Kohl’s Corp (NYSE: KSS) shares plunged 24% on Tuesday after the U.S. department store chain issued a 2025 profit forecast that significantly missed analyst expectations. The forecast followed a mixed fourth-quarter performance for fiscal 2024.
For the fourth quarter, Kohl’s reported adjusted diluted earnings per share (EPS) of $0.95, topping analyst expectations of $0.73. Revenue hit $5.18 billion, matching consensus estimates.
The company also saw its gross margin rise to 32.9% from 32.4% a year earlier, slightly ahead of the expected 32.7%. However, operating income came in at $126 million, missing the projected $185.8 million.
Despite the positive earnings report, investor focus quickly turned to the gloomy 2025 outlook, which dampened sentiment. The retailer forecasts diluted EPS to range between $0.10 and $0.60, far below the $1.32 analysts had anticipated.
Net sales are expected to drop 5% to 7%, with comparable sales projected to decline 4% to 6%—a stark contrast to estimates of a modest 0.9% decrease. Operating margin is slated to land between 2.2% and 2.6%.
In a press release, CEO Ashley Buchanan said,
“Kohl’s is built on a strong foundation that includes operating more than 1,100 conveniently located stores nationwide, serving over 60 million customers, with 30 million of those customers being Kohl’s Loyalty Members.”
He added,
“We have identified key areas of focus and are taking action in 2025 to reposition Kohl’s for future success.”
Kohl’s Corp (NYSE: KSS) also outlined plans to allocate $400 million to $425 million for capital expenditures in 2025.
