What were Kohl's fourth-quarter financial results?

Kohl's reported fourth-quarter revenue of $5.17 billion, meeting expectations, and a notable profit upside with adjusted EPS at $1.07 and adjusted EBITDA at $386 million.

Why did Kohl's margins improve despite declining sales?

Margin improvement at Kohl's was attributed to disciplined inventory management, lower store expenses, and a focus on core basics and essentials.

What is Kohl's outlook for the upcoming financial year 2026?

Kohl's issued midpoint adjusted EPS guidance of $1.30 for the 2026 financial year, with management acknowledging ongoing work to strengthen the company's position.

Home / Business and Economy / Kohl's Profit Soars Despite Sales Dip

Kohl's Profit Soars Despite Sales Dip

17 Mar

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Summary

Kohl's revenue met expectations while profit exceeded forecasts.
Margin improvement driven by inventory and expense discipline.
Same-store sales declined 2.8% year-over-year.

Kohl's concluded its fourth quarter with revenue of $5.17 billion, aligning with analyst expectations, yet experiencing a 4.2% year-on-year decline. Significantly, profitability surpassed forecasts, with adjusted EPS at $1.07 and adjusted EBITDA at $386 million, resulting in a 7.5% margin and a notable operating margin improvement. Management cited disciplined inventory control and reduced store expenses for these gains.

Despite these profitability improvements, same-store sales fell by 2.8% compared to the previous year, indicating ongoing challenges with customer traffic. The company is strategically focusing on its proprietary brands, including juniors, petites, and accessories, to offset sales softness in other areas. Store count also saw a slight reduction, ending the quarter with 1,153 locations.

Looking ahead, Kohl's provided adjusted EPS guidance for the upcoming financial year 2026, with a midpoint of $1.30, falling slightly short of analyst estimates. Management emphasized ongoing work to strengthen the company's position, with key focus areas including sequential improvements in same-store sales and traffic, margin resilience, and the effectiveness of marketing campaigns like 'By Kohl's.'

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