Macy’s (M) Q4 2024 earnings

Macy’s delivered another quarter of mixed results on Thursday as investors wait and see how quickly CEO Tony Spring can pull off a turnaround of the business with yet another activist investor looking to take the chain private.

Across the business, which includes the Macy’s banner, Bloomingdale’s and Blue Mercury, comparable sales during the all-important holiday quarter were down 1.1%. But comparable sales across its owned and licensed businesses, plus its online marketplace, were up 0.2%, which is the highest the metric has been since the first quarter of 2022. 

Plus, the so-called First 50 locations – the stores that Macy’s is devoting more resources to as part of its turnaround plan – saw comparable sales up 0.8%, marking the fourth quarter in a row the metric has been positive.

The two bright spots in an otherwise worse-than-expected set of results suggest Macy’s turnaround is showing some signs of life – it just might not be working fast enough.

For fiscal 2025, Macy’s is expecting adjusted earnings per share of $2.05 to $2.25 and sales of between $21 billion and $21.4 billion, lower than Wall Street expectations of $2.31 per share and $21.8 billion, according to LSEG.

Macy’s shares fell slightly in early trading.

Here’s how the department store performed during its fiscal fourth quarter, compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

• Earnings per share: $1.80 adjusted vs. $1.53 expected
• Revenue: $7.77 billion vs. $7.87 billion expected

The company’s reported net income for the three-month period that ended Feb. 1 was $342 million, or $1.21 per share, compared with a loss of $128 million, or a loss of 47 cents per share, a year earlier. Excluding one-time items including impairments and settlement and restructuring charges, Macy’s reported earnings of $507 million, or $1.80 per share. 

Sales dropped to $7.77 billion, down about 4% from $8.12 billion a year earlier. Like other retailers, Macy’s benefited from an extra selling week in the year-ago period, which has skewed comparisons. 

For the current quarter, Macy’s is expecting adjusted earnings per share of between 12 cents and 15 cents and sales of between $4.4 billion and $4.5 billion, far below estimates of 28 cents and $4.71 billion, according to LSEG.

On a call with analysts, chief operating officer and chief financial officer Adrian Mitchell said the company is taking a “prudent” approach to guidance given the fluid nature of the turnaround plan, cautious consumer spending and uncertainties created by recent tariff increases between the U.S. and major trade partners.

“If we weren’t in the environment that were operating in, I would be even more bullish on our potential,” CEO Spring said during a call with analysts. “But I think prudency is important at this point in time.”