Macy's Heads into the Holiday Season Like a Boss
CINCINNATI (AP) — Macy's is heading into the crucial holiday season firing on all cylinders, logging its fourth consecutive quarter of sales growth at existing locations and getting strong reactions from customers both online and in its stores.
The company also upped its annual earnings expectations, sending shares up more than 3 percent before the opening bell Wednesday.
Department stores like Macy's are under intense pressure reinvent themselves with so many shoppers migrating online or just spending money elsewhere, such has having dinner out, or on vacations.
Macy's, the first of the department stores to release quarterly results, has been expanding its store label brands to differentiate itself from rivals. It's also adding more of its off-price Backstage stores and putting into place technology that allows customers to skip the line at the register.
It's rolling out multiple layers of technology to offer people something they can't get online, such as the use of virtual reality in its furniture and cosmetics sections.
Macy's is also trying to become more nimble. It acquired Story, a concept store, which rotates themes and what it sells every few months. It brought Story founder Rachel Shechtman aboard to help create a more vibrant shopping experience at Macy's.
The changes are are taking place in the midst of a booming job market, which gives it a little more breathing room because Americans are feeling a little more confident about spending, and they are doing so.
Macy's Inc. reported third-quarter profits of $62 million, or 20 cents per share. Per-share earnings adjusted for one-time gains and losses were 27 cents, or 13 cents better than industry analyst expected, according to a survey by Zacks Investment Research.
The Cincinnati chain's revenue of $5.4 billion also beat expectations.
The company said that sales at stores opened at least a year rose 3.3 percent, its fourth straight quarter of gains after a three-year slump. The figure included sales from its licensed departments.
Macy's now expects annual profits to increase from $3.95 and $4.15 per share, to between $4.10 and $4.30.
Kohl's, J.C. Penney, and other department stores are reporting quarterly results over the next couple of weeks.
By AP reporter Anne D'Innocenzio