Target has added new brands to its beauty department. At a growing number of stores, it also has mini Ulta Beauty shops with prestige brands.
Melissa Repko | CNBC
Ulta Beauty and Target said Thursday that they have decided to end a deal that opened makeup and beauty shops in hundreds of Target’s stores.
Shares of Target fell about 2% in early trading, while Ulta’s stock slid about 1%.
In a news release, the companies said the partnership — which also added some of Ulta’s merchandise to Target’s website — will end in August 2026. Target had added more than 600 Ulta Beauty shops to its stores, according to a company spokesperson. That’s nearly a third of Target’s 1,981 U.S. stores.
The loss of the popular beauty retailer’s products could be another blow to Target as it tries to woo back both shoppers and investors. Target’s annual sales have been roughly flat for four years and it expects sales to decline this fiscal year. Shares of the company are worth less than half of what the were back in 2021, when they hit an all-time closing high of $266.39.
On earnings calls and in investor presentations, leaders of the Minneapolis-based company had touted Ulta’s shops and its trendy beauty brands as a way to drive store traffic.
At a investor presentation in New York City in March, CEO Brian Cornell highlighted beauty as a growth category for Target and cited it as reason for confidence in Target’s long-term business. He said the company gained market share in the beauty and its sales in the category rose by nearly 7% in the fiscal year that ended in early February.
In a statement on Thursday, Target Chief Commercial Officer Rick Gomez said the discounter is “proud of our shared success with Ulta Beauty and the experience we’ve delivered together.”
“We look forward to what’s ahead and remain committed to offering the beauty experience consumers have come to expect from Target – one centered on an exciting mix of beauty brands with continuous newness, all at an unbeatable value,” he said.
In a statement, Ulta’s Chief Retail Officer Amiee Bayer-Thomas described the Target deal as “one of many unique ways we have brought the power of beauty to guests nationwide.”
“As we continue to execute our Ulta Beauty Unleashed plans, we’re confident our wide-ranging assortment, expert services and inspiring in-store experiences will reinforce our leadership in beauty and define the next chapter of our brand,” she said.
