Macy's NYSE: M reported a stronger-than-expected first quarter of fiscal 2026, with executives saying the retailer’s “A Bold New Chapter” turnaround strategy is gaining traction across its Macy’s, Bloomingdale’s and Bluemercury banners.
Chairman and CEO Tony Spring said the company delivered “enterprise-wide growth” and its best comparable sales performance in four years, with all nameplates and channels positive. Macy’s Inc. net sales, comparable sales, adjusted EBITDA and adjusted diluted earnings per share all exceeded the company’s prior guidance.
“Our customer-led focus is resonating and driving tangible results,” Spring said, adding that the company has now posted five consecutive quarters of better-than-expected top- and bottom-line results and four consecutive quarters of comparable sales growth.
Sales Beat Expectations Across Nameplates
For the quarter, Macy’s Inc. net sales rose 1.8% to $4.7 billion, above guidance of $4.575 billion to $4.625 billion, COO and CFO Tom Edwards said. Excluding roughly $40 million of impact from 14 non-go-forward store closures at the end of last year, net sales increased 2.7%.
Comparable sales rose 3% on a reported basis, compared with guidance of 0.5% to 1.5%. Go-forward comparable sales increased 3.1%.
- Macy’s nameplate comparable sales rose 1.6%.
- Reimagined Macy’s locations posted 2.4% comparable sales growth.
- Bloomingdale’s comparable sales increased 10.2%.
- Bluemercury comparable sales rose 6.4%.
Spring said Macy’s nameplate delivered its fourth consecutive quarter of positive comparable sales, led by the company’s reimagined store base. During the quarter, Macy’s expanded learnings from its reimagined strategy to an additional 75 locations, bringing the total to 200. Those stores represent nearly 60% of the company’s go-forward Macy’s store base and about 75% of fiscal 2025 go-forward Macy’s store sales.
Spring said the reimagined stores have posted positive comparable sales in eight of the last nine quarters and continue to generate higher Net Promoter Scores than the broader Macy’s store base.
Bloomingdale’s Posts Record First-Quarter Sales
Bloomingdale’s was a standout in the quarter, with Spring saying the luxury banner achieved its highest first-quarter sales volume in its 154-year history. He said the banner’s strength was broad-based across channels and supported by new brands, personalized service, events and customer engagement initiatives.
Outperforming categories at Bloomingdale’s included ready-to-wear, men’s apparel, fine jewelry, shoes and tabletop. The company also added luxury brands including Chloé ready-to-wear, Isabel Marant, Phoebe Philo, Prps Denim, Heirloom and Khaite shoes.
At Bluemercury, comparable sales accelerated to 6.4%, driven by makeup, dermatological skincare and fragrances, including BYREDO and Parfums de Marly, as well as Dr. Diamond’s Metacine and SkinCeuticals. Spring said new and remodeled Bluemercury stores continued to outperform.
Margins, Cash Flow and Shareholder Returns
Total revenue rose 2.1% to $4.9 billion. Other revenue, which includes credit card revenue and Macy’s Media Network, increased 8% to $210 million. Credit card revenue rose 12% to $172 million, reflecting what Edwards called a healthy credit portfolio and lower net credit card losses. Macy’s Media Network revenue declined 5% to $38 million, which Edwards attributed to the timing of advertising spend.
Gross margin was 38.9% of net sales, compared with 39.2% a year earlier. Edwards said gross margin would have been flat with last year excluding an approximately 30-basis-point tariff impact. Selling, general and administrative expense as a percentage of revenue was flat with last year at 39.9% and better than the company expected.
Adjusted EBITDA was $290 million, or 5.9% of total revenue, above guidance of 4.9% to 5.1%. Adjusted diluted earnings per share were $0.13, exceeding the company’s prior guidance range of a loss of $0.01 to earnings of $0.01. Edwards said results included a roughly $0.04 tariff impact.
The company generated operating cash flow of $292 million, compared with an outflow of $64 million last year. Free cash flow was $140 million, versus an outflow of $203 million a year earlier. Macy’s ended the quarter with $1.3 billion in cash, compared with $932 million last year.
Macy’s returned $100 million to shareholders during the quarter through $50 million of dividends and $50 million of share repurchases. Edwards said approximately $1.1 billion remained under the company’s buyback authorization.
Company Raises Full-Year Outlook
Macy’s raised its full-year outlook to reflect better-than-expected first-quarter results and a modest increase in sales expectations for the remaining quarters. Edwards said the guidance also incorporates updated tariff and fuel assumptions, with lower tariffs offset by higher expected fuel and transportation costs. He said any potential tariff refunds are not included in the outlook because timing and amounts remain uncertain.
For the second quarter, Macy’s expects net sales of $4.75 billion to $4.8 billion and comparable sales ranging from approximately flat to up 1%. Adjusted EBITDA is expected to be 6.9% to 7.2% of total revenue, with adjusted diluted EPS of $0.29 to $0.34.
For the full year, Macy’s now expects net sales of $21.5 billion to $21.75 billion and comparable sales growth of 0.5% to 1.2%. The company expects adjusted diluted EPS of $2.00 to $2.20, including an estimated $0.10 to $0.20 combined impact from tariffs and fuel costs.
Executives Highlight AI, Events and Consumer Trends
During the call, Spring said Macy’s customers, who are predominantly middle- to upper-income, remained resilient in the first quarter. He said engagement and spending improved when products and experiences were differentiated and compelling.
Spring highlighted several merchandising and experiential initiatives, including the introduction of Ask Macy’s, an AI-powered conversational shopping assistant. He said early customer response has been favorable and that users engaging with the tool are showing higher conversion rates. Edwards said Macy’s has about 35 AI tests and pilots underway across customer-facing tools, associate support and supply chain operations.
In response to analyst questions, Spring said Macy’s has seen continued average unit retail growth, consistent traffic and higher basket size. He said the company is balancing higher price points with a broad “best, better, good” assortment architecture. He also said the promotional environment remains “very comparable” to the past several years.
Executives pointed to upcoming events, including the 50th anniversary of Macy’s Fourth of July Fireworks and the 100th Macy’s Thanksgiving Day Parade, as opportunities to drive customer engagement. The company also plans World Cup-related activations and partnerships with Live Nation and Major League Baseball.
“We have a clear strategy in place and the discipline and financial strength to execute,” Edwards said. Spring added that while more work remains, the company’s strategy is “delivering results.”
About Macy's NYSE: M
Macy's, Inc is a leading American omnichannel retailer operating under the Macy's brand, as well as specialty divisions Bloomingdale's and Bluemercury. The company's retail portfolio encompasses full-line department stores, fashion-focused specialty outlets and a high-end beauty chain, offering consumers a wide array of apparel, footwear, accessories, cosmetics and home furnishings. Through its integrated network of physical stores and digital platforms, Macy's seeks to deliver a seamless shopping experience that blends in-store service with online convenience.
The company's product assortment spans men's, women's and children's clothing, beauty and personal care products, housewares and home décor.
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