Early this week, retailer Kohl’s reported a strong start to the back-to-school shopping season. With a little help from a new Amazon partnership, the department store chain saw earnings beat Wall Street expectations for the second quarter. For example, Kohl’s shares jumped more than 6 percent in premarket trading, on Tuesday, only to reset 4 percent after day open.
Furthermore, Kohl’s posted an adjusted earnings per share of $1.55 against Wall Street expectations of $1.53. Also, $4.17 billion net sales came in just under Wall Street expectations of $4.2 billion; and same store sales were down 2.9 percent, which is more than the 2.5 percent Wall Street had expected.
Apparently, this all suggests Kohl’s is doing alright. CEO Michelle Gass notes, “We are pleased to report that our business strengthened as we progressed through the second quarter. Comparable sales were better than the first quarter and improved during the period, turning positive during the last six weeks of the second quarter with one percent growth.”
Now, it should also be noted that net income for this quarter (ending August 4) tumbled 17 percent to $241 million; the equivalent of about $1.51 per share. This is down from $292 million—about $1.76 per share—from the same period last year. In addition, net sales fell to $4.17 billion from $4.3 billion, last year. Finally, sales at stores open longer than one year also fell: 2.9 percent against Wall Street expectations of 2.5 percent.
Indeed, Kohl’s has been hoping that the new contract to accept Amazon returns will lead to a bigger partnership with the e-commerce giant that brings in more foot traffic. More people in the store, they hope, will lead to more sales.
Gass goes on to say, “We are confident that our upcoming brand launches, program expansions, and increased traffic from the Amazon returns program will incrementally contribute to our performance during the balance of the year and beyond.”