Kohl's Reports Fourth Quarter and Full Year Fiscal 2025 Financial Results

Kohl's Corporation (NYSE:KSS) ("Kohl's" or the "Company") today reported results for the quarter and year ended January 31, 2026.

• Fourth quarter net sales decreased 3.9% and comparable sales decreased 2.8%; fiscal year 2025 net sales decreased 4.0% and comparable sales decreased 3.1%.
• Fourth quarter diluted earnings per share ("EPS") of $1.07
• Fiscal year 2025 diluted EPS of $2.38 and adjusted diluted EPS of $1.62 ^(a)
• Introduces fiscal year 2026 financial outlook

Michael J. Bender, Kohl's Chief Executive Officer, said, "We are ending 2025 in a stronger position than we started, with important work still ahead of us. Over the past year, our efforts have been focused on resetting our foundation. This focus is intended to stabilize the business and strengthen our operational ability to build for a stronger future. In 2025, we made meaningful progress, despite our Q4 topline coming in softer than our expectations. We were able to manage the business with discipline, deliver improved earnings, and generate meaningful cash flow, all of which helped us strengthen our balance sheet."

"In 2026, we are committed to further strengthening our foundation by addressing operational opportunities, building on our strengths, and modernizing our processes. We are confident that the work we are investing in now is essential for Kohl's long-term benefit," Bender continued.

Fourth Quarter 2025 Results

Comparisons refer to the 13-week period ended January 31, 2026 versus the 13-week period ended February 1, 2025

• Net sales decreased 3.9% year-over-year, to $5.0 billion, with comparable sales down 2.8%.
• Gross margin as a percentage of net sales was 33.1%, an increase of 25 basis points.
• Selling, general & administrative (SG&A) expenses decreased 4.9% year-over-year, to $1.5 billion. As a percentage of total revenue, SG&A expenses were 28.3%, a decrease of 23 basis points year-over-year.
• Operating income was $212 million compared to $126 million in the prior year. Adjusted operating income was $202 million in the prior year. As a percentage of total revenue, operating income was 4.1%, an increase of 176 basis points year-over-year and an increase of 35 basis points year over year compared to prior year adjusted operating income.^(a)
• Net income was $125 million, or $1.07 per diluted share, compared to net income of $48 million, or $0.43 per diluted share, and adjusted net income of $106 million, or $0.95 per adjusted diluted share, in the prior year. ^(a)
• Inventory was $2.7 billion, a decrease of 7% year-over-year.
• Cash flow provided by operating activities was $750 million compared to $596 million in the prior year.
• Borrowings under revolving credit facility were $0, a decrease of $290 million year-over-year.

Fiscal Year 2025 Results

Comparisons refer to the 52-week period ended January 31, 2026 versus the 52-week period ended February 1, 2025

• Net sales decreased 4.0% year-over-year, to $14.8 billion, with comparable sales down 3.1%.
• Gross margin as a percentage of net sales was 37.5%, an increase of 34 basis points.
• Selling, general & administrative (SG&A) expenses decreased 4.1% year-over-year, to $5.1 billion. As a percentage of total revenue, SG&A expenses were 32.8%, an increase of 5 basis points year-over-year.
• Gain on legal settlement was $129 million from a credit card interchange fee lawsuit settlement.
• Operating income was $624 million compared to $433 million in the prior year. As a percentage of total revenue, operating income was 4.0%, an increase of 135 basis points year-over-year. Adjusted operating income was $510 million compared to $509 million in the prior year. As a percentage of total revenue, adjusted operating income was 3.3%, an increase of 15 basis points year-over-year. ^(a)
• Net income was $272 million, or $2.38 per diluted share, and adjusted net income was $186 million, or $1.62 per adjusted diluted share. This compares to net income of $109 million, or $0.98 per diluted share and adjusted net income of $167 million and $1.50 per adjusted diluted share, in the prior year. ^(a)
• Cash flow provided by operating activities was $1.4 billion compared to $648 million in the prior year.
• Current portion of long-term debt was reduced by $353 million through repayment of the 4.25% notes due July 2025 at maturity.
• Long-term debt increased $262 million through issuance of $360 million of 10.000% senior secured notes due 2030, partially offset by open market repurchases of $87 million of our outstanding long-term debt.

2026 Financial and Capital Allocation Outlook

For the full year 2026, the Company currently expects the following:

• Net sales and Comparable sales: A decrease of (2%) to flat
• Adjusted operating margin: In the range of 2.8% to 3.4% ^(b)
• Adjusted diluted EPS: In the range of $1.00 to $1.60 ^(b)
• Capital Expenditures: Approximately $350 to $400 million
• Dividend: On February 25, 2026, Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.125 per share. The dividend is payable April 1, 2026 to shareholders of record at the close of business on March 18, 2026.

 Fourth Quarter 2025 Earnings Conference Call

Kohl's will host its quarterly earnings conference call at 9:00 am ET on March 10, 2026. A webcast of the conference call and the related presentation materials will be available via the Company's web site at investors.kohls.com, both live and after the call.

Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Measures

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The Company intends forward-looking terminology such as "believes," "expects," "may," "will," "should," "anticipates," "plans," or similar expressionsto identify forward-looking statements. Forward-looking statements include, but are not limited to, the information under "2026 Financial and Capital Allocation Outlook." Such statements are subject to certain risks and uncertainties, which could cause the Company's actual results to differ materially from those anticipated by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks described more fully in Item 1A in the Company's Annual Report on Form 10-K and Item 1A of Part II of the Company's Quarterly Report on Form 10-Q for the first quarter of fiscal 2025, which are expressly incorporated herein by reference, and other factors as may periodically be described in the Company's filings with the SEC. Forward-looking statements relate to the date initially made, and the Company undertakes no obligation to update them.

This press release contains certain financial measures that are not prepared in accordance with generally accepted accounting principles (GAAP), including adjusted operating income, adjusted net income and adjusted diluted earnings per share. These non-GAAP financial measures are provided as additional insight into our operational performance and do not purport to be substitutes for, or superior to, operating income, net income, or diluted earnings per share as a measure of operating performance. We believe these adjusted measures are useful, as they are more representative of our core business, enhance comparability across reporting periods and to industry peers, and align with the measures used by management to evaluate the Company's performance. We caution investors that non-GAAP measures should not be viewed in isolation and should be evaluated in addition to, and not as an alternative for, our results reported in accordance with GAAP. Because companies may use different calculation methods, these measures may not be comparable to other similarly titled measures reported by other companies. A reconciliation of each non-GAAP measure to the most directly comparable GAAP measure is included in this release.

About Kohl's

Kohl's (NYSE:KSS) is a leading omnichannel retailer built on a foundation that combines great brands, incredible value and convenience for our customers. Kohl's is uniquely positioned to deliver against its long-term strategy and its purpose to take care of families' realest moments. Kohl's serves millions of families in its more than 1,100 stores in 49 states, online at Kohls.com, and through the Kohl's App. With a large national footprint, Kohl's is committed to making a positive impact in the communities it serves. For a list of store locations or to shop online, visit Kohls.com. For more information about Kohl's impact in the community or how to join our winning team, visit Corporate.Kohls.com.

KOHL'S CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

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RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

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CONSOLIDATED BALANCE SHEETS

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CONSOLIDATED STATEMENTS OF CASH FLOWS

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