Updated 4:01 p.m. ET Sept. 10
Macy’s Inc. reported solid second-quarter sales and profit, with contributions across all brands, but particular strength at Bloomingdale’s.
The results beat industry analysts’ expectations, motivated management to raise its sales and profit expectations for the year, and represented the fifth consecutive quarter of comparable sales gains at Macy’s Inc., as well as at the Macy’s brand.
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Bloomingdale’s had another standout performance, posting a comp gain of 11.3 percent, bringing the volume to $922 million, its highest second-quarter sales total in the history of the brand.
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For the corporation overall, net sales rose 1.1 percent to $4.9 billion, a figure that includes the impact of stores closed during the second quarter. Comparable sales rose 2.7 percent.
The Macy’s brand saw a 1.1 percent sales increase to $4.2 billion, while the 200 “reimagined” Macy stores saw a 1.9 percent gain. Reimagined stores have enhanced merchandising, automation, visuals and events, additional staff and improved service levels. Some tariff refunds will be used for piloting yet-to-be-disclosed concepts in the reimagined stores.
Bluemercury’s comps increased 6.2 percent to $76 million.
Macy’s Inc.’s second-quarter net income rose to $169 million, from $87 million in the year-ago period. Adjusted earnings before interest, taxes, depreciation and amortization increased to $457 million from $373 million. Adjusted diluted earnings per share totaled 63 cents, up 14 percent versus last year, excluding a 23-cent net tariff refund benefit. The retailer has received all of its expected tariff refunds, including $98 million in the second quarter of 2026 and $18 million afterward, for a total of $116 million.
“This was another terrific quarter for us. We are starting to see a pattern,” Tony Spring, chairman and chief executive officer of Macy’s Inc., told WWD. “We were able to beat on the top and bottom line,” meaning exceed Wall Street’s expectations.
However, investors were more cautious and sent shares of the company down 4.8 percent to $20.49 on Thursday at the closing bell.
Asked how business is progressing in the first five-and-half-weeks of the third quarter, Spring said: “It’s unfolding as we expected. There are no major surprises.”
The back-to-school business has cycled into a period where kids have returned to class and are seeing what other kids are wearing, sparking some continued spending.
With Bloomingdale’s continued outperformance, Spring was asked about the upscale brand’s expansion possibilities. “We continue to open Bloomingdale’s outlets and Bloomies. These physical boxes are smaller and easier to come by. But we are open to [more full-line] Bloomingdale’s if we can get the right locations in the right markets.”
He said there are no Bloomingdale’s department stores in Arizona, Houston, downtown Boston and Detroit. There are also no Bloomingdale’s department stores in the Pacific Northwest. Altogether, Bloomingdale’s operates 31 department stores, four Bloomies and 25 outlets.
“There is plenty of opportunity for Bloomingdale’s,” said Spring. “But with real estate, you always want to be slow and accurate, and it’s not easy. We look at everything.”
Saks Fifth Avenue and Nordstrom have recently closed several of their stores — locations that other retailers would at least check out. “We’re always listening, always looking,” Spring said. “If others are closing stores, in a lot of the cases, it’s where they shouldn’t have operated in the first place.”
The growth of Bloomingdale’s has been “sustained and organic,” fueled by consumers responding to newness, better assortments and special events, Spring said. Bloomingdale’s and Macy’s have been able to accelerate the growth of their luxury and designer businesses in part due to the disruptions at Saks Global, which emerged from a six-month bankruptcy in June as Exemplar Luxury Group.
“We sold some World Cup product, which was a benefit, and we saw some benefit from tourism in the second quarter, but that was not significant,” Spring said. “Tourism is still depressed from what it was before the pandemic. I look at that as a continued opportunity.”
Tax refunds to U.S. consumers helped the company navigate, in some cases, higher prices, Spring said.
“Despite customer sentiment being negative, which reflects politics more, consumers remain resilient and very interested in fashion and newness,” he said.
Last Tuesday, the Macy’s brand created some excitement and newness by launching its American designer campaign featuring Tommy Hilfiger, Donna Karan, Michael Kors and emerging designers Jonathan Cohen, Lapointe and Theophilio — each presenting a limited-edition designer fashion collection available only at Macy’s.
During a conference call with industry analysts, Spring pointed to several brands that were recently introduced or expanded to more doors. “Bloomingdale’s continues to deepen brand partnerships expanding the breadth of our offerings during the second quarter. We introduced several new brands, including Ulla Johnson, Proenza Schouler and Dries Van Noten. We also expanded distribution of James Perse, Chanel fine jewelry and watches, and Christian Louboutin and Prada shoes.”
At Macy’s, the Gen Z Italian beauty brand Kiko Milano launched exclusively, Happy Camp3r’s junior apparel line was introduced, and Reis, Rod & Gun, and Boss expanded to more doors.
Category-wise, Spring said: “We continue to see outperformance in watches, dresses, boutiques, career sportswear, kids, handbags, fragrances and men’s and women’s shoes. We experienced softer trends in plus sizes, intimates and women’s sleepwear. We did see improvement for our big-ticket category compared to the prior quarter, but it remains soft versus the prior year.”
Macy’s Inc. said it was taking a “balanced approach” toward doling out the tariff paybacks. “Approximately $20 million of proceeds will flow to full-year earnings per share,” the company said. “The remaining refunds of $96 million are being invested in 2026 to deliver for our customer, further the Bold New Chapter strategy and support long-term growth.”
The Bold New Chapter strategy, introduced in February 2024, involves closing about 150 underperforming Macy’s department stores through the duration of the strategy, while accelerating growth in the luxury sector, rolling out Bloomies stores, opening additional Bluemercury locations and simplifying and modernizing operations. Approximately 85 Macy’s doors have closed, with the remaining 65 or so planned to all be closed by the end of fiscal year 2028. As of Aug. 1, there are 408 full-sized Macy’s department stores, 20 smaller format Macy stores, and four Macy’s Backstage off-price stores.
With the Bold New Strategy coming to a close at the end of the year, Spring told WWD that the next iteration would be discussed during the company’s 2026 fourth-quarter conference call, scheduled for March.
With its momentum this year, the company raised its outlook for 2026. Net sales are now seen reaching about $21.68 billion to $21.83 billion, up from the previous guidance of $21.5 billion to $21.75 billion. Comparable sales are now seen rising 1 percent to 1.5 percent, up from the previous projection of 0.5 percent to 1.2 percent.
Adjusted diluted earnings per share are now seen reaching $2.15 to $2.35, up from the previous guidance of $2 to $2.20.
EMarketer vice president Suzy Davidkhanian said in a note on Thursday: “The namesake banner remains a work in progress, but five consecutive quarters of comp growth show Macy’s is building momentum beyond the strength of Bloomingdale’s and Bluemercury.”