Target and Ulta Beauty End Partnership, Closing 600 In-Store Shops

Target and Ulta Beauty have mutually agreed not to renew their partnership, which created in-store shops for beauty products at hundreds of Target stores. The partnership, launched in 2021, will conclude in August 2026. Ulta Beauty is currently in 600 of Target's roughly 1,980 stores. Both companies will continue to operate the Ulta Beauty experience at Target stores and on Target.com until the partnership ends.

Target and Ulta Beauty have mutually agreed to terminate their five-year partnership, which created in-store shops for beauty products at hundreds of Target stores. The partnership, launched in 2021, will conclude in August 2026. Currently, Ulta Beauty is present in 600 of Target's approximately 1,980 stores [1].

Both companies will continue to operate the Ulta Beauty experience at Target stores and on Target.com until the partnership ends. The decision to end the partnership comes after reaching 600 Ulta-Target shop-in-shops, falling short of the original goal of 800 locations [1].

The announcement stated that both companies remain committed to delivering a seamless shopping experience and product availability through the end of the partnership. They also assured support for their teams and partners during the transition [1].

The decision to end the partnership is likely to be a significant setback for Target, which has been facing declining sales, a shortfall in foot traffic, and national boycotts [1]. In contrast, the exit should be of little consequence to Ulta Beauty, potentially enhancing its reputation [1].

Target has experienced ten consecutive quarters of flat or declining sales, with a net sales drop of 2.8% in the first quarter of 2025. Comparable sales declined by 3.8%, while online sales increased by 4.7% [1]. Target derives approximately 80% of its sales from its nearly 2,000 stores.

Ulta Beauty, on the other hand, has seen its comp sales growth average just 1% over the last four quarters. The company has been facing competition from Sephora, Amazon, and indie brands on TikTok. However, Ulta Beauty has bigger plans ahead, including the acquisition of British retailer Space NK and international expansion [1].

Ulta Beauty's CEO, Kecia Steelman, has prioritized core business growth, scaling new, accretive businesses, and realigning the foundation for the future. The decision to end the Target partnership aligns with these priorities, allowing Ulta Beauty to focus on its core business and promising opportunities [1].

References:
[1] https://www.forbes.com/sites/pamdanziger/2025/08/15/calling-it-quits-ulta-beauty-and-targets-partnership-unravels/
[2] https://www.cnbc.com/2025/08/14/ulta-and-target-end-deal-for-in-store-shops.html