KSS
Profit’s looking better, but sales still have baggage
Kohl’s just posted fiscal Q4 2025 results, and the headline is a classic retail split-screen: earnings beat, revenue miss. The company earned $1.07 a share versus 95 cents a year ago and 85 cents expected, but sales fell short and comparable sales dropped 2.8% year over year.
The part investors actually like
Margins did some heavy lifting here. Gross margin expanded to 33.1% thanks to tighter inventory control and fewer clearance markdowns, and SG&A fell 4.9% to $1.463 billion. Operating income climbed to $212 million from $126 million last year, which is the kind of improvement that makes bulls sit up a little straighter.
But the top line is still playing defense
There’s a catch: digital sales are rising, but shipping costs are tagging along like an uninvited plus-one. Digital penetration increased 220 basis points to 35% of sales, which helps explain why the business is changing — just not necessarily getting easier.
The dividend adds a little seasoning
Kohl’s also declared a quarterly cash dividend of 12.5 cents a share on Feb. 25, payable April 1 to shareholders of record on March 18. That’s not a game-changer, but it does matter for income investors who like their department stores with a side of cash return.
Big picture: Kohl’s is showing signs of better discipline, but until sales stop leaking, this is more “progress report” than victory lap.