Share-Based Compensation

12 Months Ended

Jan. 31, 2026

Share-Based Payment Arrangement [Abstract]

We maintain a long-term incentive plan for key team members and non-employee members of our Board of Directors. This plan allows us to grant equity-based compensation awards, including stock options, stock appreciation rights, performance share units, restricted stock units, restricted stock awards, or a combination of awards (collectively, share-based awards). The number of unissued common shares reserved for future grants under this plan was 15.3 million as of January 31, 2026.

Compensation expense associated with share-based awards is recognized on a straight-line basis over the required service period and reflects estimated forfeitures. Share-based compensation expense recognized in SG&A Expenses was $282 million, $307 million, and $255 million, and the related income tax benefit was $62 million, $66 million, and $56 million, in 2025, 2024, and 2023, respectively.

Restricted Stock Units

We issue restricted stock units and performance-based restricted stock units generally with 3-year cliff or 4-year graduated vesting from the grant date (collectively restricted stock units) to certain team members. The final number of shares issued under performance-based restricted stock units is based on our total shareholder return relative to a retail peer group over a 3-year performance period. We also regularly issue restricted stock units to our Board of Directors, which vest quarterly in the year they are granted and are settled in shares of Target common stock upon departure from the Board. The fair value for restricted stock units is calculated based on our stock price on the date of grant, incorporating an analysis of the total shareholder return performance measure where applicable. The weighted average grant date fair value of restricted stock units was $107.95, $165.21, and $160.91 in 2025, 2024, and 2023, respectively.


Restricted Stock Unit Activity	Total Nonvested Units
	Restricted Stock (a)	Grant Date Fair Value (b)
February 1, 2025	4,549	$	169.59
Granted	3,960	107.95
Forfeited	(762)	137.43
Vested	(1,609)	176.10
January 31, 2026	6,138	$	133.76

(a)Represents the number of shares of restricted stock units, in thousands. For performance-based restricted stock units, assumes attainment of maximum payout rates as set forth in the performance criteria. Applying actual or expected payout rates, the number of outstanding restricted stock units and performance-based restricted stock units as of January 31, 2026, was 5.98 million.

(b)Weighted average per unit.

The expense recognized each period is partially dependent upon our estimate of the number of shares that will ultimately be issued. As of January 31, 2026, there was $443 million of total unrecognized compensation expense related to restricted stock units, which is expected to be recognized over a weighted average period of 2.4 years. The fair value of restricted stock units vested and converted to shares of Target common stock was $175 million, $225 million, and $213 million in 2025, 2024, and 2023, respectively.

Performance Share Units

We issue performance share units to certain team members that represent shares potentially issuable in the future. Issuance is based upon our performance, generally relative to a retail peer group, over a 3-year performance period on certain measures primarily including sales growth, after-tax return on invested capital, and earnings per share growth. The fair value of performance share units is calculated based on our stock price on the date of grant. The weighted average grant date fair value of performance share units was $108.32, $164.92, and $162.54 in 2025, 2024, and 2023, respectively.


Performance Share Unit Activity	Total Nonvested Units
	Performance Share Units (a)	Grant Date Fair Value (b)
February 1, 2025	1,830	$	177.15
Granted	1,894	108.32
Forfeited	(677)	168.61
Vested	(145)	216.19
January 31, 2026	2,902	$	133.60

(a)Represents the number of performance share units, in thousands. Assumes attainment of maximum payout rates as set forth in the performance criteria. Applying actual or expected payout rates, the number of outstanding performance share units as of January 31, 2026, was 1.11 million.

(b)Weighted average per unit.

The expense recognized each period is partially dependent upon our estimate of the number of shares that will ultimately be issued. Future compensation expense for unvested awards could reach a maximum of $265 million assuming payout of all unvested awards. The unrecognized expense is expected to be recognized over a weighted average period of 1.6 years. The fair value of performance share units vested and converted to shares of Target common stock was $13 million, $46 million, and $127 million in 2025, 2024, and 2023, respectively.

TARGET CORP 10-K