10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 2, 2026


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition period from ________ to _________

Commission file number 1-11084

KOHL’S CORPORATION

(Exact name of registrant as specified in its charter)


Wisconsin		39-1630919
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

N56 W17000 Ridgewood Drive, Menomonee Falls, Wisconsin		53051
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (262) 703-7000

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading 
Symbol(s)

     Name of each exchange on 
which registered

     Common Stock, $.01 par value

     KSS

     New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer	☒	Accelerated Filer	☐
Non-Accelerated Filer	☐	Smaller Reporting Company	☐
		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: May 29, 2026 Common Stock, Par Value $0.01 per Share, 113,399,993 shares outstanding.

KOHL’S CORPORATION

INDEX


PART I	FINANCIAL INFORMATION	3
Item 1.	Financial Statements:	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations	4
	Consolidated Statements of Changes in Shareholders' Equity	5
	Consolidated Statements of Cash Flows	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	21
Item 4.	Controls and Procedures	21

PART II	OTHER INFORMATION	22
Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 5.	Other Information	23
Item 6.	Exhibits	24
	Signatures	25

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS


(Dollars in Millions)	May 2, 2026	January 31, 2026	May 3, 2025
Assets	(Unaudited)	(Audited)	(Unaudited)
Current assets:
Cash and cash equivalents	$429	$674	$153
Merchandise inventories	2,897	2,745	3,137
Other	326	272	290
Total current assets	3,652	3,691	3,580
Property and equipment, net	6,779	6,914	7,209
Operating leases	2,318	2,338	2,374
Other assets	416	419	476
Total assets	$13,165	$13,362	$13,639

Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$1,248	$1,171	$1,026
Accrued liabilities	1,033	1,181	1,177
Borrowings under revolving credit facility	—	—	545
Current portion of:
Long-term debt	—	—	353
Finance leases and financing obligations	89	85	80
Operating leases	95	94	99
Total current liabilities	2,465	2,531	3,280
Long-term debt	1,387	1,436	1,174
Finance leases and financing obligations	2,338	2,365	2,433
Operating leases	2,624	2,650	2,687
Deferred income taxes	88	91	27
Other long-term liabilities	239	241	259
Shareholders’ equity:
Common stock	1	1	1
Paid-in capital	3,605	3,595	3,570
Treasury stock, at cost	(777)	(771)	(771)
Retained earnings	1,195	1,223	979
Total shareholders’ equity	$4,024	$4,048	$3,779
Total liabilities and shareholders’ equity	$13,165	$13,362	$13,639

See accompanying Notes to Consolidated Financial Statements

Table of Contents

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Quarter Ended
(Dollars in Millions, Except per Share Data)	May 2, 2026	May 3, 2025
Net sales	$2,998	$3,049
Other revenue	169	184
Total revenue	3,167	3,233
Cost of merchandise sold	1,802	1,834
Operating expenses:
Selling, general, and administrative	1,145	1,164
Depreciation and amortization	174	175
Operating income	46	60
Interest expense, net	63	76
Loss before income taxes	(17)	(16)
Benefit for income taxes	(3)	(1)
Net loss	$(14)	$(15)
Net loss per share:
Basic	$(0.13)	$(0.13)
Diluted	$(0.13)	$(0.13)

See accompanying Notes to Consolidated Financial Statements

Table of Contents

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)


	Quarter Ended
(Dollars in Millions, Except per Share Data)	May 2, 2026	May 3, 2025
Common stock
Balance, beginning of period	$1	$1
Stock-based awards	—	—
Balance, end of period	$1	$1

Paid-in capital
Balance, beginning of period	$3,595	$3,560
Stock-based awards	10	10
Balance, end of period	$3,605	$3,570

Treasury stock
Balance, beginning of period	$(771)	$(767)
Stock-based awards	(6)	(4)
Dividends paid	—	—
Balance, end of period	$(777)	$(771)

Retained earnings
Balance, beginning of period	$1,223	$1,008
Net loss	(14)	(15)
Dividends paid	(14)	(14)
Balance, end of period	$1,195	$979

Total shareholders' equity, end of period	$4,024	$3,779

Common stock
Shares, beginning of period	127	126
Stock-based awards	2	1
Shares, end of period	129	127
Treasury stock
Shares, beginning of period	(15)	(15)
Stock-based awards	(1)	—
Shares, end of period	(16)	(15)
Total shares outstanding, end of period	113	112

Dividends paid per common share	$0.125	$0.125

See accompanying Notes to Consolidated Financial Statements

Table of Contents

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Quarter Ended
(Dollars in Millions)	May 2, 2026	May 3, 2025
Operating activities
Net loss	$(14)	$(15)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	174	175
Share-based compensation	9	9
Deferred income taxes	(2)	(2)
Non-cash lease expense	22	21
Other non-cash items	(6)	2
Changes in operating assets and liabilities:
Merchandise inventories	(151)	(191)
Other current and long-term assets	(26)	31
Accounts payable	77	(16)
Accrued and other long-term liabilities	(128)	(83)
Operating lease liabilities	(29)	(23)
Net cash used in operating activities	(74)	(92)
Investing activities
Acquisition of property and equipment	(84)	(110)
Proceeds from sale of property and equipment	—	2
Net cash used in investing activities	(84)	(108)
Financing activities
Net borrowings under revolving credit facility	—	255
Shares withheld for taxes on vested restricted shares	(6)	(4)
Dividends paid	(14)	(14)
Repayment of long-term borrowings	(50)	—
Discount on redemption of debt	9	—
Finance lease and financing obligation payments	(26)	(21)
Proceeds from financing obligations	—	3
Net cash (used in) provided by financing activities	(87)	219
Net (decrease) increase in cash and cash equivalents	(245)	19
Cash and cash equivalents at beginning of period	674	134
Cash and cash equivalents at end of period	$429	$153
Supplemental information
Interest paid, net of capitalized interest	$61	$68

See accompanying Notes to Consolidated Financial Statements

Table of Contents

KOHL’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for fiscal year end Consolidated Financial Statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information, refer to the Consolidated Financial Statements and related footnotes included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026 (Commission File No. 1-11084) as filed with the Securities and Exchange Commission ("SEC"). Certain amounts in the Consolidated Financial Statements and related footnotes may not foot or crossfoot due to rounding.

Due to the seasonality of the business of Kohl’s Corporation (the “Company,” “Kohl’s,” “we,” “our,” or “us”), results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year.

Reportable Segments

We are an omnichannel retailer that operates as a single reportable segment. Our Chief Operating Decision Maker (“CODM”) is our Chief Executive Officer. The net income (loss) presented in the Consolidated Statements of Operations is the financial information reviewed by the CODM. The CODM assesses the performance of the Company and decides how to allocate resources using net income (loss) that is reported on the Consolidated Statement of Operations. Net income (loss) is used to monitor budget versus actual results. The CODM regularly reviews information consistent with the Consolidated Statements of Operations.

Supplier Finance Programs

The Company has an agreement with a third-party financing provider to facilitate a supplier financing program. The program provides participating suppliers the option to receive outstanding payment obligations of the Company early at a discount. The Company’s obligations to its suppliers, including amounts due and scheduled payment terms, are not impacted by suppliers’ decisions to finance amounts under the program. All amounts payable to the financial institution relating to suppliers participating in the program are recorded in Accounts Payable in the Consolidated Balance Sheets and were $224 million as of May 2, 2026, $201 million as of January 31, 2026, and $125 million as of May 3, 2025.

International Emergency Economic Powers Act ("IEEPA") Tariff Recovery

On February 20, 2026, the U.S. Supreme Court issued a ruling in Learning Resources, Inc. v. Trump invalidating certain tariffs previously imposed under the IEEPA. As a result of this ruling, the Company may be eligible for refunds of duties paid during fiscal 2025 and the first month of fiscal 2026. The Company paid approximately $190 million in IEEPA tariffs during this period. On April 20, 2026 U.S. Customs and Border Protection (“CBP”) launched Phase 1 of the Consolidated Administration and Processing of Entries (“CAPE”) portal and refund process. We submitted claims seeking approximately $140 million of refunds of previously paid IEEPA tariffs as part of the Phase 1 CAPE tariff refunds. We continue to monitor CBP guidance regarding Phase 2, which is expected to address entries that comprise the remainder of the Company’s potential recovery.

In accordance with ASC 450-30, “Gain Contingencies,” the Company has elected to use a gain contingency model to account for recoveries of previously paid IEEPA tariffs. Under this model, a gain contingency is not recognized in the financial statements until the gain is realized or realizable. Tariff recoveries would be reflected as a reduction of Merchandise inventories to the extent the inventory remains on hand, or as a reduction of Cost of merchandise sold for inventory that has already been sold.

Table of Contents

As of May 2, 2026, the Company has not received any refund payments. Accordingly, no gain has been recognized in the Consolidated Statement of Operations for the quarter ended May 2, 2026.

Recent Accounting Pronouncements

Accounting Standards Issued but not yet Effective

In 2024, the Financial Accounting Standards Board ("FASB") issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. For public entities, the provisions within ASU 2024-03 are effective for the first annual reporting period beginning after December 15, 2026, and for interim periods of fiscal years beginning after December 15, 2027. The provisions within ASU 2024-03 are required to be applied prospectively; however, they may be applied retrospectively for all comparative periods following the effective date. We are currently assessing the impact the adoption of ASU 2024-03 will have on our consolidated financial statement disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software ("ASU 2025-06"), which requires software capitalization to begin when both of the following occur: (1) management has authorized and committed to funding the software project; and (2) it is probable that the project will be completed and the software will be used to perform the function intended. For public entities, the provisions within ASU 2025-06 are effective for the first annual and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The provisions within ASU 2025-06 allow for a prospective, modified, or retrospective transition approach. We are currently assessing the impact the adoption of ASU 2025-06 will have on our consolidated financial statements and related disclosures.

2. Revenue Recognition

The following table summarizes net sales by line of business:


	Quarter Ended
(Dollars in Millions)	May 2, 2026	May 3, 2025
Women's	$849	$851
Accessories (including Sephora)	642	646
Men's	567	584
Home	369	370
Children's	309	312
Footwear	262	286
Net sales	$2,998	$3,049

Unredeemed gift cards and merchandise return card liabilities totaled $248 million as of May 2, 2026, $275 million as of January 31, 2026, and $276 million as of May 3, 2025. In the first quarter of 2026 and 2025, net sales of $46 million and $54 million, respectively, were recognized from gift cards redeemed in the current period and issued in prior years.

3. Debt

Borrowings under the $1.5 billion revolving credit facility, recorded as short-term debt, were $0 as of May 2, 2026 and January 31, 2026 and $545 million as of May 3, 2025.

Table of Contents

Long-term debt, which excludes borrowings on the revolving credit facility, consists of the following secured and unsecured debt:


			Outstanding
Maturity (Dollars in Millions)	Effective Rate at Issuance	Coupon Rate	May 2, 2026	January 31, 2026	May 3, 2025
2025	4.25%	4.25%	—	—	353
2029	7.36%	7.25%	42	42	42
2030	10.25%	10.00%	360	360	—
2031	3.40%	5.13%	381	425	500
2033	6.05%	6.00%	108	112	112
2037	6.89%	6.88%	87	89	101
2045	5.57%	5.55%	427	427	427
Outstanding secured and unsecured senior debt			1,405	1,455	1,535
Unamortized debt discounts and deferred financing costs			(18)	(19)	(8)
Current portion of secured and unsecured senior debt			—	—	(353)
Long-term secured and unsecured senior debt			$1,387	$1,436	$1,174
Effective interest rate at issuance			6.35%	6.26%	4.73%

Our estimated fair value of secured and unsecured senior long-term debt is determined using Level 1 inputs, using financial instruments with unadjusted, quoted prices listed on active market exchanges. The estimated fair value of our secured and unsecured senior debt was $1.2 billion at May 2, 2026 and January 31, 2026, and $1.0 billion at May 3, 2025.

The interest rate on our 3.375% notes due May 2031 is subject to a coupon adjustment provision within the notes that can cause the interest rate to step up if our long-term debt is downgraded to below a BBB- credit rating by S&P Global Ratings or Baa3 by Moody’s Investor Service, Inc., which has occurred in recent years. In total, the interest rate on the notes due May 2031 has increased 175 basis points since their issuance due to the coupon adjustment provision within the notes.

In the first quarter of 2026, we reduced our outstanding debt by $50 million through repurchases of our notes on the open market, resulting in a gain on extinguishment of debt of $9 million recognized in net interest expense.

In the fourth quarter of 2025, we reduced our outstanding debt by $87 million through repurchases of our notes on the open market, resulting in a gain on extinguishment of debt of $11 million recognized in net interest expense.

In the second quarter of 2025, we issued $360 million aggregate principal amount of 10.000% senior secured notes due 2030 and received proceeds of $357 million, net of the debt discount. The notes are guaranteed by certain of our subsidiaries. Certain of these guarantees are secured by eleven distribution centers and E-commerce Fulfillment Centers, which are held by our subsidiaries, as well as the equity interests in one of our subsidiaries.

Also in the second quarter of 2025, $353 million in aggregate principal amount of our 4.25% notes matured and were repaid.

Our various debt agreements contain covenants including limitations on additional indebtedness and certain financial tests. As of May 2, 2026, we were in compliance with all covenants of the various debt agreements.

4. Leases

We lease certain property and equipment used in our operations. Our typical store lease has an initial term of 20 to 25 years and four to eight five-year renewal options.

Lease assets represent our right to use an underlying asset for the lease term. Lease assets are recognized at commencement date based on the value of the lease liability and are adjusted for any lease payments made to the

Table of Contents

lessor at or before commencement date, minus any lease incentives received and any initial direct costs incurred by the lessee.

Lease liabilities represent our contractual obligation to make lease payments and include renewal options that are reasonably certain of being exercised. At the commencement date, the lease liabilities equal the present value of minimum lease payments over the accounting lease term. As the implicit interest rate is not readily identifiable in our leases, we estimate our collateralized incremental borrowing rate to calculate the present value of lease payments.

Leases with a term of 12 months or less are excluded from the balance; we recognize lease expense for these leases on a straight-line basis over the lease term. We combine lease and non-lease components for new and modified leases.

The following tables summarize our operating and finance leases, which are predominately store related, and where they are presented in our Consolidated Financial Statements:


Consolidated Balance Sheets		Quarter Ended
(Dollars in Millions)	Classification	May 2, 2026	January 31, 2026	May 3, 2025
Assets
Operating leases	Operating leases	$2,318	$2,338	$2,374
Finance leases	Property and equipment, net	1,526	1,553	1,632
Total operating and finance leases		$3,844	$3,891	$4,006
Liabilities
Current
Operating leases	Current portion of operating leases	95	94	99
Finance leases	Current portion of finance leases and financing obligations	79	76	71
Noncurrent
Operating leases	Operating leases	2,624	2,650	2,687
Finance leases	Finance leases and financing obligations	1,895	1,919	1,982
Total operating and finance leases		$4,693	$4,739	$4,839


Consolidated Statement of Operations		Quarter Ended
(Dollars in Millions)	Classification	May 2, 2026	May 3, 2025
Operating leases	Selling, general, and administrative	$68	$67
Finance leases
Amortization of leased assets	Depreciation and amortization	30	27
Interest on leased assets	Interest expense, net	29	30
Total operating and finance leases		$127	$124


Consolidated Statement of Cash Flows	Quarter Ended
(Dollars in Millions)	May 2, 2026	May 3, 2025
Cash paid for amounts included in the measurement of leased liabilities
Operating cash flows from operating leases	$75	$69
Operating cash flows from finance leases	28	29
Financing cash flows from finance leases	24	19

Table of Contents

The following table summarizes future lease payments by fiscal year:


	May 2, 2026
(Dollars in Millions)	Operating Leases	Finance Leases	Total
2026	$193	$138	$331
2027	265	189	454
2028	261	184	445
2029	261	182	443
2030	259	175	434
After 2030	3,514	2,526	6,040
Total lease payments	$4,753	$3,394	$8,147
Amount representing interest	(2,034)	(1,420)	(3,454)
Lease liabilities	$2,719	$1,974	$4,693

Total lease payments include $3.6 billion related to options to extend operating lease terms that are reasonably certain of being exercised and $2.6 billion related to options to extend finance lease terms that are reasonably certain of being exercised.

The following table summarizes weighted-average remaining lease term, weighted-average remaining contractually obligated lease term, and weighted-average discount rate:


	May 2, 2026	January 31, 2026	May 3, 2025
Weighted-average remaining term (years)
Operating leases	18	18	19
Finance leases	18	18	19
Weighted-average remaining contractually obligated term (years)
Operating leases	4	4	4
Finance leases	4	4	5
Weighted-average discount rate
Operating leases	6%	6%	6%
Finance leases	6%	6%	6%

The remaining contractually obligated term represents only the remaining noncancelable portion of the leases.

Other lease information is as follows:


	Quarter Ended
(Dollars in Millions)	May 2, 2026	May 3, 2025
Property and equipment acquired (disposed) through exchange of:
Finance lease liabilities	$2	($10)
Operating lease liabilities	3	5

Financing Obligations

Historical failed sale-leasebacks that did not qualify for sale-leaseback accounting upon adoption of ASC 842 continue to be accounted for as financing obligations.

Table of Contents

The following tables summarize our financing obligations, which are all store related, and where they are presented in our Consolidated Financial Statements:


Consolidated Balance Sheets
(Dollars in Millions)	Classification	May 2, 2026	January 31, 2026	May 3, 2025
Assets
Financing obligations	Property and equipment, net	$35	$36	$38
Liabilities
Current	Current portion of finance leases and financing obligations	10	9	9
Noncurrent	Finance leases and financing obligations	443	446	451
Total financing obligations		$453	$455	$460


Consolidated Statement of Operations		Quarter Ended
(Dollars in Millions)	Classification	May 2, 2026	May 3, 2025
Amortization of financing obligation assets	Depreciation and amortization	$1	$1
Interest on financing obligations	Interest expense, net	18	18
Total financing obligations		$19	$19


Consolidated Statement of Cash Flows	Quarter Ended
(Dollars in Millions)	May 2, 2026	May 3, 2025
Cash paid for and proceeds from amounts included in the measurement of financing obligations
Operating cash flows from financing obligations	$18	$18
Financing cash flows from financing obligations	2	2
Proceeds from financing obligations	—	3

The following table summarizes future financing obligation payments by fiscal year:


	May 2, 2026
(Dollars in Millions)	Financing Obligations
2026	$60
2027	80
2028	77
2029	76
2030	75
After 2030	1,017
Total financing obligation payments	$1,385
Non-cash gain on future sale of property	115
Amount representing interest	(1,047)
Financing obligation liability	$453

Total financing obligation payments include $1.0 billion related to options to extend terms that are reasonably certain of being exercised.

The following table summarizes the weighted-average remaining term, weighted-average remaining contractually obligated term, and weighted-average discount rate for financing obligations:


	May 2, 2026	January 31, 2026	May 3, 2025
Weighted-average remaining term (years)	14	15	15
Weighted-average remaining contractually obligated term (years)	5	5	5
Weighted-average discount rate	16%	16%	16%

Table of Contents

The remaining contractually obligated term represents only the remaining noncancelable portion of the financing obligations.

5. Share-Based Awards

In 2019, we issued

SEC Form 10-Q filed by Kohl's Corporation