Macy's(US:M) ZACKS·2025-12-03 16:41Core Insights - Macy's, Inc. reported third-quarter fiscal 2025 results with both top and bottom lines exceeding Zacks Consensus Estimates, despite a decrease in net sales and an increase in earnings compared to the previous year [1][3] - The company has raised its fiscal 2025 outlook, reflecting confidence in its strong balance sheet and diversified brand portfolio [2][12] Financial Performance - Adjusted earnings were reported at 9 cents per share, surpassing the Zacks Consensus Estimate of a loss of 13 cents, and increased from 4 cents in the year-ago quarter [3] - Net sales reached $4,713 million, exceeding the consensus estimate of $4,595 million, although this represented a 0.6% decline from the previous year [4] - Comparable sales increased by 2.5% on an owned basis and 3.2% on an owned-plus-licensed-plus-marketplace basis [4][5] Brand Performance - Comparable sales for the Macy's brand rose 1.4% on an owned basis and 2% on an owned-plus-licensed-plus-marketplace basis [6] - Bloomingdale's brand saw a significant increase in comps of 8.8% on an owned basis and 9% on an owned-plus-licensed-plus-marketplace basis, marking its fifth consecutive quarter of growth [6] - Bluemercury brand reported a 1.1% increase in comps on an owned basis, achieving its 19th consecutive quarter of growth [6] Margins and Expenses - Gross margin for the fiscal third quarter was 39.4%, beating the estimate of 39%, but down 20 basis points from the previous year due to tariff impacts [7] - Selling, general and administrative (SG&A) expenses were $2.02 billion, down 1.9% year over year, reflecting cost discipline and savings from closed stores [8][9] - Adjusted EBITDA was reported at $285 million, down 4.4% from $273 million in the year-ago quarter, with an adjusted EBITDA margin of 5.8%, up 20 basis points year over year [9] Financial Snapshot - The company ended the fiscal third quarter with cash and cash equivalents of $447 million, long-term debt of $2.43 billion, and shareholders' equity of $4.33 billion [10] - Merchandise inventories increased by 0.7% year over year, and net cash provided by operating activities was $247 million for the first nine months of fiscal 2025 [10] Share Repurchase and Asset Sales - In the third quarter, Macy's repurchased 2.8 million shares for $50 million, with $1.2 billion remaining under its $2 billion share repurchase authorization [11] - Asset sale gains were reported at $12 million, down from $66 million in the prior period, as the company continues to focus on closing underperforming stores [11] Fiscal 2025 Guidance - The company updated its annual outlook, raising net sales expectations to $21.48-$21.63 billion from $21.15-$21.45 billion [12][13] - Comparable owned-plus-licensed-plus-marketplace sales are now expected to be flat to up 0.5%, an improvement from the previous expectation of a decline [13] - Adjusted earnings per share are anticipated to be between $2.00 and $2.20, up from the prior range of $1.70-$2.05 [14]