Former Toys ‘R’ Us CEO Gerald Storch discusses Target’s slowing online retail growth and the future of Kohl’s.
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Love might not cost a thing for Jennifer Lopez, but it certainly does at Kohl’s.
The department store chain is ending its near decade-long partnership with the celeb due to an underperforming women’s apparel segment overall, which has been exacerbated by the coronavirus pandemic, Kohl’s CEO Michelle Gass shared in a post-earnings call.
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“Our financial performance, like many other retailers, will be materially impacted by COVID-19 in 2020,” Gass said while she warned demand for women’s apparel will likely remain weak throughout the pandemic.
Seven other brands will be removed from Kohl’s stores: Juicy Couture, Popsugar, Dana Buchman, Mudd, Candie’s, Rock And Republic and Elle.
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“Exiting them will create focus and clarity on the brands that will continue,” Gass added. “We’re still highly committed to the women’s business. In the short term, we’re facing some challenges here.”
This news comes shortly after other major retailers have announced bankruptcy filings, including JCPenney, Neiman Marcus and J.Crew – all of which were financially hurt by the two-month shutdown the pandemic has imposed on U.S. stores.
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Before the pandemic, Kohl’s was reportedly struggling with women’s apparel as consumers shifted to online shopping and competitively priced fast-fashion brands.
Kohl’s shares were down 7.65 percent at closing Tuesday after the chain shared its first-quarter losses, which ended May 2. Net sales fell about 44 percent, to $2.16 billion, and the company reported a net loss of $541 million.
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| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| KSS | KOHL’S CORP. | 17.38 | -1.44 | -7.65% |
On the flip side, Kohl’s received a 24 percent surge in online sales for the quarter and more than 60 percent in the month of April alone.
So far, the chain has reopened nearly half its U.S. stores as more states begin to reopen and ease shelter-in-place mandates.
