Nathan Howard/Getty Images via Bloomberg
TAKEAWAYS KEY
- Kohl's stock is plummeting 17% in premarket trading after it reported weaker-than-expected third-quarter earnings Tuesday, the day after it announced that CEO Tom Kingsbury would stepping down after less than two years running the struggling retailer.
- Kohl's also lowered its guidance for the full year.
- On Jan. 15, Ashley Buchanan will replace Kingsbury as CEO of The Michaels Companies.
Kohl’s KSS shares have dropped 17% on Tuesday in pre-market trading after the retailer announced weaker than anticipated quarterly results.
It comes a day following the announcement that Tom Kingsbury, the Chief Executive (CEO), will be stepping down after less than 2 years as the retailer’s leader. Ashley Buchanan will replace Kingsbury on January 15, 2023. He was appointed CEO by The Michaels Companies in February of that year.
Kohl's reported third-quarter net revenue fell 9% year-over-year to $3.51 billion, with profit of $22 million or 20 cents per share. VisibleAlpha polled its analysts, who predicted $3.85billion in revenue and a net profit of $29.8m or 27c per share.
Kohl’s lowered the outlook of its full-year sales. It now projects a decline between 7% and 8%. This is down from an earlier projection which predicted a decrease within 4% or 6%. Kohl’s also reduced its earnings-per-share (EPS) forecast for 2024 to between $1.20 and $1.50, down from the previous estimate of $1.75 to $3.25.
Former CEO Kingsbury will remain on as an advisor until May
Kohl’s announced that Kingsbury would continue to serve as a consultant for Buchanan. Buchanan previously served in senior roles at Walmart (WMT), and Sam’s Club, a division of Walmart.
Kohl’s announced that Kingsbury will continue to serve as an advisor until she retires in May of next year. Kingsbury was previously the CEO of Burlington Stores, BURL.
"Under his leadership, the company is undergoing a transformation to elevate its product portfolio, enhance the store experience and improve its long-term financial health and profitability," board chair Michael Bender said.
Bender said that Buchanan improved Michaels' "profitability and cash flow while driving operational efficiencies across the business," and also ramped up the crafts store's e-commerce business.
UPDATE—This article has been updated with Kohl's third-quarter results and the latest share price information
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