While reporting a continued slide in year-over-year sales and operating income in its fourth-quarter and full-year report, Target expects to get back to growth this year.

The Minneapolis retail giant netted $30.5 billion in sales in the fourth quarter, a 1.5% drop from 2024, per its report Tuesday. Its quarterly operating income of $1.4 billion marked a 5.9% drop.

Full-year net sales for 2025 decreased 1.7%, to $104.8 billion. Full-year operating income declined 8.1%, sitting at $5.1 billion versus $5.6 billion in 2024.

Fourth-quarter results were in line with company expectations, Target reports. The good news: Quarterly net sales grew year over year in the categories of food and beverage, beauty, and toys. Compared to the third quarter, trends strengthened in essentials and home. Same-day delivery grew more than 30%. And in the last two months of the quarter, sales and traffic accelerated, according to the company.

Related: Target adds $1 billion of investment in stores.

Its quarterly net sales decline reflects a comparable store sales decrease of 3.9% and a comparable digital sales increase of 1.9%. Capturing the full year, Target’s net sales drop reflects a 2.6% decline in comparable sales, offset in part by new-store sales and growth in non-merchandise sales. Non-merchandise sales growth encompasses double-digit growth from Roundel, Target’s in-house retail media company; more than 30% growth in its third-party marketplace; and a doubling of its membership revenue from the year prior.

The company beat estimated earnings per share for the fourth quarter by more than 7%, at $2.44. Full-year EPS of $7.57 was in line with company expectations.

“I’m incredibly proud of how our team navigated through a challenging year in 2025, as they focused on serving our guests while positioning our business for profitable growth in 2026 and beyond,” new CEO Michael Fiddelke said in a press release.

Target anticipates net sales growth of about 2% this year compared with 2025 and expects to report sales growth in every quarter of the year.

Fiddelke, at the helm since Feb. 1, reiterated points he has made about Target’s focus moving forward: “Our team is firmly focused on writing Target’s next chapter of growth, rooted in strengthening our merchandising authority, delivering an elevated and differentiated shopping experience, advancing our use of technology, and continuing to serve and invest in our team and communities.”