UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)



ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~November 1, 2014~~May 2, 2015



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition period from ________ to _________

Commission file number 1-11084

KOHL’S CORPORATION

(Exact name of registrant as specified in its charter)



Wisconsin		39-1630919
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

N56 W17000 Ridgewood Drive, Menomonee Falls, Wisconsin		53051
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (262) 703-7000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No ý

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: ~~November 29, 2014~~May 30, 2015 Common Stock, Par Value $0.01 per Share, ~~202,009,115~~197,876,457 shares outstanding.

Table of Contents

KOHL’S CORPORATION

INDEX

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS

(In Millions)


	November 1, 2014			February 1, 2014			November 2, 2013			May 2, 2015			January 31, 2015			May 3, 2014
Assets	(Unaudited)			(Audited)			(Unaudited)			(Unaudited)			(Audited)			(Unaudited)
Current assets:
Cash and cash equivalents	$	631		$	971		$	598		$	1,195		$	1,407		$	717
Merchandise inventories	4,973			3,874			4,959			4,165			3,814			3,981
Income taxes receivable	52			—			—
Deferred income taxes	125			142			147			129			116			137
Other	297			305			283			340			361			304
Total current assets	6,078			5,292			5,987			5,829			5,698			5,139
Property and equipment, net	8,671			8,745			8,925			8,518			8,515			8,677
Other assets	298			341			333			216			218			298
Total assets	$	15,047		$	14,378		$	15,245		$	14,563		$	14,431		$	14,114

Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	2,384		$	1,365		$	2,261		$	1,645		$	1,511		$	1,382
Accrued liabilities	1,162			1,138			1,198			1,140			1,160			1,078
Income taxes payable	—			94			41			87			78			73
Current portion of capital lease and financing obligations	109			139			141			113			110			112
Total current liabilities	3,655			2,736			3,641			2,985			2,859			2,645
Long-term debt	2,793			2,792			2,792			2,793			2,793			2,792
Capital lease and financing obligations	1,886			1,930			1,950			1,840			1,858			1,919
Deferred income taxes	336			382			390			358			368			339
Other long-term liabilities	572			560			548			570			562			562
Shareholders’ equity:
Common stock	4			4			4			4			4			4
Paid-in capital	2,719			2,598			2,557			2,897			2,743			2,612
Treasury stock, at cost	(8,615		)	(8,052		)	(7,802		)	(8,909		)	(8,744		)	(8,232		)
Accumulated other comprehensive loss	(21		)	(34		)	(39		)	(19		)	(20		)	(33		)
Retained earnings	11,718			11,462			11,204			12,044			12,008			11,506
Total shareholders’ equity	5,805			5,978			5,924			6,017			5,991			5,857
Total liabilities and shareholders’ equity	$	15,047		$	14,378		$	15,245		$	14,563		$	14,431		$	14,114

See accompanying Notes to Consolidated Financial Statements

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KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In Millions, Except per Share Data)


	Three Months Ended				Nine Months Ended				Three Months Ended
	November 1, 2014		November 2, 2013		November 1, 2014		November 2, 2013		May 2, 2015		May 3, 2014
Net sales	$	4,374	$	4,444	$	12,686	$	12,932	$	4,123	$	4,070
Cost of merchandise sold	2,746		2,778		7,908		8,063		2,600		2,574
Gross margin	1,628		1,666		4,778		4,869		1,523		1,496
Operating expenses:
Selling, general and administrative	1,097		1,073		3,078		3,071		1,016		1,000
Depreciation and amortization	227		228		665		665		227		216
Operating income	304		365		1,035		1,133		280		280
Interest expense, net	85		84		255		251		84		85
Income before income taxes	219		281		780		882		196		195
Provision for income taxes	77		104		282		327		69		70
Net income	$	142	$	177	$	498	$	555	$	127	$	125

Net income per share:
Basic	$	0.70	$	0.82	$	2.44	$	2.53	$	0.64	$	0.60
Diluted	$	0.70	$	0.81	$	2.43	$	2.51	$	0.63	$	0.60

Dividends declared and paid per share	$	0.39	$	0.35	$	1.17	$	1.05	$	0.45	$	0.39

See accompanying Notes to Consolidated Financial Statements

~~KOHL’S CORPORATION~~

~~CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME~~

~~(Unaudited)~~

~~(In Millions)~~

Three Months Ended Nine Months Ended
November 1,
2014 November 2,
2013 November 1,
2014 November 2,
2013
Net income $ 142
$ 177
$ 498
$ 555
Other comprehensive income, net of tax:
Unrealized gains on investments 9
—
11
4
Reclassification adjustment for interest expense on
interest rate derivative included in net income
1
1
2
2
Other comprehensive income 10
1
13
6
Comprehensive income $ 152
$ 178
$ 511
$ 561

~~See accompanying Notes to Consolidated Financial Statements~~

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KOHL’S CORPORATION

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

(In Millions, Except per Share Data)

Common Stock Paid-In Capital Treasury Stock Accumulated Other Comprehensive Loss Retained Earnings
Shares Amount Shares Amount Total
Balance at February 1, 2014 364
$ 4
$ 2,598
(153 ) $ (8,052 ) $ (34 ) $ 11,462
$ 5,978
Comprehensive income —
—
—
—
—
13
498
511
Stock options and awards 3
—
121
(1 ) (17 ) —
—
104
Dividends paid ($1.17 per common share) —
—
—
—
3
—
(242 ) (239 )
Treasury stock purchases —
—
—
(10 ) (549 ) —
—
(549 )
Balance at November 1, 2014 367
$ 4
$ 2,719
(164 ) $ (8,615 ) $ (21 ) $ 11,718
$ 5,805



	Common Stock			Paid-In Capital		Treasury Stock					Accumulated Other Comprehensive Loss				Retained Earnings
	Shares	Amount		Paid-In Capital		Shares		Amount			Accumulated Other Comprehensive Loss				Retained Earnings			Total
Balance at January 31, 2015	367	$	4	$	2,743	(166	)	$	(8,744	)		$	(20	)	$	12,008		$	5,991
Comprehensive income	—	—		—		—		—				1			127			128
Stock options and awards, net of tax	3	—		154		—		(19		)		—			—			135
Dividends paid ($0.45 per common share)	—	—		—		—		1				—			(91		)	(90		)
Treasury stock purchases	—	—		—		(2	)	(147		)		—			—			(147		)
Balance at May 2, 2015	370	$	4	$	2,897	(168	)	$	(8,909	)		$	(19	)	$	12,044		$	6,017

See accompanying Notes to Consolidated Financial Statements

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KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In Millions)


	Nine Months Ended						Three Months Ended
	November 1, 2014			November 2, 2013			May 2, 2015			May 3, 2014
Operating activities
Net income	$	498		$	555		$	127		$	125
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	665			665			227			216
Share-based compensation	38			41			14			11
Excess tax benefits from share-based compensation	(2		)	(3		)	(9		)	(2		)
Deferred income taxes	(37		)	(1		)	(23		)	5
Other non-cash revenues and expenses	19			30			10			5
Changes in operating assets and liabilities:
Merchandise inventories	(1,093		)	(1,204		)	(349		)	(105		)
Other current and long-term assets	(1		)	11			28			15
Accounts payable	1,019			954			134			17
Accrued and other long-term liabilities	(1		)	79			(69		)	(44		)
Income taxes	(175		)	(113		)	12			(64		)
Net cash provided by operating activities	930			1,014			102			179
Investing activities
Acquisition of property and equipment	(561		)	(465		)	(176		)	(176		)
Sales of investments in auction rate securities	59			1
Other	6			13			1			4
Net cash used in investing activities	(496		)	(451		)	(175		)	(172		)
Financing activities
Treasury stock purchases	(549		)	(549		)	(147		)	(167		)
Shares withheld for taxes on vested restricted shares	(17		)	(13		)	(18		)	(14		)
Dividends paid	(239		)	(229		)	(90		)	(80		)
Proceeds from issuance of debt	—			300
Proceeds from financing obligations	5			—			—			3
Capital lease and financing obligation payments	(87		)	(87		)	(27		)	(29		)
Proceeds from stock option exercises	111			77			134			24
Excess tax benefits from share-based compensation	2			3			9			2
Deferred financing costs	—			(4		)
Net cash used in financing activities	(774		)	(502		)	(139		)	(261		)
Net increase (decrease) in cash and cash equivalents	(340		)	61
Net decrease in cash and cash equivalents							(212		)	(254		)
Cash and cash equivalents at beginning of period	971			537			1,407			971
Cash and cash equivalents at end of period	$	631		$	598		$	1,195		$	717
Supplemental information:
Supplemental information
Interest paid, net of capitalized interest	$	216		$	221		$	63		$	65
Income taxes paid	493			438			84			132
Non-Cash Investing and Financing Activities
Non-Cash investing and financing activities
Property and equipment acquired through additional liabilities	$	40		$	119		$	10		$	21

See accompanying Notes to Consolidated Financial Statements

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KOHL’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for fiscal year end financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information, refer to the financial statements and related footnotes included in our Annual Report on Form 10-K for the fiscal year ended ~~February 1, 2014~~January 31, 2015 (Commission File No. 1-11084) as filed with the Securities and Exchange Commission on March ~~21, 2014.~~20, 2015.

Due to the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. In addition, quarterly results of operations may be impacted by the timing and amount of sales and costs associated with the opening of new stores.

We operate as a single business unit.

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. WeUnder the current pronouncement, we are required to adopt the new pronouncement in the first quarter of fiscal 2017 using one of two retrospective application methods. We are evaluating the application method and the impact of this new statement on our financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30). This ASU requires an entity to present such costs on the balance sheet as a direct deduction from the related debt liability rather than as an asset. Under the current pronouncement, we are required to adopt the new pronouncement in the first quarter of fiscal 2016. As of May 2, 2015, we have $12 million of debt issuance costs that would be reclassified from other assets to long-term debt on the balance sheet as a part of this pronouncement.

To conform to the current year presentation, we have corrected the presentation of $43 million of deferred income taxes that were previously recorded as long-term other assets and $24 million of other current assets that were previously recorded as an income taxes payable as of May 3, 2014.

2. Debt

Long-term debt consists of the following unsecured senior debt:


					Outstanding										Outstanding
Maturity	Effective Rate		Coupon Rate		November 1, 2014			February 1, 2014 and November 2, 2013			Effective Rate		Coupon Rate		May 2, 2015 and January 31, 2015			May 3, 2014
					(Dollars in Millions)										(Dollars in Millions)
2017	6.31	%	6.25	%	$	650		$	650		6.31	%	6.25	%	$	650		$	650
2021	4.81	%	4.00	%	650			650			4.81	%	4.00	%	650			650
2023	3.25	%	3.25	%	350			350			3.25	%	3.25	%	350			350
2023	4.78	%	4.75	%	300			300			4.78	%	4.75	%	300			300
2029	7.36	%	7.25	%	200			200			7.36	%	7.25	%	200			200
2033	6.05	%	6.00	%	300			300			6.05	%	6.00	%	300			300
2037	6.89	%	6.88	%	350			350			6.89	%	6.88	%	350			350
	5.54	%			2,800			2,800			5.54	%			2,800			2,800
Unamortized debt discount					(7		)	(8		)					(7		)	(8		)
Long-term debt					$	2,793		$	2,792						$	2,793		$	2,792

~~3. Fair Value Measurements~~

ASC No. 820, ~~“Fair~~Fair Value Measurements and Disclosures,” requires fair value measurements be classified in various pricing categories. Our long-term debt is classified as Level 1, financial instruments with unadjusted, quoted prices listed on active market exchanges. The estimated fair value of our long-term debt was $3.1 billion at May 2, 2015, January 31, 2015 and ~~disclosed in one of the following pricing categories:~~



~~Level 1:~~		~~Financial instruments with unadjusted, quoted prices listed on active market exchanges.~~

~~Level 2:~~		Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. The prices for the financial instruments are determined using prices for recently traded financial instruments with similar underlying terms as well as directly or indirectly observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.

~~Level 3:~~		Financial instruments that are not actively traded on a market exchange. This category includes situations where there is little, if any, market activity for the financial instrument. The prices are determined using significant unobservable inputs or valuation techniques.

May 3, 2014.

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KOHL’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

3. Stock-Based Compensation

Stock options

The following table summarizes our ~~financial instruments:~~stock option activity for the three months ended May 2, 2015:

November 1, 2014 February 1, 2014 November 2, 2013
Pricing Category Cost Fair Value Cost Fair Value Cost Fair Value
(In Millions)
Cash and cash equivalents Level 1 $ 631
$ 631
$ 971
$ 971
$ 598
$ 598
Auction rate securities Level 3 23
23
82
64
82
57
Debt Level 1 2,793
3,089
2,792
2,988
2,792
2,960



	Shares		Weighted Average Exercise Price
	(Shares in Thousands)
Balance at beginning of period	6,211		$	52.95
Exercised	(2,536	)	53.38
Forfeited/expired	(57	)	51.82
Balance at end of period	3,618		$	52.68

Our investments in auction rate securities (“ARS”) are included in other long-term assets in our balance sheet. We sold $59 million of ARS at par in 2014. On October 27, 2014, $23 million of ARS were called at par and were subsequently settled on November 6, 2014.

~~4. Stock-Based Compensation~~Nonvested stock awards

The following table summarizes ~~stock-based compensation grants:~~nonvested stock activity, including restricted stock equivalents issued in lieu of cash dividends, for the three months ended May 2, 2015:

Nine Months Ended
November 1,
2014 November 2,
2013
(In Thousands)
Stock options granted 186
549
Restricted shares and units granted, excluding shares earned in lieu of cash dividends 850
873
Total stock-based compensation grants 1,036
1,422
Weighted average fair value at grant date:
Stock options $ 12.23

$ 10.57
Restricted shares and units $ 56.40
$ 47.97



	Shares		Weighted Average Grant Date Fair Value
	(Shares in Thousands)
Balance at beginning of period	2,431		$	52.29
Granted	534		75.80
Vested	(564	)	52.47
Forfeited	(95	)	52.52
Balance at end of period	2,306		$	57.52

Performance share units

In March 2015, we granted performance-based restricted stock units ("performance share units") to certain executives. The performance measurement period for these performance share units is fiscal years 2015 through 2017. The fair market value of the grant was $86.87 per unit and was determined using a Monte-Carlo valuation on the date of grant. The performance share units cover a target of 131,000 shares.

The actual number of shares which will be earned at the end of the three-year vesting period will vary based on our cumulative financial performance over the vesting period. The number of performance share units earned will be modified up or down based on Kohl’s Relative Total Shareholder Return against a defined peer group during the vesting period. The payouts, if earned, will be settled in Kohl's common stock after the end of the multi-year performance period.

5.4. Contingencies

We are subject to certain legal proceedings and claims arising out of the conduct of our business. In the opinion of management, the outcome of these proceedings and litigation will not have a material adverse impact on our consolidated financial statements.

KOHL’S CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

5. Net Income Per Share

The following table summarizes our basic and diluted net income per share calculations:


	Three Months Ended				Nine Months Ended					Three Months Ended
	November 1, 2014		November 2, 2013		November 1, 2014		November 2, 2013			May 2, 2015		May 3, 2014
	(In Millions)								(In Millions)
Numerator—Net income	$	142	$	177	$	498	$	555		$	127	$	125
Denominator—Weighted average shares:
Basic	202		216		204		219			200		206
Impact of dilutive employee stock-based awards	1		2		1		2			2		2
Diluted	203		218		205		221			202		208
Antidilutive shares	4		8		5		12			—		7

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

For purposes of the following discussion, all references to “the quarter” and “the ~~third~~first quarter” are for the 13-week fiscal periods ended ~~November 1, 2014~~May 2, 2015 and ~~November 2, 2013~~May 3, 2014 ~~and all references~~. References to ~~“year to date”~~"2015" are for the ~~39-week fiscal periods~~quarter ended ~~November 1, 2014~~ ~~and~~ ~~November~~May 2, ~~2013~~.2015. References to "2014" are for the quarter ended May 3, 2014.

The following discussion should be read in conjunction with our Consolidated Financial Statements and the related notes included elsewhere in this report, as well as the financial and other information included in our ~~2013~~2014 Annual Report on Form 10-K (our “~~2013~~2014 Form 10-K”). The following discussion may contain forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could materially differ from those discussed in these forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those discussed elsewhere in this report and in our ~~2013~~2014 Form 10-K (particularly in “Risk Factors”).

Executive Summary

As of ~~November 1, 2014~~May 2, 2015, we operated ~~1,163~~1,164 family-focused, value-oriented department stores and a website ~~(www.Kohls.com)~~(www.kohls.com) that sell moderately priced exclusive and national brand apparel, footwear, accessories, beauty and home products. Our stores generally carry a consistent merchandise assortment with some differences attributable to regional preferences. Our website includes merchandise which is available in our stores, as well as merchandise which is available only on-line.

~~The following table summarizes our results.~~

Quarter Year to Date
(Dollars and shares in Millions)
Net sales $ 4,374
$ 12,686
Change in:
Net sales (1.6 )% (1.9 )%
Comparable sales (1.8 )% (2.2 )%
Gross margin as a percent of net sales 37.2 % 37.7 %
Selling, general and administrative expenses $ 1,097
$ 3,078
Net income $ 142
$ 498
Net earnings per diluted share $ 0.70
$ 2.43
Shares repurchased 2.7
10.1
Treasury stock purchases $ 157
$ 549

~~For additional details about our financial results, see Results of Operations and Financial Condition and Liquidity.~~

~~Our main business objective is to profitably increase sales. In order to increase sales, we believe that we need to increase transactions per store, which is our primary sales driver.~~ In the first quarter of 2014, we introduced a multi-year ~~vision that we believe will increase transactions per store and sales. This vision,~~strategic framework which we refer to as "the Greatness ~~Agenda,"~~Agenda". It is built on five pillars - amazing product, incredible savings, easy experience, personalized connections and winning teams.

~~Amazing product~~ ~~provides a renewed focus on providing the right merchandise mix, being locally relevant, and tailoring products to every customer across every channel. Our new beauty offerings are an example~~ All of the ~~new product~~Greatness Agenda initiatives are designed to increase sales, primarily by increasing the number of customers that ~~customers can find in many of~~shop at our stores and on-line. We are pleased with the positive impact the Greatness Agenda is having on our results and remain committed to the bold moves that are part of the Greatness Agenda.

In fiscal 2015, we are focused on key entertainment brands and properties including Cinderella, Marvel, Star Wars and our Jumping Beans and Disney collaboration. Another area of focus is sports offerings featuring NFL, NCAA and MLB team shops.

Key active and wellness initiatives in fiscal 2015 emphasize new and expanded launches, including Nike, Bliss, Gaiam yoga apparel, Champion and PUMA, and wearables that focus on wellness activities and sleep. We are planning a major re-launching of the Columbia brand this fall.

We continue to ~~test different beauty department formats. Stores with~~enhance the online shopping experience for our customers. In the first quarter of 2015, we implemented significant improvements for customers using tablets and launched a new mobile app.

During the first quarter of 2015, we rolled out buy-online, pick-up in store to all stores. Additionally, 200 more stores received the new beauty ~~department continue to outperform other stores - both~~experience in the ~~beauty department and across the store.~~ first quarter. By August, we expect to have brought this new experience to 900 of our stores.

We continue to ~~see sales increases of approximately 2 percent~~make progress in ~~higher sales volume stores~~building and activating an unmatched personalization capability. We are augmenting our behavior segmentation with the new beauty department versus a control group of stores without renovated beauty departments. We renovated beauty departments in 178 stores during the third quarter of fiscal 2014 bringing the total number of stores with the new beauty department to 512 as of November 1, 2014.shopper type, life stage and life cycle data. We expect to have ~~the new beauty department~~5 billion personalized touches in ~~approximately 900 stores~~2015.

We’ve expanded our localization assortment strategy and by the end of fiscal ~~2015.~~2015, almost half of our business will be transitioned to tailored assortments by store.

As of May 2, 2015, almost 29 million customers were enrolled in our Yes2You loyalty program. Loyalty members accounted for 54% of first-quarter transactions. We continue to ~~offer new products~~see that loyalty members are shopping more often and spending more with each trip. We continue to design program enhancements to create higher engagement with our customers as we believe this creates excitement for our customers and increases customer traffic to our stores and website. In the first quarter, we launched our first Jumping Beans collection featuring Disney characters. New elements around more of the Disney portfolio will be rolled out frequently. In June 2014, we launched the Fitbit brand as part of extending our active and wellness business. In September 2014, we launched both the IZOD brand in Men's and the Juicy Couture brand in Women's. We also further expanded our active and wellness product offerings andcustomers.

910

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~~introduced Gaiam yoga products in our stores during the third quarter. Finally, we expect to launch the Puma brand in the first half of fiscal 2015.~~

National brands are a key component of the Greatness Agenda as we believe they drive customer traffic and sales increases. In the third quarter of 2014, National brand comparable sales were higher than Private and Exclusive brand comparableNet sales for the ~~fifth consecutive quarter. Year to date, National brand penetration has increased approximately 150 basis points.~~

~~The goal~~quarter were $4.1 billion, an increase of ~~incredible savings~~ ~~is to help every customer get more from every dollar. In addition to~~$53 million, 1.3%, over the value offered in our Kohl's Cash and Kohl's-branded credit card, we now offer a loyalty program which allows enrolled customers to earn various rewards based upon the volume of their purchases. Prior to the nationwide launch in October 2014, we had approximately 10 million customers enrolled in the program. By the end of the thirdfirst quarter of ~~2014, over~~2014. Comparable sales increased 1.4%. Gross margin as a percentage of sales was 36.9% for the quarter, 17 ~~million customers had enrolled.~~

basis points higher than the first quarter of 2014. Merchandise margin increased, but was partially offset by higher shipping expenses. Selling, general and administrative ("SG&A") expenses increased in dollars and remained consistent as a percentage of sales. We ~~are also making significant investments to create an~~ ~~easy experience~~ ~~for~~increased our customers wherever or however they choose to engage with us. Whether they are shopping in one of our stores, from their mobile devices or from their laptops, we are creating a consistent experience to ensure that our customers can connect with us whereverIT and ~~however they wish. In 2014, we are focused on improving the tablet and smartphone shopping experience. We launched buy on-line and pick up in~~fixed store ~~in approximately 100 stores~~expenses during the ~~third~~ quarter. ~~We expect to offer this shopping option in all of our stores by~~For the ~~second~~quarter, net income was $127 million, 2% higher than the first quarter of ~~2015.~~

~~Personalized connections~~ ~~is about building lasting relationships~~last year, and diluted earnings per share was $0.63, an increase of 5% over the first quarter of 2014. We ended the quarter with ~~our customers. To build personalized connections during the shopping experience, we are focused on localizing~~$1.2 billion of cash and tailoring what we sell and how we communicate our product to ensure that our product and offers are personally relevant to each and every customer. At the same time, personalized connections is about contributing to causes such as children's health and education or the environment, so our customers know we are sensitive to the issues that are important to them.cash equivalents, an increase of $478 million over May 3, 2014.

~~The final pillar is~~ ~~winning teams, which is focused on building teams~~See Results of ~~engaged, talented, empowered~~Operations and ~~results-oriented management~~Liquidity and ~~associates.~~

~~We remain committed to meeting the changing shopping needs of~~Capital Resources for additional details about our customer, to strengthening our omni-channel experience and to investing in our future in a strategic and profitable manner. We are pleased with the progress we have made in these areas, but believe that we have additional opportunities to improve.financial results.

Results of Operations

Net sales.

Net sales ~~decreased $70 million, or 1.6%,~~increased 1.3% to ~~$4.4~~$4.1 billion for the ~~third quarter of 2014. Year to date, net sales decreased $246 million, or 1.9%, to $12.7 billion.~~quarter. Comparable sales ~~decreased 1.8%~~increased 1.4% for the ~~third quarter and decreased 2.2% year to date.~~quarter. Comparable sales include sales for stores (including relocated or remodeled stores) which were open during both the current and prior year periods. We also include ~~E-Commerce~~omni-channel sales in our comparable sales. ~~E-Commerce includes~~Adjustments for omni-channel sales ~~which originated on-line and~~that have been shipped, but not yet been received by the customer are ~~shipped from our E-Commerce fulfillment centers, shipped from our stores, picked up~~included in net sales, but are not included in our stores, or shipped directly from third-party vendors to our customers. Merchandise returns reduce sales at the location of the return. As a result, store sales are reduced by merchandise purchased on-line, but returned to a store.comparable sales.

The following table summarizes changes in net sales for the ~~quarter and year to date:~~quarter:

~~Table of Contents~~

Quarter Year to Date
$ % $ %
(Dollars In Millions)
Net Sales - 2013 $ 4,444
$ 12,932

Comparable sales:
Stores (187 ) (4.0 )% (481 ) (3.7 )%
E-Commerce 107
31.1 205
21.1
Total (80 ) (1.8) (276 ) (2.2)
New stores and other revenues 10
—
30
—
Total decrease in net sales (70 ) (1.6 )% (246 ) (1.9 )%
Net Sales - 2014 $ 4,374
$ 12,686

We replatformed our E-Commerce website in the second and third quarters of 2013, which temporarily decelerated growth. The increase in E-Commerce sales in the quarter was partially driven by the anniversary of the website replatform, as we continue to return to historical growth trends more similar to those experienced before the replatform.



	$			%
	(Dollars In Millions)
Net Sales - 2014	$	4,070
Comparable sales	56			1.4	%
New and closed stores and other revenues	(3		)	—	%
Increase in net sales	53			1.3	%
Net Sales - 2015	$	4,123

Drivers of the changes in comparable sales were as follows:

Quarter Year to Date
Selling price per unit 2.6 % 2.7 %
Units per transaction (1.8 ) (1.5 )
Average transaction value 0.8
1.2
Number of transactions (2.6 ) (3.4 )
Comparable sales (1.8 )% (2.2 )%



Selling price per unit	2.7	%
Units per transaction	(1.3	)
Average transaction value	1.4
Number of transactions	—
Comparable sales	1.4	%

The ~~increases~~increase in selling price per unit ~~were primarily due to increases~~was a combination of increased penetration and selling prices in our National brand ~~merchandise penetration.~~portfolio as well as improved clearance rates. Units per transaction decreased as customers purchased fewer items in response to the higher prices. ~~Increases~~Transactions were consistent with the first quarter of 2014, but trends have improved over the declines experienced in the ~~number~~first three quarters of ~~E-Commerce transactions were more than offset by decreases in~~fiscal 2014, as our ~~stores in both periods. Year-to-date transactions in our stores were negatively impacted by unfavorable weather trends which reduced customer visits.~~Greatness Agenda initiatives gained traction.

~~The~~From a regional perspective, including on-line originated sales, the Midwest ~~and Northeast regions~~region outperformed the ~~store~~Company average for the quarter. The ~~Mid-Atlantic,~~West, Northeast and Southeast ~~South Central, and West~~ regions ~~underperformed~~were consistent with the ~~store average for the quarter. Year to date, the West~~Company average. The Mid-Atlantic region reported a comparable sales increase, but was slightly below the ~~lowest decrease in comparable sales.~~Company average. The South Central region reported ~~the largest~~a slight comparable sales decrease infor the first ~~nine months~~quarter of ~~2014.~~2015.

~~For the quarter, Children's was the best performing and only~~By line of business, ~~to report higher sales. All Children's categories, except boys, reported sales increases. Accessories,~~Home, Footwear and Men's all reported comparable sales ~~were all slightly lower~~increases greater than ~~last year, but better than~~3%. Children's was consistent with the Company average. Accessories was ~~led by~~consistent with the first quarter of 2014. Women's reported comparable sales ~~increases in beauty and handbags. In Footwear, athletic shoes and men's dress and casual shoes were~~decreases from the strongest categories. Men's was led by sales increases in active and young men's. Home and Women's both underperformed the Company average. Women’s was led by the active and classic sportswear categories.

~~Year to date, Children's was the best performing and only line~~first quarter of business to report higher sales. All Children's categories, except boys, reported sales increases. Footwear and Men's also outperformed the Company average. These lines of business were led by sales increases in athletic and mens dress and casual categories within Footwear and young men's and active categories within Men's. Accessories, Home, and Women's all underperformed the Company average.

2014.

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Gross margin.


	Quarter				Year to Date
			Decrease						Decrease								Increase
	2014	2013	$	%	2014		2013		$	%			2015		2014		$	%
	(Dollars in Millions)											(Dollars in Millions)
Gross margin	$1,628	$1,666	$(38)	(2.3)%	$4,778		$4,869		$(91)	(1.9	)%		$1,523		$1,496		$27	1.8	%
As a percent of net sales	37.2%	37.5%		(0.3)%	37.7	%	37.7	%		—%			36.9	%	36.8	%		0.17	%

Gross margin includes the total cost of products sold, including product development costs, net of vendor payments other than reimbursement of specific, incremental and identifiable costs; inventory shrink; markdowns; freight expenses associated with moving merchandise from our vendors to our distribution centers; shipping and handling expenses of on-line sales; and terms cash discount. Our gross margin may not be comparable with that of other retailers because we include distribution center costs in selling, general and administrative expenses while other retailers may include these expenses in cost of merchandise sold.

~~For the quarter, gross~~Gross margin as a percentage of sales ~~decreased approximately 30~~increased 17 basis points ~~from 2013. The decrease for~~over the first quarter ~~can be attributed to~~of 2014. Merchandise margin increased 57 basis points over the first quarter of 2014, as a ~~higher mix~~result of ~~lower~~improved promotional and clearance markdowns. Shipping losses reduced gross margin ~~National brand sales~~by 42 basis points more than in the first quarter of 2014, as a result of growth in our on-line business and higher ~~markdowns. Year~~costs to ~~date, gross margin as a percentage of sales was consistent with 2013.~~ship merchandise.

Selling, general and administrative expenses.


	Quarter										Year to Date
							Increase										Increase											Increase
	2014			2013			$		%		2014			2013			$		%			2015			2014			$		%
	(Dollars in Millions)																				(Dollars in Millions)
Selling, general and administrative expenses	$	1,097		$	1,073		$	24	2.2	%	$	3,078		$	3,071		$	7	—	%		$	1,016		$	1,000		$	16	2	%
As a percent of net sales	25.1		%	24.1		%			1.0	%	24.3		%	23.7		%			0.6	%		24.6		%	24.6		%			0.07	%

~~Selling, general and administrative~~SG&A expenses ~~(“SG&A”)~~ include compensation and benefit costs (including stores, headquarters, buying and merchandising, and distribution centers); occupancy and operating costs of our retail, distribution and corporate facilities; freight expenses associated with moving merchandise from our distribution centers to our retail stores and among distribution and retail facilities; marketing expenses, offset by vendor payments for reimbursement of specific, incremental and identifiable costs; net revenues from our Kohl’s credit card operations; and other administrative revenues and expenses. We do not include depreciation and amortization in SG&A. The classification of these expenses varies across the retail industry.

The following table summarizes the changes in SG&A by expense ~~type:~~type for the quarter:


	Quarter			Year to Date			(In Millions)
	(In Millions)
Net revenues from credit card operations	$	(7	)	$	(24	)
Store expenses	(5		)	(10		)		$	17
Marketing costs, excluding credit card operations	6			4
Corporate expenses	28			30				11
Distribution costs	2			7				1
Increase in SG&A	$	24		$	7
Net revenues from credit card operations								(2		)
Marketing costs, excluding credit card operations								(11		)
Total increase								$	16

Many of our expenses, including store payroll and distribution costs, are variable in nature. These costs generally increase as sales increase and decrease as sales decrease. We measure both the change in these variable expenses and the expense as a percent of sales. If the expense as a percent of sales decreased from the prior year, the expense “leveraged” and indicates that the expense was well-managed or effectively generated additional sales. If the expense as a percent of sales increased over the prior year, the expense "deleveraged" and indicates that sales growth was less than expense growth. SG&A as a percent of sales increased, or "deleveraged," by ~~approximately 100~~7 basis points for the ~~quarter and approximately 60 basis points year to date.~~quarter.

The increase in store expense is a result of higher common area maintenance, repairs and maintenance, and store payroll. IT spending, which is included in corporate expenses, increased over the first quarter of 2014 due to growth and infrastructure investments. Corporate expenses also increased due to higher incentive compensation. The increased corporate spending was

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~~The increases~~partially offset by a decrease in ~~net revenues from credit card operations are the result of higher finance charge revenues~~health and ~~late fees due to growth in the portfolio. Partially offsetting these increases were higher bad debt~~hospital trends. Marketing expenses and operational costs. Store expenses reflect lower store payroll and lower operating expenses such as utilities, repairs and maintenance, cleaning, and insurance. Marketing costs increased in the quarter and year to date, as we launched our loyalty program nationwide in the third quarter. Corporate costs increaseddecreased for the quarter ~~and year to date due to a change~~as we were more strategic in our ~~incentive compensation estimated payout~~direct mail marketing and promotions. We plan to spend some of the savings in the third quarter of 2013, which resulted in an incentive compensation reversal for the quarter. Corporate costs also increased for the quarter and year to date, as we continue to invest in technology. Store distribution costs decreased, but were offset by higher E-Commerce fulfillment costs in both periods.future quarters.

Other Expenses.


	Quarter											Year to Date
							Increase/ (Decrease)											Increase/ (Decrease)												Increase/ (Decrease)
	2014			2013			$			%		2014			2013			$			%			2015			2014			$			%
	(Dollars in Millions)																						(Dollars in Millions)
Depreciation and amortization	$	227		$	228		$	(1	)	—	%	$	665		$	665		$	—		—	%		$	227		$	216		$	11		5	%
Interest expense, net	85			84			1			1	%	255			251			4			2	%		84			85			(1		)	(1	)%
Provision for income taxes	77			104			(27		)	(26	)%	282			327			(45		)	(14	)%		69			70			(1		)	(1	)%
Effective tax rate	35.3		%	37.0		%						36.1		%	37.0		%							35.3		%	36.0		%

Depreciation and amortization increased $11 million over the first quarter of 2014, as a result of higher IT amortization. Interest expense was consistent with ~~2013.~~the first quarter of 2014. The ~~increase in year-to-date interest expense is primarily due to higher outstanding long-term debt following the September 2013 debt issuance. The decreases in the~~ provision for income taxes ~~are due to lower~~was consistent with the first quarter of 2014, as higher income before taxes ~~primarily driven~~was offset by ~~lower sales, and~~a lower effective tax ~~rates.~~rate. The ~~decreases~~decrease in ~~the~~ effective tax ~~rates were~~rate was primarily due to a favorable state audit ~~settlements throughout 2014.~~settlement during the quarter.

Seasonality and Inflation

Our business, like that of most retailers, is subject to seasonal influences, with the major portion of sales and income typically realized during the second half of each fiscal year, which includes the back-to-school and holiday seasons. Approximately 15% of annual sales typically occur during the back-to-school season and 30% during the holiday season. Because of the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. Revenues and expenses associated with the opening of new stores may also affect our quarterly results.

Although we expect that our operations will be influenced by general economic conditions, including rising food, fuel and energy prices, we do not believe that inflation has had a material effect on our results of operations. However, there can be no assurance that our business will not be impacted by such factors in the future.

Financial Condition and Liquidity

~~Our~~

The following table presents our primary ~~ongoing~~ cash requirements ~~are for capital expenditures for new stores, remodels~~ and ~~IT spending and for seasonal and new store inventory purchases. Share repurchases and dividend payments to shareholders are currently other significant usages~~sources of cash. These payments are discretionary and can be discontinued at any time should we require cash for other uses. Our primary source of funds is cash flow provided by operations. Short-term trade credit, in the form of extended payment terms for inventory purchases, often represents a significant source of financing for merchandise inventories. We also have a line of credit available under our revolving credit facility which could be used to meet cash needs. funds.



Cash Requirements		Source of Funds
• Operational needs, including salaries, rent, taxes and other costs of running our business • Capital expenditures • Inventory (seasonal and new store) • Share repurchases • Dividend payments		• Cash flow from operations • Short-term trade credit, in the form of extended payment terms • Line of credit under our revolving credit facility

Our working capital and inventory levels typically build throughout the fall, peaking during the November and December holiday selling season.


							Decrease in Cash											Increase/(Decrease) in Cash
	2014			2013			$			%		2015			2014			$			%
Net cash provided by (used in):	(Dollars in Millions)											(Dollars in Millions)
Operating activities	$	930		$	1,014		$	(84	)	(8	)%	$	102		$	179		$	(77	)	(43	)%
Investing activities	(496		)	(451		)	(45		)	(10	)%	(175		)	(172		)	(3		)	(2	)%
Financing activities	(774		)	(502		)	(272		)	(54	)%	(139		)	(261		)	122			47	%

Operating Activities. Operating activities generated ~~$930~~$102 million of cash in the first ~~three quarters~~quarter of ~~2014,~~2015, compared to ~~$1,014~~$179 million in the first ~~three quarters~~quarter of ~~2013.~~2014.

Merchandise inventory increased $184 million to $4.2 billion at May 2, 2015. Inventory cost per store increased 4% and units per store increased 1% over the first quarter of 2014. On a unit basis, national brands increased 10% per store while

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~~Merchandise inventory increased $14 million over November 2, 2013 to $5.0 billion at November 1, 2014. Inventory per store was consistent with 2013, but~~private and exclusive brands decreased 5% and 7%, respectively. The difference between units per store ~~were 3 percent lower.~~and cost per store reflects the higher cost of national brands. Accounts payable as a percent of inventory was ~~47.9%~~39.5% at ~~November 1, 2014,~~May 2, 2015, compared to ~~45.6%~~34.7% at ~~November 2, 2013.~~May 3, 2014. The increase ~~was primarily~~reflects higher receipt volume, partially offset by slower inventory turnover. Income taxes generated cash of $12 million in the first quarter of 2015 and used cash of $64 million in the first quarter of 2014. The increase in cash is due to timing of ~~overseas inventory shipment receipts and timing of payments to some of our vendors.~~tax payments.

Investing Activities. ~~The increase~~Investing activities used cash of $175 million in ~~net cash used~~the first quarter of 2015 and $172 million in ~~investing activities reflects~~the first quarter of 2014. Capital expenditures were $176 million in both the first quarter of 2015 and 2014, as store refresh spending shifted from new stores in 2014 to beauty remodels in 2015. Corporate spending shifted from a ~~$96 million increase in capital spending primarily due to the purchase and~~ build out of a call center in Texas ~~increased IT spending, increased remodel spending and the expansion of~~in 2014 to our Menomonee Falls corporate ~~campus. The increase was partially offset by $59 million of sales at par of auction rate securities~~campus in ~~2014.~~2015.

Financing Activities. Financing activities used cash of ~~$774~~$139 million in the first ~~three quarters~~quarter of ~~2014~~2015 and ~~$502~~$261 million in the first ~~three quarters~~quarter of ~~2013.~~2014.

We paid cash for treasury stock purchases of ~~$549~~$147 million in ~~both 2014~~the first quarter of 2015 and ~~2013.~~$167 million in the first quarter of 2014. Share repurchases are discretionary in nature. The timing and amount of repurchases is based upon available cash balances, our stock price and other factors.

We received proceeds from stock options exercises of $134 million in the first quarter of 2015 and $24 million in the first quarter of 2014. The increase is due to increases in our stock price in the first quarter of 2015, leading to an increased number of exercised options.

We paid cash dividends of ~~$239~~$90 million ($~~1.17~~0.45 per share) in ~~2014~~the first quarter of 2015 and ~~$229~~$80 million ($~~1.05~~0.39 per share) in ~~2013.~~the first quarter 2014. On ~~November 12, 2014,~~May 13, 2015, our board of directors declared a quarterly cash dividend of ~~$0.39~~$0.45 per common share. The dividend is payable on ~~December~~June 24, ~~2014~~2015 to shareholders of record at the close of business on ~~December~~June 10, ~~2014.~~

~~In September 2013, we issued $300 million of 4.75% notes with semi-annual interest payments beginning in December 2013.~~

~~We received proceeds from stock options exercises of $111 million in 2014 and $77 million in 2013. The increase is due to higher stock prices, primarily in the third quarter of 2014.~~2015.

Free Cash Flow. ~~We generated free cash flow of $287 million in 2014 compared to $462 million in 2013.~~ Free cash flow is a non-GAAP financial measure which we define as net cash provided by operating activities and proceeds from financing obligation payments (which generally represent landlord reimbursements of construction costs) less capital expenditures and capital lease and financing obligations. Free cash flow should be evaluated in addition to, and not considered a substitute for, other financial measures such as net income and cash flow provided by operations.

The following table reconciles net cash provided by operating activities (a GAAP measure) to free cash flow (a non-GAAP measure).


	2014			2013			Increase/(Decrease) in Free Cash Flow			2015			2014			Increase/(Decrease) in Free Cash Flow
	(In Millions)									(In Millions)
Net cash provided by operating activities	$	930		$	1,014		$	(84	)	$	102		$	179		$	(77	)
Acquisition of property & equipment	(561		)	(465		)	(96		)	(176		)	(176		)	—
Capital lease & financing obligation payments	(87		)	(87		)	—			(27		)	(29		)	2
Proceeds from financing obligations	5			—			5			—			3			(3		)
Free cash flow	$	287		$	462		$	(175	)	$	(101	)	$	(23	)	$	(78	)

Key financial ratios. Key financial ratios that provide certain measures of our liquidity are as follows:


	November 1, 2014			November 2, 2013			May 2, 2015			May 3, 2014
Working capital (In Millions)	$	2,423		$	2,346		$	2,844		$	2,494
Current ratio	1.66			1.64			1.95			1.94
Debt/capitalization	45.2		%	45.2		%	44.1		%	45.2		%

The increases in working capital and the current ratio are primarily due to higher cash ~~balances and lower income tax payable~~ balances. The decrease in the debt/capitalization ratio ~~was consistent, as decreases in our~~is primarily due to lower capital lease and financing obligations ~~from annual rent payments were completely offset by lower capitalization, primarily due to share repurchases.~~and higher equity.

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Debt Covenant Compliance. As of ~~November 1, 2014,~~May 2, 2015, we were in compliance with all debt covenants and expect to remain in compliance during the remainder of fiscal ~~2014.~~2015.


	(Dollars in Millions)			(Dollars in Millions)
Included Indebtedness
Total debt	$	4,795		$	4,753
Permitted exclusions	(7		)	(7		)
Subtotal	4,788			4,746
Rent x 8	2,192			2,224
Included Indebtedness	$	6,980		$	6,970

Rolling 12-month Adjusted Debt Compliance EBITDAR
Net income	$	832		$	869
Rent expense	274			278
Depreciation and amortization	889			897
Net interest	342			338
Provision for income taxes	470			482
EBITDAR	2,807			2,864
Stock based compensation	51			52
Other non-cash revenues and expenses	13			19
Rolling 12-month Adjusted Debt Compliance EBITDAR	$	2,871		$	2,935

Debt Ratio (a)	2.43			2.37
Maximum permitted Debt Ratio	3.75			3.75
(a) Included Indebtedness divided by Adjusted Debt Compliance EBITDAR

Contractual Obligations

There have been no significant changes in the contractual obligations disclosed in our ~~2013~~2014 Form 10-K.

Off-Balance Sheet Arrangements

We have not provided any financial guarantees as of ~~November 1, 2014.~~May 2, 2015. We have not created, and are not party to, any special-purpose or off-balance sheet entities for the purpose of raising capital, incurring debt or operating our business. We do not have any arrangements or relationships with entities that are not consolidated into our financial statements that are reasonably likely to materially affect our liquidity or the availability of capital resources.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect reported amounts. Management has discussed the development, selection and disclosure of its estimates and assumptions with the Audit Committee of our Board of Directors. There have been no significant changes in the critical accounting policies and estimates discussed in our ~~2013~~2014 Form 10-K.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no significant changes in the market risks described in our ~~2013~~2014 Form 10-K.

Item 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (the “Evaluation”) at a reasonable assurance level as of the last day of the period covered by this report.

Based upon the Evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective at the reasonable assurance level. Disclosure controls and procedures are defined by Rule

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13a-15(e) of the Securities Exchange Act of 1934 (the "Exchange Act") as controls and other procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures.

It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving our stated goals under all potential future conditions, regardless of how remote.

(b) Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended ~~November 1, 2014~~May 2, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1A. Risk Factors

There have been no significant changes in our risk factors from those described in our ~~2013~~2014 Form 10-K.

Forward-looking Statements

This report contains statements that may constitute forward-looking statements within the meaning of the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Those statements relate to developments, results, conditions or other events we expect or anticipate will occur in the future. Words such as “believes,” “anticipates,” “plans,” “expects” and similar expressions are intended to identify forward-looking statements. Without limiting the foregoing, these statements may relate to future outlook, revenues, earnings, store openings, planned capital expenditures, market conditions, new strategies and the competitive environment. Forward-looking statements are based on our management’s then current views and assumptions and, as a result, are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Any such forward-looking statements are qualified by the important risk factors described in Item 1A of our ~~2013~~2014 Form 10-K or disclosed from time to time in our filings with the SEC, that could cause actual results to differ materially from those predicted by the forward-looking statements. Forward-looking statements relate to the date initially made, and we undertake no obligation to update them. An investment in our common stock or other securities carries certain risks. Investors should carefully consider the risks as stated in our 2013 Form 10-K and other risks which may be disclosed from time to time in our filings with the SEC before investing in our securities.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

We did not sell any securities during the quarter ended ~~November 1, 2014~~May 2, 2015 which were not registered under the Securities Act.

The following table contains information for shares repurchased and shares acquired from employees in lieu of amounts required to satisfy minimum tax withholding requirements upon the vesting of the employees’ restricted stock during the three fiscal months ended ~~November 1, 2014~~May 2, 2015:

Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
(In Millions)
August 3 – August 30, 2014 325,905
$ 54.71
325,100
$ 1,912
August 31 – October 4, 2014 1,111,727
60.89
1,108,500
1,844
October 5 – November 1, 2014 1,257,414
57.01
1,248,000
1,773
Total 2,695,046
$ 58.33
2,681,600
$ 1,773



Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
					(In Millions)
February 1 – February 28, 2015	34,887	$	61.96	30,962	$	1,643
March 1 – April 4, 2015	1,056,978	75.38		825,971	1,581
April 5 – May 2, 2015	1,096,462	75.64		1,093,408	1,498
Total	2,188,327	$	75.30	1,950,341	$	1,498

Table of Contents

Item 6. Exhibits




Exhibit Number		Description
10.1		Agreement dated as of April 17, 2015 by and between Ken Bonning and Kohl's Department Stores Inc.

12.1		Ratio of Earnings to Fixed Charges

31.1		Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema

101.CAL		XBRL Taxonomy Extension Calculation Linkbase

101.DEF		XBRL Taxonomy Extension Definition Linkbase

101.LAB		XBRL Taxonomy Extension Label Linkbase

101.PRE		XBRL Taxonomy Extension Presentation Linkbase

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



		Kohl’s Corporation (Registrant)

Date:	~~December~~June 5, ~~2014~~2015	/s/ Wesley S. McDonald
		Wesley S. McDonald On behalf of the Registrant and as Senior Executive Vice President and Chief Financial Officer (Principal Financial and Chief Accounting Officer)




PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements:	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Income	4
	Consolidated ~~Statements of Comprehensive Income~~	4
	~~Consolidated~~ Statement of Changes in Shareholders' Equity	5
	Consolidated Statements of Cash Flows	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	910
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	15
Item 4.	Controls and Procedures	15

PART II	OTHER INFORMATION
Item 1A.	Risk Factors	16
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	16
Item 6.	Exhibits	17
	Signatures	17



		November 1, 2014				February 1, 2014				November 2, 2013
	Pricing Category	Cost		Fair Value		Cost		Fair Value		Cost		Fair Value
		(In Millions)
Cash and cash equivalents	Level 1	$	631	$	631	$	971	$	971	$	598	$	598
Auction rate securities	Level 3	23		23		82		64		82		57
Debt	Level 1	2,793		3,089		2,792		2,988		2,792		2,960



	Quarter			Year to Date
	(Dollars and shares in Millions)
Net sales	$	4,374		$	12,686
Change in:
Net sales	(1.6		)%	(1.9		)%
Comparable sales	(1.8		)%	(2.2		)%
Gross margin as a percent of net sales	37.2		%	37.7		%
Selling, general and administrative expenses	$	1,097		$	3,078
Net income	$	142		$	498
Net earnings per diluted share	$	0.70		$	2.43
Shares repurchased	2.7			10.1
Treasury stock purchases	$	157		$	549

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