Wednesday, Macy’s Inc. released mixed second-quarter 2024 earnings and lowered the annual guidance.

The fashion retailer reported second-quarter sales of $4.94 billion, down 3.8% year over year, missing the consensus of $5.12 billion.

The company reported adjusted EPS of $0.53, up from $0.26 a year ago and beating the consensus of $0.29.

In an interview with CNBC, CEO Tony Spring said customers aren’t spending as freely across all of Macy’s brands — even higher-end department store Bloomingdale’s.

Also Read: Why Is Department Store Chain Macy’s Stock Getting Battered Today?

“We see that there is definitely a softness, a carefulness, a delay in the conversion of purchasing,” he said. “And people on the things that they want, the things that are priced sharply, on the newness, they’re responding, but even the affluent consumer is not spending like they were a year ago.”

Comparable sales at Macy’s were down 4.5% on an owned basis and down 3.6% on an owned-plus-licensed-plus-marketplace basis.

Comparable sales fell 1.1% at Bloomingdale’s and down 1.4% on an owned-plus-licensed-plus-marketplace basis.

Bluemercury net sales up 1.7%. Comparable sales were up 2.0% on an owned basis.

“During the second quarter, we delivered strong earnings performance in a challenging consumer environment,” said Tony Spring, chairman and chief executive officer of Macy’s, Inc. 

Guidance: The department store operator updated its annual outlook to reflect a more discriminating consumer and heightened promotional environment relative to prior expectations.

The company believes the outlook range provides flexibility to address the ongoing uncertainty in the discretionary consumer market.

Macy’s said it now anticipates 2024 net sales of $22.1 billion—$22.4 billion, which is lower than the $22.3 billion—$22.9 billion expected earlier and down from 2023 sales of $23.09 billion.

Macy’s expects 2024 comparable sales to range from a decrease of about 2% to a decline of about 0.5%. It had previously expected comparable sales to range from a decline of about 1% to a gain of 1.5%.

At the company conference call, Macy’s executive said it now expects to close 55 stores this year, up from a previous estimate of around 50. The company will only pursue accretive deals and have no significant debt maturities until 2027

Price Action: M stock is down 8.62% at $16.20 during the premarket session at last check Wednesday.

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