What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2024-03-13 compared with 2023-03-08 · 86 added, 82 removed, 120 unchanged (58% of the section changed)

16 unchanged sentences

To remain competitive, we must anticipate and adapt to developments and offerings by other retailers.

Consumers may also use third-party channels or devices to initiate shopping searches and place orders, which could make us dependent on the capabilities and search algorithms of those third parties to reach those consumers.

Any difficulties in executing our differentiation efforts could adversely affect our results of operations and financial condition.

Consumers may also use third-party channels, devices, technologies, and capabilities (including artificial intelligence) to initiate shopping searches and place orders, which could make us dependent on the capabilities and search algorithms of those third parties to reach those consumers.

Any failures or difficulties in executing our differentiation efforts could adversely affect our results of operations and financial condition.

If we do not anticipate and respond quickly to changing consumer preferences, our results of operations and financial condition could suffer.

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If we do not predict and quickly respond to changing consumer preferences and spending patterns, we may experience lower sales, spoilage, and increased inventory markdowns, which could adversely affect our results of operations.

Our ability to predict and adapt to changing consumer preferences depends on many factors, including obtaining accurate and relevant data on guest preferences, emphasizing relevant merchandise categories, effectively managing our inventory levels, and implementing competitive and effective pricing and promotion strategies.

Our ability to predict and adapt to changing consumer preferences depends on many factors, including obtaining accurate and relevant data on guest preferences, successfully implementing new technologies and capabilities emphasizing relevant merchandise categories, effectively managing our inventory levels, and implementing competitive and effective pricing and promotion strategies.

We have not always been able to predict rapid changes in consumer preferences and spending patterns, including those that were impacted by the COVID-19 pandemic, which has previously resulted in insufficient or excess inventory, increased costs, and adverse impacts on our results of operations.

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Our reputation is largely based on perceptions.

It may be difficult to address negative publicity across media channels, regardless of whether it is accurate.

Negative incidents involving us, our workforce, or others with whom we do business could quickly erode trust and confidence and result in consumer boycotts, workforce unrest or walkouts, government investigations, and litigation.

It may be difficult to address negative publicity across media channels, regardless of its accuracy or the reputability of its source, including as a result of fictitious media content (such as content produced by generative artificial intelligence or bad actors).

Negative incidents involving us, our workforce, or others with whom we do business could quickly erode trust and confidence and result in changes in consumer behavior (including consumer boycotts), workforce unrest or walkouts, government investigations, and litigation.

Negative reputational incidents or negative perceptions of us could adversely affect our business and results of operations, including through lower sales, the termination of business relationships, loss of new store and development opportunities, and team member retention and recruiting difficulties.

We have recently experienced negative perceptions of our business, which have adversely affected consumer behavior, and we could experience similar occurrences in the future.

In addition, stakeholder expectations regarding environmental, social, and governance matters continue to evolve and are not uniform.

We have established, and may continue to establish, various goals and initiatives on these matters, including with respect to diversity, equity, and inclusion topics.

We have established, and may continue to establish, various goals and initiatives on these matters, including with respect to sustainability and diversity, equity, and inclusion topics.

We cannot guarantee that we will achieve these goals and initiatives.

Any failure, or perceived failure, by us to achieve these goals and initiatives or to otherwise meet evolving and varied stakeholder expectations could adversely affect our reputation and result in legal and regulatory proceedings against us.

Any of these outcomes could negatively impact our results of operations and financial condition.

Reputational harm can also occur indirectly through companies with whom we do business.

We have relationships with a variety of other companies, including Apple, CVS, Disney, Levi’s, Starbucks, and Ulta Beauty.

If our guests have negative experiences with or view unfavorably any of the companies with whom we have relationships, it could cause them to stop shopping with us.

Any failure, or perceived failure, by us to achieve these goals and initiatives could adversely affect our reputation and results of operations.

Furthermore, our shareholders, guests, team members, and other stakeholders have evolving, varied, and sometimes conflicting expectations regarding many aspects of our business, including our operations, product and service offerings, and environmental, social, and governance matters.

Recently, our inability to meet some of those expectations has adversely affected our reputation, and the inability to meet all of those expectations in the future could adversely affect our reputation with some or all of our stakeholders.

Any adverse perception of Target could negatively impact our results of operations and financial condition and result in legal and regulatory proceedings against us.

TARGET CORPORATION

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Index to Financial Statements

Reputational harm can also occur indirectly through companies and others with whom we do business.

We have consumer-facing relationships with a variety of other companies, including Apple, CVS, Disney, Levi’s, Starbucks, and Ulta Beauty.

In addition, we have relationships with third-party companies that sell and ship items directly to guests through our digital channels.

We also have relationships with designers, celebrities, influencers, and other individuals, including for advertising campaigns and marketing programs.

If our guests have negative experiences with, or view unfavorably, any of the companies or individuals with whom we have relationships, it could cause them to stop shopping with us and negatively impact our results of operations.

If we are unable to successfully develop, source, and market our owned and exclusive brand products, our results of operations could be adversely affected.

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For example, owned brand products involve greater responsible sourcing risk in the selection of vendors, which can exacerbate reputational risk.

In addition, owned brand products generally require longer lead times between order placement and product delivery and require us to take ownership of those products earlier in the supply chain.

This exposes us to enhanced risks of supply chain disruptions and changing consumer preferences, which could adversely affect our results of operations.

In addition, owned brand products generally need longer lead times between order placement and product delivery and require us to take ownership of those products earlier in the supply chain.

This requires longer-term forecasting of consumer demand, including for categories where consumer preferences may change rapidly, and exposes us to enhanced risks of supply chain disruptions, which could adversely affect our results of operations.

If we are unable to protect against inventory shrink, our results of operations and financial condition could be adversely affected.

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To protect against rising inventory shrink, we have taken, and may continue to take, certain operational and strategic actions that could adversely affect our reputation, guest experience, and results of operations.

In addition, sustained high rates of inventory shrink at certain stores could impact the profitability of those stores and result in the impairment of long-term assets.

Investments and Infrastructure Risks

If our capital investments do not achieve appropriate returns, our competitive position, results of operations, and financial condition could be adversely affected.

In addition, sustained high rates of inventory shrink at certain stores have contributed, and may continue to contribute, to the closure of certain stores and the impairment of long-term assets.

Investment and Infrastructure Risks

If our capital investments do not achieve appropriate returns or our efficiency efforts are not successful, our competitive position, results of operations, and financial condition could be adversely affected.

Our business depends, in part, on our ability to remodel existing stores and build new stores in a manner that achieves appropriate returns on our capital investment.

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Pursuing the wrong remodel or new store opportunities and any delays, cost increases, or other difficulties related to those projects could adversely affect our results of operations and financial condition.

We are making, and expect to continue to make, significant investments in technology and supply chain infrastructure.

Furthermore, remodels and new store projects have previously been, and may in the future be, delayed or cancelled based on changes in macroeconomic conditions, changes in expected project benefits, and other factors, which could result in the inefficient deployment of our capital and adversely affect our results of operations and financial condition.

We have made, and expect to continue to make, significant investments in technology and supply chain infrastructure.

The effectiveness of these investments can be less predictable than remodeling or building new stores, and might not provide the anticipated benefits, which could adversely affect our results of operations and financial condition.

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Underestimating our replenishment capacity needs could result in lower in-stock levels or increased costs for temporary storage.

Conversely, overestimating replenishment capacity needs could result in inefficient deployment of capital.

Any of these outcomes could adversely affect our results of operations and financial condition.

Conversely, overestimating replenishment capacity needs, changes in macroeconomic conditions, changes in expected project benefits, and other factors have resulted, and could in the future result, in delays or cancellations of supply chain infrastructure

TARGET CORPORATION

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Index to Financial Statements

A significant disruption in our computing and information systems and our inability to adequately maintain and update those systems could adversely affect our operations and negatively affect our guests.

We rely extensively on computing and information systems throughout our business.

We also rely on continued and unimpeded access to the Internet to use our systems.

Our systems are subject to possible damage or interruption from many events, including power outages, telecommunications failures, malicious attacks, security breaches, and implementation errors.

If our systems are damaged or disrupted, we may incur substantial costs, experience data loss or theft, and be unable to manage inventories or process guest transactions, which could adversely affect our reputation, results of operations, and financial condition.

projects and the inefficient deployment of our capital.

Any of these outcomes could adversely affect our results of operations and financial condition.

In addition, we have undertaken an enterprise-wide initiative to simplify and gain efficiencies across our business, with a focus on reducing complexities and lowering costs.

We cannot guarantee that we will realize all of the potential cost savings from this initiative and we may experience difficulties and delays in identifying and achieving such cost savings, which could adversely affect our results of operations and financial condition.

A significant disruption to our technology systems and our failure to adequately maintain and update those systems could adversely affect our operations and negatively affect our guests.

We rely extensively on technology systems throughout our business.

We also rely on continued and unimpeded access to the Internet to use our technology systems.

These systems are subject to possible damage or interruption from many events, including power outages, telecommunications failures, third-party failures, malicious attacks, security breaches, and implementation errors.

Any damage or disruption to our technology systems could severely interrupt our business operations, including our ability to process guest transactions and manage inventories, which could adversely affect our reputation, results of operations, and financial condition.

For example, in the past, we have experienced disruptions in our point-of-sale system that prevented our ability to process debit or credit transactions, which negatively impacted some guests’ experiences and generated negative publicity.

We continually invest to maintain and update our systems, but implementing significant changes increases the risk of system disruption.

We continually invest to maintain and update our technology systems, but implementing significant changes increases the risk of system disruption.

Problems and interruptions associated with implementing technology initiatives could adversely affect our operational efficiency and negatively impact our guests and their confidence in us.

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We regularly receive and store information about our guests, team members, vendors, and other third parties.

We have programs in place to detect, contain, and respond to data security incidents.

However, we may be unable to anticipate security incidents or implement adequate preventive measures.

We also rely extensively on information systems throughout our business.

We have programs in place to detect, contain, and respond to information security, cybersecurity, and data privacy incidents.

However, we may be unable to anticipate security incidents or implement adequate preventive measures as cyber threats continue to evolve and cyberattacks become more sophisticated and frequent, including through the introduction of viruses and malware (such as ransomware) and the use of artificial intelligence by threat actors.

In addition, hardware or software that we develop or obtain from third parties may contain defects that could compromise information security, cybersecurity, or data privacy.

Unauthorized parties may also attempt to gain access to our systems or facilities, or those of third parties with whom we do business, through fraud, deception, or other bad acts.

Although we conduct regular training as part of our information security, cybersecurity, and data privacy efforts, that training may not be completely effective in preventing successful attacks.

Our only significant data security incident was a data breach that occurred in 2013 and went undetected for several weeks.

The 2013 data breach adversely affected our reputation and results of operations.

Both we and our vendors have experienced data security incidents since that data breach;

however, to date, these other incidents have not been material to our results of operations.

Based on the prominence and notoriety of our prior significant data breach, additional data security incidents could draw greater scrutiny.

If we, our vendors, or other third parties with whom we do business experience additional significant data security incidents or fail to detect and appropriately respond to significant incidents, we could be exposed to costly government enforcement actions and private litigation.

In addition, our guests could lose confidence in our ability to protect their information, stop using our RedCards or loyalty programs, or stop shopping with us altogether, which could adversely affect our reputation, results of operations, and financial condition.

The legal and regulatory environment regarding information security, cybersecurity, and data privacy is dynamic and has strict requirements for using and treating personal data.

Complying with current or contemplated data protection laws and regulations, or any failure to comply, could cause us to incur substantial costs, require changes to our business practices, and expose us to litigation and regulatory risks, each of which could adversely affect our reputation, results of operations, and financial condition.

Supply Chain and Third-Party Risks

Changes in our relationships with our vendors, changes in tax or trade policy, interruptions in our operations or supply chain, and increased commodity or supply chain costs could adversely affect our reputation and results of operations.

We are dependent on our vendors, including common carriers, to supply merchandise to our distribution centers, stores, and guests.

If our replenishment and fulfillment network does not operate properly, if a vendor fails to deliver on its commitments, or if common carriers have difficulty providing capacity to meet demands for their services like they experienced in recent years, we could experience merchandise out-of-stocks, delays in shipping and receiving merchandise, and increased costs, which could adversely affect our reputation and results of operations.

Unauthorized parties may also attempt to gain access to our information systems or facilities, or those of third parties with whom we do business, through fraud, deception, social engineering, or other bad acts.

Errors or malicious actions by our team members or contractors, faulty password management, and other vulnerabilities or irregularities could also overcome our security measures or those of third parties with whom we do business and result in a compromise or breach of our or their information systems.

Furthermore, the training we conduct as part of our information security, cybersecurity, and data privacy efforts may not be effective in preventing or limiting successful attacks.

Our only significant information security, cybersecurity, or data privacy incident was a data breach that occurred in 2013, which adversely affected our reputation and results of operations.

Both we and our vendors have experienced additional information security, cybersecurity, and data privacy incidents;

however, to date, these other incidents have not been material to our business strategy, results of operations, or financial condition.

Based on the prominence and notoriety of our prior significant data breach, additional information security, cybersecurity, or data privacy incidents could draw greater scrutiny.

If we, our vendors, or other third parties with whom we do business experience additional significant information security, cybersecurity, or data privacy incidents or fail to detect and appropriately respond to significant incidents, our business operations could be severely disrupted and we could be exposed to costly government enforcement actions and private litigation.

In addition, our guests could lose confidence in our ability to protect their information, stop using our Target-branded payment cards or loyalty programs, or stop shopping with us altogether.

Any of these outcomes could adversely affect our reputation, results of operations, and financial condition.

TARGET CORPORATION

2 unchanged sentences

Index to Financial Statements

A large portion of the merchandise that we offer is sourced, directly or indirectly, from outside the U.S., with China as our single largest source.

The legal and regulatory environment regarding information security, cybersecurity, and data privacy is dynamic and has strict requirements, including for the use and treatment of personal data.

Complying with current or contemplated information security, cybersecurity, data protection, and data processing laws and regulations (including reporting and disclosure regimes), or any failure to comply, could cause us to incur substantial costs, require changes to our business practices, and expose us to litigation and regulatory risks, each of which could adversely affect our reputation, results of operations, and financial condition.

Supply Chain and Third-Party Risks

Changes in our relationships with our vendors or other companies, changes in tax or trade policy, interruptions in our operations or supply chain, and increased commodity or supply chain costs could adversely affect our reputation and results of operations.

We are dependent on our vendors, independent contractors, and other third parties (including common carriers) to supply merchandise to our distribution centers, stores, and guests.

If our replenishment and fulfillment network does not operate properly, if a vendor fails to deliver on its commitments, or if common carriers have difficulty providing capacity to meet demands for their services like they experienced during the COVID-19 pandemic, we could experience merchandise out-of-stocks, delays in shipping and receiving merchandise, and increased costs, which could adversely affect our reputation and results of operations.

In addition, we have consumer-facing relationships with a variety of other companies, including Apple, CVS, Disney, Levi’s, Starbucks, and Ulta Beauty.

Any termination of, or adverse change in, our relationship with any of these companies could decrease our sales, increase our costs, and negatively impact our reputation and results of operations.

A large portion of the merchandise that we offer is sourced, directly or indirectly, from outside the U.S., with China as our single largest source of merchandise we import.

Any major changes in tax or trade policy between the U.S.

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Any of these actions could adversely affect our reputation and results of operations.

Political or financial instability, currency fluctuations, the outbreak of pandemics or other illnesses, labor shortages, labor unrest or strikes, transport capacity and costs, inflation, port security, weather conditions, natural disasters, armed conflicts, or other events that could affect foreign trade are beyond our control and could disrupt our supply of merchandise, increase our costs, and adversely affect our results of operations.

For example, there have been periodic closings and ship diversions, labor disputes, and congestion disrupting U.S.

ports, including in California where we receive a significant portion of the products we source from outside the U.S.

Political or financial instability, currency fluctuations, the outbreak of pandemics or other illnesses, labor shortages, labor unrest or strikes, transport capacity and costs, inflation, port security, weather conditions, natural disasters, geopolitical conflicts, terrorist attacks, armed conflicts, or other events that could affect foreign trade are beyond our control and could disrupt our supply of merchandise, increase our costs, and adversely affect our results of operations.

For example, there have been periodic closings and ship diversions, conflicts, labor disputes, and congestion disrupting railways, trucking, waterways, and ports around the world, including at California ports where we receive a significant portion of the products we source from outside the U.S.

We have from time to time made alternative arrangements to continue the flow of inventory as a result of supply chain disruptions in the U.S.

and other countries.

If these types of events recur, it could increase our costs and adversely affect our supply of inventory.

In addition, prices of fuel and other commodities that our supply chain depends on are historically volatile and subject to fluctuations based on a variety of international and domestic factors.

Rapid and significant changes in commodity prices, as has occurred in recent years, could further increase our costs and adversely affect our results of operations.

If these types of events recur and impact any of the locations or modes of transportation that we depend on, it could increase our costs and adversely affect our supply of inventory.

In addition, prices of fuel and other commodities on which our supply chain depends are historically volatile and subject to fluctuations based on a variety of international and domestic factors.

Rapid and significant changes in commodity prices, as have occurred in recent years, could further increase our costs and adversely affect our results of operations.

If services we obtain from third parties are unavailable or fail to meet our standards, our reputation and results of operations could be adversely affected.

We rely on third parties to support our business operations, including portions of our technology infrastructure, digital platforms, replenishment and fulfillment operations, store and supply chain infrastructure, delivery services, guest contact centers, payment processing, and extensions of credit for our RedCard program.

If we are unable to contract with third parties having the specialized skills needed to support our operations or if they fail to meet our performance standards, then our reputation and results of operations could be adversely affected.

Legal, Regulatory, Global, and Other External Risks

The effects of the COVID-19 pandemic, or other similar public health crises, may continue to amplify the risks and uncertainties facing our business.

The long-term impacts of the social, economic, and financial disruptions caused by the COVID-19 pandemic and the government responses to such disruptions are unknown.

In addition, the impact on our business of the long-term effects of the COVID-19 pandemic, or other similar public health crises, will depend on numerous factors that we cannot accurately predict.

The long-term effects of the COVID-19 pandemic, or other similar public health crises, may also continue to amplify other risks discussed in this Item 1A, Risk Factors, including risks related to macroeconomic conditions and consumer confidence and spending, supply chain, information security, cybersecurity, and data privacy, and our workforce, any of which could have a material effect on us.

For example, the rise in remote working arrangements by our team members, vendors, and other third parties that began during the COVID-19 pandemic increases the risk of a data security compromise and has amplified our already extensive reliance on computing and information systems and unimpeded Internet access.

We rely on third parties to support our business operations, including portions of our technology infrastructure, digital platforms, replenishment and fulfillment operations, store and supply chain infrastructure, delivery services (including by independent contractors via our Shipt subsidiary), guest contact centers, payment processing, and extensions of credit for our Target-branded payment card program.

If we are unable to contract with third parties having the specialized skills needed to support our operations, if any third-party services are interrupted, or if they fail to meet our performance standards, then our reputation and results of operations could be adversely affected.

TARGET CORPORATION

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Index to Financial Statements

Legal, Regulatory, Global, and Other External Risks

The long-term effects of the COVID-19 pandemic, or the effects of other similar public health crises, may amplify the risks and uncertainties facing our business.

The long-term effects of the COVID-19 pandemic, or the effects of other similar public health crises, may amplify other risks discussed in this Item 1A, Risk Factors, including risks related to macroeconomic conditions and consumer confidence and spending, supply chain, information security, cybersecurity, and data privacy, and our workforce, any of which could have a material effect on us.

For example, the continued utilization of remote working arrangements by our team members, vendors, and other third parties that began during the COVID-19 pandemic increases the risk of a data security compromise and has amplified our already extensive reliance on computing and information systems and unimpeded Internet access.

Our earnings depend on the state of macroeconomic conditions and consumer confidence and spending in the U.S.

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consumer confidence and spending, which can be affected by a variety of factors, including inflation, interest rates, housing prices, unemployment rates, household debt and wage levels, and credit usage.

In addition, the interconnected nature of the global economy means that international events such as armed conflicts, geopolitical conflicts, public health crises, energy availability, and market volatility can all affect macroeconomic conditions in the U.S.

In addition, the interconnected nature of the global economy means that international events such as geopolitical conflicts, terrorist attacks, armed conflicts, public health crises, energy availability, trade disputes, and market volatility can all affect macroeconomic conditions in the U.S.

A deterioration in U.S.

macroeconomic conditions or consumer confidence or spending could adversely affect our business in many ways, including slowing sales growth, reducing overall sales, reducing gross margins, and lowering our credit card profit-sharing revenue, each of which could adversely affect our results of operations and financial condition.

macroeconomic conditions or consumer confidence or spending could adversely affect our business in many ways, including reducing sales, reducing gross margins, and lowering our credit card profit-sharing revenue, each of which could adversely affect our results of operations and financial condition.

Uncharacteristic or significant weather conditions or natural disasters and the impacts of climate change could adversely affect our results of operations.

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For example, we use commodities and energy inputs in our operations that may face increased regulation due to climate change or other environmental concerns, which could increase our costs.

Furthermore, any failure to achieve our goals with respect to reducing our impact on the environment, or perception of a failure to act responsibly with respect to the environment, could adversely affect our reputation and results of operations.

Furthermore, any failure, or perceived failure, by us to achieve our sustainability goals or to otherwise meet evolving, varied, and sometimes conflicting stakeholder expectations regarding the environment, could adversely affect our reputation and results of operations.

TARGET CORPORATION

2023 Form 10-K 13

RISK FACTORS Table of Contents

Index to Financial Statements

We rely on a large, global, and changing workforce of team members, contractors, and temporary staffing.

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If we become subject to one or more collective bargaining agreements in the future, it could adversely affect our labor costs, how we operate our business, and our results of operations.

In addition to our United States operations, we have support offices in India and China, and any extended disruption of our operations in our different locations, whether due to labor difficulties or otherwise, could adversely affect our results of operations.

TARGET CORPORATION

2022 Form 10-K 12

RISK FACTORS Table of Contents

Index to Financial Statements

In addition to our U.S.

operations, we have support offices and sourcing operations in India, China, and other countries, and any extended disruption of our operations in our different locations, whether due to labor difficulties or otherwise, could adversely affect our results of operations.

Failure to address product safety and sourcing concerns could adversely affect our results of operations.

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Events that give rise to actual or perceived product safety concerns, including food or drug contamination and product defects, could expose us to government enforcement actions and private litigation and result in costly product recalls and other liabilities.

Our sourcing vendors, including any third parties selling through our digital channels, must also meet our expectations across multiple areas of social compliance, including supply chain transparency and responsible sourcing.

Our sourcing vendors, including any third parties selling through our digital channels, must also meet our expectations and comply with applicable laws and regulations across multiple areas of social compliance, including supply chain transparency and responsible sourcing.

We have a social compliance audit process that performs audits regularly, but we cannot continuously monitor every vendor, so we are also dependent on our vendors to ensure that the products we buy comply with applicable standards.

If we need to seek alternative sources of supply from vendors with whom we have less familiarity, the risk of our standards not being met may increase.

If we need to seek alternative sources of supply from vendors with whom we have less familiarity, the risk of these standards not being met may increase.

Negative guest perceptions regarding the safety and sourcing of the products we sell could harm our reputation and adversely affect our results of operations.

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Our expenses could increase and our operations could be adversely affected by changes in law or adverse judicial developments involving our workforce, including an employer’s obligation to recognize collective bargaining units, minimum wage requirements, advance scheduling notice requirements, health care or other mandates, the classification of exempt and non-exempt employees, and the classification of workers as either employees or independent contractors.

Our Shipt subsidiary is a technology company that connects Shipt members through its online marketplace with a network of independent contractors who select, purchase, and deliver groceries and household essentials ordered from Target and other retailers.

The classification of workers as employees or independent contractors, in particular, is an area that is experiencing legal challenges and legislative changes.

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If, as a result of judicial decisions or legislation, Shipt is required to treat its network of independent contractors as employees, we may experience higher digital fulfillment costs, which could adversely affect our results of operations and financial condition.

Changes in the legal or regulatory environment affecting any other area of our business, including information security, cybersecurity, and data privacy, product safety, or payment methods could cause our expenses to increase and adversely affect our results of operations.

In addition, if we fail to comply with other applicable laws and regulations, including the Foreign Corrupt Practices Act and other anti-bribery laws, we could be subject to legal and reputational risks, including government enforcement actions and class action civil litigation, which could adversely affect our results of operations and financial condition.

Changes in the legal or regulatory environment affecting any other area related to our business, including information security, cybersecurity, and data privacy, product safety, payment methods, or climate and emissions disclosure could cause our expenses to increase and adversely affect our results of operations.

In addition, if we fail to comply with other applicable laws and regulations, including the Foreign Corrupt Practices Act and other anti-bribery laws, anti-money laundering laws, import restrictions, responsible sourcing laws, and sanctions programs, we could be subject to legal and reputational risks, including government enforcement actions and class action civil litigation, which could adversely affect our results of operations and financial condition.

TARGET CORPORATION

2023 Form 10-K 14

RISK FACTORS, UNRESOLVED STAFF COMMENTS, & CYBERSECURITY Table of Contents

Index to Financial Statements

Financial Risks

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may cause greater volatility in our effective tax rate.

TARGET CORPORATION

2022 Form 10-K 13

RISK FACTORS & UNRESOLVED STAFF COMMENTS Table of Contents

Index to Financial Statements

If we are unable to access the capital markets or obtain bank credit, our financial condition and results of operations could suffer.

We are dependent on a stable, liquid, and well-functioning financial system to fund our operations and capital investments.

Our continued access to financial markets depends on multiple factors including the condition of debt capital markets, our operating performance, and our credit ratings.

If rating agencies lower our credit ratings, it could adversely affect our ability to access the debt markets, our cost of funds, and other terms for new debt issuances.

Our continued access to financial markets depends on multiple factors including the condition of debt capital markets, the condition of the banking sector, our operating performance, and our credit ratings.

If rating agencies lower our credit ratings, it could adversely affect our ability to access the debt markets, our cost of funds, and other terms for new debt issuances and borrowings.

Each of the credit rating agencies reviews its rating periodically, and there is no guarantee that our current credit ratings will remain the same.

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Disruptions or turmoil in the financial markets could reduce our ability to fund our operations and capital investments and lead to losses on derivative positions from counterparty failures, which could adversely affect our financial condition and results of operations.

Unresolved Staff Comments

Not applicable.

TARGET CORPORATION

2022 Form 10-K 14

PROPERTIES Table of Contents

Index to Financial Statements

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors