Target Stock Plummets as DEI Controversy and Consumer Cutbacks Slam Retail Giant
Target reported a 2.8 percent drop in first-quarter sales, falling to $23.85 billion—just below Wall Street’s anticipated $24.23 billion—according to the company’s May 21 earnings call.
The decline in sales came on the heels of boycotts following Target‘s decision to scale back its diversity, equity, and inclusion (DEI) initiatives after Donald Trump’s election victory.
Target CEO Brian Cornell described the results as disappointing:
“I want to be clear, we’re not satisfied with these results, so we’re moving with urgency to navigate through this period of volatility.
We’ve got to drive traffic back into our stores or visits to our site.”
The retailer is also bracing for additional sales declines throughout the remainder of 2025 due to a challenging economic environment where customers are pulling back on spending.
On Wednesday, Target’s shares fell over six percent and have dropped 40 percent over the past year.
According to recent economic data from the Consumer Price Index (CPI) and Producer Price Index (PPI), a possible deflationary cycle is underway—driven in part by the Federal Reserve’s refusal to cut interest rates.
This trend suggests retailers like Target could face a demand collapse, further straining profit margins.
In response, Target is rolling out 10,000 new items priced at $1 or more, most under $20, in an attempt to appeal to budget-conscious shoppers.
The initiative is part of a broader strategy to offer value as consumer caution grows amid ongoing economic uncertainty.
However, the company’s decision to reduce DEI efforts sparked backlash from parts of its left-leaning customer base.
The move led to renewed boycotts from progressive shoppers.
Last year, the retailer was also targeted by conservatives who objected to its transgender restroom policies and Pride-themed clothing lines marketed to children and babies.
As reported in 2023, Target drew heavy criticism for stocking LGBTQ “Pride” products featuring occult imagery created by a designer known to be a Satanist.
Wisconsin activist Scarlett Johnson exposed that Target was carrying LGBTQ-themed items from a designer named Abprallen, a self-proclaimed Satanist.
Products aimed at children included a “We Belong Everywhere” mini messenger bag, a “Too Queer for Here” tote, and a “Cure Transphobia, Not Trans People” sweatshirt listed as “Pride Adult Clothing.”
One item in particular—a shirt reading “Satan Respects Pronouns”—sparked viral backlash and contributed to negative publicity for the brand.
The retailer is also contending with the lasting impact of tariffs imposed by the Trump administration, which it says continue to add pressure to its operational challenges.
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