Messi (M) earnings for the fourth quarter of 2025

Messi On Wednesday, it beat Wall Street’s quarterly sales and profit forecasts as its namesake brand showed signs of progress, but still gave a cautious outlook for next year.

For the fiscal year, the company — whose namesake chain includes luxury department store Bloomingdale’s and cosmetics retailer Bluemercury — said it expects sales of between $21.4 billion and $21.65 billion and adjusted earnings per share of $1.90 to $2.10.

Both of these declines would represent a decline from the last fiscal year, when revenue totaled $21.8 billion and adjusted earnings per share were $2.15. Macy’s sales forecasts nearly matched or beat analysts’ expectations of $21.42 billion, but revised earnings guidance fell short of Wall Street’s forecast of $2.17 per share for the year, according to LSEG.

Macy’s said it expects comparable sales, an industry metric that takes into account short-term factors such as store openings and closings, to range from a 0.5% decline to a 0.5% increase.

In an interview with CNBC, CEO Tony Spring said Macy’s results show its strategy is working. All three of its brands grew in the fiscal year and holiday quarter. This marked the fourth straight quarter that Macy’s beat Wall Street sales guidance. For the first time in three years, Macy’s returned to positive growth, with comparable sales up 1.5% for the full year.

Even in recent weeks, Macy’s shoppers have shown “continued resilience” as they spend on new clothing and gravitate to newer brands and trendy items, he said.

However, he said Macy’s and other retailers have new unknowns that make it difficult to predict next year and have caused the company to take a “prudent” approach to its forecasts.

“Given the environment we operate in, it makes sense for us not to just put a hockey stick out there and just have a vision of what the rest of the year will unfold,” he said.

“Where will gas prices be in the rest of the year? How long will the conflict in the Middle East last? Will tariffs be refunded? Will other tariffs be strengthened or lifted? Will the consumer continue to remain resilient?” He said. “We’re not economical. The team is really focused on controlling what they can control.”

The company’s full-year guidance takes into account “macroeconomic and geopolitical factors that can impact discretionary spending,” according to a press release. She said that expectations expect greater damage from customs duties in the first half of the year compared to the second half, as the first quarter will have “the most significant impact.” It also includes the impact of investments the company is making in renovating its stores, as well as the impact of closing a smaller number of stores.

The company continued to include the Supreme Court’s tariff level in its full-year forecast, Spring said. He said it expects Macy’s tariff bill to be eased later this year because it will outweigh the impact of the tariffs a year ago.

If the company gets its money back or if the tariffs reach a lower level, “that would be beneficial” for Macy’s, he said.

Here’s how the department store operator performed during its fiscal fourth quarter, compared to what Wall Street was expecting, based on a survey of analysts conducted by LSEG:

• EPS: $1.67 was revised versus $1.53 expected
• profit: $7.64 billion versus $7.62 billion expected

Macy’s shares rose about 6% in premarket trading.

Messi’s net income for the three-month period ending January 31 rose to $507 million, or $1.84 per share, compared to $342 million, or $1.21 per share, in the same period last year. After adjusting for one-time items including impairment and restructuring costs, the retailer reported earnings per share of $1.67.

Sales fell from $7.77 billion in the same quarter last year.

Macy’s has been working for nearly two years on a three-year effort to bolster its struggling namesake brand, building on its better-performing, more luxury-focused chains Bloomingdale’s and Bluemercury and speed along the company’s supply chain and technology operations. This transformation strategy has been led by Spring, who took over the company’s top job about two years ago.

As part of its plan, Macy’s said it will close about 150, or more than a quarter, of its namesake stores by early 2027.

So far, Spring said Macy’s has closed just over 80 namesake stores and still plans to close approximately 150 stores. He declined to say how many new Bloomingdale’s and Bluemercury stores the company might open and where they will be located, but he said he sees a lot of opportunities to reach new markets.

Companywide, fourth-quarter comparable sales rose 1.8%. Including proprietary, licensed merchandise and third-party marketplace.

In the fourth quarter, comparable sales for Macy’s namesake logo rose 0.4%. When including only stores that Macy’s plans to keep open, comparable sales increased 0.6%. Bloomingdale’s comparable sales jumped 9.9%, and Bluemercury sales grew 1.3%.

Bloomingdale’s posted its best holiday season ever, which Spring attributed to the retailer’s lineup, strong store and digital experience and ability to attract shoppers across generations.

During the holiday season, Macy’s, Bloomingdale’s and Bluemercury attracted customers and less-frequent seasonal shoppers who rushed to purchase higher-priced brands and merchandise, including perfume, sunglasses and shoes, as they searched for gifts, Spring said.

Even since the gift-giving season ended, Macy’s has seen no change in consumer spending, Spring said.

“The mid- to high-end consumer, which represents the majority of our business, is resilient,” he said. “They buy new things, fashionable things, change the wardrobe, [they’re] “They are not interested in basics at the moment, and the lower income classes are clearly more selective.”

He said the store operator’s approach to carrying products across a wide range of prices was “one of the best antidotes” to an unpredictable economic backdrop.

The company, led by Spring, tried to address criticism that its Macy’s stores carried outdated merchandise, relied on too few employees, and had disorganized shelves and displays that drove shoppers to competitors.

While some of its namesake stores are closing, the company has pledged to invest in the approximately 350 Macy’s stores that will remain open. It has increased staff, added new brands, and sharpened its visual offerings in a growing number of locations.

The company began with testing in 50 stores and has now expanded to include more Macy’s namesake locations. At the 125 locations where it increased its investment, sales outperformed the rest of the Macy’s chain, with comparable sales growth of 0.9%.

The company has now added 75 more stores, bringing the total to 200 “reimagined” stores, Spring told CNBC. That represents about 60% of the Macy’s namesake locations it plans to keep open, he said.

Some of the biggest changes Macy’s has made at its namesake stores include hiring more employees who can help customers and allowing local leadership the flexibility to place those employees in parts of the store where they can make a bigger difference, Spring said.

“It’s always about the quality of the lineup, the quality of the people and the quality of the experience. I think we’ve tried to address those three things,” he said. “We added brands. We liberalized the brands. We made sure the shopping environment was more fun and less intense. [with] Better storytelling, and we’ve added people to the stores.”

The stronger store business has lifted digital sales, which account for a third of the brand’s total sales, he said.

Along with these changes, more Macy’s namesake stores now carry newer, trendier and often more expensive brands including Theory, Reiss, Good American and Rodd & Gunn. These have been well-received and Macy’s plans to add them to more locations, Spring said.

Macy’s shares closed Tuesday at $16.92, bringing the company’s market value to $4.5 billion. As of Tuesday’s close, the company’s stock had risen nearly 25% over the past year, outpacing the S&P 500’s gain of roughly 20% over the same period. However, Macy’s shares are down roughly 23% year to date.