Target and Ulta Beauty will officially part ways in August 2026, ending a five-year partnership that brought curated beauty products to over 600 of the retailer’s locations. The decision was confirmed through a joint press release, and reflects a broader transition in strategy for both companies.
According to The US Sun, the decision not to renew the original agreement was described as mutual and comes after earlier signals from leadership about pausing expansion. Although the in-store Ulta spaces will remain until the conclusion date, the change signals a reorientation toward internal priorities and a redefinition of future retail formats.
1,000-Square-Foot Beauty Shops to Close In 600+ Target Stores
The partnership launched in 2021, initially with a goal of integrating Ulta Beauty counters of approximately 1,000 square feet into Target stores across the U.S. That goal was quickly exceeded, reaching over 600 store locations within a few years. Customers benefited from linked Ulta Rewards and Target Circle programs, which will remain active until the partnership officially concludes.
The initiative was part of a broader strategy during the pandemic to increase store traffic and offer differentiated shopping experiences. But in a HUGE u-turn, the companies jointly decided in August 2025 not to renew the agreement.
Leadership Transitions and Strategic Realignment
This decision comes as both companies undergo executive transitions. Ulta Beauty named Kecia Steelman as CEO in January 2025, following the unexpected departure of Dave Kimbell. Steelman had already signaled the shift earlier in the year at the J.P. Morgan Retail Round Up Conference, stating:
“This is really just to make sure that we’re working together on all the things that we’ve learned over the last three years collectively together.”
Steelman also confirmed a pause in expansion of Ulta shops within Target stores throughout 2025. Instead, the company plans to focus on strengthening its omnichannel offerings, including the upcoming launch of the Ulta Beauty Marketplace.
Meanwhile, Target is also preparing for new leadership, as CEO Brian Cornell steps down after 11 years. The company is re-evaluating its merchandising and pricing strategies in response to 10 straight quarters of flat or declining same-store sales.
Target Shifts Priorities After Employee Survey and DEI Backlash
In June 2025, a companywide internal survey revealed that 50% of Target employees do not believe the company is making the right decisions to stay competitive. This finding came amid growing criticism of recent shifts in Target’s diversity and inclusion policies.
A January memo confirmed that Target would end its three-year DEI goals, along with reporting to external benchmarks such as the Human Rights Campaign’s Corporate Equality Index. It also disbanded a program designed to increase product sourcing from Black- and minority-owned businesses.
Kiera Fernandez, Target’s Chief Community Impact and Equity Officer, wrote in the memo:
“Many years of data, insights, listening and learning have been shaping this next chapter in our strategy.”
“And as a retailer that serves millions of consumers every day, we understand the importance of staying in step with the evolving external landscape, now and in the future — all in service of driving Target’s growth and winning together.”
This course correction marks another HUGE u-turn in Target’s public image, contributing to customer backlash and a wave of online criticism.
Customer Frustration Over Pricing Policy Changes
In another move drawing attention, Target revised its price match guarantee policy, now restricting matches to its own platforms only — in-store, app, and Target.com — excluding competitors like Walmart or Amazon. The company claimed the change would improve shopping efficiency and consistency, but customers expressed disappointment on forums like Reddit:
“If they don’t price match, I’ll just go to the store that has the cheaper prices.”
This change is widely viewed as a HUGE u-turn from Target’s prior customer-first pricing strategy.
New Formats and Seasonal Launches Amid Strategy Reset
Despite ending the Ulta collaboration, Target is not abandoning shop-in-shop formats altogether. The retailer has announced five new Warby Parker stores set to open within Target locations in 2025, staffed by the eyewear brand’s employees.
Additionally, the company has released its 2025 Halloween lineup, offering over 1,500 seasonal products, and continues to promote special in-store clearance events with discounts of up to 70%.
