Macy’s Tempers Forecast Amid Slow Holiday Season

Macy’s expects fourth-quarter sales to be at the lower end of its guidance, citing inflation and a mid-season slowdown.

Revenue will come in at the low to midpoint of the forecast of $8.16 billion to $8.4 billion that management issued in November, the retailer predicted Friday. The company maintained its adjusted earnings outlook of $1.47 to $1.67 per share. The fourth fiscal quarter runs through late January.

“In an environment when discretionary spending was under pressure, we operated with precision and agility,” said Macy’s CEO Jeff Gennette. “Black Friday/Cyber Monday sales were in line with our expectations, while the week leading up to and following Christmas were ahead. However, the lulls of the non-peak holiday weeks were deeper than anticipated.”

The occasion-apparel and gift-giving segments were strong performers throughout the season, as was the company’s Bloomingdale’s business, Gennette noted.

However, the higher cost of goods will continue to put a strain on sales this year, he continued.

“Based on current macroeconomic indicators and our proprietary credit-card data, we believe the consumer will continue to be pressured in 2023, particularly in the first half, and have planned inventory mix and depth of initial buys accordingly,” he added. “[This will] allow us to operate from a position of strength while continuing to invest in our future.”

Macy’s is set to report its results for the fourth fiscal quarter and the full year in early March.

Image: The Macy’s flagship store in Manhattan, New York, during the 2016 Christmas season. (Shutterstock)