Shares of the department store chain, Macy’s (NYSE: M) fell in pre-market trading at the time of writing on Thursday after the retailer’s disappointing outlook.
Macy’s lowered its FY23 outlook and now expects net sales to be in the range of $22.8 billion to $23.2 billion versus its prior outlook between $23.7 billion and $24.2 billion. Comparable sales are projected to be down by 7.5% to 6% year-over-year. Adjusted earnings are anticipated to be in the range of $2.70 to $3.20 per share as compared to its prior guidance between $3.67 and $4.11 per share.
Jeff Gennette, Chairman, and CEO commented, “We have moved quickly to take the appropriate actions to meet current consumer demand and manage our expenses. Our revised guidance reflects incremental clearance markdowns to address excess spring seasonal merchandise in the second quarter, along with adjustments to the category composition and inventory levels in the back half of the year.”
The retailer’s Q1 sales fell 7% year-over-year to $5 billion versus Street expectations of $5.01 billion.
The retailer reported Q1 adjusted earnings of $0.56 per share as compared to $1.08 per share in the same period last year, beating consensus expectations of $0.45 per share. Comparable sales were also down by 7.2% in Q1 on an owned-plus-licensed basis.
Macy’s declared a quarterly dividend of 16.54 cents per share payable on July 3 to shareholders of record as of the close of business on June 15, 2023.
Analysts are sidelined about Macy’s stock with a Hold consensus rating based on three Buys, four Holds, and three Sells.
