US retail giant Target has appointed a new chief executive as it struggles to reverse a decline in sales and its share price.
The leadership change comes as rising prices and uncertainty over the knock-on effects of US tariffs have raised concerns over the impact on consumer spending, particularly for Target’s discretionary products such as apparel and electronics.
Michael Fiddelke, the company’s chief operating officer, will take over from Brian Cornell in February. Mr Fiddelke has been with the company for 20 years.
Shares in Target dropped nearly 11% before recovering slightly after the announcement. Mr Cornell, who has been boss for 10 years, had been expected to retire.
The appointment of Mr Fiddelke marks a return to Target’s tradition of hiring a company insider to lead it. Mr Cornell was the first-ever outsider to be made the top boss.
Mr Fiddelke said in a statement that the company has “work to do”, and needs to move “faster, much faster”.
He pledged to improve the quality of products on offer and to embed more technology in the business.
Target is known for its affordable clothes and wide range of cheap groceries, homeware, electronics and toys.
But it has seen poor sales in the past year amid competition from Amazon and Walmart.
Its share price dropped considerably at the start of the year and has been stagnant since.
Susannah Streeter, head of money and markets, Hargreaves Lansdown, said the appointment of Mr Fiddelke was likely to underwhelm investors.
“There may have been hopes that a successor from a rival in the market could have brought extra knowledge, insight and energy, valuable assets at a time of intense competition,” she said.
Michael Baker, an analyst at DA Davidson, added: “That announcement lacks the pop that a significant external hire would provide.”
In May, Target slashed its expectations for the year after a sharp fall in sales which it blamed on a “highly challenging environment” amid the introduction of trade tariffs.
Its sales slumped by 5.7% in the three months to May, at a time when the company also faced a backlash following a previous decision to end diversity, equity and inclusion (DEI) targets.