Partnership to End After Five Years
Ulta Beauty announced on August 14 that it will close all of its mini-store locations inside Target by August 2026, ending a five-year partnership launched in 2021. In a joint decision, both companies “mutually agreed not to renew” their current deal, which brought Ulta’s beauty products and brands directly to Target shoppers.
Amiee Bayer-Thomas, Ulta’s chief retail officer, highlighted the collaboration’s role in expanding access to beauty offerings nationwide. Target’s chief commercial officer, Rick Gomez, praised the shared success and reaffirmed the retailer’s commitment to offering a robust beauty selection going forward.
Market Conditions and Strategic Shifts
While neither company specified a direct reason for ending the partnership, Target has faced declining demand as economic concerns and inflation curb discretionary spending. The retailer has also been impacted by boycotts, lawsuits related to diversity, equity and inclusion (DEI) practices, and tariffs imposed by President Donald Trump on goods from certain sourcing countries.
Following the announcement, Target’s shares fell 2%, and Ulta’s dipped about 1%. Despite the decision, Ulta’s beauty segment sales rose 5% in 2024, compared to a 0.9% drop in overall merchandise sales for the year.
Scale of Operations
Target operates 1,981 stores across all 50 U.S. states and Washington, D.C., ranking as the nation’s eighth-largest retailer. Ulta Beauty runs 1,451 standalone stores nationwide, and more than 600 Ulta mini-stores currently operate inside Target locations. Customers will be able to purchase Ulta products at Target stores and online until August 2026.
Unanswered Questions
Given the growth in beauty sales, the timing of the partnership’s end remains unclear. Industry watchers note that both companies may be adjusting strategies in response to broader retail and economic pressures while seeking new ways to attract and retain customers.