of $2.44, compared with GAAP and Adjusted EPS of $2.41 in 2024. GAAP EPS was $8.13 and Adjusted EPS was $7.57 for full-year 2025, compared with GAAP and Adjusted EPS of $8.86 in the prior year. The attached tables provide a reconciliation of non-GAAP to GAAP measures. All earnings per share figures are calculated on a diluted basis.
"I'm incredibly proud of how our team navigated through a challenging year in 2025, as they focused on serving our guests while positioning our business for profitable growth in 2026 and beyond," said Michael Fiddelke, chief executive officer of Target Corporation. "Our team is firmly focused on writing Target's next chapter of growth, rooted in strengthening our merchandising authority, delivering an elevated and differentiated shopping experience, advancing our use of technology, and continuing to serve and invest in our team and communities. Target saw a healthy, positive sales increase in February, serving as an important milestone on our path back to growth this year, and reinforcing my confidence in the momentum we're building and the future we're creating together."
The Company has the following expectations for 2026:
• Net sales growth in a range around 2 percent compared with 2025. This expectation reflects a small increase in comparable sales, with new store and non-merchandise sales contributing more than one percentage point of growth. The company expects to grow net sales in every quarter of the year.
• Full-year 2026 operating income margin rate approximately 20 basis points higher than the 4.6 percent Adjusted operating income margin rate in 2025.
• GAAP and Adjusted EPS of $7.50 to $8.50. Based on the expected timing of certain costs, the company expects Q1 GAAP and Adjusted EPS will be flat to up slightly from last year's Adjusted EPS of $1.30, with stronger year-over-year EPS growth expected through the balance of the year.
Operating Results
Fourth quarter 2025 net sales of $30.5 billion were 1.5 percent lower than Q4 2024. Fourth quarter comparable sales decreased 2.5 percent, reflecting a comparable store sales decline of 3.9 percent and a comparable digital sales increase of 1.9 percent. Operating income, which includes the impact of non-recurring items, was $1.4 billion in fourth quarter 2025, a decrease of 5.9 percent from $1.5 billion in 2024. Excluding those non-recurring items, Adjusted operating income was $1.5 billion, slightly above last year.
Full-year net sales decreased 1.7 percent to $104.8 billion from $106.6 billion last year, reflecting a 2.6 percent decrease in comparable sales partially offset by sales from new stores and growth in non-merchandise sales.
Fourth quarter operating income margin rate, which includes the impact of non-recurring items, was 4.5 percent in 2025 compared with 4.7 percent in 2024. Excluding those non-recurring items, Adjusted operating income margin rate was 4.8 percent in 2025. Fourth quarter gross margin rate was 26.6 percent, compared with 26.2 percent in 2024, reflecting lower inventory shrink, lower supply chain and digital fulfillment costs, and growth in advertising and other revenues, partially offset by the net impact of merchandising activities, including higher product and import costs.
Full-year operating income, which includes the impact of non-recurring items, of $5.1 billion in 2025 declined 8.1 percent from $5.6 billion last year. Full-year gross margin rate was 27.9 percent, compared with 28.2 percent in 2024, reflecting pressures from merchandising activities, driven primarily by higher markdowns and purchase order cancellation costs, and pressure from category mix, partially offset by lower inventory shrink and growth in advertising and other revenues.
Fourth quarter SG&A expense rate, which includes the impact of non-recurring items, was 19.9 percent in 2025, compared with 19.4 percent in 2024. Excluding those non-recurring items, Adjusted SG&A expense rate was 19.6 percent in Q4 2025. Full-year SG&A expense rate, which includes the impact of non-recurring items, was 20.6 percent in 2025, compared with 20.6 percent in 2024. Excluding those non-recurring items, Adjusted SG&A expense rate was 20.9 percent in 2025. Both periods reflect the deleveraging impact of lower sales partially offset by disciplined cost management, as adjusted SG&A expense dollars in both periods were lower than in 2024.