Total sales fell 7.4 percent in the first quarter of 2016, and a further four percent in the second. But the results were better than analysts feared.
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After the announcement, Macy’s stock was up about 15 percent during the early hours of trading today.
The Macy’s store in Yorktown remains open, but that could change next year, because the company announced Thursday it will be closing another 100 stores by early 2017. People are spending more of their money on home improvement as well as experiences like travel or spas. Macy’s, which flourished during the Great Recession, is now believed to be suffering from increased competition from fast-fashion retailers like H&M, discounters like T.J. The US firm will also seek to improve its SEO, host more in-store events to drive footfall and bring in more branded shops within its current stores in order to offset the growing rivalry from the likes of Amazon. Shoppers are buying more and more clothing online, and Amazon.com is expected to unseat Macy’s next year as the largest online clothing seller. Under Lundgren, the company looked for growth opportunities like buying upscale beauty brand Bluemercury and is adding services like same-day delivery.
The changing business model used by Macy’s prompted the company to close the Roseburg store, and Gagnon said shoppers and others in Lane County should be anxious Macy’s will close the Eugene store, too.
The company, which also owns the more-upscale Bloomingdale’s chain, has been experiencing falling sales and profits at its almost 900 stores nationwide, including its Bloomingdale’s locations.
“We chose to close a larger number of stores proactively so we can invest in a winning customer experience in our most productive and highest- potential locations, as well as invest in growth sooner and more aggressively in digital and mobile”, Gennette said. The company said it plans to maintain “a significant bricks-and-mortar presence in 49 of the top 50 USA markets”. The retailer has been under pressure from activist investors to evaluate its real estate. Chief Financial Officer Karen Hoguet told analysts the company is in talks with potential buyers of its San Francisco men’s store. The plans are for that operation to be combined into its main Union Square store.
In its second quarter, which ended July 30, Macy’s said its profits plunged to $11 million, or 3 cents a share.
Sales in the second quarter totaled $5.866 billion, a decrease of 3.9 percent, compared with sales of $6.104 billion in the same period past year.
Excluding the charges, Macy’s earned 54 cents per share. The company, with executive offices in Cincinnati and NY, logged $27 billion in revenue previous year. That topped the $5.77 billion estimate from FactSet.
Macy’s same-store sales fell 2 percent in the latest quarter.
Kohl’s, which also reported better-than-expected sales and profit, closed up 16 percent at $44.19. The stock jumped 17.1 percent to close at $39.81.
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The company said it was sticking to its outlook.
