Kohl’s Soars as Strong Sales Show Strategy Paying Off
(Bloomberg) -- Kohl’s Corp. posted stronger-than-expected sales in the third quarter and boosted its full-year outlook, showing that recent strategic moves such as focusing on athletic wear and teaming up with Sephora are resonating with shoppers.
- Same-store sales, a key metric in retail, rose 15.5%, the retailer said in a statement Thursday. That’s above the 12.7% growth estimated by analysts as compiled by Bloomberg.
- The retailer increased its full-year outlook, saying it now expects net sales to increase in a mid-20s percentage range as opposed to the previous projection of a low-20s range. It also increased its expected operating margin to as much as 8.5% this year, compared with the previous outlook of 7.6%.
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- “Our strategic efforts to transform Kohl’s into the leading destination for the active and casual lifestyle continue to build momentum,” Chief Executive Officer Michelle Gass said in the statement. “We delivered another quarter of record earnings with both sales and margins exceeding expectations.”
- Kohl’s also accelerated its share-repurchase program with a buyback of $506 million of shares in the quarter. It plans to repurchase a total of $1.3 billion in 2021.
- This summer, Kohl’s began opening Sephora shop-in-shops as a way to attract a younger demographic and build out its beauty category. The initial expansion of 200 beauty shops helped to attract shoppers.
- Kohl’s shares rose as much as 6.8% in early trading in New York. The stock had risen 39% this year through Wednesday’s close.
- See Kohl’s estimates.
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