Macy’s Stock Flutters and Swings to Third-Quarter Earnings
New York Macy’s turned profit in the third quarter and sales rose 36% as shoppers began buying dresses, luggage and other merchandise that fell to the bottom of the shopping list last year when the pandemic broke out.
Macy’s Inc. joins. To a large number of other retailers reporting strong sales as they beat rising costs and faltering supply chains ahead of the holiday shopping season.
The supermarket chain earned $239 million, or 76 cents per share, for the three months ended October 30. Adjusted earnings were $1.23 per share, easily exceeding Wall Street’s forecast of 31 cents per share, according to a survey by FactSet.
The company lost $91 million last year during the same period.
Sales came in at $5.44 billion for the quarter, also exceeding analyst expectations.
Sales in stores that have been open for at least a year are up 35.6%, including for licensed businesses such as Cosmetics.
Online sales are up 19% compared to the same period last year, and are up 49% compared to the same quarter in 2019.
The company recorded strong sales of household goods, perfumes, jewelry, watches and nightwear. Categories such as dresses, men’s clothing, and luggage continue to recover.
The New York-based company added 4.4 million new customers to the Macy’s brand, a 28% increase from 2019.
Retailers like Macy’s are paying higher wages and extending benefits to their workers in a tight labor market. Earlier this month, the store said it would pay a minimum of $15 an hour to new and existing workers by May. It’s also partnering with an online education company to offer debt-free programs to workers, investing nearly $35 million over the next four years.
Macy’s was able to increase inventory by 19.4% compared to the third quarter of last year, as it successfully weathered shortages and slowing supplies as the US economy emerged from the downturn caused by the pandemic.
The company is working to narrow down and raise its guidance for the entire year of 2021. It now expects sales of $24.12 billion to $24.28 billion, up from a range of $23.55 billion to $23.9 billion. Adjusted earnings per share are now expected to be in the range of $4.57 to $4.76, up from $3.41 to $3.75.
Analysts expected $3.92 per share with sales of $23.78 billion, according to FactSet.
Shares are up more than 10% in pre-market trading Thursday.
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