Macy’s (M) Earnings for the Fourth Quarter of 2022

People wait in line to enter a Macy’s department store during Black Friday in New York City on November 25, 2022.

Yuki Iwamura | AFP | Getty Images

Shares of Macy’s rose Thursday, as the company said it attracted holiday shoppers looking for gifts and kept the promotions in check.

But the department store operator, Which includes high-end Bloomingdale’s banner and Bloomercury beauty series, She said she’s still planning for a more volatile year ahead.

Macy’s said it expects net sales to decline in a range of 1% to 3% in the fiscal year compared to 2022, which could translate to between $23.7 billion to $24.2 billion. It said it expects its adjusted diluted earnings per share to range from $3.67 to $4.11.

In the quarter, CEO Jeff Gennett said the company was “competitive but measured in our promotions, took strategic downgrades, and didn’t purposefully chase unprofitable sales.”

He said Macy’s is focused on modernizing its own brands, opening more stores outside of malls, and growing its luxury businesses and online marketplaces.

Here’s what Macy’s did in the three-month period ended January 28 compared to what analysts were expecting, based on Refinitiv estimates:

  • Earnings per share: $1.71 vs. $1.57 expected
  • Revenue: $8.26 expected vs. $8.26 billion expected

Fourth-quarter net income fell to $508 million, or $1.83 per share, from $742 million, or $2.44 per share, a year earlier. The company reported adjusted earnings per share of $1.88. Excluding tax benefits in the quarter, adjusted earnings per share are $1.71.

Comparable sales on an owned plus license basis were down 2.7% over the year-ago period, but increased 3.3% compared to the fourth quarter in 2019.

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The company reported adjusted earnings per share of $1.88. Excluding tax benefits, it delivered adjusted earnings per share of $1.71, higher than the $1.57 that analysts had expected, according to Refinitiv.

Macy’s results indicate that sales patterns rebounded in the final weeks of the quarter. In early January, the company shared early holiday numbers. At the time, it said it expected holiday sales to come in on the lighter side of forecasts. The company said it noticed customers watching their spending more carefully and buying fewer items for themselves while shopping for gifts in November and December.

During an interview with CNBC in January, Gennette said Macy’s has been keeping a close eye on the data from its credit cards and those co-branded with American Express. He said consumers are acquiring larger balances and carrying more of those balances from month to month rather than paying them all off — a possible sign of financial stress.

“When we look at our credit portfolio, you have a customer who is under more pressure,” he said at the time.

As of Wednesday’s close, Macy’s shares are down about 1% so far this year. Its stock tracks the S&P 500, which is up about 3% over the same period. Shares of the company closed at $20.43 on Wednesday, bringing Macy’s’ market capitalization to about $5.5 billion.

Read full Macy’s earnings release.

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