(Reuters) – Kohl’s Corp forecast full-year profit below analysts’ estimates on Wednesday, squeezed by dwindling demand for clothing and accessories at the department store chain as consumers tighten their belts amid high inflation.
Shares of the retailer fell 12% in premarket trading after the company also swung to a quarterly loss of $273 million.
Surging prices of food and homes over the last year have driven down demand for non-essential products, forcing Kohl’s and other retailers into steeper discounts and promotions to clear excess stocks of casual and athleisure apparel.
Those discounts contributed to a more than 1,000 basis point decline in fourth-quarter gross margins, Kohl’s said.
The company expects fiscal 2023 earnings per share of $2.10 to $2.70, compared with analysts’ estimates of $3.20.
Comparable sales at the company fell 6.6% in the fourth quarter ended Jan. 28, compared with analysts’ estimate of a 3.7% decrease, according to Refinitiv IBES data.
(Reporting by Uday Sampath in Bengaluru; Editing by Sriraj Kalluvila)
