Macy's Q1 earnings beat but lowers outlook amid tariff concerns

Macy's, Inc. announced financial results for the first quarter that surpassed its own guidance, signaling promising progress on its "Bold New Chapter" strategy. The retailer reported net sales of 4.6 billion dollars, despite a 5.1 percent decrease inclusive of store closures compared to the same period last year, and delivered adjusted diluted earnings per share of 16 cents, exceeding expectations.

However, Macy's has revised its annual outlook to account for several factors, including potential tariffs, a moderation in consumer discretionary spending, and an increasingly competitive promotional landscape. While the company still anticipates net sales to fall within the range of 21 billion dollars to 21.4 billion dollars, it has adjusted its earnings forecast downwards to between 1.60 dollars and 2 dollars per share, a decrease from the previous outlook of 2.05 dollars to 2.25 dollars per share.

“We continued to execute against our Bold New Chapter strategy during the quarter, scaling key initiatives that improved our customer experience and contributed to stronger than expected performance across all three of our nameplates,” said Tony Spring, chairman and chief executive officer of Macy’s, Inc.

“Our first quarter results give us confidence that we have the right strategy and team in place to navigate the current environment while we continue to invest in our customer on the path to returning Macy’s, Inc. to sustainable profitable growth,” Spring added.

While the company’s overall comparable sales were down 1.2 percent on an owned-plus-licensed-plus-marketplace basis, the company highlighted strong performances from its luxury and beauty segments, with Bloomingdale's reporting a 3.8 percent comparable sales growth and Bluemercury achieving its 17th consecutive quarter of comparable sales growth with a 1.5 percent increase. Macy's comparable sales, however, saw a decline of 2.1 percent.

Furthermore, Macy's demonstrated a commitment to shareholder returns, distributing approximately 152 million dollars through 51 million dollars in cash dividends and 101 million dollars in share repurchases.