Business

Macy's Raises Annual Forecasts as Luxury Focus Draws Affluent Shoppers
By Reuters | 03 Jun, 2026

Strong demand for high-end apparel and accessories, particularly at its Bloomingdale's stores, underscored the growing K-shaped structure to the US economy.

Macy's raised its annual forecasts and posted its first quarterly sales growth in nearly four years on Wednesday, driven by strong demand for high-end apparel and accessories, particularly at its Bloomingdale's stores.

The results from the department-store operator underlined the K-shaped recovery in U.S. consumer spending, with higher-income shoppers continuing to splurge on discretionary and luxury goods while lower-income households pull back amid rising economic uncertainty.

"The Macy's Inc customer, who is predominantly middle to upper income, remained resilient in the first quarter," CEO Tony Spring said in a call with analysts.

Under Spring, the company has pushed ahead with its "Bold New Chapter" turnaround launched in 2024, focusing on higher-end labels, growing full-price sales, reinvesting in stronger locations and closing weaker stores.

"When the product and the experience are differentiated and compelling, engagement and spend increase," Spring added.

Shares of the company were up about 2% in early trading.

At Bloomingdale's, comparable sales jumped 10.2% in the three months ended May 2, while they rose 6.4% at Bluemercury. Comparable sales at Macy's namesake stores ticked up 1.6%.

"The company's investments are having a positive impact. The luxury part of Macy's business continues to perform well," Morningstar analyst David Swartz said.

Quarterly sales rose 1.8% to $4.68 billion, ending 15 straight quarters of declines and beating analysts' estimate of $4.61 billion, according to data compiled by LSEG.

On an adjusted basis, Macy's posted earnings per share of 13 cents, beating estimates of 3 cents.

Macy's now expects fiscal 2026 net sales of $21.50 billion to $21.75 billion, compared with its prior forecast of $21.40 billion to $21.65 billion.

It estimated annual adjusted per-share profit of $2.00 to $2.20, compared with its earlier forecast of $1.90 to $2.10.

Macy's said its forecast accounts for the strong first-quarter results, as well as a modest increase in sales for the rest of the year, while "recognizing macroeconomic and ongoing geopolitical uncertainty."

The company, which relies on manufacturing in China, said the forecast excludes any potential tariff refunds. It expects the annual impact of higher fuel costs of as much as 220 basis points to be largely offset by lower import tariffs in the second half of the year.

(Reporting by Neil J Kanatt in Bengaluru; Editing by Sriraj Kalluvila)