CEO Tony Spring raises the bar for store closures, while focusing on luxury expansion

  • Macy’s to close 150 underperforming stores in the next three years
  • 50 stores to close this year alone
  • Macy’s will open 15 Bloomingdale’s stores, 30 Bluemercury stores, and 30 small-format, off-mall stores
  • Q4 net sales decline of 1.7% year over year
  • Macy’s swung into a $71 million net loss
  • Macy’s sales decline likely closer to 8% factoring out the extra sales week in Q4
  • Expansion of Bloomingdale’s and Bluemercury as a bet on luxury
  • Even cash-positive stores will be closed if underperforming
  • Macy’s plans to open 30 more small-format stores in the next two years
  • Macy’s expects store-monetization proceeds of about $500 million to $650 million and asset sale gains of about $250 million to $350 million in the next three years

Macy’s announced its transformation plan, which includes the closure of 150 underperforming stores over the next three years. This year alone, 50 stores will be closed. In addition, Macy’s will open 15 Bloomingdale’s stores, 30 Bluemercury stores, and 30 small-format, off-mall stores. The company reported a decline in Q4 net sales and swung into a net loss. Despite better-than-expected margins, Macy’s experienced a significant decline in market share in its core categories. The company’s new strategy focuses on a core fleet of 350 stores, expansion of luxury brands, and a private-label refreshment. Even cash-positive stores will be closed if they are underperforming. Macy’s plans to open 30 more small-format stores in the next two years. The company expects store-monetization proceeds and asset sale gains in the next three years. Macy’s aims to provide a better shopping experience and increase private label brand volumes. However, some experts believe that Macy’s should further reduce its full-line stores and rethink its store model to excite consumers in higher-end specialty retail venues.

Factuality Level: 8
Factuality Justification: The article provides detailed information about Macy’s transformation plan, including store closures, new store openings, financial performance, and strategic decisions. The information is presented objectively without sensationalism or bias. The article includes quotes from analysts and industry experts to provide additional context and perspective.
Noise Level: 3
Noise Justification: The article provides a detailed analysis of Macy’s transformation plan, including store closures, sales performance, margin details, and strategic shifts. It includes insights from analysts and experts, as well as financial data to support the discussion. The article stays on topic and provides actionable insights for the retail industry.
Financial Relevance: Yes
Financial Markets Impacted: The closure of 150 underperforming Macy’s locations over the next three years may impact the company’s financial performance and potentially affect the retail industry.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article discusses Macy’s transformation plan, which includes the closure of underperforming stores and the opening of new locations. While this may have financial implications for Macy’s and the retail industry, there is no mention of any extreme events.

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