1. News
May 20, 2022

Kohl’s reports 4.4% drop in revenue for first quarter of FY22

The retailer expects net sales of between 0% and 1% for the full year.

US-based department store chain Kohl’s has recorded revenue of $3.71bn in the first quarter (Q1) of the fiscal year 2022 (FY22), down by 4.4% against $3.88bn in the same period of FY21.

During the three months to 30 April, the company’s net sales and comparable sales were $3.7bn, down by 5.2% from $3.9bn a year earlier.

Kohl’s Q1 gross margin was 38.3%, dropping by 69 basis points (bps) from the same period of last year, when it recorded 39.0%.

The retailer’s net income remained unchanged at $14m, while its diluted earnings per share (EPS) grew by 22% to $0.11 compared with $0.09 in Q1 2022.

For the full year, Kohl’s expects net sales in the range of 0% to 1% and an operating margin of between 7.0% and 7.2%.

Kohl’s CEO Michelle Gass said: “The year has started out below our expectations.

“Following a strong start to the quarter with positive low-single digits comps through late March, sales considerably weakened in April as we encountered macro headwinds related to lapping last year’s stimulus and an inflationary consumer environment.

“We remain committed to our long-term strategy and are encouraged that our updated store experience, with Sephora at Kohl’s shops, delivered positive comparable store sales across these 200 locations for the quarter.

“We continue to expect our business to improve as the year progresses, with growth in the second half as we benefit from the roll out of 400 additional Sephora stores, enhanced loyalty rewards and further investment in our stores.”

In February this year, Kohl’s announced the 400 Kohl’s stores that are due to add a Sephora beauty shop by the end of the year.

The stores are located across 36 US states, eight of which had not previously hosted a Sephora shop.