Turns out it may have been caused by inflation holiday dumper.
Macy’s chairman and CEO Jeff Gennette said in a fourth-quarter update on Friday that the holiday lull was “more severe than expected” and that consumers were under pressure heading into 2023. said he would continue to feel
Macy’s said Friday that net sales from the holiday quarter are likely to be at the low end to midpoint of the previously issued $8.16 billion to $8.4 billion range. Diluted earnings per share are expected to be between $1.47 and $1.67.
In last year’s fourth quarter, Macy’s posted revenue of $8.67 billion, beating analyst expectations, and adjusted earnings of $2.45 per share.
Total inventory at the end of the quarter is on a downward trend Slightly lower than last year and down to mid-teens compared to 2019.
According to Gennette, Black Friday and Cyber Monday sales were in line with expectations, and the week before and after Christmas exceeded expectations.
“Overall, our occasion apparel and gifts business has been a strength, and our inventory mix and price points have been in line with customer needs,” said Gennette, noting that the company’s high-end Bloomingdale’s stores Cosmetics line Blue Mercury continued to exceed expectations.
Macy’s warning may provide investors with an early clue that high inflation may be hampering demand for holiday shopping.
Americans spent a lot more this season trying to keep up with the high prices. According to Mastercard Spending Pulse, his U.S. retail sales for the period from Nov. 1 to Dec. 24 increased by 7.6% compared to the same period last year. U.S. retail sales fell short of expectations in November, he fell 0.6% for the month. This was the weakest performance in almost a year.
Gennette warned that consumer sentiment is unlikely to change. It changes with the new year.
“Based on current macroeconomic indicators and our own credit card data, we believe consumers will continue to be under pressure in 2023, especially in the first half, and we plan our inventory mix and initial purchase depth accordingly. ,” said Macy’s CEO. .
The company plans to report full results for the fourth quarter and fiscal year 2022 in early March 2023.