Kohl’s CEO steps down, Michael’s CEO picks replacement

Kohl’s shares fell sharply on Tuesday after the company’s earnings missed Wall Street estimates and after its announcement that CEO Tom Kingsbury will step down in January.

The weak forecast underscores an uncertain holiday season for the retail sector, which could tilt in favor of rivals like Walmart and Amazon.com as shoppers become increasingly bargain-focused.

“Our results fell short of expectations, and we’re frankly disappointed that sales have been a challenge for us throughout 2024 and weakened further in the quarter,” outgoing CEO Tom Kingsbury said in a post-earnings call.

Thomas Kingsbury attends the KIDS/Fashion Delivers Annual Gala at the American Museum of Natural History on November 5, 2014 in New York City. (Thos Robinson/Getty Images for KIDS/Fashion Delivers/Getty Images)

Michaels CEO Ashley Buchanan will take over the company on January 15, although Kingsbury will remain in an advisory role and retain his position on the Kohl’s board through his retirement in May 2025.

Buchanan, an industry veteran, has led Michaels Companies since 2020. Prior to that, Buchanan held executive positions at Walmart and Sam’s Club.

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Kingsbury served as interim CEO after former CEO Michelle Gass was tapped to take over Levi Strauss & Co. in November 2022. Kingsbury agreed to stay on as Kohl’s permanent CEO through 2025.

Under Gass’ leadership, activist investor Ancora Holdings Group pushed the company to replace her and improve the company’s performance. It wrote a letter to the board in 2022 saying the retailer needed management that would implement a precise turnaround strategy so it could start producing increased value for shareholders.

Kohl’s Cash earning periods allow customers to earn $10 Kohl’s Cash for every $50 spent. (Scott Olson/Getty Images)

Under Kingsbury, Kohl’s Chairman Michael Bender said the company “underwent a transformation to elevate its product portfolio, enhance the in-store experience and improve its long-term financial health and profitability.”

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In August, however, net sales fell 4.2% and sales at stores open at least a year fell 5.1% during the three-month period ended June 30.

At the time, Kingsbury said the company had “taken significant steps to reposition Kohl’s for future growth” but that its “efforts have not yet fully yielded the intended results, in part due to a continued challenging consumer environment and softness in our core business .”

Among the problems the company faced, Kingsbury noted that “customers were more discretionary in their spending,” which further pressured the company’s sales.

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Despite this, Kingsbury said the company’s conviction in its “strategy remains strong, and our operating discipline, solid cash flow generation and healthy balance sheet will continue to support us as we work to return Kohl’s to growth.”

Reuters contributed to this report.