Macy’s noted that Nike will return to its stores starting in October this year.
Macy’s Inc (NYSE: M), an American conglomerate holding company specializing in consumer goods, released its first quarter results on June 1. According to the announcement, Macy’s reported net sales of $4.98 billion in the first three months of the year. (Q1 2023), representing a decline of approximately 7% on an annual basis. However, analysts polled by REFINITIV expected the company to report revenue of around $5.04 billion in the first quarter.
Notably, the company noted that first-quarter net income was $155 million, or 56 cents per share, compared to $286 million or 98 cents per share a year ago. As a result, M shares continued with this year’s bearish outlook in Thursday’s pre-market to trade around $13.09, down around 4%.
According to the latest stock market data, M shares have fallen about 40% in the past three months, after falling 42% last year.
Macy’s Q1 2023 Financial Highlights
The $3.83 billion-valued company declared its regular quarterly dividend of 16.54 cents per share on common stock, which is payable July 3, 2023, to shareholders, snapshot taken June 15, 2023. This is after reporting its merchandise inventory for the first quarter was $4.607 billion. However, the company noted that the remaining part of the year will be weaker than expected.
“The company is taking a cautious approach for the remainder of the year and lowering its 2023 full-year sales and earnings guidance to reflect anticipated macroeconomic impacts on the consumer,” Macy’s said. noted.
Nevertheless, the company’s CEO, Jeff Gennette, noted that the first quarter exceeded expectations for the gross margin rate which stood at 40.0%, compared to 39.6% in the first quarter of 2022.
Regarding the Bluemercury segment, Macy’s noted that comparable sales increased 4.3% on an owned basis. Thus, approximately 676,000 active customers purchased the Bluemercury brand, on a twelve-month basis. The company noted that the Bloomingdale’s brand had 4.1 million active customers over a twelve-month period. Nonetheless, Bloomingdale’s comparable sales fell about 3.9% on an owned basis.
“During the first quarter, we achieved solid growth in our gross margin rate and our earnings expectations thanks to our disciplined teams, the strength of our inventory management and operational efficiency. We have planned the year on the assumption that consumer economic health would be tested, but beginning in late March, demand trends weakened further in our discretionary categories,” Gennette noted.
Ahead, the company promised customers that Nike would return to its stores from October. As a result, Macy’s expects sales to peak with the start of the holiday season in the second half.
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