Kohl’s (KSS) shares are moving higher in early trading, jumping by as much as 7% after the corporate beat Wall Street’s earnings expectations by $0.15 per share and raised its profit outlook.

In Q2, the retailer doubled down on inventory management and expenses, resulting in a 9% year-over-year decline in inventory. It plans to remain “committed to increasing inventory turns and managing inventory down mid-single digits,” CEO Tom Kingsbury told investors on a call.

All this in an effort to be “competitive during a really promotional holiday season,” CFO Jill Timm said.

Kohl’s expects to finish 2024 with an operating margin between 3.4% and three.8% alongside adjusted earnings per share within the range of $1.75 to $2.25.

The corporate did lower its full-year sales growth guidance as a “difficult consumer environment” persists and Kohl’s customers feel “the burden” of the next cost of living, causing them to place less of their basket.

It now expects same-store sales to fall between 3% and 5% for fiscal 12 months 2024, greater than the previously expected year-over-year decline of 1% to three%.

Sephora at Kohl’s continues to be a vibrant spot for the corporate. Total sales for the business jumped nearly 45% in Q2 12 months over 12 months, with sales growth within the low teens.

In 2024, the corporate added 140 total locations, surpassing 1,000 Sephora shops inside Kohl’s.

“We have seen a pleasant crossover when it comes to customers which can be shopping at Sephora,” Kingsbury said, adding that “around 35% of the Sephora baskets have one other product from Kohl’s of their basket.” As the sweetness store attracts younger shoppers, it plans to maneuver the junior section to the front of the shop.