"As we approach the completion of our turnaround, we are focused on re-establishing J.C. Penney as the premier shopping destination for the moderate consumer," Ullman said in a statement Thursday. "We expect to continue driving profitable sales this back-to-school season."
The retailer said its gross margin rose to 36 percent from 29.6 percent a year ago and free cash flow increased to $76 million, a $1.2 billion improvement.
"It's going to take a combination of sales and margin to get this up. And I still can't get a reasonable valuation with even these assumptions in the model until about 2018," Snyder said.
Looking forward, J.C. Penney said it expects third-quarter comparable store sales to increase mid-single digits, while gross margin is forecast to be in line with the second quarter.
The company said women's and men's apparel and accessories, home and fine jewelry were its top performing sectors in the quarter.
J.C. Penney is planning to close 33 of its stores, but is also making plans to open others. The company will open its first location in Brooklyn, New York, later this month and it also teamed up with makeup and perfume maker Sephora, a venture it said performed strongly during the quarter.
—By CNBC's Karma Allen. CNBC's Michelle Fox contributed to this report.