Kohl’s (NYSE:KSS) on Thursday slashed its financial forecast for the year, saying that its middle-income customers have been particularly pressured by higher inflation.
Shares of Kohl’s fell in early trading, even after Kohl’s beat analysts’ expectations for its fiscal second-quarter profit and revenue, as investors were more focused on future guidance.
The news from Kohl’s comes the same week that Walmart (NYSE:WMT) and Target (NYSE: TGT) both reiterated their full-year forecasts even as their profits come under pressure. Walmart said it saw more higher- and middle-income consumers visiting its shops in searched of discounted items, helping its overall performance. Target’s earnings, however, were weighed down by its efforts to clear through excess merchandise at steep markdowns before the holiday season.
Second-quarter Earnings per Share proved to be $1.11 compared to the expected $1.03, on revenue of $4.09 billion vs. $3.85 billion expected.
Sales fell 8.5% to $4.09 billion from $4.45 billion a year earlier.
Same-store sales, which track revenue at Kohl’s stores open for at least 12 months, dropped 7.7%.
The company said Thursday that it has entered into an accelerated share repurchase agreement to buy back about $500 million of its common stock.
Kohl’s also said it stands by its previously announced quarterly cash dividend of 50 cents a share, payable to shareholders Sept. 21
Kohl’s shares have fallen about 31% so far this year, as of Wednesday’s market close. They opened Thursday up $2.54, or 7.5% at $31.41.
