Good morning. There’s more executive turnover in the Fortune 500.
Target CEO Brian Cornell is stepping down, and Michael Fiddelke, chief operating officer (COO), will become chief executive on Feb. 1, 2026. Cornell has led Target for 11 years. Fiddelke began his career at Target as an intern in 2003.
He served as CFO from November 2019 until February 2024, then was appointed COO—but held both roles until Jim Lee became finance chief last September. Fiddelke’s rise to the top comes as Target faces financial challenges and declining customer trust after backlash and boycotts related to its reversal on DEI efforts earlier this year. Foot traffic and revenue remain down.
Target reported another weak quarter on Wednesday with comparable sales down 1.9%, and reaffirmed its expectation of a low, single-digit sales decline for the year—projecting a third consecutive annual drop.
As my Fortune colleague Phil Wahba writes, “Though Fiddelke, 49, extolled the value of knowing Target deeply, shares fell 10% in morning trading on the news of his appointment. Citi analyst Paul Lejuez said investors were ‘hoping for an external CEO’ with fresh eyes. Target’s stock is down 64% since its all-time high four years ago.”
During the earnings call on Wednesday, Cornell said the board chose Fiddelke through a “deliberate and thoughtful” succession planning process over several years. The board evaluated his qualifications alongside a “strong list” of both external and internal candidates, he said.
Fiddelke said on the call that he’s eager to step into a role at a company he loves, but admitted, “I know we’re not realizing our full potential right now.” He called for a “clear and urgent commitment” to build new momentum and return to profitable growth.
I asked Shawn Cole, president and founding partner of executive search and consulting firm Cowen Partners, for his assessment of the internal hire. After 20 years at Target, Cole said Fiddelke was the safe and easy choice.
“Executive searches take time, and Target clearly wanted continuity over disruption,” he said. “When a brand is already struggling, boards often look inward for someone who knows the playbook, culture, and politics. The downside is exactly what we saw in the market reaction: investors were hoping for fresh eyes.”
From CFO to CEO
Fiddelke’s ascent at Target highlights a growing trend—moving from CFO to CEO, sometimes with a COO role in between. Research by leadership advisory firm Russell Reynolds Associates found that in the first half of this year, 173 CFOs were appointed—a seven-year high, up from 169 at the same time last year. The rise, fueled by more retirements and record CEO turnover in 2024, was especially prominent in the S&P 500 and ASX 200 indexes, according to the report.
“In this environment, with economic headwinds, tariffs, and margin pressure, the CFO seat has become a real launchpad,” Cole said. CFOs today are strategic operators with boardroom presence, and Fiddelke’s time as COO is significant, a traditionally strong source for CEOs.
What does Cole think Fiddelke must do to earn stakeholders’ trust? “He’s got to prove he’s not just another insider keeping the status quo alive,” he said. “Employees need to see culture and innovation tackled, investors want a turnaround story, and customers want excitement about shopping at Target again. If he plays defense, the market won’t forgive him.”
He added: “Bold moves are necessary, but former CFOs often tend to play it safe.”
SherylEstrada
sheryl.estrada@fortune.com
Leaderboard
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