default-output-block.skip-main
BoF Logo

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.

Macy's Posts First Sales Gain in Three Years

The department store chain's quarterly sales gain shows it's making progress.
Macy's flagship store in Herald Square, New York | Source: Shutterstock
By
  • Bloomberg

NEW YORK, United States — Macy's Inc. posted a surprise sales gain last quarter and sees the momentum carrying into 2018, renewing investors' optimism in the battered department-store chain.

Total comparable sales — a key benchmark — rose 1.4 percent in the fiscal fourth quarter, which includes the holiday season. Analysts had predicted a 0.6 percent decline. The shares surged as much as 13 percent in early trading after the results were posted.

The results mark a major milestone for the Cincinnati-based chain, which had suffered 11 straight quarters of comparable-sales declines. Chief Executive Officer Jeff Gennette, who took the helm at Macy’s last year, has vowed to bring shoppers back by opening more off-price locations, closing underperforming stores and reducing superfluous inventory.

Macy's CEO has vowed to bring shoppers back by opening more off-price locations, closing underperforming stores and reducing inventory.

The turnaround strategy now looks to be bearing fruit. The company expects comparable sales to range between the break-even point and 1 percent growth this year.

“We are encouraged to see a trend improvement in our brick-and-mortar business,” Gennette said in a statement Tuesday.

The stock climbed as high as $31.11 in premarket trading. Before the rally, the shares were up 9 percent this year.

Mall malaise

Fourth-quarter net sales amounted to $8.67 billion, matching analysts’ estimates. Excluding some items, profit was $2.82 a share in the period, which ended February 3.

Falling foot traffic at malls and a broader slump in apparel has waylaid the department-store industry for years. Shares of Macy’s plunged 30 percent in 2017 as investor pessimism deepened.

With the outlook brightening again, other department-store stocks also gained on Tuesday. Kohl's Corp., Nordstrom Inc. and J.C. Penney Co. all rebounded in early trading.

By Lindsey Rupp, Editors: Nick Turner, Lisa Wolfson

© 2021 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
CONNECT WITH US ON
State of Fashion 2023
© 2022 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions and Privacy policy.
State of Fashion 2023