Kohl’s (KSS) spiked 8% and Macy’s (M) surged 14% on Thursday after both companies reported what were arguably lackluster sales.

Kohl’s reported EPS of $1.22, which declined 2% year-over-year with comparable store sales down 1.8%. Meanwhile, Macy’s reported revenues that fell 3.9% year-over-year to $5.87 billion and comparable store sales down 2%.

The sharp spike in shares is evidence that expectations had come down too far for the group, with department store stocks vastly underperforming the overall market for months.

Thursday’s news further suggest that retailers’ bold moves to respond to the ongoing secular shift in shopping trends—namely a continued exodus out of malls and toward online, like Amazon (AMZN) — may be gaining traction.

At Kohl’s, EPS—which came in ahead of analyst estimates—was driven by better gross margins (up 50 basis points) and good cost controls in its 1,100 stores. And inventories—down 7.6%—were well managed, defending gross margin.

And while the company lowered its guidance—now expecting full-year earnings of $3.80 to $4.00 versus $4.05 to $4.25—this decrease wasn’t worse than the already-reduced market expectations of $3.84.

Still, the managements of these companies see much more work ahead.

“Our sales improved over our first quarter results, but were below our expectations,” according to Kohl’s chairman and CEO Kevin Mansell.

At Macy’s, while comparable stores sales declined by 2%, this came in better relative to expectations for a 4.5% decline. Management reaffirmed guidance calling for comparable store sales to decline 3-4%.

“We are encouraged by the distinct improvement in our sales and earnings trend in the second quarter,” Chairman and CEO Terry Lundgren said in the release. “Over the past few months, we have been saying that a setback is a setup for a comeback, and we now believe we are set up well to proceed to a comeback.”

Macy’s strategic initiatives

Perhaps most importantly, the company outlined a series of initiatives to drive profitable growth and to respond to a changed consumer.

The company plans to close 100 full-line stores, which represents 14% of their base. Macy’s currently has 728 stores, including 675 full-line locations.

The company continues to pursue opportunities to generate value from its real estate portfolio as well, which will likely become an important initiative for incoming CEO Jeff Gennette. The company has been examining opportunities for four of Macy’s large downtown flagship stores in various cities.

Activist investors, including Starboard Value, have pushed for a real estate spinoff to unlock an estimated $21 billion of value as declining department store traffic has been seen increasingly as a secular, not cyclical, issue.