In an earnings call today, CEO Brian Cornell told investors that the company has suffered declines in sales, partly because consumers are spending less on discretionary goods amid uncertainty over tariffs, but also because of “headwinds” caused by a customer boycott of its January decision to roll back DEI initiatives. Target saw its total sales drop by nearly 3%, while comparable sales fell 3.8%. And like many other companies, the retailer lowered sales guidance for the year, citing tariff costs. 

“I want to be clear that we’re not satisfied with these results,” Cornell told reporters. Target’s share price has dropped a whopping 37% over the past year and fell further on today’s announcements.

Against that backdrop, Target shared a significant leadership shuffle on Wednesday that includes the departure of two women from its C-suite team: Christina Hennington, chief strategy and growth officer, and Amy Tu, chief legal officer. The company also said it will create a new “Enterprise Acceleration Office” to help drive efficiencies and growth. 

But analysts and industry watchers aren’t convinced that the company’s modifications will turn things around. Neil Saunders of GlobalData Retail wrote in a research note that the changes “do nothing to restore confidence in the company. On the contrary, they are emblematic of a business that has made too many mistakes and has lost its way on several fronts.”

DeAnn Campbell, an independent retail consultant in Atlanta, says she’s concerned that Target has lost a major talent in Hennington, who worked at Target for 21 years and was widely seen as a possible successor to Brian Cornell. “She really spearheaded their DEI program and has been pushing it quite a bit in the company, so to see her departure is not solving the problem,” Campbell told Fortune. 

Hennington has a “brilliant mind” for partnerships, and was instrumental in building Target’s groundbreaking partnership with Ulta Beauty and the sale of its pharmacies to CVS, she added. Losing that kind of strategist right now is a disappointment, she argues, as Target tries to reinvigorate its in-store sales experience.  “How are we going to get Target back to that big box, boutique feel?” she says. 

Target, Hennington, and Tu did not respond to Fortune’s request for comment. 

Hennington first joined the retailer as a buyer for its Toys department in 2003, according to her LinkedIn profile, and eventually held C-suite roles in merchandising and growth before being named chief strategy and growth office only one year ago. Before arriving at Target, Amy Tu spent six years at Tyson Foods, and a similar amount of time at Boeing. 

Behind DEI woes, long-term pain

Five years ago, following the death of George Floyd in the retailer’s hometown, Target took pains to increase its commitments to DEI and to the Black community. Then, in January, shortly after President Donald Trump took office and signed a number of anti-DEI executive orders, Target scaled back its diversity efforts, including those around suppliers. The response to Target’s back-pedalling was swift. Activists in Minneapolis and Georgia called for boycotts, while the daughters of a Target cofounder voiced concerns that the company was abandoning its original culture. 

However, Campbell and other retail watchers say that while the DEI boycott and Target’s poor handling of it has contributed to the store’s battered reputation, the company had been suffering from a lack of investment in its stores and products for much longer, and that Target’s tired stores have had a bigger impact on its declining financials. 

Gone are the days when shoppers were delighted by designer kettles or when First Ladies proudly wore Target gowns, says Campbell. And while Target has run into an enduring decline, competitors like Walmart are making inroads with both its products and in-store experience. 
On social media, Saunders also suggested that some of the company’s bottom line growth—net income increased by 10%, a bright spot in today’s earnings—reflects a lack of investment in Target stores and staffing, which he called “a case of short-term gain at the expense of longer-term pain.”