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By Savyata Mishra
(Reuters) - Kohl's Corp new CEO warned that a turnaround will take "some time" after the U.S. department store chain forecast a bigger-than-anticipated drop in annual sales, sending its shares sliding 20% to a near three-decade low on Tuesday.
The company joins larger rival Macy's and big-box retailers Walmart and Target in tempering expectations as U.S. inflation risks rise and recession fears mount amid a chaotic implementation of President Donald Trump's tariffs.
The uncertainty compounds the struggles at Kohl's, which posted a steeper-than-expected fall in holiday-quarter comparable sales, due to uneven demand and customers turning to cheaper options at discount retailers including TJX Cos.
New boss Ashley Buchanan on a post-earnings call acknowledged that most of the issues were likely "self-inflicted" over the past years.
Buchanan laid out plans to address them through rebuilding its private-label brand and evaluating its promotion strategy to draw in value-focused shoppers. Since taking charge in January, he has rolled out layoffs and store closures.
Kohl's stock was trading at $9.66. It has lost roughly 80% of its value in the last three years.
"The company needs to make major changes but it's unclear if they will work since Kohl's has been changing its merchandise for years and it has not helped," Morningstar analyst David Swartz said.
Menomonee Falls, Wisconsin-based Kohl's expects 2025 comparable sales to decline 4% to 6%, compared with estimates for a 0.9% drop, according to data compiled by LSEG.
The outlook recognized the uncertainty the consumer was facing as well as the tough macro environment, the company said.
Kohl's projected earnings per share in the range of 10 cents to 60 cents, compared with estimates of $1.23.
Kohl's fourth-quarter same-store sales fell 6.7%, compared with estimates of a 6.2% drop. It earned 95 cents per share on an adjusted basis, above estimates of 73 cents.
(Reporting by Savyata Mishra and Aamir Sohail in Bengaluru; Editing by Sriraj Kalluvila)
