Target is cutting about 1,000 corporate positions and eliminating 800 open roles as part of an effort to speed up business decision-making and drive growth under its new chief executive, Michael Fiddelke.
Fiddelke, who will succeed Brian Cornell as CEO in February, has been focused on ways to speed up the way corporate teams work, turning the company into a leaner and faster organization to drive innovation. This includes eliminating layers of management.
About 80% of the roles being cut are based in the U.S., with the majority concentrated in the Minneapolis area, where the company is headquartered, and in leadership positions. Target said those in leadership positions were three times more likely to be laid off than other employees.
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The eliminations will account for 8% of the company’s global headquarters team.
“To better serve our guests, we’re prioritizing the need to work faster and reduce the complexity that has been created over time. This is especially important against the backdrop of a rapidly changing business landscape,” Fiddelke said, adding that this announcement “is an important step toward our key priorities: strengthening our retail leadership in style and design, enhancing the guest experience and expanding how we use technology to fuel our next chapter of growth.”
Affected employees will receive benefits and pay through the beginning of January in addition to any severance they were offered, Target said.
Fiddelke said in a note to employees on Thursday that since the company launched the Enterprise Acceleration Office in May, it has been pushing ahead with a mission to “move faster and simplify how we work to drive Target’s next chapter of growth.”
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As the executive who has been overseeing the initiative since its launch, Fiddelke has been looking into ways to improve cross-functional collaboration and advance key priorities. This includes streamlining company-wide processes and leveraging technology and data in new ways to empower teams and accelerate performance since its launch.
“The truth is, the complexity we’ve created over time has been holding us back. Too many layers and overlapping work have slowed decisions, making it harder to bring ideas to life,” Fiddelke said in the note to employees.
Fiddelke said all U.S. HQ team members are being asked to work from home next week, but Target in India and its other global teams will follow their in-office routines.
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Fiddelke, who has been with Target for over two decades, said that while the decision to make these cuts was a difficult one, they will aim to “set the course for our company to be stronger, faster and better positioned to serve guests and communities for many years to come.”
In Fiddelke’s current role as Target’s chief operating officer, he has overseen efforts that enabled exponential growth across the business, including investments to build and scale the company’s stores, supply chain, digital capabilities and team. He also spearheaded enterprise efforts to deliver more than $2 billion in efficiencies.
Now, he is facing a new challenge: turning around a retailer that has been experiencing declining store traffic and profit pressures, partly due to tariffs.
In its latest fiscal quarter, the company reported $25.2 billion in sales, down just under 1% from a year ago. The company blamed the dip on shoppers pulling back on merchandise, though that was partly balanced out by stronger non-merchandise sales, like services.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| TGT | TARGET CORP. | 94.02 | -0.38 | -0.40% |
Sales at stores open at least a year fell nearly 2%, with in-store sales dropping more than 3%. Online sales, however, grew a little over 4%. Overall, profit for the quarter came in at $1.3 billion, which was down about 19% from last year.
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