Macy’s Inc., exceeded its own expectations on sales during the third quarter, boosting optimism for the holiday season and prompting the retailer to raise its 2025 guidance.
Net income was $11 million, and adjusted net income was $26 million for the third quarter ended Nov. 1 That compares to net income of $28 million and adjusted net income of $11 million in the year-ago quarter.
Adjusted earnings before interest, taxes, and depreciation and amortization (EBITDA) increased to $285 million, and core adjusted EBITDA was $273 million. That compares to adjusted EBITDA of $273 million, and core adjusted EBITDA of $207 million in the year-ago quarter. (Core adjusted EBITDA excludes additional items not considered central, or ‘core’ to the business.)
Macy’s Inc. generated Q3 net sales of $4.71 billion, compared to $4.74 billion in the year-ago period, though the company indicated that the most recent sales figure exceeded its expectations and included store closings.
Comparable sales – including owned, licensed and marketplace sales – rose 3.2 percent and also surpassed the company’s expectation. Comp sales are considered a better measure of the company’s performance.
By division, net sales at Macy’s, inclusive of store closures, were down 2.3 percent. Comparable sales were up 2 percent.
Macy’s “Reimagine” 125 stores, which are those receiving significant investments for increased staffing in high-traffic areas such as women’s shoes and fitting room areas, fresher products and improved visuals, achieved comparable sales growth of 2.7 percent. They continue to outperform the overall Macy’s store chain.
Bloomingdale’s comparable sales were up 9 percent, marking the upscale department store’s biggest gain in 13 quarters. Bluemercury reported a 1.1 percent gain in comparable sales.
“Our third quarter sales were the strongest in 13 quarters, reflecting the acceleration of our Bold New Chapter strategy and demonstrating that the meaningful enterprise-wide changes we’ve made are resonating with customers,” Tony Spring, chairman and chief executive officer, said in a statement Wednesday morning. “As we enter the holiday season, we are well-positioned with compelling new merchandise and an omnichannel customer experience that delivers both inspiration and value. With a strategy rooted in hospitality, our teams are focused on driving long-term, profitable growth.”
Tony Spring
Masato Onoda/WWD
Macy’s Bold New Chapter is a three-year strategy that was introduced in February 2024. It centers around closing about 150 Macy’s department stores, accelerating growth in the luxury sector and in online sales, expanding the brick and mortar footprints of Bloomies, which are smaller, more specialized versions of the full-line Bloomingdale’s department stores, and Bluemercury, and monetizing assets, such as certain real estate holdings.
The company on Wednesday raised its guidance on sales for 2025 and adjusted diluted EPS guidance. Sales are now seen reaching $21.47 billion to $21.63 billion, up from the previous forecast of $21.15 billion to $21.45 billion. Comparable sales are now forecast to be flat to up about 0.5 percent, while the previous forecast called for comp sales to be down 1.5 percent to about flat.
Adjusted diluted earnings per share are seen at $2 to $2.20, up from previous guidance of $1.70 to $2.05. The revised guidance takes into consideration the consumer is more choiceful in the fourth quarter of 2025, assumes that current tariffs remain in place and provides flexibility to respond to changes in consumer demand and the competitive landscape.
Among other Q3 results issued by Macy’s:
- Merchandise inventories increased 0.7 percent year-over-year, in-line with expectations, reflecting tariff-related cost
increases. - The company ended the third quarter with cash and cash equivalents of $447 million and had $2 billion of available borrowing capacity under its asset-based credit facility.
- As of the end of the third quarter this year, total debt was $2.4 billion. The company indicated that it has no material long-term debt maturities until 2030.
- The company returned about $99 million to shareholders, consisting of $49 million in quarterly cash dividends and $50 million in share repurchases.
