Kohl`s Corp
Q1 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: +4.68%.
Did KSS Beat Earnings? Q1 2026 Results
Kohl's delivered a first-quarter fiscal 2025 earnings beat that offered some relief to investors watching the struggling department store retailer, as the company posted a diluted loss of $0.13 per share against a consensus estimate of $0.22, a 41.12% positive surprise, even as revenue of $3.05 billion fell just shy of the $3.06 billion estimate and dropped 9.8% year over year. The narrower-than-expected loss was driven primarily by margin discipline and cost containment, with gross margin expanding to 39.9% and SG&A expenses declining 5.2% to $1.16 billion, helping lift operating income to $60 million from $43 million a year ago. Comparable sales fell 3.9%, underscoring persistent traffic headwinds, and the balance sheet showed strain with cash at $153 million and revolver borrowings climbing to $545 million. The company also announced the closure of its Monroe, Ohio e-fulfillment center, a cost-reduction move expected to carry $25 to $30 million in pre-tax charges. Kohl's affirmed its full-year outlook, projecting net sales to decline 5% to 7% and diluted EPS of $0.10 to $0.60.
- Gross margin expansion of 37 basis points driven by category mix benefits and inventory management
- SG&A expense reduction of 5.2% from lower spending in stores, marketing, and supply chain
- Credit expense shift from SG&A to Other Revenue
- Operating income improved to $60 million from $43 million year-over-year
- Net loss narrowed to ($0.13) per diluted share from ($0.24) in prior year
“I am honored to assume the role of Interim CEO at such an important time for our company. Kohl's has a tremendous opportunity to build on our strong foundation of over 1,100 conveniently located stores and a large and loyal customer base.”
Kohl's CEO, on the earnings call
Forward Guidance & Outlook
Kohl's affirmed its full-year 2025 financial outlook. The company expects net sales to decline 5% to 7% versus 2024, comparable sales to decline 4% to 6%, operating margin in the range of 2.2% to 2.6%, and diluted EPS of $0.10 to $0.60. Capital expenditures are expected in the range of $400 million to $425 million, which will include investments to complete the Sephora rollout, expand impulse queuing fixtures, and enhance the omnichannel experience. The annual cash dividend has been reduced to $0.50 per share to allow for greater balance sheet flexibility. The company plans to focus on rebuilding its cash balance, reducing reliance on the revolver, and reducing debt and overall leverage. Share repurchases are expected to resume over the long-term with excess cash flow following improvement in overall leverage.
KSS YoY Financials
Figures from SEC filings and company reports. Not investment advice.