In a move that underscores the relentless instability at one of America’s largest department-store chains, Kohl’s Corp. has named Michael J. Bender as its permanent chief executive, marking the retailer’s fourth CEO in four years. The appointment, announced Monday, comes after a year of sales declines, executive ousters and strategic misfires that have left the Menomonee Falls, Wisconsin-based company scrambling to regain its footing amid fierce competition from e-commerce giants and discounters.

Bender, a 30-year retail veteran who had served as Kohl’s interim CEO since May, steps into the role permanently nearly seven months after replacing Ashley Buchanan, who was fired over an undisclosed personal relationship with a vendor. The episode was just the latest in a string of leadership upheavals that have rattled investors and employees alike. Kohl’s shares, which have lost more than half their value over the past five years, rose about 3% in premarket trading following the news.

Leadership Carousel Accelerates Decline

The rapid turnover at the top has coincided with deteriorating financial performance. Kohl’s reported a 5.6% drop in comparable sales for the third quarter ended Nov. 2, marking the eighth consecutive quarter of declines. Total revenue fell 4.9% to $3.89 billion, missing Wall Street estimates, as the company grappled with softening consumer demand for apparel and home goods. According to CNBC, the retailer has struggled with multiple CEOs in recent years while facing declining sales.

Under previous leadership, Kohl’s pursued aggressive partnerships, such as expanding its in-store presence for Amazon return hubs and Sephora shops, but these moves have yet to stem the tide. Net sales for fiscal 2024, which ended in late January, declined 2% to $17.4 billion, with the company posting a net loss of $184 million. Analysts point to macroeconomic pressures, including persistent inflation and shifting shopping habits, as key culprits.

Bender’s elevation was first reported by Bloomberg on Sunday, citing sources familiar with the matter. The decision reflects the board’s confidence in Bender’s deep operational knowledge, having joined Kohl’s in 2021 as chief financial officer before ascending to roles overseeing merchandising and supply chain.

Bender’s Retail Pedigree and Early Challenges

A finance executive by training, Bender brings experience from Macy’s and Sears Holdings, where he navigated restructurings and store closures. At Kohl’s, he has focused on cost-cutting, including reducing corporate headcount and optimizing inventory. In his interim stint, Bender emphasized stabilizing the core business while exploring new revenue streams, such as loyalty-program enhancements and digital investments. ‘We are making progress on our strategic priorities,’ Bender said in the company’s third-quarter earnings call, according to a transcript reviewed by The Wall Street Journal.

Yet the path ahead remains treacherous. Kohl’s e-commerce penetration stands at about 38% of sales, lagging behind rivals like Walmart and Target. The company’s loyalty program, Kohl’s Cash and rewards, drives over 70% of transactions, but membership growth has stalled. Posts on X from industry observers highlight skepticism, with some users questioning whether Bender can deliver the ‘transformational change’ needed to compete with off-price retailers like TJX Cos. and fast-fashion players.

Competitors are pulling ahead: Target Corp. reported a 0.9% comparable-sales increase in its latest quarter, buoyed by strong demand for groceries and essentials, while Walmart Inc. continues to encroach on department-store turf with everyday low prices. Kohl’s, with its middle-market positioning, has been squeezed from both ends.

Sales Slide Deepens Amid Macro Headwinds

The third-quarter results painted a grim picture. Gross margin contracted to 35.1% from 36.2% a year earlier, pressured by higher shrinkage and promotional activity. Operating income plunged 42% to $202 million. Management attributed the weakness to ‘a challenging macro environment,’ with apparel sales down mid-single digits and home goods faring even worse. CBS News noted that Kohl’s has promoted Bender after nearly seven months in the interim role, seeking to move past leadership turmoil.

Looking ahead, Kohl’s forecast fourth-quarter comparable sales to decline 4% to 6%, with full-year guidance implying a loss. The company plans to open 15 remodeled stores in 2025 and shutter 27 underperformers, part of a long-term fleet optimization strategy that has seen over 100 closures since 2020. Capital expenditures are targeted at $500 million, focused on supply-chain automation and technology upgrades.

Investor sentiment remains cautious. JPMorgan analyst Chris O’Cull called the CEO news ‘incrementally positive’ but urged focus on execution. Short interest hovers around 20% of the float, reflecting bets on further downside.

Past CEOs’ Legacies and Strategic Pivots

The parade of leaders tells a story of failed experiments. Michelle Gass, CEO from 2022 to early 2024, pushed celebrity partnerships and Sephora expansion but departed for Levi Strauss & Co. amid slumping sales. Her predecessor, Kevin Schleusner, lasted barely a year. Buchanan’s brief tenure ended in scandal, with Kohl’s disclosing in May that she was terminated for cause over the vendor relationship, prompting an internal review but no material financial impact.

Bender now inherits a balance sheet strained by $2.1 billion in long-term debt and negative free cash flow. Share repurchases have been halted, and the dividend yield, once a draw for income investors, stands at 10% but is under review. According to Reuters, Bender was named interim after Buchanan’s firing.

Strategic bets include deepening the Sephora partnership, now in over 1,000 stores, which generated $2 billion in sales last year—about 12% of total revenue. Amazon returns, available in all locations, boost foot traffic but cannibalize margins. Bender has signaled interest in private-label innovation and off-price concepts to counter Ross Stores Inc.

Board’s High-Stakes Bet on Continuity

The board, chaired by Michael Francis, opted for an internal promotion over an external search, betting on Bender’s familiarity amid activist pressure. Engine Capital, which owns 9.8% of shares, has called for a sale or breakup, arguing Kohl’s undervalued real estate—worth an estimated $10 billion—dwarfs its $3 billion market cap. Other activists, including Macellum Advisors, have pushed similar agendas.

Employee morale has suffered from the churn, with Glassdoor reviews citing ‘constant change’ as a top concern. Unionization efforts at select stores add another layer of complexity. On X, former associates expressed mixed views, praising Bender’s accessibility but doubting quick turnarounds.

For Bender, success hinges on holiday execution and 2025 guidance. A soft Christmas could invite more activist fire. As one retail analyst posted on X, ‘Fourth CEO in four years? Kohl’s needs more than stability—it needs reinvention.’ The stakes couldn’t be higher for the chain that once symbolized Midwestern reliability.