Kohl’s reports better-than-expected Q1 loss as inventory improvements and steady guidance support investor sentiment.
Stock Earnings Results
May 28, 2026
Table of Contents
May 28, 2026
Kohl’s Corporation (NYSE: KSS) reported first-quarter fiscal 2026 results with sales still declining, but shares moved higher after the company posted a narrower-than-expected loss, improved inventory levels, and reaffirmed full-year guidance.
Kohl’s is a department store retailer selling apparel, footwear, accessories, beauty, home goods, and private-label merchandise through stores and digital channels.
The company reported a loss of $0.13 per share, narrower than estimates for a loss of $0.18, representing a 27.8% earnings surprise. Revenue came in at $3.17 billion, above estimates of $3.16 billion, though revenue declined 2.0%.
Kohl’s reported net sales of $3.0 billion, down 1.7% year-over-year.
Comparable sales declined 1.1%, but management said this was the company’s best comparable sales performance in more than four years.
Gross margin was 39.9% of net sales.
That was up 4 basis points from the prior-year period, showing slight improvement despite lower sales.
SG&A expenses declined 1.6% year-over-year to $1.1 billion.
As a percentage of total revenue, SG&A was 36.2%, up 15 basis points from the prior-year period.
Operating income was $46 million, compared with $60 million a year earlier.
Operating margin was 1.4% of total revenue, down 41 basis points year-over-year.
Kohl’s reported a net loss of $14 million, or $0.13 per diluted share.
That compared with a net loss of $15 million, or $0.13 per diluted share, in the prior-year quarter.
Inventory declined 8% year-over-year to $2.9 billion.
Cleaner inventory was one of the more important positives in the report because it gives Kohl’s more flexibility on pricing, promotions, and working capital.
Kohl’s reported no borrowings under its revolving credit facility.
That was a $545 million improvement from the prior-year period, showing better balance sheet discipline.
Kohl’s reaffirmed its full-year 2026 outlook.
The company continues to expect net sales and comparable sales to range from down 2% to flat. Adjusted operating margin is expected to be 2.8% to 3.4%, while adjusted diluted EPS is expected to be $1.00 to $1.60.
Kohl’s board declared a quarterly cash dividend of $0.125 per share.
The dividend is payable June 24, 2026, to shareholders of record as of June 10, 2026.
Investors are likely to watch whether Kohl’s can turn improving comps into actual sales growth.
The key areas are:
Kohl’s quarter was not a growth story, but it was better than feared.
Sales and operating income still declined, but the company delivered its best comparable sales performance in years, reduced inventory, controlled expenses, and reaffirmed guidance. The stock reaction likely reflected relief that the turnaround is showing early signs of stabilization.
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