Kohl’s delivered a Q2 earnings beat on Tuesday, but the market was not impressed. The stock slid more than 6% in pre-market trading after the retailer reported that both net sales and comparable sales fell 0.9% year-over-year to $3.3 billion for the quarter ended August 1.
Adjusted earnings per share came in at $1.28, more than double Wall Street’s estimate of 58 cents. Net income was $151 million, slightly down from $153 million a year ago.
The sales decline continues a multi-year downward trend that CEO Michael Bender has been working to reverse since taking the role in May 2025. Bender acknowledged “critical work ahead” while pointing to what he called ongoing progress in comparable sales trends.
$KSS (Kohl's) #earnings are out: pic.twitter.com/dgxMfOGUHf
— The Earnings Correspondent (@earnings_guy) August 26, 2026
One factor helping the quarter was a roughly $150 million windfall from tariff refunds received during the period. That boosted the company’s ability to raise its full-year guidance.
Management now expects full-year net and comparable sales to be flat to down 1.5%, compared to a prior forecast of flat to down 2%. Adjusted EPS guidance was raised to a range of $1.80 to $2.40, up from $1.00 to $1.60. Analysts had been expecting $1.45.
Kohl’s also announced it plans to restart its share repurchase program, targeting up to $100 million under an existing $3 billion authorization. The program had been paused in May 2020.
In the past six months, the retailer bought back $113 million of its unsecured debt at a $15 million discount, adding to $87 million in repurchases from the prior year.
Analyst sentiment heading into the print leaned negative. JP Morgan’s Matthew Boss maintained an Underweight rating with a price target of $17. Morgan Stanley and Bank of America also held negative ratings on the stock.
Options activity the day before the report showed put contracts outnumbering calls roughly four-to-one, with heavy positioning in near-term strikes well below the stock price. The market had been bracing for a negative reaction.
Adding to investor caution, Kohl’s announced a new Chief Customer Officer role while its Chief Marketing Officer departed, raising questions about leadership continuity during a key turnaround period.
The broader market offered no support. The S&P 500, Dow Jones, and Nasdaq were all essentially flat on the day, meaning the pressure on KSS was driven entirely by company-specific factors.
Kohl’s core customer base of middle- and lower-income shoppers continues to face pressure from tight discretionary spending. With the stock now trading closer to its 52-week low of $11.38 than its 52-week high of $25.22, investors remain skeptical that the turnaround is gaining real traction.
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