US Markets

Macy's cuts forecast after first profit miss in two years, shares slide

Credit: REUTERS/Mike Blake

Macy's Inc cut its full-year earnings forecast after missing Wall Street estimates for quarterly profit for the first time in two years, as the department store operator discounted heavily to clear Spring inventory, sending its shares down 13%.

Adds CEO quote, details from statement

Aug 14 (Reuters) - Macy's Inc M.N cut its full-year earnings forecast after missing Wall Street estimates for quarterly profit for the first time in two years, as the department store operator discounted heavily to clear Spring inventory, sending its shares down 13%.

The company said on Wednesday inventory became a challenge as it also missed the mark with its key women's sportswear private brands and a higher decline in international tourism.

"We had a slow start to the quarter and finished below our expectations," Chief Executive Officer Jeff Gennette said in a statement.

The company has entered the Fall with the right inventory, he added.

Macy's now expects 2019 adjusted profit to be between $2.85 per share to $3.05 per share, down from a previous forecast of $3.05 to $3.25.

Net income attributable to Macy's shareholders slumped 48% to $86 million, or 28 cents per share, in the second quarter ended Aug. 3.

Analysts had expected the company to earn 45 cents per share, according to IBES data from Refinitiv.

Macy's shares, which declined about 35% this year, are set to open at near 10-year low.

(Reporting by Aishwarya Venugopal in Bengaluru; Editing by Sriraj Kalluvila)

((Aishwarya.Venugopal@thomsonreuters.com; within U.S. +1-646-223-8780; outside U.S. +91 80 6749 1017;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More