US department store chain Macy's has recorded a 2.4% decline in net sales during the third quarter (Q3) of the fiscal year 2024 (FY24), recording $4.74bn compared to $4.86bn in the same quarter of the previous year.
During the quarter, the company’s comparable sales also saw a decrease, falling by 2.4% on an owned basis and 1.3% on an owned-plus-licensed-plus-marketplace basis.
The decline was primarily due to underperformance in non-First 50 locations, digital channels and cold weather categories.
Over the quarter, net sales of Macy’s brand were down 3.1%, with comparable sales down 3% on an owned basis.
Bloomingdale's and Bluemercury experienced growth, with Bloomingdale's net sales increasing by 1.4% and Bluemercury by 3.2%.
Bluemercury notably achieved its 15th consecutive quarter of comparable sales growth.
Despite these gains, Macy's overall net income for Q3 FY24 decreased to $28m from $41m in the previous year, with diluted earnings per share falling from $0.15 to $0.10.
Its selling, general and administrative expenses rose slightly to $2.1bn, reflecting investments aimed at customer engagement, but were partially offset by stringent cost controls.
Macy's chairman and CEO Tony Spring said: “Our third quarter results reflect the positive momentum we are building through our Bold New Chapter strategy.
“We are encouraged by the consistent sales growth in our Macy's First 50 locations and the strong performance of Bloomingdale's and Bluemercury. Quarter-to-date, comparable sales continue to trend ahead of third-quarter levels across the portfolio. Looking ahead, we remain committed to achieving sustainable, profitable growth for Macy’s.”
Macy’s has raised its net sales guidance for fiscal 2024 to between $22.3bn and $22.5bn, up from previous estimates of $22.1bn to $22.4bn.
However, gross margin rates are expected to be between 38.2% and 38.3%, down from the previous guidance of 39% to 39.2%.
The company expects adjusted EBITDA [earnings before interest, taxation, depreciation and amortisation] as a percent of total revenue to be between 8% and 8.4%.
