Kohl's Corporation
Department Store RetailFounded 1962- Updated July 2025
Reviewed by Swet Parvadiya
Last reviewed: July 2025
CorpDigest
Kohl's Corporation
Company History
Founded 1962 in Menomonee Falls, Wisconsin
Last reviewed: 2025-07-15 · By Swet Parvadiya
Kohl's is a retailer in structural decline fighting to stabilize. FY2025 revenue fell 4.6% to $15.46 billion, the third consecutive year of decline, with comparable sales down 3.1%. Net income of $272 million was inflated by a $129 million lawsuit gain; adjusted net income of $186 million barely improved from $167 million in FY2024. The company has burned through four CEOs in four years, with Michael Bender now tasked with executing a turnaround against a leveraged balance sheet carrying $6.63 billion in debt. The single bright spot is Sephora at Kohl's, which generated over $3.1 billion in Accessories sales and grew 2% even as every other merchandise category declined. FY2026 guidance calls for net sales down 2% to flat, adjusted operating margin of 2.8% to 3.4%, and diluted EPS of $1.00 to $1.60. The question is whether a retailer with a 3.3% adjusted operating margin can survive in an industry where off-price competitors are growing and department stores are disappearing.
Maxwell Kohl came to the United States from Poland and worked in factories in the Milwaukee area until 1927, when he used his savings to open a small grocery store at Lincoln Avenue and Kinnickinnic Avenue in Milwaukee's Bay View neighborhood. The business grew through the Depression, and in 1946 he opened the first supermarket in Milwaukee's Sherman Park neighborhood featuring then-novel services like an in-store bakery and deli. By 1970, he had built a chain of 48 supermarkets across Wisconsin, which he sold that year. Dissatisfied with his own shopping experiences, he opened the first Kohl's department store in 1962 in Brookfield, Wisconsin, applying supermarket efficiencies to department store retail. By 1972, the Kohl family enterprise included 56 supermarkets, 6 department stores, 3 drug stores, and 3 liquor stores. That year, the family sold a controlling interest to British American Tobacco. Maxwell Kohl retired; his son Herbert Kohl became a U.S. Senator and owner of the Milwaukee Bucks; and his son Sidney became a successful real estate developer in Florida.
Maxwell Kohl, a Polish immigrant working in Milwaukee factories, opened a corner grocery store at Lincoln Avenue and Kinnickinnic Avenue using his savings. This was the beginning of a retail empire that would eventually include 48 supermarkets.
Kohl opened the first supermarket in Milwaukee's Sherman Park neighborhood to feature then-novel services like an in-store bakery and deli, innovations that would later influence his department store concept.
Based on his dissatisfying experience buying a shirt, Maxwell Kohl opened the first Kohl's department store in conjunction with a supermarket in Brookfield, Wisconsin. He applied supermarket efficiencies to department store retail, offering lower prices than high-end stores with higher quality than discounters.
The Kohl family sold a controlling interest in their retail enterprise to a subsidiary of British American Tobacco Company. By this point, the enterprise included 56 supermarkets, 6 department stores, 3 drug stores, and 3 liquor stores. The Kohl family continued managing the business.
British American Tobacco's subsidiary BATUS Inc. acquired full ownership of Kohl's Department Stores. Herb Kohl, Maxwell's son, resigned as president. He would later become a U.S. Senator from Wisconsin and owner of the Milwaukee Bucks.
A group of management executives and investors led by William Kellogg purchased the 40-store Kohl's retail chain from British American Tobacco for approximately $300 million, setting the stage for national expansion.
Kohl's acquired Federated Department Stores' Main Street chain, entering the Chicago, Detroit, and Minneapolis-St. Paul markets and expanding beyond its Midwest base for the first time.
Kohl's went public on the New York Stock Exchange, pricing shares and raising capital for expansion. At the time, the company operated 76 stores in the Midwest. The IPO valued the company at approximately $600 million.
Kohl's was added to the S&P 500 index, recognizing its growth and market capitalization. The company had become a significant player in U.S. retail.
Kohl's launched its e-commerce website, Kohls.com, giving the company an online presence that has grown to represent 29% of net sales. The platform initially offered merchandise available in stores plus online-exclusive items.
Kohl's opened 28 stores in California, achieving a coast-to-coast presence for the first time in the company's history. This marked the completion of a national expansion strategy that began with the 1988 Main Street acquisition.
In May 2012, Kohl's surpassed JCPenney to become the largest department store chain in the United States by store count. The company operated approximately 1,100 stores at the time.
Kohl's expanded its Amazon returns partnership to all 1,100+ stores nationwide, allowing customers to return Amazon packages unpackaged and free of charge. Then-CEO Michelle Gass called it the 'single biggest initiative of the year.' The company later claimed 2 million new customers from the partnership.
Kohl's announced a long-term strategic partnership with Sephora to open shop-in-shop beauty destinations in Kohl's stores. The first 200 locations opened in Fall 2021, with plans to expand to at least 850 stores by 2023. Sephora became the exclusive beauty partner on Kohls.com.
Activist investors including Macellum Capital Management pressured Kohl's board, nominating 10 directors and pushing for real estate monetization. The company adopted a poison pill defense. In November 2022, CEO Michelle Gass announced her departure to become president of Levi Strauss. Tom Kingsbury, former Burlington Stores CEO, was appointed interim CEO.
In February 2023, Tom Kingsbury was named permanent CEO. The Sephora rollout continued, reaching 850 stores by year-end. The company also laid off approximately 60 marketing and merchandising employees at corporate headquarters to 'drive greater efficiency.'
Sephora at Kohl's sales exceeded $1.4 billion in 2023, up over 90% year-over-year. The company announced a partnership with WHP Global's Babies 'R' Us to open shop-in-shop baby gear sections in approximately 200 stores. Store comparable sales were flat for the year, the best performance since 2010.
In May 2025, CEO Ashley Buchanan was fired for cause after an investigation found he directed the company to engage in vendor transactions involving undisclosed conflicts of interest with a former romantic partner. Board member Michael Bender was appointed interim CEO and named permanent CEO in November 2025. The company also began testing discontinuation of Amazon returns at select stores.
Kohl's reported FY2025 net sales of $14.78 billion (down 4.0%), total revenue of $15.46 billion, net income of $272 million (including a $129 million lawsuit gain), and adjusted net income of $186 million. The company issued $360 million in 10.000% senior secured notes due 2030 and repaid $353 million in maturing 4.25% notes. Sephora was present in over 1,100 stores.
Kohl's acquired Federated Department Stores' Main Street chain to enter the Chicago, Detroit, and Minneapolis-St. Paul markets, expanding beyond its Midwest base for the first time. This acquisition was the foundation of Kohl's national expansion strategy.