Macy's(US:M)2025-12-10 21:30Sales Performance - Comparable sales for Macy's, Inc. increased by 2.5% on an owned basis and 3.2% on an owned-plus-licensed-plus-marketplace (O+L+M) basis in Q3 2025 compared to Q3 2024[95] - Bloomingdale's achieved its highest comparable sales growth in 13 quarters, with an increase of 8.8% on an owned basis and 9.0% on an O+L+M basis[95] - Comparable sales increased by 3.2% on an owned-plus-licensed-plus-marketplace basis for the 13 weeks ended November 1, 2025[134] - The company experienced a decrease in comparable sales on an owned basis of 2.4% for the 13 weeks ended November 1, 2025[136] - The impact of departments licensed to third parties and marketplace sales contributed an additional 0.7% to comparable sales for the same period[134] Financial Results - Net sales for Q3 2025 were $4,713 million, a decrease of $29 million or 0.6% from Q3 2024, primarily due to the closure of 64 non-go-forward locations[97] - Net sales for the 39 weeks ended November 1, 2025, decreased by $400 million, or 2.8%, to $14,125 million compared to $14,525 million in 2024, primarily due to the closure of 64 non-go-forward locations[105] - Net sales for the 13 weeks ended November 1, 2025, were $165 million, with a net loss of $197 million for the same period[128] - Net income decreased to $135 million for 2025, compared to $240 million in 2024[104] - The company reported a net income of $11 million for the 13 weeks ended November 1, 2025, with diluted earnings per share of $0.04[142] Margins and Expenses - Gross margin for Q3 2025 was $1,858 million, representing a gross margin rate of 39.4%, a decline of 20 basis points from Q3 2024[99] - Gross margin decreased to $5,575 million, or 39.5% of total revenue, from $5,776 million, or 39.8% in 2024, primarily due to markdowns and tariffs[107] - Selling, general and administrative (SG&A) expenses decreased by $40 million or 1.9% in Q3 2025, with SG&A as a percentage of total revenue improving to 41.2%[100] - Selling, general and administrative (SG&A) expenses decreased by $67 million, or 1.1%, to $5,881 million, representing 40.0% of total revenue, compared to 39.7% in 2024[108] Earnings and Tax - Adjusted diluted earnings per share for Q3 2025 were $0.09, compared to $0.04 in Q3 2024[96] - The effective tax rate for Q3 2025 was -120.0%, reflecting an income tax benefit of $6 million, compared to an expense of $7 million or 20.0% in Q3 2024[103] - Adjusted EBITDA for 2025 was $1,002 million, down from $1,074 million in 2024[104] - Adjusted EBITDA for the 39 weeks ended November 1, 2025, was $1,002 million, compared to $1,074 million for the same period in 2024[140] Assets and Liabilities - Current assets decreased from $1,160 million to $1,087 million, while noncurrent assets increased from $5,727 million to $5,598 million[127] - Total liabilities increased from $8,837 million to $8,237 million, with current liabilities rising from $1,606 million to $1,744 million[127] Capital Expenditures and Share Repurchase - Capital expenditures were $525 million in 2025, focused on digital and technology investments, compared to $649 million in 2024[118] - The company repurchased approximately 15.4 million shares at an average cost of $13.05 per share during 2025, with $1,174 million remaining under the share repurchase authorization[121] Operational Efficiency - The company opened a new fulfillment and store replenishment center, China Grove, which incorporates automation and AI to enhance supply chain efficiency[94] - The company emphasized the importance of non-GAAP financial measures, such as EBITDA, in evaluating operational efficiency and performance[130]