What: US department store reports better-than-expected quarter with digital sales headed to USD 10 billion

Why is it important: Macy's made money for the first time in the pandemic

Signs of a recovery are beginning to emerge. Last Macy’s report issued in November 2020 was already announcing better-than-expected quarter results thanks to a massive shift to online shopping.

On 23 February, Macy's said that it turned a profit for the first time in the pandemic, making USD 160 million during the 13 weeks ending on January 30, down from USD 340 million during the same stretch a year ago.

But Macy's is still struggling. Net sales dropped to USD 6.8 billion from USD 8.3 billion during the same quarter last year. Sales also fell to USD 17.3 billion in the year that ended on 30 January, posting a net loss of USD 3.9 billion.

Neil Saunders, managing director at GlobalData Retail, said in a note to clients that the results were a "marked improvement" and show that Macy's is "slowly climbing its way out of the depths."

Macy's believes this coming year will be better than the last one. It expects "continued pandemic-related challenges in the spring season," but with "momentum building" in the second half of the year. The company, in particular, is betting on strong growth online in the coming years. "We anticipate annual digital sales to reach USD 10 billion within the next three years, and that digital will become an even more profitable contributor to our business," CEO Jeff Gennette said.

Macy's made money for the first time in the pandemic 

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