10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 1, 2026


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition period from ________ to _________

Commission file number 1-11084

KOHL’S CORPORATION

(Exact name of registrant as specified in its charter)


Wisconsin		39-1630919
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

N56 W17000 Ridgewood Drive, Menomonee Falls, Wisconsin		53051
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (262) 703-7000

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading 
Symbol(s)

     Name of each exchange on 
which registered

     Common Stock, $.01 par value

     KSS

     New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer	☒	Accelerated Filer	☐
Non-Accelerated Filer	☐	Smaller Reporting Company	☐
		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: August 28, 2026 Common Stock, Par Value $0.01 per Share, 113,376,445 shares outstanding.

KOHL’S CORPORATION

INDEX


PART I	FINANCIAL INFORMATION	3
Item 1.	Financial Statements:	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations	4
	Consolidated Statements of Changes in Shareholders' Equity	5
	Consolidated Statements of Cash Flows	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	24
Item 4.	Controls and Procedures	24

PART II	OTHER INFORMATION	25
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 5.	Other Information	26
Item 6.	Exhibits	27
	Signatures	28

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS


(Dollars in Millions)	August 1, 2026	January 31, 2026	August 2, 2025
Assets	(Unaudited)	(Audited)	(Unaudited)
Current assets:
Cash and cash equivalents	$821	$674	$174
Merchandise inventories	2,913	2,745	2,994
Other	285	272	306
Total current assets	4,019	3,691	3,474
Property and equipment, net	6,661	6,914	7,113
Operating leases	2,297	2,338	2,363
Other assets	433	419	441
Total assets	$13,410	$13,362	$13,391

Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$1,418	$1,171	$1,134
Accrued liabilities	1,090	1,181	1,159
Borrowings under revolving credit facility	—	—	75
Current portion of:
Finance leases and financing obligations	92	85	84
Operating leases	96	94	96
Total current liabilities	2,696	2,531	2,548
Long-term debt	1,325	1,436	1,520
Finance leases and financing obligations	2,295	2,365	2,409
Operating leases	2,613	2,650	2,672
Deferred income taxes	70	91	54
Other long-term liabilities	243	241	261
Shareholders’ equity:
Common stock	1	1	1
Paid-in capital	3,614	3,595	3,578
Treasury stock, at cost	(779)	(771)	(771)
Retained earnings	1,332	1,223	1,119
Total shareholders’ equity	$4,168	$4,048	$3,927
Total liabilities and shareholders’ equity	$13,410	$13,362	$13,391

See accompanying Notes to Consolidated Financial Statements

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KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended		Six Months Ended
(Dollars in Millions, Except per Share Data)	August 1, 2026	August 2, 2025	August 1, 2026	August 2, 2025
Net sales	$3,318	$3,347	$6,316	$6,396
Other revenue	197	199	366	383
Total revenue	3,515	3,546	6,682	6,779
Cost of merchandise sold	1,893	2,011	3,695	3,845
Operating expenses:
Selling, general, and administrative	1,188	1,199	2,333	2,363
Depreciation and amortization	173	175	347	350
Impairments, store closing, and other costs	—	11	—	11
(Gain) on legal settlement	—	(129)	—	(129)
Operating income	261	279	307	339
Interest expense, net	63	78	126	154
Income before income taxes	198	201	181	185
Provision for income taxes	47	48	44	46
Net income	$151	$153	$137	$139
Net income per share:
Basic	$1.34	$1.37	$1.22	$1.24
Diluted	$1.28	$1.35	$1.18	$1.23

See accompanying Notes to Consolidated Financial Statements

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KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)


	Three Months Ended		Six Months Ended
(Dollars in Millions, Except per Share Data)	August 1, 2026	August 2, 2025	August 1, 2026	August 2, 2025
Common stock
Balance, beginning of period	$1	$1	$1	$1
Stock-based awards	—	—	—	—
Balance, end of period	$1	$1	$1	$1

Paid-in capital
Balance, beginning of period	$3,605	$3,570	$3,595	$3,560
Stock-based awards	9	8	19	18
Balance, end of period	$3,614	$3,578	$3,614	$3,578

Treasury stock
Balance, beginning of period	$(777)	$(771)	$(771)	$(767)
Stock-based awards	(2)	—	(8)	(4)
Dividends paid	—	—	—	—
Balance, end of period	$(779)	$(771)	$(779)	$(771)

Retained earnings
Balance, beginning of period	$1,195	$979	$1,223	$1,008
Net income	151	153	137	139
Dividends paid	(14)	(14)	(28)	(28)
Balance, end of period	$1,332	$1,119	$1,332	$1,119

Total shareholders' equity, end of period	$4,168	$3,927	$4,168	$3,927

Common stock
Shares, beginning of period	129	127	127	126
Stock-based awards	—	—	2	1
Shares, end of period	129	127	129	127
Treasury stock
Shares, beginning of period	(16)	(15)	(15)	(15)
Stock-based awards	—	—	(1)	—
Shares, end of period	(16)	(15)	(16)	(15)
Total shares outstanding, end of period	113	112	113	112

Dividends paid per common share	$0.125	$0.125	$0.25	$0.25

See accompanying Notes to Consolidated Financial Statements

Totals may not foot due to rounding

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KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Six Months Ended
(Dollars in Millions)	August 1, 2026	August 2, 2025
Operating activities
Net income	$137	$139
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	347	350
Share-based compensation	19	17
Deferred income taxes	(21)	28
Impairments, store closing, and other costs	—	11
Non-cash lease expense	44	43
Other non-cash items	(9)	3
Changes in operating assets and liabilities:
Merchandise inventories	(166)	(48)
Other current and long-term assets	3	31
Accounts payable	247	93
Accrued and other long-term liabilities	(77)	(105)
Operating lease liabilities	(46)	(56)
Net cash provided by operating activities	478	506
Investing activities
Acquisition of property and equipment	(146)	(200)
Proceeds from sale of property and equipment	—	21
Other	(7)	—
Net cash used in investing activities	(153)	(179)
Financing activities
Proceeds from issuance of debt, net of discount	—	357
Deferred financing costs	—	(8)
Net repayments under revolving credit facility	—	(215)
Shares withheld for taxes on vested restricted shares	(8)	(4)
Dividends paid	(28)	(28)
Repayment of long-term borrowings	(113)	(353)
Discount on redemption of debt	15	—
Finance lease and financing obligation payments	(44)	(46)
Proceeds from financing obligations	—	10
Net cash used in financing activities	(178)	(287)
Net increase in cash and cash equivalents	147	40
Cash and cash equivalents at beginning of period	674	134
Cash and cash equivalents at end of period	$821	$174
Supplemental information
Interest paid, net of capitalized interest	$146	$147

See accompanying Notes to Consolidated Financial Statements

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KOHL’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for fiscal year end Consolidated Financial Statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information, refer to the Consolidated Financial Statements and related footnotes included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026 (Commission File No. 1-11084) as filed with the Securities and Exchange Commission ("SEC"). Certain amounts in the Consolidated Financial Statements and related footnotes may not foot or crossfoot due to rounding.

Due to the seasonality of the business of Kohl’s Corporation (the “Company,” “Kohl’s,” “we,” “our,” or “us”), results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year.

Reportable Segments

We are an omnichannel retailer that operates as a single reportable segment. Our Chief Operating Decision Maker (“CODM”) is our Chief Executive Officer. The net income presented in the Consolidated Statements of Operations is the financial information reviewed by the CODM. The CODM assesses the performance of the Company and decides how to allocate resources using net income that is reported on the Consolidated Statement of Operations. Net income is used to monitor budget versus actual results. The CODM regularly reviews information consistent with the Consolidated Statements of Operations.

Supplier Finance Programs

The Company has an agreement with a third-party financing provider to facilitate a supplier financing program. The program provides participating suppliers the option to receive outstanding payment obligations of the Company early at a discount. The Company’s obligations to its suppliers, including amounts due and scheduled payment terms, are not impacted by suppliers’ decisions to finance amounts under the program. All amounts payable to the financial institution relating to suppliers participating in the program are recorded in Accounts Payable in the Consolidated Balance Sheets and were $303 million as of August 1, 2026, $201 million as of January 31, 2026, and $226 million as of August 2, 2025.

International Emergency Economic Powers Act ("IEEPA") Tariff Recovery

On February 20, 2026, the U.S. Supreme Court issued a ruling in Learning Resources, Inc. v. Trump invalidating certain tariffs previously imposed under the IEEPA. As a result of this ruling, the Company is eligible for refunds of duties paid during fiscal 2025 and the first month of fiscal 2026. The Company paid approximately $190 million in IEEPA tariffs during this period. On April 20, 2026, U.S. Customs and Border Protection (“CBP”) launched Phase 1 of the Consolidated Administration and Processing of Entries (“CAPE”) portal and refund process with Phase 2 being launched in June 2026. We submitted claims seeking approximately $185 million of refunds of previously paid IEEPA tariffs as part of the Phase 1 and Phase 2 CAPE tariff refunds.

In accordance with ASC 450-30, “Gain Contingencies,” the Company has elected to use a gain contingency model to account for recoveries of previously paid IEEPA tariffs. Under this model, a gain contingency is not recognized in the financial statements until the gain is realized or realizable. Tariff recoveries are reflected as a reduction of Merchandise inventories to the extent the inventory remains on hand, or as a reduction of Cost of merchandise sold for inventory that has already been sold.

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As of August 1, 2026, the Company received approximately $150 million of tariff refunds, of which approximately $100 million reduced our Cost of Merchandise Sold. A portion of the refund was recorded as a reduction of inventory, shared with our vendor partners, and invested to deliver greater value to our customers.

The Company’s remaining IEEPA refund claims continue to be accounted for as gain contingencies and will be recorded once realized or realizable. Uncertainty remains regarding the timing, amount and ultimate receipt of any further refunds, and as such, no additional amounts have been recognized in the consolidated financial statements for these remaining claims.

Recent Accounting Pronouncements

Accounting Standards Issued but not yet Effective

In 2024, the Financial Accounting Standards Board ("FASB") issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. For public entities, the provisions within ASU 2024-03 are effective for the first annual reporting period beginning after December 15, 2026, and for interim periods of fiscal years beginning after December 15, 2027. The provisions within ASU 2024-03 are required to be applied prospectively; however, they may be applied retrospectively for all comparative periods following the effective date. We are currently assessing the impact the adoption of ASU 2024-03 will have on our consolidated financial statement disclosures.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software ("ASU 2025-06"), which requires software capitalization to begin when both of the following occur: (1) management has authorized and committed to funding the software project; and (2) it is probable that the project will be completed and the software will be used to perform the function intended. For public entities, the provisions within ASU 2025-06 are effective for the first annual and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The provisions within ASU 2025-06 allow for a prospective, modified, or retrospective transition approach. We are currently assessing the impact the adoption of ASU 2025-06 will have on our consolidated financial statements and related disclosures.

2. Revenue Recognition

The following table summarizes net sales by line of business: