Pic: Refrina - stock.adobe.com
Additionally, Macy’s strengthened its digital presence by improving site navigation, pricing algorithms, and omnichannel experience, resulting in positive digital sales growth in the fourth quarter (Q4) of FY24, the company said in a press release.
Bloomingdale’s and Bluemercury continued their growth trajectory, with Bloomingdale’s achieving its strongest-ever fourth-quarter sales, posting a 6.5 per cent increase in comparable sales, while Bluemercury recorded 16 consecutive quarters of positive comparable sales growth.
Macy’s enhanced customer engagement through live events, influencer partnerships, and product assortment improvements, with strong results in ready-to-wear, beauty, and women’s shoes. Supply chain efficiencies reduced order-to-shipment time by 1,100 basis points (bps) and improved inventory replenishment by 400 bps, while free cash flow rose 71 per cent to $679 million.
Outlook for fiscal 2025 (FY25)
The company’s FY25 outlook remains cautious amid macroeconomic uncertainties but is focused on digital growth, luxury expansion, and strategic store investments. Macy’s is leveraging its strong balance sheet, marketing partnerships, and private brand expansion to drive sustainable growth and profitability.
For full fiscal 20205 (FY25), the company expects net sales between $21.0 billion and $21.4 billion, reflecting a comparable owned-plus-licensed-plus-marketplace sales decline of approximately 2.0 per cent to 0.5 per cent versus 2024.
The go-forward (company's core business operations that are expected to remain active and drive future growth) business comparable sales are projected to decline by approximately 2.0 per cent to flat. The company is focused on measuring its core adjusted EBITDA, which excludes asset sale gains, as a key metric for stabilisation and profitable growth.
Adjusted EBITDA as a percentage of total revenue is forecast between 8.4 per cent and 8.6 per cent, while core adjusted EBITDA is expected to range from 8.0 per cent to 8.2 per cent. Additionally, adjusted diluted earnings per share (EPS) is projected to be between $2.05 and $2.25.
Full fiscal 2024 (FY24) performance
Macy’s Inc reported net sales of $22.3 billion in FY24 for the period ended February 1, 2025, a 3.5 per cent decline year-over-year (YoY), with comparable sales down 2.0 per cent on an owned basis and 0.9 per cent on an owned-plus-licensed-plus-marketplace basis.
Growth in Macy’s First 50 locations, Bloomingdale’s, and Bluemercury was offset by weaker performance in non-First 50 locations and the digital channel. Go-forward business comparable sales declined 1.7 per cent on an owned basis and 0.6 per cent on an owned-plus-licensed-plus-marketplace basis. The company’s net sales fell 4.2 per cent, with comparable owned-plus-licensed-plus-marketplace sales down 1.6 per cent. However, the First 50 locations posted a 1.8 per cent increase in comparable sales, while Bloomingdale’s and Bluemercury achieved 2.5 per cent and 4.0 per cent comparable sales growth, respectively.
Other revenue declined 7.9 per cent to $713 million, primarily due to a 13.2 per cent drop in credit card revenues ($537 million), impacted by higher net credit losses. The gross margin rate remained flat at 38.4 per cent, with a 10-bps decline in merchandise margin, mainly due to product mix and Macy’s transition to cost accounting.
Selling, general, and administrative expenses (SG&A) decreased by $45 million to $8.3 billion, reflecting strong cost controls and strategic investments in customer experience, but as a percentage of total revenue, SG&A rose 110 bps to 36.2 per cent due to lower sales.
“As we close out the First year of the Bold New Chapter strategy, investments in the customer experience enabled us to achieve our highest comparable sales of the year, our best performance in 11 quarters,” said Tony Spring, chairman and chief executive officer (CEO) of Macy’s, Inc. “At Macy’s, our First 50 locations delivered four quarters of increased sales, while our luxury nameplates, Bloomingdale’s and Bluemercury, achieved accelerated annual sales growth. As we enter the second year of our strategy, we plan to scale initiatives that are resonating with our customers to drive long-term profitable growth and further unlock shareholder value.”
“Building on our momentum, we continue to elevate the customer experience, deliver operational excellence and make prudent capital investments. We remain committed to generating healthy free cash flow and returning capital to shareholders through share buybacks and predictable quarterly dividends,” said Adrian Mitchell, Macy’s, Inc chief operating officer (COO) and chief financial officer (CFO) of Macy’s, Inc.
Fibre2Fashion News Desk (SG)