KohlS 2026 Q3 Earnings Sharp Net Income Drop Amid Revenue Decline

Kohl’S (KSS) reported fiscal 2026 Q3 earnings on Dec 3, 2025, with results showing a significant decline in profitability despite modest revenue resilience. The company’s shares fell 7% in the latest trading session, though they gained 41.18% month-to-date. Kohl’S issued guidance in-line with current results but provided no material revisions to forward-looking expectations.

Revenue

Kohl’S Q3 revenue fell 2.9% to $3.41 billion compared to $3.51 billion in the prior year. While net sales totaled $3.58 billion, segment performance revealed mixed trends. Women’s apparel led with $844 million, followed by Men’s at $677 million and Accessories (including Sephora) at $669 million. Home and Children’s categories contributed $464 million and $453 million, respectively, while Footwear revenue dropped to $300 million. Additional revenue streams, including Other, totaled $168 million.

Earnings/Net Income

Earnings per share (EPS) plummeted 60% to $0.08, and net income contracted to $8 million, a 63.6% decline from $22 million in 2025 Q3. The sharp reduction underscores margin pressures and operational challenges, particularly in physical retail.

Post-Earnings Price Action Review

The stock’s post-earnings performance highlighted investor skepticism. A strategy of buying KSS when earnings beat and holding for 30 days yielded a meager 10.04% return, lagging the benchmark’s 137.15%. With a Sharpe ratio of 0.02 and volatility at 75.87%, the approach offered minimal risk-adjusted gains despite a 0% maximum drawdown. The underwhelming result suggests limited confidence in near-term catalysts to drive sustained momentum.

CEO Commentary

Kohl’s CEO acknowledged a “mixed business performance,” citing gradual recovery in digital sales and private-label brands but ongoing struggles with brick-and-mortar traffic. Strategic priorities include omnichannel integration, high-margin product expansion, and technology investments to enhance customer experience. The tone remained cautiously optimistic, emphasizing disciplined execution amid macroeconomic uncertainties.

Guidance

The company reiterated Q3 2026 guidance for revenue of ~$3.407 billion and EPS of $0.08. Management emphasized cost optimization, modest CAPEX growth for digital infrastructure, and leveraging private-label offerings to drive margin expansion.

Additional News

Within three weeks of the earnings release, three key non-earnings events emerged:

1. Kruger Products’ Debt Issuance: Kruger Products Inc. announced a senior unsecured notes offering, exempt from Canadian securities prospectus requirements. Proceeds will support its investment in KPT, which holds a 12.1% stake in Kruger.

2. Coupang Data Breach: South Korea’s Coupang faced scrutiny after a cybersecurity incident, with the attacker using multiple IP addresses to evade detection. The company assured no payment or login data was compromised.

3. Soros Fund Management Scam Alert: The firm warned investors about phishing attempts impersonating CEO Dawn Fitzpatrick, urging caution against suspicious Zoom call requests tied to deepfake AI risks.