Macy’s posted its strongest comparable sales performance for the first fiscal quarter in four years on Wednesday, as legacy department store turnarounds continued to show progress.
Led by 200 stores said to be reimagined Macy’s has improved, same-store sales grew 3% overall during the quarter and 1.6% for its namesake banner.
At Bloomingdale’s, comparable sales grew 10.2%, helped by a busy product line, an “exciting” differentiator in the luxury space and the recent bankruptcy of rival Saks Fifth Avenue, CEO Tony Spring told CNBC in an interview.
“Does the disturbance in the square help us? Of course,” he said. “Is that the main reason we’re growing? No.”
Spring said better-than-expected sales and profits led the company to raise its full-year guidance after taking a cautious view.
It now expects total sales for 2026 to be between $21.5 billion and $21.75 billion, significantly ahead of expectations of $21.59 billion, according to LSEG. It expects adjusted earnings per share to be between $2 and $2.20, up from a previous range of between $1.90 and $2.10 and ahead of expectations of $2.07 in the mid-to-late quarter, according to LSEG.
It now expects comparable sales to rise between 0.5% and 1.2% annually, compared with a previous view of a 0.5% to 0.5% decline.
Macy’s shares rose more than 2% in retail trading on Wednesday.
Many retailers have reported strong growth during their first fiscal quarter in recent weeks thanks to higher-than-usual tax refunds. Some companies issued cautious guidance for the current quarter on mild economic concerns that could lead to lower demand, especially as consumers pay more for gas because of the war in the Middle East.
Spring said the tax refunds “definitely” helped in the first quarter, but they weren’t the only reason Macy’s grew. Worse, the same trends the company has seen in the first quarter so far have continued in the second, he said.
“We have raised our guidance for both sales and profit for the remainder of the year to reflect the business trends we see as we begin the second quarter, we are very pleased with the second quarter so far and the scope of the operating segments,” said Spring. “You don’t see a significant change in the way the consumer views our categories and our business across all three of our names.”
He said strong consumer behavior led Macy’s to raise its outlook “despite economic and geopolitical uncertainty.”
Here’s how the department store performed in its first fiscal quarter compared to Wall Street’s expectations, based on a survey of LSEG analysts:
- Earnings per share: 13 cents adjusted versus 3 cents expected
- Net worth: $4.68 billion versus $4.61 billion expected
The company’s reported net income for the three months ended May 2 was $63 million, or 23 cents per share, compared with $38 million, or 13 cents per share, a year earlier. Adjusting for restructuring costs and other one-time charges, Macy’s posted earnings per share of 13 cents.
Sales rose to $4.68 billion, up nearly 2% from $4.60 billion last year.
Macy’s is nearly two years into the three-year turnaround that Spring has led since taking over as the retailer’s chief executive. It also includes the closing of underperforming stores in dead malls across the country and the redevelopment of those that it has decided to keep open.
Those investments have included focusing on the fundamentals of retail, such as making sure stores are well-staffed, fun to spend time in, and stocked with things people want to buy.
“We don’t do fancy things, we do things that make a big difference in business,” said Spring. “We’re very focused on the product, we’re very focused on customer care, and I think the results show that if we do those two things consistently, and we don’t get tired, we stay relentless in our commitment, we get the results we want.”
