Department store chain Macy’s (NYSE:M) reported revenue ahead of Wall Streets expectations in Q3 CY2025, but sales were flat year on year at $4.91 billion. The company’s full-year revenue guidance of $21.55 billion at the midpoint came in 1.1% above analysts’ estimates. Its non-GAAP profit of $0.09 per share was significantly above analysts’ consensus estimates.
Is now the time to buy M? Find out in our full research report (it’s free for active Edge members).
Macy's (M) Q3 CY2025 Highlights:
- Revenue: $4.91 billion vs analyst estimates of $4.73 billion (flat year on year, 3.9% beat)
- Adjusted EPS: $0.09 vs analyst estimates of -$0.13 (significant beat)
- Adjusted EBITDA: $285 million vs analyst estimates of $210.5 million (5.8% margin, 35.4% beat)
- The company lifted its revenue guidance for the full year to $21.55 billion at the midpoint from $21.3 billion, a 1.2% increase
- Management raised its full-year Adjusted EPS guidance to $2.10 at the midpoint, a 12% increase
- Operating Margin: 0.9%, in line with the same quarter last year
- Same-Store Sales rose 3.2% year on year (-2.4% in the same quarter last year)
- Market Capitalization: $5.95 billion
StockStory’s Take
Macy’s third quarter results met Wall Street’s revenue expectations and outperformed on adjusted profit, reflecting the early momentum of the company’s Bold New Chapter strategy. Management credited better-than-expected same-store sales growth to improvements in curated assortments, store upgrades, and a more seamless omnichannel experience. CEO Tony Spring specifically highlighted strong customer response to the refreshed Reimagine 125 store locations and the continued growth of the luxury-focused Bloomingdale’s and Bluemercury banners.
Looking forward, Macy’s increased its full-year outlook, citing ongoing benefits from operational enhancements and merchandise mix improvements. Management said tariff mitigation efforts, targeted investments in automation, and expansion of brand partnerships would be key to supporting profitability. CEO Tony Spring emphasized, “We’re committed to bringing Macy’s to the consideration set of even more shoppers and our reimagine 125 locations are providing a road map for the future,” while CFO Tom Edwards reiterated a focus on cost discipline and inventory management to navigate an evolving retail environment.
Key Insights from Management’s Remarks
Management credited sales momentum to reimagined store formats, growth in luxury, and disciplined cost controls, while also noting ongoing margin pressures from tariffs and evolving consumer behavior.
- Reimagine 125 store impact: The refreshed Reimagine 125 locations outperformed the broader Macy’s fleet, driving higher store traffic and better customer satisfaction, as measured by Net Promoter Scores. Management views these stores as a blueprint for future upgrades across the chain.
- Luxury banners outperforming: Bloomingdale’s delivered its fifth straight quarter of growth, with strong results in men’s apparel and fine jewelry, while Bluemercury continued to benefit from expanded skincare offerings and new brand partnerships. These banners are helping Macy’s diversify beyond its core mid-tier customer.
- Digital and omnichannel investments: Management highlighted success in digital sales, supported by enhancements to the website, app, and fulfillment operations, including the new China Grove distribution center equipped with automation and AI-driven logistics.
- Tariff mitigation and margin management: Despite ongoing margin pressure from tariffs, Macy’s offset some impacts through vendor negotiations, selective price increases, and product mix shifts. CFO Tom Edwards noted that these actions helped the company deliver better-than-expected gross margins for the quarter.
- Credit card and media revenue strength: Growth in Macy’s proprietary credit card portfolio and continued expansion of the Macy’s Media Network contributed to non-retail revenue, supporting overall profitability even as in-store traffic faced headwinds.
Drivers of Future Performance
Management expects continued sales growth to be driven by upgraded store formats, digital expansion, and disciplined inventory management, while navigating persistent tariff and consumer headwinds.
- Store modernization and assortment: The company plans to expand the Reimagine 125 concept and invest in new merchandising strategies to further differentiate Macy’s stores. Management believes this will drive incremental traffic and improve conversion rates.
- Digital and fulfillment enhancements: Ongoing investments in e-commerce platforms and the recently opened automated distribution center are expected to accelerate order delivery, support omnichannel sales, and improve the customer experience.
- Cost and margin discipline: Macy’s intends to offset external margin pressures—such as tariffs—by leveraging supply chain efficiencies, implementing cost controls, and tailoring promotions to maintain profitability while supporting growth initiatives.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will watch for (1) sustained traffic gains and customer satisfaction in Reimagine 125 and other upgraded stores, (2) measurable improvements in digital sales and fulfillment speed from the China Grove distribution center, and (3) ongoing progress in luxury banners and credit card revenues. Execution on cost containment and inventory discipline will also be critical indicators of Macy’s ability to meet its updated guidance.
Macy's currently trades at $22.53, in line with $22.70 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
Our Favorite Stocks Right Now
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.