Macy’s (M) reports fiscal Q2 2022 earnings

Macy’s on Tuesday cut its full-year forecast, saying it anticipates deteriorating consumer spending on discretionary items like apparel that will force the department store chain to use heavy markdowns to move items off shelves.

The warning comes even as the retailer reported a fiscal second-quarter profit and revenue that topped analysts’ expectations.

Macy’s now sees fiscal 2022 revenue to be in a range of $24.34 billion to $24.58 billion, down from prior estimates of $24.46 billion to $24.7 billion. It puts its annual adjusted earnings per share in a range of $4.00 to $4.20, down from prior guidance of $4.53 to $4.95. Wall Street analysts had been looking for full-year guidance of $24.36 billion and $4.51 per share, according to Refinitiv consensus estimates.

“We expect to come out of this uncertain period in a strong position with a healthy balance sheet,” Chief Executive Officer Jeff Gennette said in a statement.

Here’s how Macy’s performed in its fiscal second quarter compared with what analysts were anticipating, based on Refinitiv estimates:

• Earnings per share: $1 adjusted vs. 85 cents expected
• Revenue: $5.6 billion vs. $5.49 billion expected

Net income in the three-month period ended July 30 fell to $275 million, or 99 cents per share, from $345 million, or $1.08 a share, a year earlier.

Net sales fell slightly to $5.6 billion from $5.65 billion a year earlier.

Macy’s comparable sales on an owned plus licensed basis dropped 1.6% from the prior year. Analysts had been looking for a 2% decrease, according to Refinitiv.

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