- In today’s CEO Daily: Fortune‘s Phil Wahba reports on Target’s new CEO starting his tenure on the hot seat.
- The big story: Elon Musk combines xAI and SpaceX as he pursues data centers in space.
- The markets: Stocks rebound globally after days of volatility.
- Plus: All the news and watercooler chat from Fortune.
Good morning. If you read brand new Target CEO Michael Fiddelke’s first message as chief to customers, employees and partners, you could be forgiven for not realizing that the retailer currently finds itself in the maelstrom surrounding immigration raids across the country, especially in its hometown of Minneapolis.
Fiddelke, who officially took the reins of the struggling retailer on Sunday, laid out in a note on LinkedIn and on Target’s website on Monday what his priorities are as he takes over. They include restoring Target’s leadership in cheap-chic merchandise, making its stores and website easier and more pleasant to use, more fully leveraging tech to improve customer experience and operations, and “strengthening” employees and “growing alongside the communities” where Target runs its stores.
While these kinds of CEO messages are typically aimed at employees to give them insight into a new leader’s strategy, it’s clear that current events won’t let Fiddelke just get on with business.
Demonstrations have recently taken place at about two dozen Target stores in Minnesota as well as in other cities, including Chicago, Los Angeles, Philadelphia and New York. On Sunday, the American Federation of Teachers, which says its members own nearly 7 million shares via the pension funds in which they participate, called for Target to speak out against ICE. And on Monday, protesters at Target headquarters in Minneapolis demanded that the company take a stronger position against ICE. (A Target spokesperson said Fiddelke’s note was intended to underscore his strategy to employees and partners, and that his priorities include employee safety.)
Target has addressed the recent unrest in Minneapolis and St. Paul, but as part of a 60-company message from Minnesota Chamber of Commerce that called for “an immediate deescalation of tensions.” Indeed, corporate America has been much more shy to directly criticize the U.S. government than it was in 2020 during that period of social unrest.
Many commentators on Fiddelke’s LinkedIn post said Target’s comeback wouldn’t happen without addressing ICE and the fact that it has backed away from DEI initiatives as the political winds shifted. “If you want to lead with purpose, stop letting ICE stage on your property in locations all over Minnesota,” one person wrote. Another wrote: “Please reinstate DEI to get your customers back!”
In his message, Fiddelke wrote that “in the weeks ahead, my focus is simple: listen closely, move with clarity and urgency, and lead with purpose.” Fiddelke is very comfortable talking broadly about winning back consumer trust—meaning offering the products they want at good prices. But now Target finds itself having to contend with customers who feel let down by the brand and what they thought it stood for. Winning back that trust may be an even bigger challenge.—Phil Wahba
Contact CEO Daily via Diane Brady at diane.brady@fortune.com
Top leadership news
Musk combines SpaceX and xAI
Elon Musk’s SpaceX announced that it has acquired xAI, the artificial intelligence lab also owned by Musk. The combined companies will be worth a reported $1.25 trillion, per Bloomberg, with Musk specifically touting space-based data centers as an important aspect of the deal.
AI may not be affecting the labor market as some suspect …
A recent report from the Yale Budget Lab found that AI isn’t disrupting the labor market and spurring layoffs like many think it is. “At this exact moment, it just doesn’t seem like there’s major macroeconomic effects here,” Martha Gimbel, executive director and cofounder of the Yale Budget Lab, told Fortune.
… but changes to the CEO role are very real
Despite that, the onset of the technology is redefining the CEO role and arriving as tenures in the top seat are shrinking. Already-established CEOs may have to lean on adaptability, but some boards may be looking for new, AI-fluent candidates.
The markets
S&P 500 futures are up 0.19% this morning. The last session closed up 0.54%. STOXX Europe 600 was up 0.43% in early trading. The U.K.’s FTSE 100 was down 0.12% in early trading. Japan’s Nikkei 225 was up 3.92%. China’s CSI 300 was up 1.18%. The South Korea KOSPI was up 6.84%. India’s NIFTY 50 was up 2.56%. Bitcoin was at $78K.
Around the watercooler
‘We are an n of 1’: Palantir hails ‘incredible’ earnings as stock rockets nearly 8% after hours by Nick Lichtenberg
Devon Energy CEO: ‘Stars align’ to acquire Coterra for nearly $26 billion as merger mania returns to the oilfield by Jordan Blum
Top AI leaders are begging people not to use Moltbook, a social media platform for AI agents: It’s a ‘disaster waiting to happen’ by Eva Roytburg
Trump ‘woke the rest of the world up’ to leveraging economic firepower against trade partners, says Morgan Stanley CIO by Eleanor Pringle
CEO Daily is compiled and edited by Joey Abrams, Claire Zillman and Lee Clifford.
