Kohl’s (NYSE: KSS) shares spiked early Wednesday as the struggling retailer posted a surprise profit while it chases a turnaround.
The retailer reiterated its full-year outlook, expecting net sales to range between a decline of 2% and a decline of 4%, including the approximately 1% impact from having one more week of sales this year. It said it expects diluted earnings per share to range from $2.10 to $2.70, excluding nonrecurring charges.
Kohl’s earnings per share came in at 13 cents vs. the expected loss of 42 cents. Revenue was $3.36 billion vs. $3.34 billion.
Kohl’s surprise quarterly profit comes after multiple quarters of disappointing sales and a sinking stock price. Last year, the retailer became a target for activist investors Ancora Holdings and Macellum Capital, which pushed the company to oust its then-CEO Michelle Gass and shake up its board. Kohl’s also discussed and then ended a bid last year to sell its business to Vitamin Shoppe owner Franchise Group.
Since then, Kohl’s has tapped a new CEO: Tom Kingsbury, the former chief executive of off-price retailer Burlington Stores. Gass, its former CEO, left to become the next leader of Levi Strauss.
In more recent months, Kohl’s efforts to reinvent itself and woo shoppers have run into other obstacles. Many middle-income shoppers feel squeezed by inflation and are buying fewer discretionary items, such as clothing.
KSS shares surged $2.15, or 11.2%, to $21.42.
