Kohl’s CEO Michelle Gass Resigns to Join Levi Strauss

Kohl’s CEO Michelle Gass Resigns to Join Levi Strauss

Kohl’s Corp.

KSS 9.94%

Chief Executive

Michelle Gass

is leaving the department-store chain early next month to join

Levi Strauss

LEVI -2.28%

& Co. with plans to have her take over as the jeans maker’s CEO.

At Kohl’s, Ms. Gass has been under attack from activist investors for sales declines and a steep drop in the company’s stock price. In September, activist investor Ancora Holdings Inc., urged the company to replace Ms. Gass and its chairman. Kohl’s shares, down nearly 40% on the year, jumped 8% in early Tuesday trading.

Ms. Gass will leave Kohl’s Dec. 2 and join Levi Jan. 2, where she will serve as president with oversight of Levi’s brand and global digital and commercial operations. The 54-year-old will succeed Levi’s CEO

Chip Bergh

within 18 months, the company said. Mr. Bergh, who is 65 years old, has run Levi Strauss since 2011.

Kohl’s appointed

Tom Kingsbury

to serve as interim CEO until a permanent successor is named. Mr. Kingsbury is a former

Burlington Stores Inc.

CEO who joined Kohl’s board in 2021 as part of a settlement with activists. In a statement, Ancora said it was the right time to find new leadership and it was pleased that Mr. Kingsbury was the interim CEO.

Kohl’s also released preliminary results for the quarter ended Oct. 29. The company said that same-store sales decreased 6.9% compared with a year earlier. Net sales fell 7.2%. The company earned 82 cents a share compared with $1.65 a share.

It plans to report full results on Nov. 17.

Kohl’s, with roughly 1,100 stores, has struggled to attract shoppers amid rising competition from discounters, fast-fashion chains and online competitors. Earlier this year, Kohl’s scrapped plans to sell itself to the owner of Vitamin Shoppe—in a debt-funded deal initially worth $8 billion but later reduced. The company’s market capitalization has fallen to around $3 billion.

Ms. Gass wasn’t schooled in the art of selling clothes. She studied chemical engineering at Worcester Polytechnic Institute and received a master’s in business administration from the University of Washington. She then spent six years honing her marketing skills at

Procter & Gamble Co.

before joining

Starbucks Corp.

in 1996.

When she departed the coffee chain after nearly 17 years, founder

Howard Schultz

credited her with helping develop such products as the Frappuccino.

Ms. Gass joined Kohl’s in 2013 as chief customer officer with responsibility for marketing and the e-commerce business. In 2015, her role expanded to chief merchandising officer, and in 2018 she took over as CEO and joined the board.

Ms. Gass had some early success at the helm of Kohl’s, telling her team that they needed to think differently and shouldn’t be afraid to try new ideas. She formed a partnership with

Amazon.com Inc.

that allowed shoppers to use Kohl’s stores to return goods bought at the online retailer. Last year, she wooed Sephora away from JCPenney, where it had operated shops for more than a decade.

She overhauled the merchandise, dropping poorly performing brands such as Dana Buchman, and bringing in new ones, including Tommy Hilfiger, Eddie Bauer and Cole Haan. She expanded the selection of activewear from brands such as

Nike Inc.,

Adidas AG and

Under Armour Inc.

Ms. Gass also simplified discounts and pricing and is refurbishing stores. The company is on track to repurchase $1.3 billion in stock in the current fiscal year.

Yet, the moves haven’t improved Kohl’s business enough to satisfy some shareholders. While sales initially increased, they had started to decline even before the pandemic forced retailers to temporarily shut stores and kept consumers homebound. The company has faced two years with activist investors calling for board changes.

Write to Suzanne Kapner at Suzanne.Kapner@wsj.com

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Author: Shirley