Target and Ulta mutually agree not to renew partnership launched in 2021

Key Points

• Target and Ulta Beauty have mutually decided not to renew their partnership that started in 2021, which includes in-store beauty shops at Target locations.
• The current Ulta Beauty experience will continue at Target stores and online until the partnership ends in August 2026.
• The announcement comes during a time when Target is facing challenges in regaining customer loyalty amid increased competition and changing shopping habits.
• Target is expected to report its fiscal second-quarter results soon, alongside an announcement regarding a new CEO succession plan.

NEW YORK (AP) — Target and Ulta Beauty are parting ways, ending a partnership launched in 2021 that created in-store shops filled with beauty products at hundreds of the discounter's stores.

According to a joint release issued Thursday, the companies said they have “mutually agreed" not to renew their pact, which concludes in August 2026. Until then, the Ulta Beauty experience at Target will continue in Target stores and on Target.com, the release said.

Ulta is currently in 600 of Target's roughly 1,980 stores, according to a Target spokesperson.

“For 35 years, Ulta Beauty has revolutionized how people experience beauty — bringing together an unmatched assortment from mass to luxury — and our partnership with Target was one of many unique ways we have brought the power of beauty to guests nationwide,” said Amiee Bayer-Thomas, chief retail officer of Ulta Beauty, in a statement.

Rick Gomez, executive vice president and chief commercial officer at Target, said in a statement he was committed to "offering the beauty experience consumers have come to expect from Target.”

The partnership was announced in 2020 and came as the coronavirus pandemic upended shopping habits and more people tried to minimize potential exposure to the virus through one-stop shopping. COVID had dampened sales of lipstick as people wore masks, but the skincare business enjoyed stronger sales.

The shops are about 1,000 square feet and carry makeup, skincare, and fragrance and operated beside existing beauty sections in Target stores. The deal was a way for both Target and Ulta to increase their customer base.

“It’s a combination of two winning retailers that have great momentum in the market that can redefine the category,” Target CEO Brian Cornell told The Associated Press back in 2020.

The announcement comes as Target is struggling to regain its footing with its shoppers who are pulling back on discretionary items and are shopping at other rivals that they believe to be lower price or offer better merchandise.

Target is slated to report its fiscal second-quarter results on Wednesday.

In September 2022, Target extended its contract for its chairman and CEO Brian Cornell for another three years. It has not announced its succession plan.