Macy’s Inc. said on its Q3 earnings call that it will shutter about 65 stores by the end of January 2025, extending the previously announced store closures by 15 locations. Tony Spring, chief executive officer of Macy’s, said the company’s move would focus on underperforming locations to further the company’s overall efforts to right-size the operations and enhance profitability. Adrian Mitchell, CFO of Macy’s, cited the company’s “Bold New Chapter” initiative, which involves shuttering 150 locations by 2026.
Despite the struggles, Spring recognized that these closures put Macy’s in a better position for long-term success. “This step gets us even closer to becoming a more profitable Macy’s, Inc.,” he said.
Key Highlights
Store Closures:
65 stores to close by January 2025 (15 more than previously planned).
Part of the “Bold New Chapter” initiative targeting 150 closures by 2026.
Financial Performance:
Net sales were $4.7 billion for Q3, down 2.4% from last year.
Comparable sales were up 3.2%, with increases driven by the women’s apparel, beauty, and digital categories.
Gains fueled by collaborations between brands, including Jenni Kayne and Kim Kardashian’s Skims.
Growth in Luxury Segment:
Bloomingdale’s and Bluemercury reported positive Q3 comparable sales.
Executives credited this phenomenon to robust product offerings and competitive price points.
Internal Investigation:
Employee hid $150 million of costs from Q4 2021 to November 2024.
Fraud had an “immaterial impact” on financial performance; no impact on revenue or inventory.
Vendors were fully paid despite discrepancies.
Consumer Behavior Shifts:
More shop online than go into stores.
Consumer economic concerns are reducing discretionary spending.
Macy’s Strategic Response:
Optimize store fleet and closing lower-performing stores.
Investing in digital and new brand partnerships.
Accelerating growth in high-performing segments: luxury and beauty.
Looking Ahead
Macy’s leadership remains optimistic about its future despite the headwinds it currently faces. In fact, strategic store closures, digital innovation, and investments in high-performing segments reflect a clear commitment to adaptation and growth.
Though it will indeed be tough, the efforts Macy’s undertakes to streamline its operations and focus on profitable segments are targeted at making the company relevant and competitive in the evolving retail industry.
Macy’s Inc. said on its Q3 earnings call that it will shutter about 65 stores by the end of January 2025, extending the previously announced store closures by 15 locations. Tony Spring, chief executive officer of Macy’s, said the company’s move would focus on underperforming locations to further the company’s overall efforts to right-size the operations and enhance profitability. Adrian Mitchell, CFO of Macy’s, cited the company’s “Bold New Chapter” initiative, which involves shuttering 150 locations by 2026.
Despite the struggles, Spring recognized that these closures put Macy’s in a better position for long-term success. “This step gets us even closer to becoming a more profitable Macy’s, Inc.,” he said.
Key Highlights
Store Closures:
65 stores to close by January 2025 (15 more than previously planned).
Part of the “Bold New Chapter” initiative targeting 150 closures by 2026.
Financial Performance:
Net sales were $4.7 billion for Q3, down 2.4% from last year.
Comparable sales were up 3.2%, with increases driven by the women’s apparel, beauty, and digital categories.
Gains fueled by collaborations between brands, including Jenni Kayne and Kim Kardashian’s Skims.
Growth in Luxury Segment:
Bloomingdale’s and Bluemercury reported positive Q3 comparable sales.
Executives credited this phenomenon to robust product offerings and competitive price points.
Internal Investigation:
Employee hid $150 million of costs from Q4 2021 to November 2024.
Fraud had an “immaterial impact” on financial performance; no impact on revenue or inventory.
Vendors were fully paid despite discrepancies.
Consumer Behavior Shifts:
More shop online than go into stores.
Consumer economic concerns are reducing discretionary spending.
Macy’s Strategic Response:
Optimize store fleet and closing lower-performing stores.
Investing in digital and new brand partnerships.
Accelerating growth in high-performing segments: luxury and beauty.
Looking Ahead
Macy’s leadership remains optimistic about its future despite the headwinds it currently faces. In fact, strategic store closures, digital innovation, and investments in high-performing segments reflect a clear commitment to adaptation and growth.
Though it will indeed be tough, the efforts Macy’s undertakes to streamline its operations and focus on profitable segments are targeted at making the company relevant and competitive in the evolving retail industry.