- The retailer announced that there will be only 350 Macy’s stores by 2026
- Macy’s focuses on luxury and opens Bloomingdale’s and Bluemercury stores
- Fourth-quarter revenue fell to $8.12 billion, down 2 percent from a year ago
Macy’s will close 150 stores over the next three years, the department store said Tuesday, after a fourth-quarter loss and declining sales.
The struggling retailer, which has been in business for more than a century and a half, said it would close 50 U.S. locations by the end of this year.
By 2026, there will be only 350 Macy’s stores, the company said.
In addition, Macy’s announced it would focus on its Bloomingdale’s and Bluemercury luxury stores and open more, smaller versions of these locations.
It said it would open 15 of its higher-end Bloomingdale’s stores and 30 of its high-end Bluemercury cosmetics stores in the coming years.
Macy’s will close 150 stores over the next three years, the department store announced on Tuesday
The company’s fourth-quarter revenue fell to $8.12 billion, down nearly 2 percent from a year ago.
Macy’s suffered a quarterly loss of $71 million, or 26 cents per share, it announced.
The company’s growth plan seeks to capitalize on a shift in shopping behavior in the U.S. as department stores continue to face competition from online rivals.
Macy’s stock price has fallen 75 percent from a peak of $73 per share in 2015, amid the rise of e-commerce giants like Amazon and the success of budget retailers.
“We are taking the necessary steps to reinvigorate relationships with our customers through enhanced shopping experiences, relevant assortments and compelling value,” new CEO Tony Spring, who succeeded Jeff Gennette earlier this month, said in a statement.
By expanding its higher-end offerings, Macy’s is trying to appeal to wealthier shoppers, who have proven resilient and willing to shop despite rising inflation.
“Bloomingdale’s expansion may work because there are several strong luxury markets where the chain is not represented,” Neil Saunders, an analyst at GlobalData Retail, said in a note to clients.
Meanwhile, Macy’s is also cutting jobs to reduce costs.
Today’s announcement comes weeks after the company announced five store closures and more than 2,300 layoffs last month.
Job losses will affect approximately 3.5 percent of the total workforce and 13 percent of corporate employees.
In October last year, the retailer also said it would open 30 smaller versions of its namesake stores in shopping centers across the country over the next two years, focusing more on its ‘small’ stores outside city centres.
It marks a change in direction for the company known for its huge locations, often in urban shopping centers.
“We believe that reducing Macy’s store base to a more manageable (and profitable) size is prudent given the overall structural shift toward online spending and the shift away from department stores,” said Dana Telsey, a retail analyst, in a note note to customers. .
This is a breaking news story. Updates are coming.