Market Hit: Consumer Edge data accurately tracks Kohl’s Q1 revenue miss and shopper dynamics

Consumer Edge US Transact data accurately tracked Kohl’s revenue miss and the contributing trends underpinning it, as flagged by company management, such as the struggling middle-income consumer. While the tone of the print was downbeat, the company did flag some bright spots, such as continued strength in shopper count growth, with CE Cohort data also reflected.

Kohl’s (KSS) Massive Sales Miss

Kohl’s (KSS) reported total revenue growth down -5.3% year over year, close to CE US Transact implied reported figure of -6%, and significantly below consensus estimates of -0.5%. The company also missed on comparable sales and EPS. As a result of broad misses, the stock opened down -25% on Thursday.

Affluent Shoppers Thrive, Middle-Income Cohort Falters

Kohl’s noted a few drivers behind the quarter’s revenue miss, one of the more notable being a divergence between the behavior of its most affluent customers – who it says held up fine – and the middle-income cohort, who constitute a major share of the company’s shopper base and who saw a major falloff in the quarter. Looking at shopper behavior by income bracket, using CE US Cohort data, this is borne out. Shoppers earning >$100k saw continued acceleration in spend growth, in the quarter, while shoppers in the $80-100k bracket saw the sharpest deceleration, once again.

Against a difficult backdrop, the company did sound a few hopeful notes. One was the continued growth in shopper count that Kohl’s saw in the quarter. Looking at CE US Cohort data, this actually appears to be a potential differentiator for KSS.

Kohl’s appears to have successfully defended shopper count growth better than most peers, in recent months, which is notable given the challenging consumer landscape that department store managements have been decrying. Should Kohl’s be able to continue this trend, it could represent a potential jumping-off point for a turnaround.

Consumer Edge is the leading provider of alternative data for consumer spending behavior, and the only provider of global revenue signals. If you’d like to benefit from using Transact US or other products for department stores, retail, and other industry data year-round to track trends and market hits like these, schedule a demo.

About the Authors

Michael Gunther is the VP Head of Insights for the CEIC. Explore more of his insights here and follow him on LinkedIn.

Alex Breslin-Johnson is a Senior Insights Analyst for the CEIC. Follow him on LinkedIn.