Keep pulling the thread on Fund 101.
Lower inventory shrink contributed about 90 basis points of benefit to Target's gross margin last year, bringing the shrink rate back to pre-pandemic levels.
In Q4, Target grew adjusted operating income dollars and adjusted EPS over the prior year, even on a decline in sales.
Target's top-line performance accelerated further in February, resulting in healthy growth in the first month of the new fiscal year.
Target is planning to reinvest a billion dollars into its P&L this year.
Target's planned $1 billion P&L reinvestment includes hundreds of millions for additional store labor and training.
Target is funding its $1 billion P&L investment partly through the annualization of about half a billion dollars in one-time tariff and inventory adjustment costs from 2025.
Target realized about $200 million in savings from last year's headcount reduction at headquarters and field team changes.
For the full year 2026, Target is planning to grow net sales in a range around 2% versus last year.
Target is planning for a 2026 operating income rate that is approximately 20 basis points higher than the 4.6% adjusted rate from 2025.
Target expects to generate GAAP and adjusted EPS in a range from $7.50 to $8.50 in 2026.
Target expects full-year capital expenditures to be approximately $5 billion in 2026, up more than a billion dollars from last year.
More than $1 billion of Target's 2026 CapEx plan will be spent in support of its food and beverage business, more than double the amount invested in recent years.