Financial Data and Key Metrics Changes - First quarter net sales reached $4.6 billion, exceeding guidance of $4.4 billion to $4.5 billion [9][29] - Comparable owned plus licensed plus marketplace sales declined by 1.2%, better than the guidance of a decline of 4.5% to 2.5% [9][29] - Adjusted diluted EPS was $0.16, above the guidance range of $0.12 to $0.15, compared to $0.27 last year [11][33] - Gross margin was $1.8 billion or 39.2% of net sales, flat compared to the prior year [32] Business Line Data and Key Metrics Changes - Macy's net sales were down 6.5%, with comparable sales down 2.1% [30] - Bloomingdale's net sales increased by 2.6%, with comparable sales rising by 3.8% [31] - Blue Mercury net sales were up 0.8%, with comparable sales increasing by 1.5% [31] - Backstage outperformed the total Macy's fleet, while Marketplace achieved approximately 40% GMV growth [12] Market Data and Key Metrics Changes - International tourism negatively impacted comparable sales by about 30 basis points [10] - The go-forward business comps outperformed total, declining by 0.9% [10] Company Strategy and Development Direction - The company is focused on its "Bold New Chapter" strategy, which includes strengthening and reimagining Macy's, accelerating luxury, and modernizing operations [8][12] - The reimagined 125 locations outperformed the rest of the Macy's fleet, with a negative comp of 0.8% compared to a negative 2.1% for the total Macy's nameplate [12][30] - The company aims to diversify sourcing to mitigate tariff impacts, with 20% of products originating from China, down from over 50% pre-pandemic [19] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for the second quarter, noting stronger performance in March and April compared to February [45] - The company anticipates a more choiceful consumer and plans to navigate an uncertain promotional environment [22][35] - Management highlighted the importance of maintaining a healthy inventory to sales ratio while being disciplined with inventory commitments [22][39] Other Important Information - The company plans to invest approximately $800 million in capital expenditures to support long-term growth [38] - SG&A expenses were relatively flat at $1.9 billion, with a percentage of total revenue at 39.9%, reflecting lower net sales [32] Q&A Session Summary Question: Sales guidance and consumer pressure - Management reaffirmed the annual sales guidance, noting stronger performance in March and April compared to February, and expressed cautious optimism for the rest of the year [44][45] Question: Impact of tariffs on pricing - Pricing is gradually being impacted by tariffs, with limited pricing seen in the second quarter, and management is negotiating with suppliers to manage costs [52][56] Question: Actions to capture market share - The company is focusing on product flow, improving marketing quality, and enhancing in-store experiences to capture market share [66] Question: Gross margin pressure in Q2 - Management indicated that gross margin pressure in Q2 will be influenced by markdowns and tariffs, with a focus on maintaining competitive pricing [68][69] Question: Inventory planning amid tariffs - The company plans to remain disciplined in inventory management, avoiding over-purchasing to mitigate tariff impacts [90] Question: Consumer health across income cohorts - Consumer health remains under pressure, but there is a positive response to newness and good value, particularly in categories like fine jewelry and big-ticket items [113][115]

Financial Data and Key Metrics Changes - First quarter net sales reached $4.6 billion, exceeding guidance of $4.4 billion to $4.5 billion [9][29] - Comparable owned plus licensed plus marketplace sales declined by 1.2%, better than the guidance of a decline of 4.5% to 2.5% [9][29] - Adjusted diluted EPS was $0.16, above the guidance range of $0.12 to $0.15, compared to $0.27 last year [11][33] - Gross margin was $1.8 billion or 39.2% of net sales, flat compared to the prior year [32] Business Line Data and Key Metrics Changes - Macy's net sales were down 6.5%, with comparable sales down 2.1% [30] - Bloomingdale's net sales increased by 2.6%, with comparable sales rising by 3.8% [31] - Blue Mercury net sales were up 0.8%, with comparable sales increasing by 1.5% [31] - Backstage outperformed the total Macy's fleet, while Marketplace achieved approximately 40% GMV growth [12] Market Data and Key Metrics Changes - International tourism negatively impacted comparable sales by about 30 basis points [10] - The go-forward business comps outperformed total, declining by 0.9% [10] - The luxury segment showed resilience, with Bloomingdale's and Blue Mercury continuing their positive comp trends [14][15] Company Strategy and Development Direction - The company is focused on its "Bold New Chapter" strategy, emphasizing omni-channel performance and reimagining store locations [8][9] - The strategy includes strengthening Macy's, differentiating luxury offerings, and modernizing operations [15][16] - The company aims to leverage generative AI to modernize its supply chain and improve inventory allocation [9][12] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the second quarter, noting improved performance in May compared to earlier months [43][44] - The company is navigating uncertainties related to tariffs and consumer behavior, with a focus on maintaining flexibility in inventory commitments [22][23] - Management highlighted the importance of strategic pricing decisions to offset tariff impacts while remaining competitive [45][46] Other Important Information - The company closed 64 underperforming locations as part of its strategy [25] - The impact of tariffs is estimated to affect annual gross margin by roughly 20 to 40 basis points [20] - The company plans to invest in customer-facing initiatives funded by savings from closed locations [32][38] Q&A Session Summary Question: Sales guidance and consumer pressure - Management reaffirmed annual sales guidance, noting stronger performance in March and April compared to February, with cautious optimism for the rest of the year [43][44] Question: Strategic pricing decisions - Pricing adjustments are being made selectively, with a focus on maintaining value for customers while managing tariff impacts [45][46] Question: Impact of tariffs on pricing and consumer willingness - Pricing is gradually being integrated into the system, with limited increases observed in the second quarter [51][52] Question: Actions to capture market share - The company is enhancing product offerings, improving marketing quality, and enhancing in-store experiences to capture market share [65][66] Question: Reimagine 125 performance and future plans - Management remains optimistic about the Reimagine 125 initiative, with improvements noted in March and May [75][76] Question: SG&A guidance range - The SG&A guidance range provides flexibility to navigate various scenarios amid uncertainty [78][79] Question: Consumer health and category performance - Consumer health remains under pressure, but there is a positive response to newness and value [114][115]

Financial Data and Key Metrics Changes - For FY 2024, the company achieved net sales of $22.3 billion, with a comparable sales decline of 0.9% versus 2023, an improvement of 510 basis points [15] - GAAP diluted earnings per share were $2.07, while adjusted diluted earnings per share were $2.64 [15] - Operating cash flow reached nearly $1.3 billion, and the company ended the year with $1.3 billion in cash, an increase of $272 million from the prior year [15] Business Line Data and Key Metrics Changes - Macy's saw four consecutive quarters of positive growth at its first 50 reimagined locations, with initiatives including improved staffing and visual merchandising [16][17] - Bloomingdale's returned to positive annual comparable sales growth, achieving the highest fourth quarter in the company's history [18] - Blue Mercury experienced its fourth consecutive year of positive comparable sales, opening 17 new locations and remodeling seven stores [20] Market Data and Key Metrics Changes - The company closed 64 underperforming Macy's stores and one Bloomingdale's location as part of its strategy to rationalize its store portfolio [27] - The company reported a return to positive digital sales growth in the fourth quarter, indicating a recovery in online shopping performance [17] Company Strategy and Development Direction - The "Bolder Chapter" strategy aims to enhance customer experience and create a more agile business, focusing on improving shopping experiences and operational efficiency [16][21] - The company is committed to ongoing board refreshment, with an average board tenure reduced to 4.2 years, down from 5.3 years last year [29] Management's Comments on Operating Environment and Future Outlook - The management acknowledged the current volatility in the market but expressed confidence in the company's strategy and leadership to navigate these challenges [24] - The company remains committed to enhancing customer experience while strategically investing in growth initiatives [24] Other Important Information - The company returned $192 million to shareholders through quarterly cash dividends, reflecting a 5% increase per share from 2023 [15] - The leadership team is evolving, with Tom Edwards set to join as COO and CFO, indicating a focus on strengthening the company's financial position [22] Q&A Session Summary Question: Plans to sell more of Macy's real estate? - The company is rationalizing and monetizing underperforming store locations as part of its strategy, having closed 64 Macy's and one Bloomingdale's location in 2024 [26][27] Question: Approach to board refreshment? - The company is committed to board refreshment, with a focus on having the right mix of skills and reducing average board tenure [29][30] Question: Dynamic of Macy's vendor relationships? - The company maintains strong vendor relationships and has attracted new vendors as part of its transformation strategy [31][32] Commentary: Appreciation for leadership and store updates? - The management expressed pride in the State Street store and its historical significance, emphasizing ongoing efforts to maintain its legacy [35][36]