Ulta and Target are ending their shop-in-shop partnership in 2026 (Getty Images)
Ulta Beauty and Target have "mutually agreed" to close the mini-Ultas inside Target stores next year.
The two companies announced the news in a press release.
Why are Ulta and Target ending their partnership?
What we know:
The companies said they will not renew the shop-in-shop partnership when the current agreement ends in August 2026. Guests with linked rewards accounts will continue to earn Ulta Beauty Rewards on eligible Ulta Beauty at Target purchases until then.
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What we don't know:
Neither company offered a reason for the split.
By the numbers:
Ulta is currently in 600 of Target’s roughly 1,980 stores, according to a Target spokesperson.
The backstory:
The shops are about 1,000 square feet and carry makeup, skincare, and fragrances. They’re operated beside existing beauty sections in Target stores. The deal was a way for both Target and Ulta to increase their customer base.
The partnership was announced in 2020 and launched in 2021 as the coronavirus pandemic upended shopping habits and more people tried to minimize potential exposure to the virus through one-stop shopping. COVID had dampened sales of lipstick as people wore masks, but the skincare business enjoyed stronger sales.
Target’s sales slump continues
Dig deeper:
Target’s profits have been stagnant for the past few years, though Reuters reports that the retailer’s beauty segment sales were up 5% in 2024, compared to a 0.9% decline in overall merchandise sales.
In May, the company reported that sales fell more than expected in the first quarter, and the retailer warned they will slip for all of 2025 as its customers, worried over the impact of tariffs and the economy, pull back on spending.
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Target also said customer boycotts did some damage during the latest quarter. The company, long a fierce corporate advocate for the rights of Black and LGBTQ+ people, scaled back many diversity, equity and inclusion initiatives in January after they came under attack by conservative activists and the White House. Target’s retreat created another backlash, with more customers angered by the retailer’s reduction of LGBTQ+-themed merchandise for Pride Month in June 2023.
What's next:
Target is expected to report its second-quarter fiscal results on Wednesday.
The Source: This report includes information from Target, Ulta, Reuters and The Associated Press.