Macy's (M) Misses Q2 EPS by 6c, Comments on H2 Outlook

Macy's (NYSE: M) reported Q2 EPS of $0.80, $0.06 worse than the analyst estimate of $0.86. Revenue for the quarter came in at $6.27 billion versus the consensus estimate of $6.3 billion. Comps increased 3.4%.

Looking Ahead

Expectations for the second half of 2014 remain on track, with guidance for comparable store growth of 2 percent to 3 percent. However, even with an improved sales trend in the second quarter, the company was unable to make up its sales shortfall from the first quarter. This calculates to expectations for a full-year 2014 comparable sales increase of 1.5 percent to 2 percent. Full-year 2014 comparable sales together with comparable sales of departments licensed to third parties now are expected to increase by 2 percent to 2.5 percent. Previous guidance was for full-year comparable sales to increase by 2.5 percent to 3 percent. The company continues to expect full-year 2014 earnings per diluted share in the range of $4.40 to $4.50, consistent with guidance previously provided.

Our sales trend improved at both Macy’s and Bloomingdale’s in the second quarter, reflecting a rebound in shopping activity once weather patterns normalized. We also benefitted from a shift in a major Macy’s promotional event into the first two days of the quarter. Advancements in our M.O.M. strategies – My Macy’s localization, Omnichannel integration and Magic Selling customer engagement – continued to drive sales growth across the country. We also are very pleased by customer response to improvements at our Macy’s Herald Square flagship in New York, where we are mid-way through the third year of an unprecedented remodel project,” said Terry J. Lundgren, Macy’s, Inc. chairman and chief executive officer.

“We are approaching the second half of 2014 with confident optimism in our business strategies, merchandise assortments and marketing plans, tempered with the reality that many customers still are not feeling comfortable about spending more in an uncertain economic environment,” Lundgren said. “Thus, we remain focused on outperforming our competitors through innovation in omnichannel, which has added new dimensions in how consumers can shop us and how our company can satisfy customer demand. This includes a robust Buy Online Pickup in Store process, which has been rolled out to all full-line Macy’s stores nationwide so that it is fully available this fall and into the holiday shopping season. Moreover, our Millennial strategies have sharpened our merchandising and marketing to customers in the age range of 13 to 30. This has created new positive energy as our customers begin back-to-school shopping.”

For earnings history and earnings-related data on Macy's (M) click here.

You May Also Be Interested In

• American Express (AXP) down despite beating Q1 estimates on top and bottom lines
• Vail Resorts (MTN) Reports Certain Ski Season Metrics for the Season-to-Date Period Ended April 14
• Acme United (ACU) Misses Q1 EPS by 20c