Cathy Smith is retiring as CFO of Target after playing an integral role in the retailer’s turnaround strategy during her three-year tenure.
Target said Thursday that Smith will stay on the job until her successor is named and them move to an advisory role until May 2020 to ensure a smooth transition. She joined the company in September 2015 after serving as CFO at Express Scripts.
“On behalf of our board of directors and Target’s entire team, I want to thank Cathy for her leadership and valuable contributions,” CEO Brian Cornell said in a news release, adding that her “deep expertise and leadership helped usher in strategic change for Target and positioned us for sustainable, long-term growth.”
Smith said she was “excited about what is in store for Target and myself as I plan for retirement, including freeing up more time for my family. As we look ahead to 2019, Target is in a position of strength and poised to continue building on its momentum.”
Smith’s retirement was announced as Target reported a strong holiday season, with same-store sales increasing 5.7% in November and December. The company said it is also expecting that 2018 will be the fifth consecutive year in which its digital sales grow more than 25%.
Under Cornell, Target pursued a turnaround by overhauling its merchandising, modernizing its 1,850 U.S. stores, and expanding its e-commerce channels. “Smith was an important contributor to the transformation program,” according to The Wall Street Journal.
“The next person in that chair has some big shoes to fill,” said Charles O’Shea, a senior credit officer at Moody’s Investors Service.
Analysts said Smith’s successor will need to allocate enough capital for the company’s transformation efforts while making sure that it remains tactical about its investment, including spending on its digital shopping platforms.
“That person will have to manage the books while being able to say no to certain spending plans,” said Joseph Feldman, an analyst at Telsey Advisory Group.
Target’s capital expenditures were forecast to rise to approximately $3.5 billion in 2018, up from around $2.5 billion the year before.