American holding company of department stores Macy’s Inc. posted better-than-expected first-quarter results, with net sales hitting US$4.6 billion, surpassing guidance.
However, comparable sales dipped 2.0% on an owned basis and 1.2% on an owned-plus-licensed-plus-marketplace basis.
Earnings per share came in at $0.13 GAAP and $0.16 adjusted, both exceeding forecasts.
Bloomingdale’s and Bluemercury stood out, delivering 3.0% and 1.5% comparable sales growth, respectively.
The retailer returned $152 million to shareholders through dividends and buybacks.
Mixed Performance Across Business Segments
Macy’s flagship stores struggled, with net sales down 6.5% and comparable sales dropping 2.9% on an owned basis. In contrast, Bloomingdale’s and Bluemercury continued their upward trajectory, with Bloomingdale’s net sales rising 2.6% and Bluemercury marking its 17th consecutive growth quarter. The Reimagine 125 initiative, aimed at revitalising select locations, saw a 1.3% decline in comparable sales.
Profitability Takes a Hit, Shareholder Returns Hold Steady
Macy’s GAAP net income fell to $38 million, down from $62 million in Q1 2024. Adjusted net income dropped to $46 million, compared to $77 million last year. EBITDA also declined, coming in at $324 million, or 6.8% of total revenue, versus $364 million in Q1 2024. Despite the earnings dip, Macy’s maintained its commitment to shareholders, paying out $51 million in dividends and repurchasing $101 million in shares.
Guidance Cut Amid Tariff and Consumer Spending Concerns
Macy’s reaffirmed its annual net sales guidance of $21.0 billion to $21.4 billion but lowered its adjusted EPS forecast to $1.60–$2.00, down from $2.05–$2.25. The retailer expects comparable sales to decline between 2.0% and 0.5%. CEO Tony Spring emphasised the company’s strategic flexibility, navigating a competitive promotional landscape while leveraging its diverse brand portfolio.
Macy’s faces headwinds from tariffs and cautious consumer spending, but its high-end brands and strategic initiatives buffer against broader retail challenges.
At the time of writing, the stock price of Macy's Inc (NYSE: M) was US$12, down 4 cents (0.33%) today. It has a market cap of around $3.34 billion.
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