Kohl's Posts Another Kitchen Sink Quarter, But New CEO Has a Plan

Core Viewpoint - Kohl's Co. shares have reached all-time lows following a disappointing fiscal fourth quarter earnings report, despite a commendable earnings-per-share (EPS) beat, with gloomy forward guidance [1][8]. Financial Performance - Kohl's reported an EPS of 95 cents, exceeding consensus estimates by 23 cents or 27%, but revenues fell 9.4% year-over-year (YOY) to $5.17 billion, missing the $5.19 billion consensus [7]. - Comparable sales decreased by 6.7% YOY, and inventory grew by 2% YOY to $2.9 billion [7]. - For fiscal 2026, management expects EPS between 10 cents to 80 cents, significantly below the consensus estimate of $1.18, with revenue expectations of $14.32 billion to $14.63 billion, missing the $15.45 billion consensus [8]. Leadership and Strategy - New CEO Ashley Buchanon, who took over on January 15, 2025, emphasized that any turnaround will take time and grounded expectations for immediate recovery [2][4]. - The company has implemented a three-pillar comeback strategy focusing on a balanced product assortment, reestablishing quality and value, and enhancing the omnichannel shopping experience [5][4]. Market Reaction - Following the earnings report, Kohl's stock plunged 24% the next day and continued to fall another 11% in subsequent days, reflecting a lack of confidence in the company's outlook [6]. - The market capitalization has fallen to less than $1 billion, while the company's real estate holdings are valued at over $6 billion, raising questions about potential value opportunities [9].