• Kohl’s said inflation has pressured its middle-income customers
higher inflation, putting a damper on sales of apparel, shoes and other
discretionary items.
Shares
of the US departmental store chain dropped as much as 10% as it joined a
host of other retailers, including Target Corp (NYSE:
TGT) and Best Buy
Co (NYSE:
BBY), who also warned of a profit squeeze for the year.
Decades-high
inflation and recession fears forced Americans to minimize spending on
clothing, shoes and other non-essentials, leaving the retailers with
bloated inventories.
Excess
stocks have forced retailers to offload inventories through steep
discounts and clearance sales, with Kohl’s offering up to 80% discounts
Chief Executive Michelle Gass, in a statement, said this year “has
turned out to be more challenging than initially expected.”
The
Wisconsin-based retailer now expects 2022 earnings per share in the
range between $2.80 and $3.20, down from the $6.45 to $6.85 range
estimated earlier. Analysts, on average, expect a profit of $4.06 per
company also projected full-year net sales to fall between 5% and 6%,
compared with its previous forecast of flat to 1% growth. Net sales in
