Shares of Kohl’s (KSS) rose as much as 7% in early trading after the company beat Wall Street’s earnings estimates by $0.15 per share and raised its profit outlook.

In Q2, the retailer doubled its inventory management and spending, leading to a 9% year-over-year decline in inventory. The company plans to “remain committed to increasing inventory turns and managing inventory at a mid-single digit rate,” CEO Tom Kingsbury told investors on a call.

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

Kohl’s expects to end 2024 with an operating margin of 3.4% to 3.8% and adjusted earnings per share of $1.75 to $2.25.

The company cut its full-year sales forecast, citing a continued “challenging consumer environment” and Kohl’s customers “feeling the burden” of higher living costs, causing them to put less in their shopping carts.

The company now expects comparable-store sales to decline 3% to 5% for fiscal 2024, up from the previously expected 1% to 3% annual decline.

Sephora at Kohl’s continues to be a bright spot for the company. The company’s total revenue rose nearly 45% in Q2 year over year, with sales growth in the low teens.

By 2024, the company added a total of 140 locations, surpassing the number of Sephora stores within Kohl’s.

“We’ve seen a nice overlap in terms of customers shopping at Sephora,” Kingsbury said, adding that “about 35% of Sephora baskets have another Kohl’s product in their basket.” As the beauty retailer attracts younger shoppers, it plans to move the juniors department to the front of the store.