Target Corporation Revenue & Financials

Target's FY2026 revenue of $104.8 billion declined from $109.1 billion in FY2023 — the fourth consecutive year of declining revenue following the FY2022 peak. Net income of $3.705 billion on $104.8 billion in revenue represents a 3.5% net margin, which reflects both the gross margin pressure from the ongoing mix shift away from discretionary merchandise and the shrink problem — theft and inventory loss — that has required investment in store security and operating procedure changes across the fleet. The revenue decline from $109.1 billion to $104.8 billion over four years is a $4.3 billion contraction in a business that depends on traffic volume and basket size to absorb the fixed cost structure of 2,000+ stores. The comparable transaction growth turning negative — customers visiting less frequently — has been the mechanism of this contraction, and the recovery depends on whether the investments in Drive Up, Shipt, and owned brand expansion can rebuild the discretionary trip frequency that the 2022-2026 period eroded. Gross margin has been recovering after the 2022 inventory markdown shock, when Target took significant markdowns on excess discretionary inventory it had accumulated during the COVID-era demand surge. The FY2022 margin compression event — gross margin fell sharply as the company cleared excess inventory — reset the financial baseline but also demonstrated the risk of the consumer discretionary concentration in Target's category mix. Market capitalization of approximately $41 billion on $104.8 billion in revenue implies roughly 0.39x revenue — a deep discount to historical valuation that reflects the traffic decline, the discretionary spending pressure, and investor uncertainty about whether the owned brand and same-day service investments will restore the growth trajectory that justified higher multiples in the 2017-2021 period.