An operating lease is treated like a rental contract. Neither the leased asset nor the associated liability is reported on the lessee balance sheet, but the rights may be very similar to the rights of an owner. The lessee only records the lease payments as a rental expense in income statement.

Adjustments to Financial Statements for Operating Leases
Adjusted Financial Ratios for Operating Leases (Summary)
Adjusted Total Asset Turnover
Adjusted Debt to Equity
Adjusted Return on Assets (ROA)

Target Corp., adjustments to financial statements

US$ in millions

	Feb 1, 2025	Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
Adjustment to Total Assets
Total assets (as reported)	57,769)	55,356)	53,335)	53,811)	51,248)	42,779)
Add: Operating lease right-of-use asset (before adoption of FASB Topic 842)¹	—)	—)	—)	—)	—)	—)
Total assets (adjusted)	57,769)	55,356)	53,335)	53,811)	51,248)	42,779)
Adjustment to Total Debt
Total debt (as reported)	15,940)	16,038)	16,139)	13,720)	12,680)	11,499)
Add: Operating lease liability (before adoption of FASB Topic 842)²	—)	—)	—)	—)	—)	—)
Add: Current portion of operating lease liabilities	353)	329)	296)	254)	211)	200)
Add: Noncurrent operating lease liabilities	3,582)	3,279)	2,638)	2,493)	2,218)	2,275)
Total debt (adjusted)	19,875)	19,646)	19,073)	16,467)	15,109)	13,974)

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

^{1, 2} Equal to total present value of future operating lease payments.

Target Corp., Financial Data: Reported vs. Adjusted

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Target Corp., adjusted financial ratios

	Feb 1, 2025	Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
Total Asset Turnover¹
Reported total asset turnover	1.84	1.94	2.05	1.97	1.83	1.83
Adjusted total asset turnover	1.84	1.94	2.05	1.97	1.83	1.83
Debt to Equity²
Reported debt to equity	1.09	1.19	1.44	1.07	0.88	0.97
Adjusted debt to equity	1.36	1.46	1.70	1.28	1.05	1.18
Return on Assets³ (ROA)
Reported ROA	7.08%	7.48%	5.21%	12.91%	8.52%	7.67%
Adjusted ROA	7.08%	7.48%	5.21%	12.91%	8.52%	7.67%

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

¹ See details »

² See details »

³ See details »

Financial ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Target Corp. adjusted total asset turnover ratio deteriorated from 2023 to 2024 and from 2024 to 2025.
Adjusted debt to equity	A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity.	Target Corp. adjusted debt to equity ratio improved from 2023 to 2024 and from 2024 to 2025.
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Target Corp. adjusted ROA improved from 2023 to 2024 but then slightly deteriorated from 2024 to 2025.

Target Corp., Financial Ratios: Reported vs. Adjusted

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	Feb 1, 2025	Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
As Reported
Selected Financial Data (US$ in millions)
Net sales	106,566)	107,412)	109,120)	106,005)	93,561)	78,112)
Total assets	57,769)	55,356)	53,335)	53,811)	51,248)	42,779)
Activity Ratio
Total asset turnover¹	1.84	1.94	2.05	1.97	1.83	1.83
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Net sales	106,566)	107,412)	109,120)	106,005)	93,561)	78,112)
Adjusted total assets	57,769)	55,356)	53,335)	53,811)	51,248)	42,779)
Activity Ratio
Adjusted total asset turnover²	1.84	1.94	2.05	1.97	1.83	1.83

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

2025 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 106,566 ÷ 57,769 = 1.84

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 106,566 ÷ 57,769 = 1.84

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Target Corp. adjusted total asset turnover ratio deteriorated from 2023 to 2024 and from 2024 to 2025.

	Feb 1, 2025	Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
As Reported
Selected Financial Data (US$ in millions)
Total debt	15,940)	16,038)	16,139)	13,720)	12,680)	11,499)
Shareholders’ investment	14,666)	13,432)	11,232)	12,827)	14,440)	11,833)
Solvency Ratio
Debt to equity¹	1.09	1.19	1.44	1.07	0.88	0.97
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Adjusted total debt	19,875)	19,646)	19,073)	16,467)	15,109)	13,974)
Shareholders’ investment	14,666)	13,432)	11,232)	12,827)	14,440)	11,833)
Solvency Ratio
Adjusted debt to equity²	1.36	1.46	1.70	1.28	1.05	1.18

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

2025 Calculations

¹ Debt to equity = Total debt ÷ Shareholders’ investment
= 15,940 ÷ 14,666 = 1.09

² Adjusted debt to equity = Adjusted total debt ÷ Shareholders’ investment
= 19,875 ÷ 14,666 = 1.36

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Solvency ratio	Description	The company
Adjusted debt-to-equity	A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity.	Target Corp. adjusted debt-to-equity ratio improved from 2023 to 2024 and from 2024 to 2025.

	Feb 1, 2025	Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
As Reported
Selected Financial Data (US$ in millions)
Net earnings	4,091)	4,138)	2,780)	6,946)	4,368)	3,281)
Total assets	57,769)	55,356)	53,335)	53,811)	51,248)	42,779)
Profitability Ratio
ROA¹	7.08%	7.48%	5.21%	12.91%	8.52%	7.67%
Adjusted for Operating Leases
Selected Financial Data (US$ in millions)
Net earnings	4,091)	4,138)	2,780)	6,946)	4,368)	3,281)
Adjusted total assets	57,769)	55,356)	53,335)	53,811)	51,248)	42,779)
Profitability Ratio
Adjusted ROA²	7.08%	7.48%	5.21%	12.91%	8.52%	7.67%

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

2025 Calculations

¹ ROA = 100 × Net earnings ÷ Total assets
= 100 × 4,091 ÷ 57,769 = 7.08%

² Adjusted ROA = 100 × Net earnings ÷ Adjusted total assets
= 100 × 4,091 ÷ 57,769 = 7.08%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Target Corp. adjusted ROA improved from 2023 to 2024 but then slightly deteriorated from 2024 to 2025.

Target Corp. (NYSE:TGT)

Analysis of Operating Leases

Adjustments to Financial Statements for Operating Leases

Target Corp., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios for Operating Leases (Summary)

Target Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Adjusted Debt to Equity

Adjusted Return on Assets (ROA)