Macy’s announced stronger-than-expected results for its fiscal second quarter on Thursday, posting comparable sales growth of 2.7% overall, with its namesake brand increasing 1.1% and its higher-end Bloomingdale’s division rising 11.3%. The beauty brand Bluemercury also contributed to the company’s performance with a 6.2% increase in comparable sales. Management attributed much of the growth to strategically reimagined store locations that are central to the company’s broader turnaround initiative.
The company elevated its full-year financial projections following the strong quarter. Macy’s now projects net sales between $21.68 billion and $21.83 billion, up from its prior guidance of $21.5 billion to $21.75 billion. The retailer also raised its comparable sales outlook to between 1% and 1.5% growth, compared with the previous range of 0.5% to 1.2%. Full-year earnings per share guidance was increased to a range of $2.15 to $2.35, versus the prior $2 to $2.20, with approximately 5 cents per share expected from tariff refunds.
The company reported net income of $169 million, or 62 cents per share, compared with $87 million, or 31 cents per share, in the year-earlier period. Adjusted earnings per share came in at 40 cents. Sales increased slightly to approximately $4.87 billion from $4.81 billion year-over-year, while credit card revenue climbed 2%, or $3 million, reflecting what the company characterized as a healthy credit portfolio and stable credit card losses.
Macy’s received $116 million in tariff refunds and intends to invest roughly $96 million of that amount toward customer experience improvements and its turnaround strategy rather than temporary price reductions. Chief Executive Tony Spring emphasized the company’s commitment to long-term enhancements over short-term promotional tactics. He noted that Macy’s continues to monitor fuel cost uncertainties and is reserving a portion of the refunds as a precaution.
Despite the positive financial results and raised guidance, Macy’s shares declined nearly 5% on Thursday. Spring told media outlets that the company is well-positioned to serve both higher-income and value-conscious consumers amid a bifurcated marketplace, as it approaches the completion of its three-year turnaround plan designed to reinvigorate growth in the challenging department store sector.
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