Macy's slides on weak 2025 earnings forecast; Q4 profit tops estimates

March 06, 2025 11:55 PM AEDT | By Investing

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Macy's slides on weak 2025 earnings forecast; Q4 profit tops estimates

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Investing.com -- Macy's (NYSE:M) reported mixed results for its fourth quarter of fiscal 2024 and missed analyst expectations for annual earnings guidance, sending its shares about 1% lower in the Thursday premarket trade.

For Q4 2024, the department store operator reported earnings per share (EPS) of $1.80, trumping analyst estimates of $1.54. Revenue for the period totaled $7.77 billion, roughly in line with the expected $7.78 billion.

Comparable sales on an owned basis declined 1.1% year over year, improving from a 5.4% drop the previous year but missing the estimate of a 0.09% decline. Owned-plus-licensed-plus-marketplace comparable sales rose 0.2%.

Macy's reported a gross margin of 35.7%, down from 37.5% a year ago but just ahead of the 35.6% forecast.

“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 CEO of Macy’s.

“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.”

For fiscal 2026, Macy’s expects EPS between $2.05 and $2.25, below the consensus estimate of $2.32. Full-year revenue is projected between $21 billion and $21.4 billion, compared to the consensus of $21.3 billion.

The company's comparable owned-plus-licensed-plus-marketplace sales are projected to decline between 2.0% and 0.5% versus 2024. The go-forward business comparable owned-plus-licensed-plus-marketplace sales are expected to be down about 2.0% to flat compared to the prior year.

Adjusted EBITDA as a percentage of total revenue is forecasted to range between 8.4% and 8.6%.

During 2024, Macy’s removed 64 non-go-forward locations, contributing to asset sale gains of $144 million, which were $83 million higher than the previous year.

The company ended the year with $1.3 billion in cash on its balance sheet, an increase of $272 million from the prior year.

This article first appeared in Investing.com

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