What: Following underwhelming holiday sales, Macy's adjusts its current quarter revenue forecast to the lower end of its $7.8-8 billion range, though bright spots emerge in Bloomingdale's, Bluemercury, and pilot store performance.

Why it is important: This mixed performance highlights the challenges traditional department stores face in executing transformation strategies while maintaining growth, particularly as they balance store optimisation with changing consumer behaviours.

Macy's has trimmed its sales outlook for the current quarter after holiday season results fell short of expectations, with comparable sales remaining flat through early January. Despite previous optimism about engaged but cautious holiday shoppers, the company now forecasts sales at or slightly below its projected $7.8-8 billion range. CEO Tony Spring's strategic focus on store optimisation continues to show promise, with the First 50 pilot locations and higher-end brands Bloomingdale's and Bluemercury maintaining positive comparable sales. The company plans to expand this successful initiative to an additional 75 Macy's locations, focusing on enhanced staffing levels and optimised product assortments in categories like shoes and handbags.

IADS Notes: Macy's holiday performance reflects broader transformation challenges. While the company's First 50 pilot stores show promise, flat comparable sales and lowered forecasts suggest a more challenging path ahead. The expansion of this initiative to 75 additional locations comes amid ongoing pressure from activist investors and recent accounting investigations, highlighting the complex balance between transformation and operational stability.

Macy’s trims sales outlook after holidays didn’t deliver