Ditching DEI hurt Target's sales in first quarter

Maybe ending its diversity, equity, and inclusion programs wasn’t such a good idea for Target.

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Sales at Target stores that have been open at least a year were down 3.8 percent in the first quarter of 2025 compared with the same period last year, multiple media outlets report.

“Fewer customers visited Target and spent less when they shopped,” CNN notes. “Target also cut its financial outlook, a sign Target’s problems won’t go away quickly. The company expects sales to decline by low single-digits this year.”

“We faced several additional headwinds this quarter, including five consecutive months of declining consumer confidence, uncertainty regarding the impact of potential tariffs, and the reaction to the updates we shared on [DEI] in January,” CEO Brian Cornell told analysts in a Wednesday conference call.

In January, shortly after Donald Trump was sworn in to his second term as president and ordered the end of DEI efforts in the federal government, several private companies, including Target, followed suit. Target announced it would end its Racial Equity Action and Change program this year and would cease participating in the Human Rights Campaign’s Corporate Equality Index. The company had earned a perfect 100 score in the most recent index.

Jamal Bryant, a minister and civil rights activist in Atlanta, called for a 40-day boycott of Target stores beginning in early March. The company had seen a drop in shoppers even before that. Foot traffic in Target stores declined 9 percent year-over-year in February and 6.5 percent year-over-year in March.

Target had also seen backlash last year when it removed some Pride items after far-right activists complained.

Target’s stock price declined 7 percent in pre-market trading Wednesday. The price has come down 37 percent over the past year.

Also on the call, Cornell said the company would face huge costs from Trump’s tariffs but would try not to raise prices. It will look at using different suppliers and other moves. “We have many levers to use in mitigating the impact of tariffs, and price is the very last resort,” he said.

GLAAD President and CEO Sarah Kate Ellis released this statement on Target's financial report: "This morning, Target's CEO admitted that the company's earnings are down partially because of their announcement that Target was halting DEI initiatives (or as he said, 'updates we shared on belonging in January.' Target has turned their backs on consumers of color, LGBTQ consumers, and our allies.

"With the LGBTQ community wielding $1.4 trillion in spending power and the fastest-growing consumer segments being Black, Latine, and younger consumers, it’s no surprise that Target's bottom line is down. Other companies must take note: Prices and value are one thing, but to grow your business, you need to look at your values."