Target CEO Gregg Steinhafel announced Monday he will step down as CEO, president and chairman of the retail chain’s board of directors following the theft of 110 million customers’ personal and payment data at the end of last year.
“Today we are announcing that, after extensive discussions, the board and Gregg Steinhafel have decided that now is the right time for new leadership at Target,” the announcement posted to the company website on Monday said.
According to the board’s statement, Steinhafel “held himself personally accountable [for the data breach] and pledged that Target would emerge a better company.” The theft by hackers included 40 million customers’ credit and debit card information, and another 70 million customers’ emails and phone numbers during the 2013 fourth-quarter shopping season.
The company announced in its most recent February earnings report the breach has cost it $61 million in related expenses so far, and last week announced it plans to spend $100 million to update its payment systems to more secure chip-based credit and debit cards, and terminals to accept them.
February’s earnings report also revealed the company’s shares went down by $1.13-per-share in 2013 after the retail chain’s 124-store expansion into Canada, which has been described as a “giant failure” by Belus Capital Advisors CEO Brian Sozzi. According to Sozzi, Steinhafel’s resignation didn’t come soon enough.
“It would have been better to start the year with fresh eyes and a fresh approach,” Sozzi told USA Today. “I think this reflects the very slow-moving nature that is inherent of Target’s culture.”
Target CFO John Mulligan will serve as interim CEO while the company employs executive recruitment firm Korn Ferry to find his permanent replacement. Steinhafel, a 35-year veteran of Target, will serve as an advisor throughout the transition.
“The last several months have tested Target in unprecedented ways,” Steinhafel said. “From the beginning, I have been committed to ensuring Target emerges from the data breach a better company, more focused on delivering for our guests.”
Target shares were down by more than 3 percent, or $1.89 to $60.11 around noon Monday.