Kohl's (NYSE: KSS) shares tumbled Tuesday morning despite it releasing second-quarter earnings that beat analysts' profit and sales estimates.
The retailer also raised its profit outlook for the year.
Net income during the quarter ended August 4 surged 40.4% to $292 million, or $1.76 per share, compared with $208 million, or $1.24 a share, a year ago. Analysts expected earnings of $1.64 a share.
Revenue climbed 4% to $4.57 billion, again ahead of the $4.26 billion forecast by analysts.
The chain, based in Menomonee, Wisconsin, said sales at Kohl's stores opened for at least 12 months were up 3.1% better than the 2.7% increase that analysts were expecting.
The department store chain said its men's and women's apparel segments were the strongest during the quarter, followed by shoes. It also reported stronger gross margins thanks to a heightened focus of late on trimming excess inventory and selling more items at full price.
Looking to the full year, Kohl's now expects to earn between $4.96 and $5.36 per share, compared with a prior range of between $4.86 and $5.31 a share.
Michelle Gass, Kohl's chief executive officer, said, "We are pleased to report that our sales momentum continued in the second quarter, resulting in a comparable sales increase of 3.1%, our fourth consecutive quarter of positive comparable sales. We saw strength across the business -- both our store and digital channels, all regions of the country, and our proprietary and national brands."
Shares improved in price 44 cents to $79.29
