Target Corporation

Good morning, everyone, and welcome to our 2026 Financial Community Meeting. I'd like to thank everyone who's here with us in Minneapolis today and welcome everyone who's here with us online. Michael will kick off in a couple of minutes, but first I have a couple of important disclosures. First, any forward-looking statements that we make this morning are subject to risks and uncertainties, the most important of which are described in our SEC filings. And second, in today's remarks, we refer to non-GAAP financial measures, including adjusted earnings per share, adjusted operating income, and adjusted SG&A expenses. Reconciliations of all non-GAAP measures to the most directly comparable GAAP measure are included in our financial press releases, financial presentations, and SEC filings, which are posted on our Investor Relations website. With that, I'll turn it over to Michael. Thank you.

Welcome, everyone.

We're thrilled to be hosting our financial community meeting from our hometown of Minneapolis this year. And we're going to dive right in because we've got a lot to cover. It's a new chapter at Target. And today, Kara, Jim, and I will share our plans for what's next, starting with a clear definition of Target's place in retail, followed by the four priorities that will guide our path forward and the choices that underlie each. And finally, how those choices translate to growth. Our plans build on what's always been true about Target when we're at our best. But let me be clear, that doesn't mean dwelling on the past. Instead, we're moving forward with urgency and a firm focus on Target's unique place in American retail. That means delivering the style, design, experience and value consumers crave and delivering the consistent performance we all expect. And we've already started. We've updated our organizational structure and leadership team in service of simplicity and speed. We've added new directors to our board who bring deep expertise in style and design and who have experience with the type of transformational change we're driving. And as we shared in this morning's press release, sales trends have improved in recent months, showing early signs we're on the right path. All of this stems from important work we've done to clearly define the lane we occupy in retail, which I'll come back to in just a minute, and the choices that position us to grow and win. These choices translate to very intentional investments, investments in categories and capabilities where we know we have an edge and that matter most to our guests and our business. So if you take away one thing from today, it's this. Target's new chapter is all about fueling growth. And we'll do so by playing our own game and making big changes to delight our guests. Now, these types of changes don't happen overnight. We have work to do and there are no shortcuts. But we're excited to do the work. And it's already underway. Many changes guests will see and feel right away. In fact, if I were to step back and draw a heat map of the entire store, highlighting where we're making changes this year, you'd see more change to what we sell and how we sell it than you've seen in a decade. I won't steal Kara's thunder, but know that we're playing to our strengths. From categories where we're consistently leading, like beauty, to others, like home, where we know we can win and which we're reimagining to achieve greater relevance and differentiation. That means pairing products with experience in a way that only Target can. And all of it is rooted in our learnings of what's worked, what hasn't, and what will drive this new chapter of growth. So let's talk about what will be different moving forward. It starts with clarity about the retailer we are and the experience we create for our guests. It's about doing the work to build connection with new guests, deepen relationship with existing guests, and earn back trust with guests we've disappointed. That work starts with listening actively and attentively across all of our stakeholders and using their input to shape our path forward. We've been gathering feedback from consumers, from those who love us to those who don't, in order to gain a deeper understanding of the role Target plays in their lives. We've been meeting with founders of small businesses who have grown their brands with Target and want other entrepreneurs to follow in their footsteps. We've also been meeting with national brands and design partners to reinforce our commitment to style, design, and value. We've been talking to our team about what they need in order to serve our guests well. And as a result, we're moving quickly to simplify work, speed up decisions, and empower our merchants and store teams. And we've been talking to all of you here today to understand what's top of mind for investors as we get Target back to growth. That collective input has crystallized what we do well, where we have work to do, and most importantly, the lane we're uniquely suited to own and win in retail. That lane begins with our purpose of helping all families discover the joy of everyday life. And we'll bring that purpose to life by being the most delightful experience in retail. Now those aren't just words. Delight is a critical filter for decisions and informs our actions going forward. It encompasses what we consider foundational to a great shopping experience. Convenience, speed, price. Yet consumers consistently say they want and expect more, especially from Target. So, delight is our standard. That means getting the basics right. Short pricing, strong in-stocks, wicked fast same-day delivery. Yet our bar is higher. We want to spark an emotional connection, so shopping isn't a chore, it's a joy. And that spans everything we do, from the products we sell to the experiences we create, from the design of our shopping carts to the way we greet our guests, from making our marketing campaigns to our community partnerships. All of it ladders up to a brand that's designed to inspire, invite, and delight. So clearing this bar requires making choices about how we will show up as a retailer. Because for Target, differentiation is how we win. And Target is built to be different. We're doubling down on our design ethos across our products and experience. We're leaning into curation with an acute focus on blending style with value. And we're creating an experience that feels elevated, seamless, and importantly, human. And we're getting crisper on the guests who power our growth. These guests are united by mindset. They value style and design, seek ease and simplicity, and they don't want to settle for anything that feels ordinary or joyless. They move fast, they're digitally fluent, and they gravitate toward brands that mix practicality with fun and personal expression. We refer to this group as Busy Families, and it's one where we see outsized strength in sales and loyalty. So we're leaning in here, knowing that when we serve busy families well, we create durable, long-term value that has a positive ripple effect for all target guests. That's the foundation. A clear purpose and ambition rooted in joy and delight, clear choices that differentiate us and play to our strengths, and a deeper understanding of what busy families need and expect from us. Which brings me to the four priorities that underpin our growth strategy. Four priorities we're advancing in parallel because of how they work together to drive growth. Leading with merchandising authority, elevating the guest experience, accelerating technology, and strengthening team and communities. I'll spend most of my time today on the first two because that's where guests will feel changed the most. Then I'll touch on how technology, team, and community power it all. So let's start with merchandising authority. Earlier this year, I spent some time with the team who manages our corporate archives. This collection is pretty unreal, spanning artifacts from our early department store roots to products from every design partnership we've ever had. Now, I share this not as a point of nostalgia, but as a reminder of who Target is at our best. When we're setting the bar on style, when we democratize great design, when we're pace setters of what's cool and what's buying, that's what merchandising authority means, and it's what we aspire to deliver across categories and brands. At its core, merchandising authority is about curation and playing to our strengths. Target is not an everything store. That's not what guests want from us. They want a strong, trend-forward assortment that they can trust to deliver quality and value. And that's exactly what we do at Target when we're at our best. So we're making choices. In assortment, we're doubling down where we are strongest and where guests tell us our right to win and grow is highest. An early template for this approach is Fun 101. This is a multi-year transformation from hard lines, which many retailers sell, to a more immersive, trend-forward approach to sports, play, gadgets, and pop culture. This is an area where Target has a right to win and our guest base loves to shop. Whether it's bringing style and sport together with a fan central destination or an affordable plush wall so families can get fun toys at a great price, you're going to see us infuse our assortment with newness, value, and a fresh experience to match. And it's not just fun 101. We're taking this approach to categories like baby, home, food and beverage, and beauty, repositioning our assortment and our floor plans to bring newness to all 2,000 stores this year. In other words, we're giving guests more reasons to shop us more often. And as we always do, we're using their feedback to iterate, refine, and keep getting stronger over time. This will be a journey, and it starts with a lot of change in 2026, but it doesn't stop there. In fact, the team is already actively planning for 2027 and beyond. Now to priority two, elevating the guest experience. Delighting our guests always starts with product, but a huge part of what drives guest love for our brand is the experience we create around those products. And for many guests, their experience starts with discovery on social and in search. This is where our scale allows us to lean in and invest at the top of the purchasing funnel so that we reach consumers in all the ways they're shopping today. Whether it's connecting with consumers on social by partnering with creators who share our commitment to style, design, and value, or our investments in AI to make search more conversational, almost like having a personal shopper, or the way our media business, Roundel, seamlessly integrates into the shopping experience so guests find products that feel just right for them. That's discovery at its best, and it's a critical entry point for building trust, which in turn builds loyalty. And loyalty is an important growth engine for us. The reach of our loyalty program, Target Circle, gives us critical information about how consumers shop, enabling us to deliver an experience that feels more relevant and tailored. And when guests feel like their experience is personal, they shop with us more. Members of our loyalty program, Target Circle, spend three times more on average. And those enrolled in Target Circle 360 with unlimited same-day delivery spend seven times more. These guests account for more trips, too. As with many of the updates I've shared today, work is already underway on what's next, and Kara will share more shortly. Digital discovery and loyalty are essential to an elevated guest experience. And especially for Target, I want to emphasize that our stores are every bit as essential. In many ways, they are truly the heartbeat of our experience. Guests tell us they love the feeling of walking into a Target that's clean, welcoming, and easy to shop. In fact, one of the greatest compliments we ever receive is when guests refer to their local store as my Target. That possessive speaks volumes about the role our stores play in building lasting relationships with guests. I challenge you to think of any other retailer, company for that matter, that sparks the same sense of ownership and care. Now, you heard me talk earlier about delight is our standard. We need our experience to delight guests every time. And to be crystal clear, there's real work for us to do here. That's why we're strengthening reliability and service end to end, as well as making meaningful investments in payroll and training that our teams need to consistently deliver for our guests. And while we're not yet at the bar I have for us, we're seeing progress. Our relentless cross-company efforts on reliability have produced ongoing year-over-year gains in on-shelf availability, and you'll see us continue to focus on improvements here. We're leveraging technology to support our company's digital growth and enhance the in-store experience. That balance has been skewed in recent years by explosive digital growth. But today, we're using technology to keep momentum building in our digital business and simplify work for our store teams so they can spend more time serving our guests. And we're making a more than $2 billion incremental investment across the business this year, including an additional $1 billion in CapEx to support new stores and remodels, and another $1 billion to elevate the guest experience. Jim will provide more detail in a few minutes, but all of this is designed to elevate how guests experience Target every time they shop with us. The next two priorities, accelerating technology and strengthening team and communities, are just as critical, and they work hand-in-hand powering the first two. In fact, we've touched quite a bit on technology already today. It's woven into everything that we do. And that's because at Target, we don't chase technology for technology's sake. We believe in technology with a purpose. In our case, making shopping more joyful. And it should directly benefit our team and our guests. So whether it's making it easier for guests to find the perfect product when they browse our aisles, or putting technology into the hands of our team so they can better serve our guests, our tech investments are all in service of our ambition to be the most delightful experience in retail. The same can be said for why we prioritize strengthening team and communities. This has always been core to who we are, and it will continue to be at the center of this new chapter for Target. For all the team members tuning in today, thank you. Everything I've outlined today, the resilience, the progress, the boldness, is because of you, Team Target. And our ambition to be the most delightful experience in retail begins and ends with you. I'm so proud to lead this team and excited about what we are building together. And what we are building extends far beyond the walls of our stores, our supply chain facilities, and our offices. Target beliefs in the power of community and turns that belief into tangible action. Like the one million hours our team volunteered last year, which is the tenth time in our history we've hit that milestone. That includes our Bullseye Builds with Community program, which pairs our commitment to volunteerism with our design expertise to meet the needs of local neighborhoods. We recently announced a planned investment of $1 million to bring this program to 13 community spaces this year. Action also includes the 5% in profits we give back to communities in products, cash, and through the Target Foundation. This is something we've done for 80 years, and today translates to millions of dollars each week. These investments make our community stronger and more vibrant. We'll also continue to invest in our team so that every team member can grow a meaningful career with us. This includes pay, benefits, and signature programs like Dream2Be, which provides tuition-free education assistance for our team. More than 12,000 team members have earned degrees and professional certificates through Dream2B to date, a testament to the growth and opportunity that we value so much at Target. Because when our team thrives, so do our guests. And when our communities thrive, so does Target. So let's step back and turn to the bottom line and what all this means to Target's future. A thriving, growing target is the only goal and will be the focus of this team every single day. A growing target is a great place for our team and our partners and is the only path to creating value for our shareholders. The questions I know are top of mind for many of you. One, what's Target's winning path? And two, what will it cost? The answer to number one is when we play our own game. We're confident the plans we've laid out today position Target for sustainable growth. Our path to growth and share gains is unique to Target and is fully within our power to drive. And that confidence is justified because the early wins we're seeing directly align to where we've committed to do more. And the answer to the second question? It does require investment. We have work to do and Jim will get into the details shortly. But a clear strategy leads to sharper focus. And when you couple that sharp focus with the work the team is doing to find efficiency, we're able to make real investment against the work. You'll see us make the changes in investments in the areas that matter most to guests and ultimately win trips, build baskets, and drive growth. And that's the bottom line. Target's new chapter of growth begins this year because we're clear on Target's place in retail, we have four priorities that will guide our path forward, and we're making strategic choices and investments across the business that drive performance. I'll now turn it over to Kara and then to Jim to talk more about those choices and how they translate into long-term profitable growth.