Shares of Kohl's $KSS jumped more than 15% in premarket trading Thursday after the company disclosed comparable sales results that were the strongest in over four years.
For the quarter that closed May 2, the company recorded a net loss of $14 million, equivalent to 13 cents per diluted share. A year earlier, the loss was nearly identical at $15 million, also 13 cents per diluted share. Revenue came in at $3 billion, off 1.7% from a year ago, while comparable sales slipped 1.1%. Wall Street had projected a per-share loss of 19 cents, according to CNBC.
The result represented a notable turnaround in trajectory: comparable sales had dropped 2.8% in the preceding quarter, according to CNBC.
The company stood by its annual guidance, projecting net sales and comparable sales somewhere between flat and a 2% decline, with adjusted earnings per share expected to land between $1.00 and $1.60, the company said.
Bender described the quarter as the company "knocking on the door of growth," citing gains in cost discipline, inventory health, and overall balance sheet strength as evidence of progress, the company said. Inventory fell 8% year-over-year to $2.9 billion, and borrowings under the company's revolving credit facility stood at zero, down $545 million from a year earlier, the company said.
"We're not done," Michael Bender told CNBC. "I think it's really important to underscore that as well, that we love the trajectory of where things are headed, but we know we still have a lot of work ahead of us."
Bender said the company's core customers — lower- and middle-income shoppers — are facing pressure from high energy prices and sustained inflation, requiring Kohl's to focus on delivering value. Kohl's has filed for tariff refunds and said its potential recoveries exceed $100 million, though the retailer has yet to collect any of those funds, according to CNBC.
Through Wednesday, Kohl's shares had shed about 37% of their value since the start of the year, according to Reuters. Bender took on the permanent chief executive role in November, tasked with reversing a prolonged stretch of falling sales during which the chain has ceded market share to Amazon $AMZN and discount rivals, Reuters reported.