Macy’s Reports Decline in Sales and Profits, But Beats Expectations
In a challenging retail environment, Macy’s reported a decline in sales and profits during the first quarter of the year. The iconic department store chain faced higher costs and financial challenges, leading to a pullback in customer spending. However, despite these obstacles, Macy’s managed to beat Wall Street expectations with its quarterly results announced on Tuesday.
CEO Tony Spring, who took over in February, highlighted that all income groups are becoming more thoughtful with their spending habits. The company’s upscale brands, including Bloomingdale’s and Bluemercury, are also feeling the impact of changing consumer behavior. While luxury sales have held up better overall, lower-tier customers are prioritizing essentials like rent and family obligations.
To adapt to the evolving retail landscape, Macy’s is accelerating the expansion of its new small-format stores while closing underperforming locations. The company plans to open 30 small-format stores by the fall of 2025, nearly tripling the current count. Additionally, Macy’s is focusing on upgrading its remaining traditional stores, adding more salespeople, and enhancing visual displays to attract customers.
Despite the challenges, Macy’s remains optimistic about its future outlook. The company raised its annual forecast and is committed to its turnaround efforts. Investors are closely watching Macy’s performance, with pressure to accelerate growth. In early trading, Macy’s shares fell slightly, reflecting the ongoing uncertainty in the retail sector.