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Shares of Macy’s Inc. (NYSE: M ) rose more than 1% on Tuesday. The stock has fallen 11% over the past three months. The retailer is set to report its fourth-quarter 2022 results on Thursday, March 2, before the market opens. Here’s what to expect from the earnings report:
results
Macy’s has guided for net sales of $8.16-8.40 billion for the fourth quarter of 2022. Analysts project revenue of $8.25 billion. This compares to net sales of $8.6 billion reported in the fourth quarter of 2021 and $5.2 billion reported in the third quarter of 2022.
earnings
For Q4 2022, Macy’s expects adjusted EPS between $1.47-1.67. The consensus estimate is $1.57. The company reported adjusted EPS of $2.45 in Q4 2021 and $0.52 in Q3 2022.
Points to note
In Q3 2022, Macy’s net sales were down 3.9% year over year, but up 3.1% compared to the same period in 2019. As customers continue to return to stores, they are moving more toward event-based categories like dresses and bags than casual categories. wear and soft houses are popular during the pandemic.
In Q3, Macy’s owned plus licensed comparable sales declined 2.7% but luxury nameplates Bloomingdale’s and Bluemercury posted comp sales growth of only 4% and 14%. The company sees significant long-term growth opportunities for both nameplates.
Macy’s investment in digital and omnichannel capabilities may be paying off. The company has launched private offers and loyalty programs as well as offering a mix of private label and branded products. However, promotions and higher markdowns to push the slow-moving category have weighed on margins. The company expects gross margin in Q4 2022 to be no more than 270 basis points lower than Q4 2021.
Through a competitive holiday season and inflationary environment, Macy’s saw Black Friday/Cyber Monday sales in line with expectations, with the week ahead and after Christmas performing better than anticipated. However, the non-peak holiday week remains quieter than expected.
The company saw strength in its eventwear and gift-giving businesses during the holidays and luxury brands Bloomingdale’s and Bluemercury continued to outperform throughout the season.
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