Macy's, Inc. has recently released its 10-Q report, providing a detailed snapshot of its financial performance. Macy's, Inc. is an omni-channel retail organization that operates stores, websites, and mobile applications in the United States, selling a variety of merchandise under the Macy's, Bloomingdale's, and bluemercury brands. The company was founded in 1830 and is based in New York, New York.
In the third quarter of 2024, Macy's continued to make progress on its three-year Bold New Chapter strategy. This included rationalizing its store base, launching First 50 locations, revitalizing its assortment, rolling out additional small format stores, growing its digital presence, and accelerating luxury growth. The company also focused on simplifying and modernizing its operations.
In terms of financial performance, Macy's reported a decrease in net sales of $118 million, or 2.4%, compared to the third quarter of 2023. The decrease was primarily attributed to weakness in non-First 50 locations, digital channels, and cold weather categories. Additionally, the company experienced a decrease in credit card revenues, offset by growth in the Macy's Media Network.
The cost of sales decreased by $41 million, or 1.4%, in the third quarter of 2024 compared to the same period in 2023. Gross margin and merchandise margin rates also decreased by 60 basis points and 70 basis points, respectively, primarily due to the change in inventory valuation method and product mix.
Selling, general, and administrative expenses (SG&A) increased by $24 million, or 1.2%, in the third quarter of 2024 compared to the same period in 2023. This increase was attributed to strategic customer-facing investments, partially offset by cost controls.
The company's operating income for the third quarter of 2024 was $64 million, down from $83 million in the third quarter of 2023. Diluted earnings per share also decreased from $0.15 to $0.10.
For the 39 weeks ended November 2, 2024, Macy's reported a decrease in net sales of $447 million, or 3.0%, compared to the same period in 2023. The decrease was attributed to ongoing macroeconomic conditions, although the company experienced strong performance in its First 50 locations.
Macy's also provided supplemental financial measures, including adjusted diluted earnings per share, EBITDA, and adjusted EBITDA, to offer a comprehensive view of its financial performance.
As a result of these announcements, the company's shares have moved 2.2% on the market, and are now trading at a price of $16.44. For the full picture, make sure to review Macy's's 10-Q report.
