Macy’s earnings top estimates, as retailer brings in new customers to its online business, raises outlook

Macy’s on Thursday reported fiscal second-quarter profit and revenue that topped analysts’ estimates, as customers returned to its stores to buy denim, luggage and new dresses.

The department store chain also hiked its outlook for 2021, heading into the back half of the year. Despite the ongoing uncertainty from the Covid pandemic, Macy’s said its turnaround strategy is working and drawing in new shoppers.

CEO Jeff Gennette said in a news release that momentum in the first quarter continued into the second quarter, as the retailer attracted more younger customers to shop its stores.

Here’s how the company did for its fiscal second quarter, compared with what Wall Street was anticipating, using a survey of analysts by Refinitiv:

• Earnings per share: $1.29 adjusted vs. 19 cents expected
• Revenue: $5.65 billion vs. $5.01 billion expected

Macy’s net income for the period ended July 31 grew to $345 million, or $1.08 per share, compared with a net loss of $431 million, or $1.39 per share, a year earlier. Excluding one-time adjustments, Macy’s earned $1.29 per share during the quarter. Analysts had been looking for 19 cents a share.

Net sales grew to $5.65 billion from $3.56 billion a year earlier. That beat estimates for $5.01 billion.

Macy’s raised its outlook for net sales in fiscal 2021 to be in a range of $23.55 billion to $23.95 billion, up from a prior range of $21.73 billion to $22.23 billion.

It expects full-year adjusted earnings to be in a range of $3.41 to $3.75 per share, up from previous guidance of $1.71 to $2.12 a share.

The department store chain has reinstated its regular quarterly dividend of 15 cents per share of common stock, payable Oct. 1. Macy’s board of directors also authorized a $500 million share repurchase program.

As of Wednesday’s market close, Macy’s shares are up more than 60% year to date, putting its market value at $5.64 billion.

Find the full earnings press release from Macy’s here.

This story is developing. Please check back for updates.