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Kohl’s Retail Earnings Beat Expectations, But Stock Drops on Weak Guidance

Retail

Business Honor
11 March, 2025

Kohl’s reports better retail earnings, but a weak 2025 outlook leads to a stock decline.

Kohl's reported better-than-expected fourth quarter earnings and revenue on Tuesday, but its stock fell as the company gave far worse-than-expected guidance for the next year. During Tuesday's premarket trade, the company's shares dropped by over 15%. According to LSEG, Kohl's expects a 5% to 7% decline in revenue in 2025, while Wall Street shows a 1.6% decline.

According to StreetAccount, the company expected that comparable sales would decline by 4% to 6%, while analysts predicted a 0.9% decline. According to LSEG, Kohl's expects profits per share to be between 10 and 60 cents, which are below the midpoint Wall Street expectation of $1.23. Over the past year, the company's shares have dropped by more than 50%. Following Dick's Sporting Goods earlier Tuesday, Kohl's was the most recent retailer to predict a stormy 2025.

Concerns about an impending economic downturn have been compounded by President Donald Trump's tariff tactics, slower-than-expected job creation, and declining consumer confidence. Kohl's net sales dropped from $5.71 billion to $5.18 billion in the fourth quarter of 2023. Sales increased from $16.59 billion in 2023 to $15.39 billion in 2024. The fourth quarter and full year of fiscal 2023 were one week longer than those of fiscal 2024.

Kohl's defines quarterly comparable sales as sales from e-commerce and stores that have been open for at least a year. These sales decreased 6.7% from the previous year. Street Account said that Wall Street anticipated a 6.8% decline.

The fourth quarter net income for Kohl's was $48 million, or 43 cents per share, compared to $186 million, or $1.67 per share, in the fourth quarter of 2023. Kohl's announced fourth-quarter earnings of 95 cents per share after removing damage and store closing costs.