A person walks past a Macys store in Hyattsville, Maryland, on February 22, 2022.
Stefani Reynolds | AFP | Getty Images
Macy’s reported first-quarter earnings and sales tax on Thursday ahead of analysts’ expectations as shoppers returned to malls to buy new clothing, luggage and luxury items despite decades of high inflation that has threatened to reduce consumption.
The department store chain, which also owns Bloomingdale’s, reaffirmed its sales outlook for fiscal year 2022 and increased its profit targeting, expecting stronger credit card revenue for the rest of the world. the year.
It joins Nordstrom to counter a broader trend in the retail industry with negative forecasts and warnings about a decline in consumer spending on discretionary spending. In recent days, companies such as Walmart, Target, Kohl’s and Abercrombie & Fitch have warned that higher logistics and labor costs will continue to consume their short-term profits.
Macy’s shares soared more than 14% in pre-market trading in the news.
The retailer still expects 2022 revenue to be flat at up to 1% compared to 2021 levels, which would be between $ 24.46 billion and $ 24.7 billion.
It now projects earnings, on a tight basis, between $ 4.53 and $ 4.95 per share, from a previous range of $ 4.13 to $ 4.52.
“While macroeconomic pressures on consumer spending increased during the quarter, our customers continued to shop,” CEO Jeff Gennette said in a press release. He added that the company saw a shift from consumers to stores and to clothing for special occasions such as women’s dresses and tailored men’s items.
This is how Macy’s did in its first fiscal quarter compared to what Wall Street anticipated, according to a poll by Refinitiv analysts:
- Earnings per share: $ 1.08 adjusted for the expected 82 cents
- Revenue: $ 5.35 billion compared to projected $ 5.33 billion
For the three-month period ended April 30, Macy’s reported net income of $ 286 million, or 98 cents per share, compared to net income of $ 103 million, or 32 cents per share. , a year earlier.
Excluding spot items, it earned $ 1.08 per share, exceeding analysts ’expectations of 82 cents-adjusted earnings per share.
Revenue rose to $ 5.35 billion from $ 4.75 billion in last year’s period, also surpassing analysts ’forecast.
Digital sales rose 2%, accounting for 33% of net sales for the quarter. The retailer said it had 44.4 million active customers, 14% more than the previous year, with the help of Macy’s loyalty program that helped attract more people online and to stores.
Sales in the same stores for both their own and licensed stores grew 12.4% compared to the previous year. Analysts polled by Refinitiv had been looking for a 13.3% increase.
Macy’s reported inventory levels on April 30 that were up 17% from the previous year and down 10% compared to 2019 levels.
Macy’s said those levels inflated a bit as shoppers stopped buying active and casual clothing as well as household items. Supply chain restrictions have also eased during the quarter, he said, resulting in a higher than expected percentage of inventories.
This story is unfolding. Please check for updates again.