Target Corporation (NYSE: TGT) has named Michael Fiddelke as its next Chief Executive Officer, replacing Brian Cornell who will step down after 11 years leading the retail giant. The announcement comes as Target’s stock has plunged 22% in 2025 alone, reflecting mounting challenges from declining sales, increased competition, and tariff pressures.
Fiddelke, 49, currently serves as Target’s Chief Operating Officer and will assume the CEO role on 1st February 2026, while Cornell transitions to executive chairman of the board. The leadership change marks a critical juncture for the Minneapolis-based retailer as it struggles to regain momentum after several quarters of disappointing performance.
Wall Street Wanted an Outsider
According to a June survey of 51 investors by Mizuho Securities, about 96% favoured an external hire for Target’s next CEO. Target’s stock dropped nearly 10% in pre-market trading following the announcement, suggesting investors were disappointed the company chose an internal candidate.
Target stock currently trades at $105.33, with analysts maintaining a consensus “Buy” rating and an average price target of $117.41, forecasting an 11.47% increase over the next year. However, recent downgrades have created headwinds. Bank of America Securities analyst Robert Ohmes downgraded Target to “Sell” from “Hold” and cut the price target to $93 from $105, citing concerns over long-term sales and profitability outlook.
Challenges Mount for America’s Retail Giant
Target faces a perfect storm of operational and strategic challenges. The company’s comparable sales fell 1.9% in the second quarter, with profits down 20% from the same period last year. The retailer has been particularly hurt by its exposure to discretionary merchandise, which consumers have reduced amid persistent inflation.
Target also faced backlash earlier this year after ending some of its diversity, equity, and inclusion programs, angering supporters who felt blindsided by the decision. The move hurt sales among Target’s traditionally progressive customer base, adding to the company’s woes.
Competition from Walmart Inc. (NYSE: WMT) and Amazon.com Inc. (NASDAQ: AMZN) continues to intensify, while tariffs on imported goods pose additional cost pressures, with about 50% of Target’s merchandise coming from overseas.
Fiddelke’s Twenty-Year Journey to the Top
During his 20-year career at Target, Fiddelke has held leadership roles across merchandising, finance, operations and human resources. He started as an intern in 2003 and worked his way up through the ranks, serving as Chief Financial Officer for five years before becoming COO in February 2024.
“I’ve seen how our business can perform when we’re at our best, and therefore where we also have clear opportunities today to improve our performance, and we must improve,” Fiddelke said on an earnings call.
His priorities as CEO include returning Target to its former status as a retail innovator, improving store consistency and investing heavily in technology. This includes an initiative called “Fun 101,” which seeks to capitalise on the latest trends for electronics and home goods.
Cornell’s Mixed Legacy
Cornell took over in 2014 and initially revitalised overseeing a strategy to remodel stores and strengthen the chain’s online business to compete with Amazon. In 2018, reported its best results in a decade, and Cornell was named CNN Business’ CEO of the Year in 2019 for leading a successful turnaround.
The pandemic initially boosted Target’s fortunes as shoppers rushed to purchase home goods and essentials. However, the company began to falter in 2022 when it bought too much merchandise, creating a glut of unsold inventory just as inflation pressured consumers’ wallets.
Under Cornell’s tenure, Target’s shares gained 80% through Tuesday’s close, though this lags the roughly 230% advance of the S&P 500 Index over the same period.
Retail Sector Under Pressure
It’s struggles reflect broader challenges facing traditional retailers. The retail landscape continues to evolve rapidly, with companies forced to adapt to changing consumer preferences and digital disruption.
Tariffs and a consumer slowdown have put additional pressure on It, which stocks more nonessential merchandise than its competitors. The company must balance maintaining competitive prices with preserving margins as cost pressures mount.
Analyst Outlook Mixed
“Investor sentiment has been mixed as Fiddelke does have an impressive 20-year tenure at TGT but also no prior CEO experience,” TD Cowen analyst Oliver Chen wrote Wednesday.
Some analysts remain cautiously optimistic. “Regaining the market’s credibility will be critical, but it’s achievable,” wrote UBS analyst Michael Lasser. “Target has the foundation and scale to stage a recovery, making the stock a longer-term opportunity.”
Currently, Wall Street analysts expect Target to report earnings of $2.02 per share in Q2 2025, compared to $2.57 in the prior-year quarter, with revenue expected to decline about 2% year-over-year to $24.94 billion.
The Road Ahead
Fiddelke acknowledged the challenges ahead, saying: “I want to thank Brian for his leadership and for ensuring Target has an excellent foundation, consisting of nearly 2,000 stores, a USD 30 billion owned-brand portfolio and world-class partnerships.“
The incoming CEO faces immediate pressure to reverse Its declining performance while navigating an increasingly competitive retail environment. His success will depend on whether he can reignite growth, improve operational efficiency, and win back both customers and investors.
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With It’s shares trading near multi-year lows and facing headwinds from multiple directions, Fiddelke’s appointment represents both an opportunity for fresh leadership and a test of whether internal expertise can drive the transformation needed to restore Target’s retail dominance.
It’s quarterly earnings results will provide crucial insights into the company’s trajectory under new leadership, as investors watch closely for signs of improvement in the coming quarters.
