Kohl’s shares took a hit on Wednesday after the department store revealed a continued slide in sales for the second quarter. Investors reacted coolly to the report, sending the stock price down five percent to 16.75 dollars in premarket trading. Net sales dropped to 3.32 billion dollars, while same-store sales dipped by nearly one percent, missing analyst expectations which had predicted a modest growth of about zero point six percent.

Despite the disappointing top line, there was a significant silver lining in the form of a windfal windfall. The retailer received 150 million dollars in tariff refunds during the quarter, much of which boosted its gross margins. This unexpected cash infusion allowed Kohl’s to significantly raise its full year earnings outlook, shifting its adjusted earnings per share projection upward to between 1.80 and 2.40 dollars from an initial estimate of 1.00 to 1.60 dollars.

While the financial cushion from tariffs helped stabilize the bottom line, it did little to mask the struggle to attract shoppers back into stores. To appease investors amidst these headwinds, Kohl’s announced plans to resume share repurchases of up to 100 million dollars in 2026 and confirmed a quarterly dividend payment scheduled for late September. The company also slightly narrowed its sales guidance, though it still expects overall performance to remain flat or decline by up to one and a half percent for the remainder of the year.